PROCEDURES FOR ESTABLISHING A FOREIGN CAPITAL COMPANY IN VIETNAM

In 2021, the Vietnamese legal system has a lot of investment incentive policies in economic sectors in Vietnam for foreign investors. Accordingly, when conducting investment to establish a company in Vietnam, foreign investors need to learn and grasp the provisions of current laws to ensure the most optimal conditions when investing and doing business in Vietnam. To help foreign investors easily set up a company in Vietnam, Doanh Tri will guide in detail the procedures for establishing a foreign capital company.
I. Legal basis
- Law on enterprises 2020;
- Law on investment 2020.

II. Subjects of application for the establishment of foreign capital companies:
- The company has from 1% to 100% capital contributed by foreign investors right after its establishment;
- Foreign-owned companies (which have been granted investment registration certificates in Vietnam) continue to establish more economic organizations; capital contribution, purchase of shares and capital contributions of economic organizations; investment under a Business Cooperation Contract (BBC) in one of the following cases must carry out the procedures for issuance of an investment certificate: New establishment of capital contribution from 1% to 100% of the company's charter capital;
- Cases, where foreign investors contribute capital or purchase shares to a Vietnamese company that already has an Enterprise Registration Certificate (even in the case of buying up to 100% of the company's contributed capital), are not required to carry out procedures. Procedures for issuance of an Investment Registration Certificate, except in the case of a company doing business in the field of education and training, if a foreign investor purchases from 1% of the contributed capital, it also needs to carry out the procedures for granting an Investment Registration Certificate.
- For companies operating in the field of retailing goods to consumers or setting up retail establishments, it is necessary to apply for a business license, a license to set up a retail establishment.

III. Procedures of the establishment of a foreign capital company in Vietnam
1. Dossier to prepare to establish a foreign capital company in Vietnam
For individual investors:
- Copy of identity card, identity card, or passport (Notarized copy, consular legalization at Vietnamese diplomatic missions abroad - including passport);
- Confirmation of the investor's bank account balance corresponding to the expected investment capital in Vietnam (If it is a confirmed foreign bank, it is necessary to provide a notarized copy, consular legalization at the embassy). Vietnamese diplomatic representative abroad);
- Head office lease contract, Papers proving the lessor's right to lease (Certificate of land use right, Construction permit, Certificate of business registration with real estate business function of the lessor) or equivalent documents).
For business investors:
- A copy of the Certificate of Establishment or other equivalent document certifying the investor's legal status (Notarized copy, consular legalization at Vietnamese diplomatic missions abroad);
- A copy of one of the following documents: financial statements of the last 2 years of the investor; commitment to the financial support of the parent company; financial institution's commitment to financial support; guarantee on the financial capacity of the investor; Confirm the investor's bank account balance corresponding to the expected investment capital in Vietnam. (Notarized copy, consular legalization at Vietnamese diplomatic missions abroad);
- Notarized passport of the legal representative of the company in foreign countries (Notarized copy, consular legalization at Vietnamese diplomatic missions abroad);
- Notarized passport of the director - the legal representative of the company in Vietnam (If a foreigner Notarized copy, consular legalization at the Vietnamese diplomatic mission abroad);
- Head office lease contract, Papers proving the lessor's right to lease (Land use right certificate, Construction permit, Business registration certificate with real estate business function of the lessor) or equivalent documents).

2. Steps to establish a foreign capital company
Step 1: Apply for an Investment Certificate
Dossier of application for investment certificate:
- A written request for the implementation of an investment project;
- Copy of identity card/identity card or passport for individual investors; a copy of the Certificate of Establishment or other equivalent document certifying the legal status of the investor is an organization;
- The investment project proposal includes the following contents: investor implementing the project, investment objectives, investment scale, investment capital and capital mobilization plan, location, duration, and investment schedule, demand labor, a proposal for investment incentives, assessment of the project's socio-economic impact and efficiency;
- A copy of one of the following documents: Financial statements of the last 2 years of the investor; commitment to the financial support of the parent company; financial institution's commitment to financial support; guarantee on the financial capacity of the investor; documents explaining the financial capacity of the investor;
- Proposing land use plan; In case the project does not request the State to allocate or lease land or permit the change of land use purpose, a copy of the location lease agreement or other document certifying that the investor has the right to use the land to carry out investment project.
Authorities competent to grant investment certificates to establish foreign capital companies
- The Department of Planning and Investment shall issue Investment Registration Certificates for the following investment projects:
+ Investment projects outside industrial parks, export processing zones, high-tech zones, economic zones;
+ Investment projects on infrastructure development of industrial parks, export processing zones, high-tech parks, and investment projects in industrial parks, export processing zones, and hi-tech zones in localities where the Management Board has not been established.
- Management Boards of industrial parks, export processing zones, hi-tech parks, and economic zones shall receive, issue, adjust and revoke investment registration certificates for investment projects in industrial parks, industrial zones, export processing, high-tech zones, economic zones.
Step 2: Apply for a Certificate of Business Registration
Dossiers of application for Certificate of Business Registration
- Business registration application form;
- Draft company charter;
- A list of members for a limited liability company or a list of founding shareholders for a joint-stock company;
- Decision on capital contribution, Letter of appointment of an authorized representative for company members.
Step 3: Apply for a business license for some conditional lines of business

The above information is about the ‘Procedures for establishing a foreign capital company in Vietnam' For more information and advice on this issue, please contact Doanh Tri Law Firm directly via:

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