Procedure for setting up foreign company in Vietnam ?
Procedure for setting up foreign company in Vietnam? A foreign business entity or a foreign trader is allowed to establish company in vietnam.
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Enterprise Law 2014 effectivesince January 1st2015
Investment Law 2014 effectivesince January 1st2015
- Investors should, at first, choose their business industries and branches because each industry/ branch is regulated in details in the WTO commitments, then do further study on specialized law regulations (i.e. 20-billion capital is a must in real estate business) so that they can make right investment decisions and requirements.
- After choosing business industries and branches, investors should consider choosing types of investment.
Limited liability company with wholly foreign-owned capital
Chapter III, Article 47. Limited liability company with two or moremembers
1. Limited liability company is an enterprise in which:
a) A member may be an organization or an individual; the number of members shall not exceed fifty;
b) A member shall be liable for the debts and other property obligations of the enterprise to the extent ofthe amount of capital contributed to the enterprise;
c) As stipulated by the Government on “the provisionsfor the establishment of an enterprise with wholly foreign-owned capital”, the transfer to other members in Article 52, 2014 Law on Enterprises is of full force and effect on 1 July 2015.
2. After registration and issuance of an operating license, a company shall be entitled to have the right to trade.
3. A limited liability company with two or more members may not issue shares.
Section I2, Chapter III, Article 73. One Member Limited Liability Companies
1. A one member limited liability company is an enterprise owned by one organization or individual (hereinafter referred to as company owner); the company owner is liable for all debts and other property obligations of the company to the extent of the amount of the charter capital of the company.
2. A one member limited liability company shall have legal entity status from the date of issuance of an enterprise registration certificate.
3. A one member limited liability company may not issue shares.
# Shareholding companies with wholly foreign owned capital
Chapter V, Article 110. Shareholding companies (2014 Law on Enterprises with full force and effect on 1 July 2015)
1. A shareholding company is an enterprise in which:
(a) The charter capital is divided into equal portions called shares;
(b) Shareholders may be organizations or individuals; the minimum number of shareholders is three and there is no restriction on the maximum number;
(c) Shareholders are only liable for the debts and other property obligations of the enterprise to the extent of the amount of capital contributed to the enterprise; clause 3 Article 119 and clause 1 Article 126 of this 2015 Law on Enterprises.
2. A shareholding company has legal entity status from the date of issuance of the enterprise registration certificate.
3. A shareholding company may issue all classes of shares to raise funds.
# RESEARCH ON DOSSIERS AND PREPARATION FOR DOSSIERS FOR INVESTMENT
Licenses required to be applied to a Company with wholly foreign-owned capital
- Investment certificate
- Enterprise registration certificate (separated)
- Business license
With respect to Business License, please follow the guidance with basic dossiers as follows:
Dossier for requesting for issuance of a Business License:
The supplement of operational objectives for goods trading activities and activities directly related to goods trading is the amendment of operational objectives of the enterprise, the dossers include:
2.1 Dossiers for investment project verification as stipulated in Decree No. 108/2006/ND-CP dated 22 September 2006 of the Government guiding the implementation of a number of articles of the Law on Investments
2.2 Dossiers for issuance of a Business License as stipulated in Circular No. 09/2007/TT-BTM, including
a) A written request for issuance of a Business License in form MD-1 promulgated withCircular No. 09/2007/TT-BTM;
b) A written explanation about the satisfaction of business conditions. The content of the written explanation about the satisfaction of business conditions shall be made based on the Appendix attached to thisofficial letter.
c) A written registration for the contents of goods purchase and sale and activities directly related to the goods purchase and sale: specifying the form of operation is wholesaling, retailing, setting up retail facilities of groups of commodities; commercial advertisement; commercial assessment…
2.3 Where a project is not associated with the facility investment and construction (not associated with the construction of workshops, installation of machinery and equipment for production) it is now suggested tosupplement the goods trading and activities directly related to goods purchase and sale, besides the dossiersmentioned in items 1 and 2 above, it is required to supplement dossiers on legal person or related documents to prove capacity and experience of the investor in carrying out the operational objectives.
- Investment certificate issued by a Division of Planning and Investment at provincial level
- Enterprise registration certificate issued by a domestic Enterprise Division
- Business license issued by the Department of Trade and Industry
- Posting announcement of establishment
- Initial tax declaration
- Invoice purchase
- Bank account opening
- Social insurance declaration
# NEW POINTS OF 2014 LAW ON INVESTMENT
EFFECTIVE SINCE 1 JULY 2015 ON THE ESTABLISHMENT OF COMPANIES WITH FOREIGN OWNED CAPITAL
On 26 November 2014, the National Assembly of the Socialist Republic of Vietnam has adopted the Law on Investment with effect from 01 July 2015. 2014 Law Investment with 7 chapters, 76 articles stipulates the operations of investors doing business in Vietnam as well as the business investment from Vietnam abroad. 2014 Investment Law has shown many new highlight points in comparison with the provisions of 2005 Law on Investment.
1. Removing the issuance of investment certificates for domestic investors
Based on 2014 Law on Investment, domestic investors’ projects will not perform procedures for issuance of an investment certificate
2. Composing the issuance of enterprise registration certificates
2014 Law on Investment separating the contents of investment project registration is to issue on the basis of an Investment Registration Certificate. After the Investment Registration Certificate is issued, enterprises will register for business (registering for an enterprise registration certificate) in accordance with new 2014 Law on Investment.