Vietnam has become an attractive destination for foreign enterprises seeking to expand their market. To assist foreign merchants in establishing branches in Vietnam, this article by ADVN Law provides comprehensive information on the necessary conditions and legal procedures.
Vietnam has become an attractive destination for foreign enterprises seeking to expand their market. To assist foreign merchants in establishing branches in Vietnam, this article by ADVN Law provides comprehensive information on the necessary conditions and legal procedures.
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According to Clause 1, Article 44 of the 2020 Enterprise Law, a branch is a dependent unit of an enterprise that performs all or part of the enterprise's functions, including acting as the enterprise’s authorized representative. The branch's business activities must align with the enterprise's registered business sectors.
A foreign company branch in Vietnam operates similarly to a domestic company branch, having its own seal, tax code, and the ability to sign contracts with partners and customers. However, according to regulations, each foreign merchant is allowed to establish only one branch in each centrally governed province or city.
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A foreign merchant is eligible to establish a branch in Vietnam if they meet the following conditions:
• They are legally established and registered under the laws of their home country or territory that is a party to an international treaty to which Vietnam is a signatory or is recognized by the laws of their home country.
• They have been operating for at least five years from the date of establishment or registration.
• If the business registration certificate or equivalent document specifies an operational duration, it must have at least one year remaining from the date of application submission.
• The branch’s operations must align with Vietnam’s market commitments under international treaties and comply with Vietnamese laws.
• If the business sector of the foreign merchant is not covered by Vietnam's international commitments, the branch's establishment must be approved by the relevant Ministry.
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3.1. Application dossier
The application dossier includes the following documents:
1. Application form for branch establishment (Form MĐ-5 issued under Circular 11/2016/TT-BCT).
2. Certified copy of the foreign merchant's business registration certificate, legalized by consular authorities.
3. Letter of appointment for the head of the branch.
4. Certified copy of the branch’s operational charter.
5. Certified copy of the ID/Passport of the branch head (Vietnamese or foreigner).
6. Audited financial statements of the most recent fiscal year.
7. Lease contract and supporting documents proving the eligibility of the branch office location.
Note:
• All foreign documents must be translated into Vietnamese and notarized.
• Documents proving the branch office location must comply with Vietnamese regulations regarding land use, fire prevention, etc.
3.2. Application process
Applications are submitted to the Ministry of Industry and Trade, following this process:
1. Within 03 working days, the Ministry will review and request additional documents if necessary (only one request for supplementation is allowed).
2. Within 07 working days, the Ministry will issue the branch establishment license if the dossier is valid; otherwise, they will provide a written explanation for rejection.
3. Within 15 days from the issuance date, the Ministry will publish the branch information on its official website.
Special cases: If the branch’s activities fall outside Vietnam’s international commitments, the Ministry of Industry and Trade will seek approval from the relevant regulatory Ministry, extending the process by an additional 03 – 05 working days.
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4.1. Cases where a license may not be granted
The Ministry of Industry and Trade may reject the application under the following circumstances:
• The foreign merchant does not meet the eligibility requirements.
• The submitted dossier is incomplete and not supplemented upon request.
• The merchant's previous branch license was revoked within the past 02 years.
• National defense, security, social morality, or public health concerns.
4.2. Post-establishment obligations
After obtaining the license, the branch must:
• Obtain a legal seal and register for digital signatures.
• Register and issue electronic invoices.
• Declare and pay taxes as per Vietnamese regulations.
• Submit annual reports on branch activities to the Ministry of Industry and Trade.
4.3. Validity period of the license
The branch license is valid for a maximum of 05 years, and renewal is possible for the same period as the original license.
4.4. Regulations on the branch head
The branch head is responsible for all branch operations and must not simultaneously hold the following positions:
• Head of another representative office of the same foreign company in Vietnam.
• Legal representative of an economic organization established in Vietnam.
If the branch head leaves Vietnam, they must appoint an authorized person to manage the branch's operations in their absence.
If you need more information or support, please contact ADVN LAW for detailed advice.
A.D.V.N LAW OFFICE
- Address: F2&F3, No. 2 Phung Khac Khoan, Da Kao Ward, District 1, Ho Chi Minh City
- Phone: 0903.693.301 – 0909.393.329
- Email: vanphongluatsuadvn@gmail.com; advnlaw@gmail.com
We are committed to accompanying you to protect your legal rights and resolve disputes most effectively.
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