In case foreign investor intends to set up a wholly foreign invested company in Vietnam for trading goods, we would like to advise as follows:
a) According to the Item 1, Article No. 4 of Decree No.23/2007/ND-CP dated 12 February 2007 of the Government providing regulation for implementation of commercial law regarding purchase and sale of goods and activities directly related to the purchase and sale of goods by enterprises with foreign owned capital in Vietnam (Hereinafter referred to as “Decree No.23/2007/ND-CP”), foreign investors who satisfy following conditions shall be entiled to license for activities of trading in Vietnam:
– It is an investor belonging to a country or territory participating in an international treaty of which the Socialist Republic of Vietnam is a member and in such treaty Vietnam has undertaken to open the market on activities of purchase and sale of goods and activities directly related to purchase and sale of goods;
– The form of investment is consistent with the schedule/s undertaken in international treaties of which the Socialist Republic of Vietnam is a member and is consistent with the law of Vietnam;
– The goods and services in which business is conducted are consistent with Vietnam’s undertaking to open the market and are consistent with the law of Vietnam;
– The scope of operation is consistent with Vietnam’s undertaking to open the market and is consistent with the law of Vietnam;
– It has approval from the State body authorized in Vietnam.
Under Vietnam WTO’s Commitments, from the year of 2009, foreign investor is entitled to join goods import and trading activities in Vietnam.
b) Another important thing is the charter capital of the trading company in Vietnam.
With the respect to purchase and sale of goods and activities directly related to the purchase and sale of goods, Vietnam Law does not impose any minimum rate of charter capital.
Thus, the foreign investor shall be self responsible for its estimate of sufficient charter capital to be injected into the Company in Vietnam for running its business project.
c) If the foreign company established a representative office in Vietnam already.
Vietnam law compliance of the Representative Office of foreign investor in Vietnam shall be a factor to be accounted by the Licensing Authority before granting Investment Certificate for the new company in Vietnam.
We would like to note that Hanoi Department of Industry and Trade shall be asked to comment about law compliance of Representative Office of foreign company in Vietnam during the examination process for granting investment certificate.
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