Question: My company in this right moment his looking for new opportunities for investment. Already present in south america and African markets, were looking for an opportunity in South East asia and we decided to initiate our next stage in Vietnam.
At that time I would like to meet with someone from your office responsible for my account.
At this first stage we need some general information require to decide what type of investment we will develop in your country.
These are our initial questions:
1) Foreign investment
2) foreign ownership of companies
3)local tax for local companies
4)Foreign rental of local property
5)Employment of local manpower by a foreigner
6)Foreign appointed as a Director/ CEO for a local company
7)Foreign bank regulation, regarding foreign investment
Answer: SBLAW would like to advise you as follows:
For your ease of reference, please see our brief introduction on Vietnam Law as follows:
– For carrying out business activities in Vietnam, foreign investor can setup foreign invested company. Foreign invested company can be incorporated either in the form of Wholly Foreign Owned Company or Joint Venture Company. With respect to some conditional investment sectors such as freight transportation, advertisement, tourism etc in which foreign ownership is limited, Joint Venture Company shall be compulsory.
Total time for setting up Foreign Invested Company in Vietnam is about 20 working days (for a straight forward case). Some time, the licensing process can be lasted longer due that it takes time for competent authority to consult relevant ministries before granting license.
– Generally, a foreign invested company shall have two licenses: (i) Investment Registration Certificate and (ii) Certificate of Enterprise Registration. With respect to some special investment sectors such as trading, education … etc, it shall require you to obtain sub-licenses for carrying out business activities.
– Regarding to tax, there is no difference between foreign invested companies and pure local companies. Companies in Vietnam shall subject to Business License Tax (100-150USD per year), Corporate Income Tax (20% of profit. Some investment sectors can enjoy preferred Corporate Income Tax Rate of 10% or tax exemption), Value Added Tax (5-10%), Import, Export Duty, Special Consumption Tax (applicable with luxury goods or services such as car, alcohol, tobacco, massage etc).
– Foreign invested company can lease either of land lot, office building space for developing business activities in Vietnam.
– Foreign invested company in Vietnam is allowed to employ local employee in Vietnam. Wage paid to employee in Vietnam must be equivalent to or greater than minimum wage applicable to the region or city where you registered head office address.
– Either of Foreigner and Local person can act as CEO or legal representative of the company. A Company can have one or more legal representatives. However, at least one of them must reside in Vietnam. In case he/she is absent from Vietnam, he/she must authorize other person to resume his/her responsibility.
– After setting up company in Vietnam, you can open bank account in banks duly operating in Vietnam. You must have at least two kind of bank account:
+ Investment Bank Account is to receive capital contribution from foreign country and offshore loan.
+ Normal Bank Accounts for supporting your daily business activities. For this, you can open foreign currency bank account and Vietnam Dong Bank Account.