This is with regards to your email from which a Korean Company (hereinafter referred to as “Client”) requested us to assist in setting up foreign invested company, (hereinafter referred to as “FIC”) in Vietnam.
We further understand that upon establishment, FIC shall carryout import and supplying equipments or spare parts to other Korean Company and other companies in Vietnam.
Thus, we are pleased to present herewith our Legal Service Proposal for your kind reference.
1. BRIEF INTRODUCTION ON ESTABLISHMENT OF FIC
The establishment of a FIC in Vietnam requires an Investment Certificate from the licensing authority. Depending upon the location of the company, the licensing authority may be the Provincial People’s Committee (for companies located outside industrial or export processing zones) or the provincial Industrial and Export Processing Zones Management Authority (for companies located in industrial or export processing zones).
We would like to clarify that the procedure for establishment of a FIC in Vietnam generally takes a rather long time in comparison with other countries in the region.
Our practical experiences show that although the total time for establishment of a foreign invested company as stipulated under Vietnam Investment Law 2014 is only 15 days, the actual process may take a longer time due to that the competent authority must consult other relevant offices to evaluate the investment project.
With respect to several cases that involves with relocation of 10,000 people or more in highlands; 20,000 people or more in other areas or requirement for changes of land purposes or project in several special field such as Construction and operation of airports; air transport; Construction and operation of national seaports; Petroleum exploration, extraction, and refinery etc, it shall require for approval from the National Assembly, Prime Minister or Provincial People Committee before starting the licensing process. In this case, we assume that your case is not subject to such requirement for approval.
However, we reserve our right to re-quote our professional fee and amend the work schedule if your case is subject to approval of the National Assembly, Prime Minister or the Provincial People Committee. In order to setup a FIC, it shall require you to undergo two following steps:
Step 1: Obtainment of Investment Certificate. The Law requires that within 15 working days from submission of the application dossier the competent authority shall have to issue the Investment Certificate for Foreign Investor. However, having preliminarily discussed with the Licensing Authority, we do not much expect that the licensing authority can comply with this requirement in practice, especially, those relating to conditional investment sectors. For granting the Investment Certificate, the relevant licensing authorities shall evaluate the legitimacy and the feasibility of such Investment Project to determine on granting of the Investment Certificate on the following basis:
– Legal framework including Vietnam’s WTO Commitments, Vietnam Investment Law, Vietnam Enterprise Law, Regulations applicable to specific industries as well as the master economic development plan of the city or province that the FIC shall register its head-office.
-Your financial ability, investment capital to put in the Investment Project, facilities and human resources serving the implementation of such investment project in Vietnam.
Step 2: After obtainment of Investment Certificate, Client shall be required to obtain the Certificate of Business Registration. The Law requires that within 05 working days from submission of application dossier, the competent authority shall have to issue the Certificate of Business Registration for forming the Foreign Invested Company.
2. Specific comments
Vietnam Government does not impose any limitation to right of foreign invested company in importing and trading equipments. However, some cosmetic products are listed as products not encouraged for importation. Then, for prudence, a list of equipments with HS Code should be provided to us for review.
3. SCOPE OF WORKS
Following works are proposed based on the request of Client. However, depending on the specific position/situation of Client, several work items may not be necessary. Meanwhile, other works may be required. SB Law shall immediately advise Client the same upon review documents of the case. However, any additional works shall not fall under the scope of this Legal Service Proposal Letter, but could be provided upon request. Preparation of the application documents:
Notifying application documents required in accordance with Vietnamese law;
Drafting application documents required for submission purpose in English language;
Liaising with you to discuss the draft application documents;
Amending the application documents based on your comments;
Obtaining preliminary comments from the licensing authority on the draft application documents;
Finalizing the application documents following comments from the licensing authority; and
Translating the final version of the application documents into Vietnamese for execution. We anticipate that this step shall be completed within 07 working days from receipt of full required information and documents from Client.
Licensing procedures:
Submitting the application dossier to the licensing authority on Client’s behalf;
Monitoring and following up with the relevant authorities on the approval process;
Keeping you updated on the developments and additional requirements, if any; and
Assisting you in obtaining Investment Certificate and Certificate of Business Registration We anticipate that we can complete licensing procedures within 30 working days from submission of application dossier to the competent authority. Post-licensing procedures:
Placing an announcement on establishment of FIC in data base of company registration;
Obtaining Seal Sample. Within 13 working days we shall complete the post licensing procedures.
4. PROFESSIONAL FEE
SB Law professional fees for the scope of work as stipulated at Item 4 shall be 6,850USD (Six thousand eight hundred and fifty US Dollar); –
The above said service fee is exclusive of 10% VAT, actual cost for translating your documents from English into Vietnamese (10USD/100 words), and accommodation (if Client requests us to travel out of Hanoi or Ho Chi Minh City).
