Foreigners in the company’s name in Vietnam

by NguyenThiThuTrang

Currently, the number of foreigners coming to Vietnam to work and invest is very high and focuses on big cities, provinces with industrial parks, export processing zones and high-tech zones. The fact that foreigners choose Vietnam as a destination is because our country has a lot of potential with an abundant labor source, a large consumption market and is a country currently participating in bilateral and multilateral agreements allowing investment with FDI capital. So, when doing investment activities in Vietnam, can foreigners in the company’s name in Vietnam? Lawyer X will answer the above question through the following article:

Investment Law 2020
Enterprise Law 2020

Can foreigners name a company in Vietnam?

According to the provisions of Article 5 of the Investment Law 2020 on investment and business policies: “Investors have the right to conduct business investment activities in industries and trades not prohibited by this Law. For conditional business lines, investors must satisfy the conditions for business investment as prescribed by law.”

Investors under the provisions of the Investment Law 2020 are organizations and individuals conducting business investment activities, which include: domestic investors, foreign investors and economic organizations with investment capital. foreign investment. Also according to the provisions of the Investment Law 2020: Foreign investors are individuals with foreign nationality or organizations established under foreign laws that carry out investment and business activities in Vietnam.

Thus, foreigners can completely conduct business investment activities in Vietnam for the industries and trades that Vietnam’s law allows foreign investors to register. In parallel with the provisions of the Investment Law 2020, the Enterprise Law 2020 also has provisions on the establishment of foreign-invested enterprises for foreign individual investors holding positions and titles: member company, company shareholders, legal representative, company owner. Article 17 of the Law on Enterprises 2020 also clearly states: “Every organization and individual has the right to establish and manage an enterprise in Vietnam, except for the cases where it is not permitted to establish an enterprise specified in Clause 2 of this Article. 17 Enterprise Law 2020.”

Thus, it is possible for foreigners to name the company. Foreigners are allowed to invest and do business in Vietnam and bear the name of the company with the position and title suitable to the form of investment and the type of enterprise that the foreigner registers.

Conditions for foreigners to name companies in Vietnam

The foreigner is a lawful citizen of the country in which he holds his nationality, has full papers proving his/her personal status such as a valid passport or other personal legal papers;
In case a foreigner names the company in the direction of direct investment through an investment project, he must prove his financial capacity by certifying his account balance;
For conditional business lines, the foreigner in the name of the company must satisfy the conditions prescribed by law;
The implementation of investment forms, scope of activities as well as related procedures must satisfy the conditions under the Investment Law, relevant legal documents and other conditions of international treaties. of which Vietnam is a member.

Procedures for foreigners to name companies in Vietnam

In Vietnam, foreigners use the company’s name under many positions such as capital contributors, company shareholders, and owners. Regardless of which position a foreigner chooses, they must carry out the same procedures for investment registration and business registration. Currently, foreigners in the company’s name can choose to invest in the direct direction (establishment of an investment project) or invest in the indirect direction (register for capital contribution, buy shares, buy back the contributed capital).

Conditions for establishing a foreign company

According to the provisions of Vietnamese law as well as the WTO Schedule of Commitments and relevant international treaties, the general conditions for foreign investors to establish a company in Vietnam are as follows:

Being an individual over 18 years old, an organization or an enterprise with nationality that is a member of the WTO or has signed a bilateral investment treaty with Vietnam. However, in Vietnam, some industries only allow foreign investors who are legal entities to invest in Vietnam). Currently, for investors who are individual passport holders with “cow’s tongue line” will not be able to contribute investment capital in Vietnam or in the name of the representative to manage the capital contribution of the organization, the representative under the law of the company incorporated in Vietnam.
Have the financial capacity to invest and demonstrate the financial capacity to invest in Vietnam.
Having a location for implementing an investment project in Vietnam through a location lease contract, house rental contract, land lease and lawful housing documents of the lessor to serve as the company’s headquarters and the project implementation location judgment.
For investment projects in the manufacturing sector, investors must prove that they are eligible to rent factories and have contracts to rent factories in industrial clusters or parks.
Meeting specific conditions for conditional business lines for foreign investors.
For some fields such as trade, wholesale and retail of goods, investors need to prove that they have experience in the field of investment.

Subjects must carry out the procedures to apply for an Investment Certificate

Companies with 1% – 100% capital contributed by foreign investors upon establishment;
Foreign-invested companies continue to establish more economic organizations; capital contribution, purchase of shares or capital contribution of business organizations; or invest under a BCC contract;
Foreign investors who contribute capital or purchase shares in Vietnamese companies that already have an enterprise registration certificate are not required to carry out procedures for issuance of an investment registration certificate, unless the company does business in the field of education and training. If the foreign investor buys from 1% of the contributed capital, it also needs to carry out the procedures for the issuance of an Investment Registration Certificate.
Regulations for foreign-invested companies established before July 1, 2015: Foreign-invested economic organizations already established in Vietnam, if they have new investment projects, are allowed to do so. continue to implement that investment project without necessarily establishing a new economic organization.

Apply for Investment Registration Certificate

Investors carry out procedures to apply for an Investment Registration Certificate at the investment registration agency (Management Board of Industrial Parks, Export Processing Zones, Hi-Tech Parks, Receiving Economic Zones; Department of Planning and Investment; and investment in provinces and centrally run cities).

Records include:

A written request for implementation of an investment project;
Proposing investment projects;
A valid copy of the identity card, identity card or passport for the investor being an individual; Certificate of incorporation or other equivalent document certifying the legal status of the investor being an organization;
One of the following documents: Financial statements of the last 2 years of the investor; commitment to financial support of the parent company; financial support commitments of financial institutions, guarantees on the financial capacity of investors; documents explaining the financial capacity of the investor;
Proposing land use needs; If the project does not request the State to allocate or lease land or permit the change of land use purpose, a valid copy of the location lease agreement or other document certifying that the investor has the right to use the site shall be submitted. to carry out investment projects;
An explanation on the use of technology for the project (if any), including the following contents: technology name, technology origin, technological process diagram; main technical parameters, use status of main machinery, equipment and technological lines;
Other relevant documents and documents.

Apply for a Certificate of Business Registration, engrave the legal entity’s seal and notify the seal sample

After being granted the Investment Registration Certificate, the Investor shall carry out the procedures for applying for the Certificate of Business Registration, engrave the legal entity’s seal and notify the seal sample at the business registration office (Department of Accounting). planning and investment in provinces and centrally run cities).

Records include:

Application form for establishment of a business
Company rules
List of founding shareholders, list of shareholders who are foreign investors (If the type of company is shares)
List of company members (If the type of company is a limited liability company with 2 TVs or more)
List of authorized representatives (in the case of an enterprise whose members/shareholders are legal entities)
A valid copy of the identity card, identity card or passport for individual members/shareholders/company owners; Certificate of incorporation or other equivalent document certifying the legal status of members/shareholders/owners of the company being an organization;
Notice of seal sample;
Other relevant documents and documents

Time limit for settlement

– Processing time for issuance of Investment Registration Certificate is 15 working days from the date of receipt of valid application.

– Processing time for issuance of business registration certificate is 03 – 05 working days. The time for posting the seal and the effective seal is 04 working days.

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Frequently asked questions

What types of companies can foreign investors establish in Vietnam?

Although depending on the number of foreign investors participating in the establishment of economic organizations and business management models, foreign investors are allowed to establish the following types of companies in Vietnam:
One member limited liability company;
– Limited liability company with two or more members;
Joint stock company.

Can foreigners establish business households?

According to the provisions of the decree guiding business registration, the subjects entitled to business household registration are Vietnamese citizens who are full 18 years old, have full legal capacity and civil act capacity; households have the right to establish business households and are obliged to register business households according to regulations.
Therefore, foreigners cannot establish business households. If you want to do business in Vietnam, you need to ask a Vietnamese citizen to act on behalf of the business household or carry out investment procedures and business registration in Vietnam.

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