For commercial activities of foreign traders in Vietnam, the State always pays attention, promotes, and creates favorable conditions to promote domestic cooperation with foreign traders by many measures, including legal provisions on administrative procedures so that foreign traders can have commercial activities in Vietnam. One of the procedures that many foreign traders are concern about is establishing a representative office of a foreign company. Therefore, LSX Law firm will provide information about the application for a license to establish a branch or representative office and the Service of applying to establish foreign branches, representative offices.
Enterprise Law 2020
Decree 07/2016/ND-CP detailing the Commercial Law on Representative Offices
What are branches?
A branch is an affiliated unit of an enterprise; established to expand the business scale and market of the enterprise. Branches have no legal status.
Besides, in terms of locations permitted to set up branches, enterprises may set up one or more branches or representative offices in a locality according to administrative unit boundaries and may establish branches in the country and abroad.
What are representative offices?
Representative offices include two main types: Representative offices of domestic companies; and Representative Offices of Foreign Traders.
In addition, a representative office is a dependent unit of the enterprise; it has the duty to represent as authorized for the interests of the enterprise and protect those interests. Representative offices do not perform the business functions of enterprises.
Representative offices and branches of foreign traders in Vietnam have the following rights; obligations under Vietnamese law. Foreign traders must take responsibility before Vietnamese law for all operations of the representative office; Its branch in Vietnam.
Conditions for applying to establish foreign branches, representative offices
Foreign traders may only be granted operation certificates of representative offices in Vietnam when fully meeting the following conditions:
Firstly, foreign traders may establish and register their business under must the laws of countries and territories participating in international treaties to which Vietnam is a contracting party or recognized by the laws of these countries and regions. ;
Secondly, foreign traders have operated for at least 01 years from the date of establishment or registration;
In case the business registration certificate or paper of equivalent validity of the foreign trader stipulates the operation term, such time limit must be at least 01 year from the date of application submission;
Moreover, the operation contents of the Representative Office must be consistent with Vietnam’s commitments in international treaties to which Vietnam is a signatory;
In case the operation content of the Representative Office is not consistent with Vietnam’s commitments; or non-national foreign traders; also territories participating in international treaties to which Vietnam is a signatory; the establishment of a Representative Office must be approved by the Minister; Heads of ministerial-level agencies in charge of specialized management.
Service of applying to establish foreign branches, representative offices of LSX Law firm
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Finally, hope this article about Service of applying to establish foreign branches, representative offices is helpful for you!
Accordingly, the granting of a representative office establishment license is specified in Decree 07/2016/ND-CP detailing the Commercial Law on representative offices; Branches of foreign traders in Vietnam at the Department of Industry and Trade.
Representative offices perform the functions of a liaison office, market research, and promotion of business investment opportunities of the traders they represent, excluding the service industry where the establishment of a representative office in that field is specified in specialized legal documents.