Types of commercial presence of foreign investors in Vietnam

by HaTrang

There are many ways in which foreign investors can establish a commercial presence in Vietnam. LSX Law firm has summarized and introduced 3 types of commercial presence of foreign investors as follows.

Legal grounds

Investment Law 2020

Business cooperation contract

For foreign enterprises in particular commercial presence in the form of business cooperation contracts will not establish economic organizations. Accordingly the Investment Law, the form of business cooperation (BCC contract). A BCC contract is an investment form signed between investors for business cooperation, capital contribution, profit sharing, and distribution. products and jointly assume the same risk without forming a legal entity. This will save a lot of time and effort for investors.

Besides, this type allows the parties to operate with independent legal status, flexibly solve problems, but can still support each other in the process of production and business.

Foreign-invested enterprises

Depending on the field of business; the State allows foreign investors to establish enterprises with 100% foreign investment capital; or compels joint ventures with Vietnamese traders according to a certain percentage of capital contribution.

Furthermore, in the case of a joint venture, a foreign investor may contribute capital, purchase shares or a capital contribution portion of a Vietnamese trader according to the ratio prescribed by law and in accordance with international treaties signed by Vietnam.

Branches and representative offices

Lastly, the final form of establishing a commercial presence is that investors can set up branches and representative offices in Vietnam. Accordingly the regulations, foreign investors legally recognized by the law of that trader’s country or registered for business; will be granted a license to establish a representative office if it has been operating for not less than 1 year, and may establish a branch if it has operated for not less than 1 year.

See more: Procedures for representative office or branch establishment licenses

Procedures after foreign investors establish a company in Viet Nam

Hopefully this article “Types of commercial presence of foreign investors in Vietnam” is useful for you, If you need any further information, please contact LSX Law firm for the best service and advice: 0833102102

Related questions

What do foreigners need to prepare to establish a company in Vietnam?

Accordingly the Investment Law 2020, Foreigners establishing a company in Vietnam need to prepare the following documents: Legal passport; confirm the bank account corresponding to the investment capital in Vietnam; location profile for project implementation.

How much capital do foreigners need to set up a company in Vietnam?

Vietnamese law does not stipulate the minimum investment capital of foreigners when setting up a company in Vietnam. However, foreigners setting up a company in Vietnam need to prepare an appropriate amount of investment capital to operate the project in Vietnam.

How long does it take for foreigners to set up a company in Vietnam?

Accordingly the Investment Law 2020, the Enterprise Law 2020; the time for foreigners to set up a company in Vietnam is about 20-25 working days.

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