Attractive employment and labor policies make Vietnam the most attractive place for foreign investors. Currently, the establishment of foreign-invested enterprises is facilitated and supported by the state. However, for some reasons, investors may initially have difficulty completing the dossier for establishing a foreign-invested company and need to ensure that the company operates in accordance with the regulations governing foreign companies. outside the law. Viet My Law has practical experience in establishing 100% foreign-invested enterprises for investors and is ready to support foreign investors in all legal issues in a cost-effective and efficient manner. with the best results.

1. Conditions for establishing a foreign-invested company in 2024

Investment sectors not included in the prohibited investment sectors include:

• Investment in projects that undermine national defense, security or public interests
• Investment in projects that destroy Vietnam’s history, culture, ethics, and customs
• Investment in projects that harm human health, destroy resources, or destroy the environment
• Investment in projects that treat hazardous waste brought into Vietnam from abroad, produce toxic chemicals, or use toxic substances prohibited by international treaties.
• Foreign investors investing in Vietnam for the first time must establish an investment project and carry out investment registration procedures or investment confirmation with relevant state agencies.
• Foreign investors investing in conditional investment sectors must ensure a number of investment conditions

Conditions for each specific case are:

1.1 Conditions for establishing a foreign-invested enterprise in the manufacturing sector

• Investors need to ensure that the project location is consistent with the local development plan.
• Must have sufficient financial capacity to implement the project
• Ensure full environmental conditions and safety and order

1.2 Conditions for establishing a foreign-invested enterprise in the manufacturing sector

• Foreign investors need to ensure the project location
• Must have financial capacity and experience to implement the project
• Import, export, and distribution must have an HS code, not be subject to export prohibitions, restrictions, import and distribution prohibitions, and be consistent with the roadmap set forth by Vietnam when joining the WTO.
• Meet the conditions for implementing the Certificate, conditions on investment capital and legal capital prescribed for each specific sector.
• Meeting foreign investor quotas in any project

1.3 Conditions for establishing foreign-invested enterprises in the service sector

• Foreign investors are only allowed to register in the service sector that Vietnam committed to open the market when joining the WTO.
• Joining the WTO requires ensuring a number of conditions according to the Schedule of Service Commitments for Vietnam.
• Foreign investors need to ensure the project location
• Investors need to demonstrate their capacity and experience to be able to carry out the investment project
• Investors need to demonstrate their financial capacity to carry out the project.

2. Procedures for granting investment registration certificates to foreign enterprises

Foreign investors use this form to donate capital contributions to Vietnamese companies that have a Certificate of Company Registration. Depending on the field, foreign investors can invest from 1% to 100% of capital in Vietnamese companies, then foreign investors carry out procedures to buy capital contributions and shares of Vietnamese companies. Therefore, Vietnamese companies with foreign capital must carry out procedures to change the Certificate of Company Registration according to the provisions of law. This form of investment is called foreign portfolio investment through the purchase of shares and bonds of foreign companies (FPIs).

Foreign investors entering Vietnam to invest in projects must carry out procedures to obtain an Investment Registration Certificate. However, in some cases, investors may have to register their investment policy under the supervision of the Prime Minister or the Provincial People’s Committee before proceeding with the procedure to apply for an Investment Registration Certificate.

2.1 Prepare documents for investment registration certificate issuance in 2024

Investors need to prepare documents for investment registration certificate issuance including the following documents:

• Application form for investment project implementation.
• Copy of ID card/citizen identification card or passport
• Copy of Charter or other equivalent documents proving the legal status of the investor as an organization.
• Investment project proposal including the investor implementing the project, investment objectives, investment scope, investment capital and capital mobilization plan, location, duration and investment plan, labor demand, proposed investment incentives, assessment of the socio-economic impact of the project.
• Copies of the investor’s financial statements for the last 2 years; financial support commitment of the parent company, of the investor’s financial institutions, documents describing the financial capacity of the investors.
• Proposal for land use, copy of land lease contract or land use right of the investor to implement the project, in case the project does not require the State to allocate land, lease land, or allow change of land use purpose, other supporting documents must be submitted for use.
• Documents guiding the use of technology in investment enterprises mentioning the name of technology, origin of technology, technological process diagram, technology name, description of origin, process diagram, main technical parameters, uses of machines, equipment, main technical lines.
• BCC contract if the project is an investment project in the form of BCC contract.

2.2 Submitting application for investment registration certificate

After preparing all necessary documents for establishing a foreign-invested company to be granted an investment registration certificate, the investor submits the application to the receiving export processing zone, high-tech zone, economic zone or the investment registration agency (Industrial Park Management Board) of the Department of Planning and Investment of the province or centrally-run city – based on the authority to issue the investment certificate)

2.3 Agency receiving and processing the application

The investment registration agency receives the application. The investment registration agency will issue the investment registration certificate within 15 days from the date of receiving the complete and valid application. In case the application does not meet the requirements or is rejected, the Investment Registration Office shall notify the investor in writing and state the reasons.

3. Dossier for establishing a foreign-invested company in 2024

A foreign-invested company is a special type of enterprise in which foreign investors contribute part or all of the capital, established and operating in accordance with regulations as well as many international agreements and laws. Procedures for establishing a foreign-invested company in Vietnam must comply with a number of specific conditions stipulated in the Enterprise Law 2020 and the Investment Law 2020.

After receiving the Investment Registration Certificate, the investor completes and submits the dossier for establishing a foreign-invested company. The dossier for establishing a foreign-invested company includes:

• Application for Business Registration;
• Company Charter;
• A valid copy of one of the identification documents of the foreign investor who is an individual, legal representative, investor or founding shareholder.
• Copy of the company charter or other equivalent documents proving the legal status of the investor as an organization.
• List of members or list of shareholders
• Copy of investment registration certificate
• Document appointing an individual as the authorized representative of the owner, member, shareholder of the organization (if any).

The investor prepares the above documents, documents issued by foreign agencies and organizations must be consularized and notarized.

4. Procedures for establishing a foreign-invested enterprise in 2024

After completing the steps to apply for an investment registration certificate, investors need to proceed with the next steps to establish a company.

Basically, the process of establishing a foreign-invested enterprise is similar to the process of establishing a domestic company.

When carrying out the procedure for establishing a foreign-invested company at this stage, it is first necessary to choose the appropriate type of company. After choosing the appropriate type of company, investors need to complete the dossier. The dossier for each type of company is submitted to the competent authority.

The business registration dossier is sent to the dossier reception office of the Business Registration Office, where the company is headquartered.

Article 15 of Decree 01/2021/ND-CP stipulates that the Trade Licensing Office shall receive business registration dossiers

After receiving and reviewing the dossier, the Department of Trade shall issue a Business Registration Certificate to the case where the dossier is complete and valid within 3 days from the date of receipt of the valid dossier. In case the dossier is incomplete or rejected, the Department of Industry and Trade shall notify the investor in writing and state the reasons.

Note: If the enterprise engages in retail sales of goods to consumers or establishes a retail establishment, the enterprise must complete additional procedures to apply for a business license and be licensed by the Ministry of Planning and Investment before it can operate.

With many years of experience in preparing dossiers for establishing foreign-invested company, VIET MY LAW AND ACCOUNTING commits to helping you better understand the legal procedures, regulations and investment environment of Vietnam, and to advise on any questions investors may have. If you have difficulty understanding the procedures for establishing a foreign company, please contact us for support and advice. Thank you very much!