How to establish a Vietnamese subsidiary (limited liability, joint venture, stock)

How to establish a local corporation in Vietnam (limited liability, joint stock, stock)

Establishing a local corporation in Vietnam takes a lot of time and is often extremely difficult to proceed with the procedure. This time, we will introduce the information required when establishing a local corporation in Vietnam.

Business form of Vietnamese subsidiary

• Limited liability corporation
• Joint-stock company / corporation

The most commonly selected form of business is a limited liability corporation.

Limited Liability Corporation (LLC)

A limited liability corporation is a corporation established through capital contribution.
The liability of each investor is limited within the scope of their capital contribution.
This is a Japanese limited liability company.

Investment capital requirements of limited liability corporation

There is no minimum capital requirement for foreign investors in establishing a limited liability corporation in Vietnam. Investors can be set to companies or individuals. Investors of a limited liability corporation can be established alone or in multiples. When establishing multiple limited liability corporations, the number of investors is at least 2 and the maximum is 50. Regulations for limited liability corporations, either single or multiple, are almost the same.

Business form by foreign investment

• 100% foreign-affiliated company (when all members are foreign investors)
• Foreign investment joint venture between a foreign investor and at least one domestic investor

* All capital must be paid in full within 90 days after the establishment of the limited liability corporation.

Organizational structure of limited liability corporation

The organizational structure of a limited liability corporation consists of the chairman of the company, the president, and corporate auditors. If the limited liability corporation has 11 or more members, an audit committee is also required. The member parliament is the highest decision-making body of a limited liability corporation and is composed of all capital-contribution members.

Accounting / audit requirements for limited liability corporations

Each company is required to prepare financial statements, and the balance sheet and income statement must be submitted to the Ministry of Finance, the Local Taxation Bureau, the Statistics Bureau and other local governments that meet the requirements of the law (end of fiscal year). Within 90 days).

All foreign-affiliated companies must be audited by an independent auditor in Vietnam. Banks, non-bank financial institutions, and branches of foreign banks need to change audit firms every five years.

In addition, if you are preparing annual financial statements in foreign currency, you will be required to convert them to Vietnamese dong and submit them to the Vietnamese authorities. These financial statements are also subject to audit.

Joint-stock company / corporation (JSC)

The limited partnership is established through the shares of the company.
Under Vietnamese law, only limited partnerships are allowed to publicly issue shares and can be listed on the stock exchange. The registered capital of the limited partnership company will be split into shares, and each shareholder will hold shares corresponding to the amount of capital provided to the company (Co., Ltd.). The joint venture company is 100% foreign-owned, or is generally a joint venture between domestic and foreign investors.

Investment capital requirements of limited partnership

The limited partnership requires a minimum of three shareholders. Except for transfer restrictions, shareholders are generally free to transfer their shares to others.

Organizational structure of joint-stock company

The organizational structure of a limited partnership company consists of a general meeting of shareholders, a board of directors, a representative director and directors. The Board of Corporate Auditors is not required only if the limited partnership has 11 or less shareholders and each shareholder holds less than 50%, but otherwise it is necessary to establish a board of corporate auditors.

The general meeting of shareholders is the highest decision-making body of the limited partnership company, while the board of directors is divided into the normal business management operations of the limited partnership company and is similar to a Japanese joint-stock company. The board must have at least 3 and a maximum of 11. Of the board of directors, legal directors (signers) are required to be resident in Vietnam.

Accounting / audit requirements of limited partnership company

You are required to prepare audited financial statements and submit them to the appropriate Vietnamese authorities within 90 days of the end of the fiscal year.

Procedure for establishing a local subsidiary in Vietnam

Establishing a local corporation in Vietnam generally requires a long-term process. The establishment procedure generally involves the following procedures.

Obtain a business registration certificate and tax registration certificate from the Business Registration Office of the Ministry of Planning and Investment.

The first procedure for establishing a Vietnamese company is to submit relevant documents in accordance with Decree 43/2010 / ND-CP (April 15, 2010) and Decree 05/2013 / ND-CP (Amendment). If your application for corporate registration meets the requirements for issuing a corporate registration certificate, information about your application will be sent to the tax office database. The tax office will create a unique company code and transfer it to the domestic information database. Issued by the local business registration office.

Institution: Investment Planning Bureau
Time: 14 days
Cost: VND 200,000

Acquisition of company seal (corporate seal)

The company obtains a company seal from the seal manufacturer.

Time: 8 days
Cost: VND 165,000 – VND 370,000 due to bronze seal

Seal registration with the police station

In Vietnam, when registering a seal with the police, the company representative is required to submit a copy of the company registration certificate and tax registration certificate and present their identification card.

Institution: Police station
Time: 1 day
Cost: 50,000 dong

Opening a bank account

The minimum deposit amount for opening a bank account varies depending on each bank. To open an account, the applicant requires a bank-issued application, a company seal, a company registration certificate, and a board resolution.

Institution: Bank
Time: 1 day
Cost: Free

Announcement of registration details on the National BioResource Project (NBRP)

Under Decree No. 05/2013 / NĐ-CP dated January 1, 2013, companies will register their registration details on the Domestic Business Registration Portal (NBRP) within 30 business days from the date of registration of establishment. Must be posted. You are required to pay $ 300,000 according to the Ministry of Finance Circular 106/2013 / TT-BTC dated August 9, 2013.

Institution: National Business Registration Portal (NBRP)
Time: 5 days
Cost: 300,000 dong

Payment of corporate enterprise tax

Corporate business tax (business license tax) is paid through the tax office in your jurisdiction or a designated commercial bank. You will be paid in the first month of your company's business year and will obtain a tax registration certificate and tax code in that month. Companies established in the first half of the year are required to pay the full amount of the annual business license tax, and 50% if established in the second half of the year.

Institution: Tax Office or Commercial Bank
Time: 1 day
Cost: VND 1,000,000

Get VAT invoice

All companies must use self-printing VAT invoices from January 1, 2011. Therefore, you need to place an order for VAT invoices and register the circulation of VAT invoices with the City Tax Department.

There are three ways to get a VAT invoice: in-house printing, requesting a printing company, and purchasing from the tax office. Of these, the most common method is to request a printing company.

If you prepare your own VAT invoice, you need to notify the tax office of the issuance of the invoice and register it. You must submit a standard form with:

• Invoice sample
• If the company rents an office, a copy of the rental agreement
• Company representative ID
• Copy of company registration certificate
• Copy of tax registration certificate

Institution: City Tax Division
Time: 10 days
Cost: Approximately 200,000 VND per book

Registered with the labor bureau of the local government

Within 30 days of starting a business, the employer must register all employees with the Labor Department.

Institution: Labor Bureau
Time: 1 day
Cost: Free

Register employees with the Social Insurance Fund (health insurance / social insurance)

All employees who have a contract for 3 months or more must register with the Social Insurance Fund. Employers are required to fill in the following information and apply.

• Employee name and date of birth
• Salary (listed in labor contract)
• Social insurance serial number (for already issued employees)
• Certificate of company business registration certificate
• A copy of each employment contract

Institution: Social Insurance Fund
Time: At the same time as the procedure one day ago
Cost: Free

Employee registration with the union

Employers must register with a local or industry trade union within six months of the start of the business. The term "trade union" includes:

• Local or municipal level labor federations under the General Labor Federation
• Central level industrial union
• Trade unions of companies under the Vietnam General Labor Union
• Labor federations of districts, towns, and local cities
• Regional level industrial union
• Trade unions in processing, industrial and high-tech zones
• Corporate union
• Excellent trade unions at other establishments

In accordance with the provisions of Labor Law, Trade Union Law, and the Vietnam Trade Union Charter, the company is responsible for establishing trade unions. If the company's union is not established within six months, the senior union will appoint an interim executive committee of the union.

Institution: Labor Federation
Time: 7 days
Cost: Free

How to set up a company in Vietnam

Related page:Explaining the method and cost of establishing a company in Vietnam (establishing a local corporation) (AACS)!

 

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