How to Open a Company in Vietnam
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How to Open a Company in Vietnam

Have you thought about opening a business abroad? Vietnam is one of the most up-and-coming countries in the world and well worth considering. It’s also a tech hub, but how to open a company in Vietnam?

With friendly people and a low cost of living and low wages, it’s the perfect place to consider opening a business. With phenomenal growth every year even despite the COVID restrictions, if you play your cards right you could end up making a lot of money.

Here’s everything you need to know about how to open a company in Vietnam.

1# Do your research

Before you begin your journey into Vietnam company set up you should do your research. Most experts argue you should come to Vietnam first as a tourist and try to understand and immerse yourself in the culture for at least a month before you open the company.

Nowadays, most of Vietnamese people could speak English as well as it is in other Asian countries such as Thailand, India, Hong Kong, or China.

You should also consider reading books such as Startup Vietnam by Andrew Rowan or Crossing the Street: How to Make a Success Of Investing in Vietnam by Andy Ho. These are great for learning about Vietnam business set up.

#2: Business Lines

Part of the Vietnamese culture that it’s important to understand is that it’s a socialist republic governed by the ruling Communist Party. Vietnam is not like China. There is a lot more freedom here and there is no mass surveillance.

But one thing the two countries do have in common is a certain degree of control over what foreigners can and can’t do in terms of business.

To do a Vietnam company set up you must decide what business you will pursue before you open your company and then apply for those specific business lines and only some of those are open to foreigners.

Your business must also have an initial capital investment that matches the business lines you’ve applied for. The level of capital investment required is evaluated by the local business and planning departments on a case-by-case basis.

Be aware that once you have committed to a specific business line and initial capital investment you must do capital contribution within three months of being granted your business license.

#3: Engage a Lawyer

Personal connections in Vietnam are very important. Laws can also be interpreted in different ways depending on who is applying and in what part of the country.

You are more likely to succeed if you have a reputable lawyer who can vouch for you. These are not easily found on Google. You will often find lawyers, accountants, and other key people through personal recommendations or friendships you make with other foreign businesspeople in Vietnam.

If you do attempt to make your application on your own be aware that the application will be completely in Vietnamese and that it requires endless amounts of paperwork.

#4: Apply For Your IRC

The first step, as your lawyers will no doubt advise you, is to apply for your Investment Registration Certificate. This is a certificate granting you the ability to invest in Vietnam.

Any business with foreign direct investment – regardless of the percentage – must have an IRC.

Your application must include a certain amount of capital investment and copies of bank statements showing that you have this amount of money in your bank account.

Generally, you must also include copies of your passport. If you are setting up the company in partnership with someone else then you must also decide on how the company will be split up: whether it will be 50/50, 60/40, or for instance 80/20. The business lines of the Partnership Company is also an issue to be aware of, as it will determine your maximum rate of your capital in joint venture. Absolutely, your lawyer will be the one to tell you about it before making joint venture.

#5: Apply For Your ERC

The next step is to apply for an Enterprise Registration Certificate. This step is easy once you have got your IRC and generally only takes one week for approval. The IRC grants you the right to invest in Vietnam.

The ERC grants you the right to use that investment to establish a company and complete your Vietnam company formation.

You will need your ERC to apply for your company stamp, company sign, and to open a company bank account in Vietnam.

#6: Apply For Visas

The next stage, once you have your ERC, is to apply for visas to enable you to stay in the country, long term.

Permanent residency is not an option unless you were born Vietnamese and can get a Vietnamese passport and family books. Instead, there are two ways you can get shorter-term temporary residence and visas that you can renew while you have the company.

Labour Visa Route

The labor visa route enables you to get a temporary residence card that lasts for 2-3 years. You can apply to work at your own company and give yourself a salary and work contract required to get a temporary residence card.

The laws have recently become tight on this and you may need to show a Bachelors’s degree or 3 years of management experience. This may change in the future as Vietnam opens back up the world.

Investment Visa Route 

The investment visa route is the most straightforward. As long as you are an investor or a manager of a Vietnam business, you are eligible for a 2-year TRC after granting Work Permit or Work Permit exemption.

In some cases, investment capital is also an important issue for you to receive visas with different durations. The more capital, the longer the visa period, it could be up to 10 years with an amount of USD 5,000,000.

How to Open a Company in Vietnam? Understand Vietnam First

How to open a company in Vietnam? Since the outbreak of the pandemic, the implementation of opening a company remotely has become popular and widely applied, including in Vietnam. All you need to do is determine the business line you want to operate in Vietnam and find reputable lawyers so that they can guide you on all related matters.

If you need assistance in setting up a business in Vietnam or anywhere in Asia be sure to contact us today.

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