VIETNAM-BASED BRANCH OF THE FOREIGN COMPANY

Vietnam-based branch of the foreign company

VIETNAM-BASED BRANCH OF THE FOREIGN COMPANY

Vietnam-based branch of the foreign company

Vietnam-based branch of the foreign company

Vietnam-based branch of the foreign company means a dependent unit of the foreign trader. The Headquarter shall be legally responsible for the entire operations of the branches in Vietnam. Branch of the foreign company is not a popular choice of foreign investors in Vietnam because of complicated entry procedures in compared with a representative office or subsidiary company. Moreover, compliance operation procedures of a branch are equal to a subsidiary company but the operation functions are less convenience.

CONDITIONS FOR GRANT OF LICENSES FOR ESTABLISHMENT

  • The foreign trader is incorporated and registers for doing business in accordance with provisions of laws of recognized countries
  • The foreign trader has come into operation for at least 05 years from the date of establishment or registration.
  • The Certificate of Business registration or equivalent document is valid for at least 01 more year from the date of submission of the application.
  • The scope of operation of the branch is conformable with Vietnam’s Commitments to market access.

PAPERS FOR LICENSES FOR ESTABLISHMENT

  • Copies of the Certificate of Business Registration or equivalent documents of the foreign trader.
  • A letter of appointment of the head of the branch.
  • Copies of audited financial statements or certificates of fulfillment of tax liabilities or financial obligations of the last fiscal year or equivalent documents as proof of existence and operation of the foreign trader issued or certified by competent authorities where such foreign trader is established.
  • Copies of the branch charter.
  • Copies of the passport or ID card (for Vietnamese) or copies of the passport (for foreigners) of the head of the branch.
  • Documents on the expected location of the branch including:
    • Copies of memorandum of understanding (MOU) or leasing agreements or documents as proof of the right to use a location as the branch.
    • Copies of documents on the expected location of branch of the foreign company under Article 28 hereof and provision of related laws.
    • Documents specified above shall be certified or legalized by overseas diplomatic missions or Consulates of Vietnam, translated into Vietnamese and certified true.

PROCEDURES FOR LICENSES FOR ESTABLISHMENT

  • Summit the application to the licensing agency where the representative office is expected to be located.
  • The licensing agency shall examine such application and request the applicant to complete their application by a written notification of whether the license or establishment of the branch is granted or not within 10 working days from the date of receipt of the valid application.

STRUCTURES OF BRANCHES

  • The organization structure and personnel of a branch shall be decided by their head office.
  • The employment of foreign workers of representative offices or branches shall comply with legislation on labor.

RIGHTS OF BRANCHES

  • To rent offices, rent and purchase equipment and facilities necessary for their operations.
  • To recruit Vietnamese and expatriate employees to work for them according to Vietnamese law.
  • To enter into contracts in Vietnam in compliance with their operation contents specified in their establishment licenses.
  • To open Vietnam dong accounts and foreign-currency accounts at banks licensed to operate in Vietnam.
  • To transfer profits overseas according to the provisions of Vietnamese law.
  • To have seals bearing their own names according to the provisions of Vietnamese law.
  • To conduct activities of goods purchase and sale and other commercial activities in compliance with their establishment licenses according to the provisions of Vietnamese law and treaties to which the Socialist Republic of Vietnam is a contracting party.

OBLIGATIONS OF BRANCH OF THE FOREIGN COMPANY

  • To observe the accounting regime provided for by Vietnamese law; in cases where it is necessary to apply another commonly used accounting system, the approval by the Finance Ministry of the Socialist Republic of Vietnam is required.
  • To report on their operations according to the provisions of Vietnamese law.

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Summary
Branch Of The Foreign Company | Conditions, Rights & Obligations
Article Name
Branch Of The Foreign Company | Conditions, Rights & Obligations
Description
Vietnam-based branch of the foreign company means a dependent unit of the foreign trader. The Headquarter shall be legally responsible for the entire operations of the branches in Vietnam. Branch of the foreign company is not a popular choice of foreign investors in Vietnam because of complicated entry procedures in compared with a representative office or subsidiary company. Moreover, compliance operation procedures of a branch are equal to a subsidiary company but the operation functions are less convenience.
Author
Publisher Name
VIVA BUSINESS CONSULTING
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