Branches of foreign businesses

1. Establishment conditions:

According to Article 8 Decree 07/2016/ND-CP detailing Law on Commercial on representative offices, branches of foreign businesses in Vietnam.

“Foreign businesses are to be granted license for establishment of branches when meeting the following conditions:

Foreign businesses have business registered in a country as a member of international agreements according to the law and commitments in the international agreements or being recognized by the law of these countries or territories;

Foreign businesses have been operated for no less than 05 years for their legal establishment with valid business registration;

If their Business Registration Certificate or equal documents of foreign businesses states about the expiration date, the validity of that time should remain at least one year since the submission of the dossier;

The operation contents of the Branches must be in accordance with the commitments on market opening of Vietnam in international agreements and relevant to the business lines of foreign businesses.

If the operation of branches is not in accordance with commitments of Vietnam or foreign businesses are not from countries, territories participating international agreement that Vietnam is a member, the establishment of branches must be approved by the Minister as specialized management.”.

After checking WTO Commitments, if the business lines of the foreign businesses are relevant and able to open market, the foreign businesses are allowed to establish branches in Vietnam.

2. Procedures for branch establishment in Vietnam.

Legal base: Decree 07/2016/NĐ-CP detailing representative offices, branches of foreign businesses in Vietnam.

 Procedures include: (Article 13 Decree 07/2016/ND-CP)

The foreign businesses directly submit the dossier through post office (if meet the applicable conditions) to Ministry of Industry and Trade.

Within 03 days since presentation of valid application dossier, the agency in charge of licensing shall examine and request for the supplement if the dossier is incomplete and invalid. Supplement of the dossier shall be done once during the process.

Excluding cases as stipulated under the Decree, within 07 working days since the full receipt of valid dossier, the agency in charge of licensing shall grant or refuse to grant the license for establishment of branches to foreign businesses. If refusal, reasons for refusal should be explained in writing.

A Dossier includes: (Article 12 Decree 07/2016/ND-CP)

• Application for establishment of branches in accordance with forms issued by the Ministry of Industry and Trade. The Application must be signed by legal representative of the foreign business;
• Copy of the Business Registration Certificate or other alternative documents of the foreign business;
• Documents of foreign businesses authorizing/nominating heads of branches;
• Audited financial reports or documents proving tax or financial obligations in the latest fiscal year or other alternative documents certified by competent agencies where foreign businesses are located to prove the real existence and operation of the foreign business in the latest fiscal year;
• Copy of the Charter of branches;
• Copy of passport or identity card or citizen card (if the head of representative is Vietnamese) or copy of passport (if the head of representative is foreigner);
• Copy of a memorandum or an agreement on renting the location or copy of documents proving that the business has the right to exploit and use the location to set up the branch office;
• Copies of documents on the location where the branch office is to be located.

Note: Some Documents as regulated above must be translated into Vietnamese and certified in accordance with Vietnam laws; some must be legalized or Consular Legalized in accordance with Vietnam laws.

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