PROCEDURE FOR ESTABLISHMENT OF FOREIGN INVESTMENT ENTERPRISE IN VIETNAM

Nowadays, when economy and investment from Korea to Vietnam have been severely affected by Covid-19 pandemic, OTIS LAWYERS would like to provide investors with necessary information and advice, which helps investors have good plans when investing in Vietnam in near future. In this consulting article, OTIS LAWYERS would like to provide investors with information and Vietnamese law regulations related to procedures for establishment of foreign-invested enterprise in Vietnam.

Currently, the establishment of foreign-invested enterprises is governed by the Investment Law in 2020 and its guiding documents.

According to current law, to establish a foreign-invested legal entity in Vietnam, investors shall carry out following procedures:

• Applying for Investment Registration Certificate (Register for investment project)
• Applying for Enterprise Registration Certificate (establish for legal entity)

Applying for Invesment Registration Certificate

About the subject has to apply for Investment Registration Certificate (IRC)

According to Clause 1 Article 37 of Law on Investment 2020, cases that have to carry out the procedures for applying Investment Registration Certificate include:

• Investment projects of foreign investors;
• Investment projects of the foreign- invested economic organizations

About the procedures

Step 1: Investors or investor's authorized person shall declare and submit online dossiers

Step 2: The investor or investor's authorized person shall submit paper dossier to the competent authority

Step 3: The authority shall receive investment project dossiers and evaluate the validity

Step 4: For some specific business lines which have to consult specialized authorities, the Investment Registration Authority shall send an official dispatch for appraisal opinions.

Step 5: Issuing Investment Registration Certificates after appraising satisfactory dossiers and meeting all investment conditions.

About necessary dossiers for establishing legal entities

For individual investor

• Notarized copy of all pages of passport (for foreign investors); notarized copy of ID card/Citizen identification card/passport (for Vietnamese investors participating in the project);
• Confirmation of the bank account balance of each investor corresponding to the expected investment capital in Vietnam (original copy if issued in Vietnam, consular legalization copy if issued in foreign country)

For organization investor or enterprise investor

• A consular legalization copy of Establishment Certificate/ Enterprise registration certificate;
• A notarized copy of all pages of passport/ ID card/Citizen identification card of legal representative;
• A notarized copy of all pages of passport/ID card/identity card of authorized person who manages the contributed capital at the established company;
• A consular legalization copy of the investor's financial statements of latest 2 years (showing profitable business). In case the financial statement of the enterprise shows that the business enterprise is not profitable, it is required to provide bank account balance confirmation of enterprise which confirms at least equal or greater than the intended capital for investment registration in Vietnam.

Legal dossiers of investment location includes

• Head office lease contract
• A copy of the land use right certificate and legal documents related to the leased location such as the construction permit, the lessor's business registration certificate or equivalent documents

Dossiers related to project/ established enterprise

• A notarized copy of all pages of passport/ID card/ Citizen identification card of legal representative
• Information of project and established enterprise (fill in the information form provided by OTIS LAWYERS)

Other necessary documents that need to be drafted include

• An application form for execution of the investment project, including a commitment to incur all costs and risks if the project is not approved;
• Proposal for the investment project;
• Contents of the explanation for the technology to be used in the investment project if the project requires appraisal and collection of opinions on the technology in accordance with the Law on Technology Transfer;
• Other documents relating to the investment project, and requirements on the eligibility and capacity of the investor in accordance with law (if any).

Period of time to carry out the procedures: Within 15 working days. In case there is further appraisal or consultation with relevant agencies, the procedure may last up to 30-35 working days.

The power to issue: Departments of Planning and Investment of Province/City or Management boards of industrial parks, export-processing zones if the investment projects located therein,

The result:

Note: For investment projects regarding some special fields under the power to approve investment guidelines of the National Assembly, the Prime Minister or the Chairman of provincial People's Committee, before applying for an Investment Registration Certificate, investors shall carry out procedures to apply for investment guideline approval of the National Assembly, the Prime Minister or People's Committee depending on the field and authority.

Applying for Enterprise Registration Certificate

After being granted the Investment Registration Certificate, investors shall implement the procedures to establish an economic organization to carry out the investment project or in other words, carry out the procedures for applying for Enterprise Registration Certificate.

About procedure

Step 1: Investors or authorized person of investors declare and submit online dossier

Step 2: Business Registration Authority shall receive and process the dossier

Step 3: Issuing Enterprise Registration Certificate after the application is valid

Must-have documents including

Must-have documents

• Business Registration form;
• Company Charter;
• List of members/ shareholders (for Limited liability company with two or more members, Shareholding company);
• Notarized copy of all pages of passport/ ID card of individual Owner/members/ shareholders);
• Consular legalization copy of Establishment license/Certificate of business registration of an organization/enterprise (if owner/members/shareholders are foreign organizations/ enterprises) or Notarized copies of Establishment license/Certificate of business registration of an organization/enterprise (if owner/members/shareholders are Vietnamese organizations/ enterprise);
• Written Authorization;
• Copy of issued Investment Registration Certificate;
• Other legal documents.

About procedures

• Step 1: Issuance of Enterprise Registration Certificate: Submit dossier, business registration authority appraises, issues Certificate and publishes electronic statement

Received result:

• Step 2: Carrying out the procedure of engraving the company's seal

Period of time to implement procedure: Within 07 working days

Power of issuance: Department of Planning and Investment of the province/city where the enterprise located

This is OTIS LAWYERS's advice regarding the establishment of foreign-invested enterprise in Vietnam. During the establishment process, there will be many related legal issues such as investment business lines, required investment capital, possible investment incentives or tax-related issues…, These issues will be answered in our next articles. If you have any questions, please leave a comment or email us for advice.

Proud to be a professional unit in the field of investment and corporate law, OTIS LAWYERS is very pleased to accompany our customers in all legal issues.

For any questions or comments, please contact:

OTIS LAWFIRM & PARTNERS

Address: K28 Lane 68 Trung Kinh, Yen Hoa Ward, Cau Giay District, Hanoi

Mobile: 0987.748.111

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