What are the procedures for establishment of business organizations by foreign investors in Vietnam?

What are the procedures for establishment of business organizations by foreign investors in Vietnam? (Internet image) 

Regarding this issue, LawNet would like to answer as follows:

1. What are the procedures for establishment of business organizations by foreign investors in Vietnam?

According to Article 63 of Decree 31/2021/ND-CP, establishment of business organizations by foreign investors is as follows:

- Except for the case in Article 67 of Decree 31/2021/ND-CP, the foreign investor shall establish a business organization and execute an investment project as follows:

+ In the case of execution of a new investment project, the foreign investor shall follow procedures for approval of investment guidelines and issuance of the investment registration certificate to the new investment project, and procedures for establishing a business organization in accordance with regulations of law corresponding to each type of business organization;

+ In the case of receipt of an investment project and establishment of a business organization, the foreign investor shall follow procedures for issuance of the investment registration certificate (if such project is not issued with the investment registration certificate) or adjustment of the investment registration certificate (if such project has been issued with the investment registration certificate) and procedures for business organization establishment in accordance with regulations of law corresponding to each type of business organization.

- Documentation and procedures for establishment of the business organization shall comply with regulations of law on enterprises or other law corresponding to each type of business organization.

- Charter capital of a business organization established by a foreign investor for execution of an investment project is not necessarily equal to the investment capital of the investment project. The business organization established by the foreign investor shall contribute capital and raise capital from other sources to execute the investment project according to the schedule on the investment registration certificate.

2. Execution of investment projects and business investment activities of foreign-invested business organizations in Vietnam

Pursuant to Article 64 of Decree 31/2021/ND-CP, execution of investment projects and business investment activities of foreign-invested business organizations in Vietnam is as follows:

- If there is a new investment project other than the investment project issued with the investment registration certificate, the foreign-invested business organization shall follow the procedures below:

+ The business organizations specified in Point a through c Clause 1 Article 23 of the Law on Investment 2020 shall follow procedures for issuance of the investment registration certificate as set out in Decree 31/2021/ND-CP;

+ Business organizations other than those specified in Point a of this Clause shall implement the reporting regulation specified in Clause 5 Article 72 of the Law on Investment 2020. The report shall specify: The project’s name, investment objectives, investment scale, investment capital, location, schedule, labor demand, and investment incentives (if any).

- A foreign-invested business organization is entitled to adjust the contents of enterprise registration at the business registration authority without necessarily having an investment project. The addition of business lines by the foreign-invested business organization must satisfy market access conditions (if any) applied to a foreign investor.

- A foreign-invested business organization is entitled to establish branches, representative offices and business locations outside its headquarters without necessarily having an investment project. Applications and procedures for establishment of a branch, representative office or business location of the business organization shall comply with regulations of law on enterprises or other law corresponding to each type of business organization.

- When making investment or trading securities on the securities market, every foreign-invested business organization shall comply with regulations of law on securities regarding investment procedures and holding of charter capital, unless otherwise prescribed by international investment-related treaties regarding holding of charter capital.

Nguyen Ngoc Que Anh

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