5 Conditions to Establish Branch Office in Vietnam as Foreign Traders

Establish Branch Office in Vietnam under Commercial Law

The Commercial Law regulates conditions to establish branch office in Vietnam.

The Decree also stipulates the conditions for foreign traders to be granted licenses to establish branch office in Vietnam.

Conditions to Establish Branch Office in Vietnam

Foreign traders will be licensed for the establishment of branches when they meet 5 conditions:

1.Foreign traders can establish and register for business in accordance with law of nation and territories participating in international treaties in which Vietnam is a member, or recognized by the law of those nations and territories.

2.Foreign traders that have been in operation for at least five year from the date of establishment or registration.

3.In case the certificate of business registration or papers with equivalent value of the foreign traders have prescribed the time limit for operation, then the duration must be at least 1 year from the date of submitting record.

4.The operation of the branch office must be consistent with the market-opening commitments of Vietnam in the international treaties in which Vietnam is a member, and in line with the business lines of the foreign trader.

5. If the content of the branch operation is inconsistent with Vietnam’s commitments or foreign traders do not belong to any nations and territories participating in the international treaties in which Vietnam is a member, the establishment of branches must be approved by the Minister of specialized management.

Term of License to Establish Branch Office in Vietnam

The license for the branch of foreign traders have a term of 5 years but does not exceed the remaining term of the certificate of business registration or papers of equivalent value of the foreign trader in the case that those papers contain provisions on the term.

How a Law Firm in Vietnam Could Help Trader to Establish Branch Office in Vietnam?

Foreign businesses eyeing expansion into Vietnam often find the establishment of branch offices as a strategic move. However, navigating through the legal requirements and conditions can be complex. This is where legal experts in Vietnam play a crucial role, ensuring a smooth and compliant process to establish branch office in Vietnam. Let’s delve into the conditions and the valuable assistance a law firm can provide in this endeavor.

1. Compliance with Local and International Laws

The first condition to establish branch office in Vietnam is ensuring that foreign traders can establish and register businesses in accordance with the laws of their home country. Furthermore, these laws should align with the international treaties involving Vietnam. Legal experts proficient in both local and international law can guide businesses through this intricate process, ensuring compliance at every step.

2. Operational Experience Requirement

Foreign traders seeking to establish branch office in Vietnam must demonstrate a track record of at least five years from the date of their establishment or registration. This requirement ensures that businesses with a proven operational history are more likely to contribute positively to Vietnam’s economic landscape. Legal advisors assist in presenting the necessary documentation and verifying compliance with this condition.

3. Duration of Operation

The duration of operation is a critical aspect, often outlined in the certificate of business registration or equivalent papers. Legal experts meticulously review these documents, ensuring that the proposed operation duration for the branch office is at least one year from the date of submitting records. This attention to detail is vital for a successful application.

4. Consistency with Vietnam’s Market-Opening Commitments

The business lines of the foreign trader and the operation of the branch office must align with Vietnam’s commitments in international treaties. Legal professionals play a pivotal role in evaluating and ensuring this alignment, reducing the risk of conflicts and facilitating a seamless integration into the Vietnamese market.

5. Approval Process for Non-Compliant Operations

In cases where the nature of the branch’s operation deviates from Vietnam’s commitments or the foreign trader doesn’t belong to any nations and territories participating in relevant international treaties, approval from the Minister of specialized management is required. Legal experts navigate the complexities of this approval process, offering guidance on necessary documentation and procedures.

6.Term of License and Legal Oversight

The license for a foreign trader’s branch office in Vietnam typically spans five years. Legal professionals ensure that the granted term aligns with the remaining term of the certificate of business registration or equivalent papers. This meticulous oversight is crucial for avoiding legal complications in the future.

In conclusion, to establish branch office in Vietnam involves navigating through a set of stringent conditions. Legal experts specializing in Vietnamese business laws and international treaties play an indispensable role in guiding foreign traders through these complexities. Their expertise ensures not only compliance with regulations but also a strategic and legally sound entry into the vibrant Vietnamese market. For businesses eyeing expansion, partnering with a reputable law firm in Vietnam is a proactive step towards a successful establishment of a branch office.

About ANT Lawyers, a law firm in Vietnam

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers has lawyers in Ho Chi Minh city, Hanoi,  and Danang, and will help customers in doing business in Vietnam.