Hello, I am planning establish a two-member limited liability company in Ho Chi Minh City. The company intends to engage in real estate business, but I am not sure about the conditions. Can your company advise me on the necessary documents and procedures to both establish the company and meet the requirements for operating in this industry?
Answer
1. Conditions for Engaging in Real Estate Business
- Establish a business entity in accordance with the provisions of the 2020 Enterprise Law.
- The company must not be under a prohibition from operation, temporary suspension, or termination of operations under a court judgment, a decision of a competent state authority.
- Ensure compliance with the ratio of credit debt, corporate bond debt to charter capital.
- The real estate enterprise approving a real estate project must ensure that its owner's equity shall not be lower than 20% of total investment of that project, if the area of land used is less than 20 ha, or 15% of total investment of that project, if the area of land used is 20 ha or higher, and that it is capable of raising capital for implementing that project. If a real estate enterprise implements several real estate projects at the same time, its owner's equity must be sufficient to fund all of such projects at the abovementioned percentage.
Legal Basis: Clauses 1 and 2, Article 9 Law on Real Estate Business 2023.
2. Prohibited Acts in Real Estate Business
- Put the real estate that does not meet the conditions set forth in this Law on the market.
- Forge documents or deliberately falsify information on the real estate or the real estate project to be put on the market.
- Fail to disclose information on the real estate or the real estate project to be put on the market as prescribed in this Law.
- Commit fraudulent or deceitful acts in real estate business.
- Receive payment for sale or lease purchase of off-plan housing, off-plan buildings or their floor areas against the provisions of this Law; use money received from buyers or tenant-buyers of off-plan housing, off-plan buildings or their floor areas against regulations of law.
- Partially fulfill or fail to fulfill financial obligations to the State.
- Issue or use practicing certificates for real estate brokers against the provisions of this Law.
- Collect, manage or use charges, fees and other amounts related to real estate business against regulations of law.
Legal Basis: Article 8 Law on Real Estate Business 2023.
3. Procedures for Company Establishment
Step 1: Choose the type of business entity:
Based on the information you provided, you intend to establish a Two-Member Limited Liability Company (LLC).
Step 2: Prepare the registration documents for the Two-Member LLC
- Application for business registration.
- Company charter.
- List of company members.
- A certified copy of the legal representative’s and members’ identification documents.
- Investment registration certificate (if the company is established by a foreign investor or an economic organization with foreign investment).
Step 3: Submit the Application to the Department of Planning and Investment of the Province/City (Currently renamed as the Department of Finance) through one of the following methods:
- At the Business Registration Office:
- Via postal service
- Online through the National Business Registration Portal.
Step 4: Wait for Processing
Within 3–5 working days from the date of document submission:
Step 5: Complete Post-Licensing Procedures and Business Registration Announcement
After the business is granted the Business Registration Certificate, the following essential steps must be taken to ensure smooth operations:
- Purchase a digital signaturefor online tax registration, declaration, and payment.
- Open a business bank accountin the company's name.
- Design and install a company signboardin compliance with regulations.
- Register for the issuance of electronic invoicesfor business transactions.
- Contribute charter capitalwithin the committed timeframe.
- Ensure full compliance with all business conditionsrequired before and during operations.
