Question: I am Japanese, I would like to open restaurant in Sai Gon, please advise.
Answer: SBLAW would like to advise as follows:
1.SETTING UP FOREIGN INVESTED ENTERPRISE IN VIETNAM
We would like to clarify that the procedure for establishment of a foreign invested enterprise in Vietnam generally takes a rather long time in comparison with other countries in the region. Our practical experiences show that actual process may take a longer time due to that the licensing authority must consult other relevant departments to evaluate the investment project.
Generally, the licensing authorities shall evaluate the legitimacy and the feasibility of investment project on the following basis:
- The legal framework including Vietnam’s WTO Commitments, Vietnam Investment Law, Vietnam Enterprise Law, Regulations applicable to specific industries as well as the master economic development plan of the city/province where the restaurant is located;
- Financial ability, investment capital to put in the investment project, facilities and human resources serving the implementation of such investment project in Vie
According to applicable Law on Investment 2014, an investment in the form of the establishment of an economic organisation will require a foreign investor to go through a two-step licensing process as follows:
- application for obtaining an Investment Registration Certificate (IRC); and
- registration for establishment of an enterprise by obtaining an Enterprise Registration Certificate (ERC).
In addition to the mentioned-above licenses, depends on actual business the NewCo operates, it is required to obtain other relevant sub-license/permission after incorporation of the NewCo. For example, a restaurant has to be obtained the following sub-licenses including (i) Certificate of satisfaction on food safety and hygiene; (ii) Certificate of satisfaction on conditions for fire-fighting and prevention, and so on before officially operating.
2.SPECIFIC CONDITIONS FOR INVESTMENT REGISTRATION
Under Vietnam’s WTO Commitments on Services, Serving Food & Beverage (F&B) services is classified to CPC 642. From 01 January 2015, Vietnam undertakes to open its market for foreign investors to setup foreign invested company for running F&B business in Vietnam without strict accompanying requirements.
In addition, Brewery is not a prohibited business line under Vietnam’s WTO Commitments on Services as well as Investment Law. Therefore, it is allowed to set-up foreign invested company to conduct Brewery in Vietnam.
In this case, in order to secure the high success possibility, we highly recommend Client to carefully account the following factors:
Location of the restaurant/brewery: Location of restaurant in Vietnam must strictly comply with master plan of the local government. The approval of local government is required before granting investment license. We recommend Client to locate their business within trading section or oriented places for restaurant. Client should look for locations having sufficient area for motorbike/car parking.
We need to check the address of restaurant whether it is located in “restricted area” before closing the deal. In addition, according to Decision No. 2485/QD-UB-QLĐT dated 04/8/1994 of the HCMC People’s Committee regarding the Diplomatic Areas, enterprises shall not be permitted to register within the following areas:
- District 1 (restaurant and hotel business is not allowed):
– Street: Phung Khac Khoan, Dien Bien Phu, Nguyen Van Thu, Nguyen Dinh Chieu, Tran Cao Van belongs to Da Kao Ward
– Street: Nguyen Thi Minh Khai, Mac Dinh Chi belongs to Ben Nghe Ward
- District 3 (all businesses are not allowed):
– Nguyen Dinh Chieu axis (from Mac Dinh Chi street to Pham Ngoc Thach street). Specifically: 49 to 59 (49, 51, 53, 55, 57, 59); No. 124 to No. 130 (124, 126, 128, 130);
– Pham Ngoc Thach axis (from Dien Bien Phu street to Nguyen Thi Minh Khai street). Specifically: From 6 to 46; From 5 to 53.
Investment capital: Under Vietnam Law, F&B business does not require for a minimum rate of investment capita However, Client should register a feasible capital depends on scale of the investment project.
It is noted that charter capital of a company must be fully contributed within 90 days upon its incorporation, according to Law on Enterprise 2014.
Experience of Client: Having experience in the relevant fields of F&B is also one of important factor that determining feasibility of the case.
Other factors to be accounted: A conditional business lineis an activity that is subject to additional requirements, such as a special business license. Restaurant (F&B) business are conditional business lines; therefore, it is required to apply and obtain the following permit/license for officially operating business in Vietnam.
Regarding the Restaurant company:
Location of the Restaurant must follow with urban planning of local government.
License for food hygiene and safety for restaurant (serving beverages and foods) is required.
License for firefighting and prevention is required.
License for environmental protection might be required.
The restaurant must follow with regulations on social security and order of local government.
It is not required for applying License if organizations and individuals organizing art troupes and Vietnamese performers for the purposes of internal service or performance at tourist accommodation establishments, restaurants, refreshments not selling tickets or collecting a performance fee. However, Client must comply with the relevant provisions on performance.
Regarding Restaurant foreign-invested company registration, our professional fee shall be 3,000USD (Three thousand US Dollars).
Professional fee for additional works will be described herein. Client would tick “X” for selection of service you are instructed us to implement.
No. Service Estimated Fee (USD) Mark “X” 1. Applying Certificate of satisfaction on food safety and hygiene 1,200USD/license 2. Applying Certificate of satisfaction on conditions for fire-fighting and prevention 1,200USD/license 3. Applying License for environmental protection 1,500USD/license 4. License for selling alcohol on-site 300USD/license 5. Advisory services on employee recruiting and labor issues; Drafting and registering statutory labor collective agreement and internal labor regulations 500USD