Franchising is one of the most popular business models, especially in service industries such as F&B, education, and hospitality. However, to operate a legally compliant franchise in Vietnam, businesses must adhere to strict legal regulations, including the franchise registration process with the Ministry of Industry and Trade (MOIT).
1. Practical Experience
SB Law has successfully provided franchise registration consultancy services for major brands such as:
- Caffe Bene (2011)
- Starbucks (2012)
- J&G Fried Chicken (2018)
- Speak Up (2018)
- Helen Doron (2019)
- Kinderland (2020)
With extensive experience in handling documentation and understanding legal procedures, we assist businesses in optimizing registration timelines and ensuring legal compliance.
2. Conditions for Franchise Registration
According to Decree No. 35/2006/ND-CP, businesses must meet the following conditions to register a franchise in Vietnam:
The franchise system must have been in operation for at least one year.
If a Vietnamese business receives a franchise from a foreign company, it must have operated under this model for at least one year before transferring franchise rights.
The franchise agreement must comply with Vietnamese legal regulations.
3. Franchise Registration Process
Step 1: Preparing the Application
The application dossier includes:
- A certified copy of the business registration certificate.
- The franchise agreement.
- Documents introducing the franchise system.
- Financial statements and other relevant documents.
- If the franchise is from a foreign entity, all documents must be translated and notarized.
Step 2: Submitting the Application
- The application is submitted to the Ministry of Industry and Trade (MOIT).
- Within two (02) working days of receiving a complete application, the consulting firm will formally submit the application.
Step 3: Processing and Approval
- The MOIT reviews the application within 20-40 working days.
- If additional documents are required, the business must provide updates as requested.
- Once the application is approved, the MOIT issues a notification confirming the franchise registration.
4. Challenges and Solutions
Extended Processing Time
Authorities may request additional documents or consult other agencies, causing delays. SB Law helps clients shorten processing time by:
- Ensuring a complete application before submission to avoid unnecessary delays.
- Verifying all legal documents, including franchise agreements, financial reports, and franchise introduction materials.
- Pre-coordinating with MOIT officials to ensure compliance with legal requirements.
- Regularly tracking the application status via the MOIT system or official representatives.
- Responding promptly to document requests to prevent prolonged processing.
Legal Differences
Foreign businesses often struggle to align their franchise agreements with Vietnamese regulations. SB Law assists by:
- Reviewing the entire franchise agreement to ensure compliance with Vietnamese law, particularly:
- Vietnamese Commercial Law 2005 – Governing franchise operations.
- Decree No. 35/2006/ND-CP – Detailed regulations on franchising.
- Civil Code 2015 – Covering commercial contracts and intellectual property rights.
- Franchise agreements from foreign entities must be registered with MOIT before becoming effective.
- Adjusting agreements to meet registration requirements, including:
- Adding clauses to protect the franchisee’s rights under Vietnamese law.
- Modifying liability provisions and intellectual property protection terms to satisfy regulatory review.
By leveraging SB Law’s expertise, businesses can navigate Vietnam’s franchise registration process efficiently, ensuring smooth market entry and legal security.
See more at: Intellectual Property
