Question:
Foreign enterprises may establish a branch in Vietnam to conduct business activities. However, I would like to gain a clearer understanding of the legal requirements and procedural steps involved in establishing a branch under Vietnamese law.
Answer:
According to Article 8 of Decree No. 07/2016/ND-CP, foreign businesses must meet the following conditions to establish a branch in Vietnam:
- The foreign company must have been operating for at least five years from the date of establishment or business registration under the laws of its home country.
- The business activities of the branch must align with the parent company’s scope of business as per Vietnamese regulations.
- The foreign business must obtain a decision on branch establishment issued by the competent authority of its home country.
The procedure to establish a branch includes the following steps:
- Prepare the application dossier, which includes: An application form for branch establishment; A copy of the business registration certificate or an equivalent document of the parent company; A letter of appointment for the branch head; The parent company's financial statements; A lease agreement for the branch’s office in Vietnam.
- Submit the dossier to the Department of Industry and Trade in the province/city where the branch will be located.
- The competent authority will review and issue the Branch Establishment License within 7-10 working days if the application is valid.
- Once licensed, the branch must register its seal, obtain a tax code, open a bank account, and comply with regulatory reporting obligations.
Read more >> Contract consultancy in Vietnam
