- What are the Options Available for Company registration in Ho Chi Minh City?
- What are the Required Documents for Incorporation?
- Getting Started with Your Office Space – Things to Consider
- Things to Know While Living as an Expat in Ho Chi Minh City
- The landscape of the Local Economy
- Future Economic Megacity
- Foreign Direct Investment in HCMC
- Establish Your Company with Cekindo
Vietnam’s financial capital, Ho Chi Minh City, also known as Saigon, is a vibrant metropolis of over 10 million inhabitants and accounts for one-third of Vietnam’s total GDP. It is widely regarded as one of the fastest expanding marketplaces for technology, manufacturing, and the top developing property market in Asia-Pacific, making company incorporation in Ho Chi Minh City one of the most lucrative opportunities the Vietnamese market has to offer.
Moreover, despite the devastating effects of COVID-19, Ho Chi Minh City has maintained a steady development, solidifying its title of Vietnam’s economic powerhouse. To keep the reputation, the city’s administration and residents have been working hard to implement numerous initiatives to allow the city to recover quicker and more sustainably.
Vietnam has always set a lucrative stage for foreign investors to tap into HCMC’s market and contribute to the growing economy with different amendments throughout the year. Here we present all the information that you need to know before investing and setting up your own company here in Ho Chi Minh City.
What are the Options Available for Company registration in Ho Chi Minh City?
Vietnam makes its market highly approachable for foreign investors by providing several business entity alternatives to incorporate during initial investments. Each entity is suited to a particular size of the investment, the number of investors involved, and the motive of market entry. Let’s see what are these options and which one is suited for you:
Limited Liability Company
Considering Limited Liability Company (LLCs) are the most common legal entity due to the reduced risk of liability attached to this type of entity as well as the lower capital requirements., They are particularly fit for small and medium-sized businesses (SMBs) looking to set up or expand to Vietnam. Depending on the structure, an LLC can have a single member or multiple members. The number of members in a multi-member LLC might range from two to fifty.
Representative Office Vietnam
A Representative Office is preferable for foreigners interested in investigating the business environment and doing market research in Vietnam. Due to the nature of its structure, in which invoicing cannot be processed, this type of company is ideal for hiring staff and observing the market, before a full expansion. It also enables them to establish a sales network for the parent firm before fully expanding into Vietnam.
Branch Office In Vietnam
An affiliate of the parent company is a Branch Office. You can perform all of your parent company’s business activities and generate profits from your branch office in Vietnam. It is essentially a copy of your parent company with local stipulations applied. You can perform full commercial activities, hire staff and list on the stock market.
Joint-stock Company Vietnam
Joint-stock companies are typically larger and consist of three or more shareholders as founding shareholders. A company’s charter capital is formed by the equal division of its shareholders’ shares into equal units, which are owned by individuals or organizations.
Additionally, shareholders are held responsible for the firm’s obligations and liabilities based on how much capital they contributed. Moreover, just like a limited liability company, a JSC can be registered as either a wholly foreign-invested company or a joint venture company.
What are the Required Documents for Incorporation?
The required documentation for corporate and individual investors are listed below:
- Certificate of incorporation (an authentic copy) or certificate of business registration or equivalent documents
- Latest audited financial report (an authentic copy)
- Legalized copies of Passport from Directors and Shareholders
- Latest Bank Statement (an authentic copy)
- Legalized copies of Passport from Directors
Proposed registered address needs to be proved by a rent agreement from Owner/Landlord.
Getting Started with Your Office Space – Things to Consider
Ho Chi Minh City’s District 1 is the ideal location for renting office space. This is due to the close proximity to international restaurants, banks, entertainment venues and more. However, there are various things to consider before setting up an office in these areas, like:
- Accessibility: Make sure that the office space is easily accessible by both public and private transportation.
- Amenities: Double check that the facility is adaptable to your team’s business strategy, space requirements, and working style.
- Location Reputation: The reputation of your office location might have a significant influence on your company’s prospects.
- Cost: A decent location might be more expensive. If you don’t have the funds for a real office, consider a virtual office, as having a company address is required during company establishment in Ho Chi Minh City.
- Size: The size of your workplace space might impact your team’s performance and productivity.
Things to Know While Living as an Expat in Ho Chi Minh City
Vietnam is known for its vibrant culture, ancient history, and exemplary natural landscapes. Despite the years of war, the country picked up well after and strived relentlessly to become one of the fastest-expanding economies in the SEA region. The city is a prime location for numerous commercial activities, with friendly, well-educated and progressive people. And foreign investors show a predominant inclination towards incorporating their companies in Ho Chi Minh City.
Ho Chi Minh City in comparison with other cities in Vietnam
This city is defined by gleaming new skyscrapers and Buddhist pagodas with coils of incense burning and older women selling mangos from baskets. The city is alive with fresh colours, noises, and flavours that make expats more intrigued and involved with their surroundings. According to some expat mouthpieces here, living in Ho Chi Minh City is an obvious decision, even when their term for any specific purpose, such as college or job, expires.
Affordable Modern Living
The inexpensive cost of living is one of the things that foreigners enjoy about Ho Chi Minh City. Compared to other Asian cities, there are various condominiums and bedroom rentals that are reasonably priced.
The landscape of the Local Economy
Ho Chi Minh City has been the engine of Vietnam’s economy, accounting for around 23% of the country’s GDP and 27% of the national budget. Furthermore, HCM City is the home of Vietnam’s first stock exchange, with the Ho Chi Minh City Stock Exchange’s total market capitalization accounting for more than 77% of the national total and 51.27% of the country’s GDP in 2020.
Moreover, the industrial sector is experiencing increased investment in new industrial plants, especially in light of the trade wars between the United States and China. Around 25% of Vietnam’s industrial output is produced in the several industrial parks and economic zones surrounding this city of over ten million people.
Furthermore, with a young workforce (median age of 30.1 years), the city’s business landscape is exceptionally vibrant and exciting. Ho Chi Minh City attracts high-skilled people because of its cultural mood, thriving start-up ecosystem, cutting-edge enterprises, and technology concentration.
Future Economic Megacity
Ho Chi Minh City strives to be an innovative and contemporary service-industrial city that maintains its position as an economic engine and development driver for the entire country by 2025. And by 2030, the city is predicted to become Southeast Asia’s economic, financial, commerce, science & technology, and cultural hub.
The 11th Congress of the HCM City Party Committee (2020-2025 tenure) set 26 development goals in five categories, including a GRDP growth rate of 8% on average every year, and the digital economy clocking 25% to the GRDP by 2025 and 40% by 2030, giving the country an anticipated shape of an economic megacity.
Foreign Direct Investment in HCMC
HCM City has drawn more than 33% of all foreign direct investment (FDI) projects in Vietnam on average. Compared to other cities, the city has the most significant density of financial institutions, with local credit institutions’ total mobilized capital accounting for 24% of the country’s entire sum.
Establish Your Company with Cekindo
As a prosperous land with so many rooms to grow, inhabited by some of the most ambitious citizens, Ho Chi Minh City is always a booming market for international investors. To conquer this challenging but rewarding market, having a highly-skilled and professional local team like Cekindo by your side is crucial. Fill in the form below and see how we can assist you on your company incorporation journey!