As you may be aware, incorporating a company in any country can be a difficult process. Especially in Vietnam, where the economic and social growth is on the rise, changes are made regularly in the business sector that opens up opportunities within the market. Foreign investors need to be kept up to date with the constant changes in the business world to ensure the company incorporation in Vietnam is produced efficiently on the road to success.
In order to dodge those newcomer mistakes, we have devised an essential guide for foreign investors to follow when incorporating a company in Vietnam.
IRC and ERC
An investment registration certificate (IRC) is the first step to establishing a company in Vietnam. Within this project, foreign investors have to have an ‘approval’ as such to reach their company’s incorporation in Vietnam.
The foreign investor must then proceed to an enterprise registration certificate (ERC) which usually takes around one week. Once both certificates have been awarded, the company can move on to the further, mandatory stages like tax registration for example.
Legal representative in Vietnam
In Vietnam, it’s a requirement that every company has to have at least one legal representative. Their role is to ensure that laws and obligations are followed and are engaged in transactions that maybe consisted between other parties. The legal representative’s full name and details need to be present in government documents as they are the primary person representing the company.
A Business address in Vietnam
It’s a binding requirement that all companies in Vietnam require a fixed, business address for their company. There are certain requirements and boundaries to this as it is insufficient for companies to use virtual offices as a business address. Lawyers and other service providers can lease out offices at a cost for their clients. A certificate of the Land Use Right of the leased property will be issued.
The issuing process of an IRC and ERC
For an IRC to be issued, it usually takes within 15 days from the date of the approved application to be completed. Upon the completion of the application forms, the ERC will be processed by the Business Registration Division of the Department of Planning and Investment. This usually takes three working days from the completed application. Both are subject to the delays of collation of documents and the completion of forms.
Documents required in order to establish a company
In Vietnam the specific documents that are required for a corporate investor are as follows:
- Certificates of the company’s legal documents
- Original bank statements
- Passport or ID card of the legal representative
- Passport or ID card of a representative who is authorized by the investing company
- Lease contract
- Documentation of the leasing right of the landlord
Regarding an individual investor, the documents that are required are:
- Passport of the owners
- Original bank statements
- Lease contract
- Documentation of the leasing right of the landlord
Investors contribution to Charter Capital
For foreign investors, it is expected that they contribute their Charter Capital within 90 days from the date of ERC being issued. The Charter Capital is the amount that shareholders contribute within a prescribed time limit. Upon approval from the local licensing authority, investors cannot increase or decrease the amount. It can either constitute 100 percent of the total investment capital or can be used in combination with loan capital to produce the total investment of the company.
Post-registration of a company in Vietnam
Once the company has been established in Vietnam, additional procedures need to be fulfilled. The post-licensing procedure includes purchasing a company seal, register tax reports, opening bank accounts, etc. Cekindo can support you with this process from the beginning to even post registration of your company in Vietnam.
Related article: What are the Benefits and Challenges of Registering a Company in Vietnam?
Consult a professional now for Company Incorporation in Vietnam
Cekindo’s specialists can assist you throughout this procedure so those uncertain moments can be clarified leaving you with certainty. Speak to one of our team today and leave your company incorporation procedure to us. Start by filling in the form below.