So you want to expand your business to Vietnam, one of the world’s most dynamic young economies, with a branch office.
Expanding an already established company to a new market and incorporating a company could be a daunting task. Hence, the provision for opening a branch office makes up for the ideal way. A Branch is an extension of a foreign parent company that can be formed instead of a Limited Liability Company or a Joint Stock Company. A branch office in Vietnam has full rights to generate income, issue invoices, hire, and more.
Expanding to Vietnam? Read About Branch Office Incorporation Services
When a company creates a branch in another country, it must adhere to the local legal compliances. Similarly, a foreign businessperson undertaking commercial operations in Vietnam must comply with the law’s requirements for the creation of a branch office in Vietnam, and each foreign businessperson is limited to one branch per province or town.
There are several benefits of a Branch Office in Vietnam like issuance of VAT invoices on its own, permission of conducting full business activities like inventory, manufacturing, and trading; accounting and financial records can be kept together or separated from the headquarters, and entry into and amendments to contracts or agreements are allowed.
Aspects of a Branch Office in Vietnam
Structure of a Branch Office
As a Branch Office is considered exactly that, a branch of the parent company, it can only be opened if there is already an existing entity in the home country. You must prove this by providing legitimate business licenses of incorporation from your home country. Therefore the parent company bares all liabilities of the branch office in Vietnam.
The branch manager, who is in charge of the daily operations of that branch, must be assigned as the legal representative based in Vietnam. The manager is in charge of all branch operations, including hiring new employees and making sure that all divisions’ output is at a high level and that all deadlines are fulfilled.
Process for Incorporating a Branch Office in Vietnam
Following the submission of the application and any supporting documents, the registration of a branch typically takes 30 to 60 days. The first stage in the process is to obtain the registration certificate and the branch’s seal.
Legalization and translation of all papers into Vietnamese might take up to two weeks. Refer to the next section for more information on the prerequisites.
Legal Requirements for a Branch Office in Vietnam
- Corporate investor (The Owner)’s Business Certificate/ Enterprise Certificate/ Company Certificate or equivalent documents from the country of origin.
- Copies of audited financial statements of the 5 previous years
- Passport or ID card of the head of the branch
- (MOU) or office leasing agreements
- POA from the Corporate investor to Cekindo
- A letter of appointment of the head of the Branch
- All documentation requested from the home country must be translated and legalized.
InCorp Vietnam (formerly Cekindo) is a leading provider of global market entry services. We are part of InCorp group, a regional leader in corporate solutions, that encompasses 8 countries in Asia-Pacific, headquartered in Singapore. With over 1,100 legal experts serving over 15,000 Corporate Clients across the region, our expertise speaks for itself. We provide transparent legal consulting, setup, and advice based on local requirements to make your business perfectly fit into the market with healthy growth.
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