So you want to expand your business to Vietnam, one of the worlds 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, issues invoices, hire and more.
Expanding to Vietnam? Read About Cekindo’s Company Registration 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 invoice 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
A Branch office comprises smaller divisions of the company’s core departments, such as human resources, marketing, accounting, and so on, as well as their activity-specific divisions. These divisions are responsible for the administrative and operational parts of the company at their many locations across the country and around the world. However, certain activities, such as accounting services, price assessment services, credit rating services, commodity exchange operations, and so on, do not permit the registration of a branch.
The branch manager, who is responsible for the day-to-day operations of the branch, must be a legal representative based in Vietnam. The manager is in charge of all branch functions, such as recruiting new staff and ensuring that all divisions’ production is up to par and that all goals and objectives are met on time.
Branch managers are frequently asked to handle their offices as if they were their own company. They are required to improve the company’s image in their community, grow the client base, and interact with other companies. The branch manager’s position is critical to a branch’s success in any location.
Process for Registering a Branch Office in Vietnam
Normally, it takes one month to register a branch after the application and accompanying papers are submitted. Obtaining the registration certificate and the branch’s seal is the first step in the procedure.
To open a branch in Vietnam, the parent company must meet the following requirements for a branch office in Vietnam:
- Incorporation certificate
- Certificate of good standing or commercial register extract
- Articles of association
- Latest audited annual report
- Business licenses of the parent company
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
- 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
How Can Cekindo Help?
Setting up a branch office in Vietnam consists of multiple procedures that are time-consuming, and overly official, not to mention all in a foreign language. Having company registration professionals, like Cekindo, by your side can save you a great deal of time as well as provide you a hassle-free experience. Cekindo provides a wide spectrum of ancillary services related to company registration, like legal consultancy, license and other documents acquisition, tax and accounting, and HR services.