Benefits of Incorporating Your Business in Vietnam
Why should your businesses move to Vietnam?
Free Trade Agreements – Low Tariffs
From the recently signed EU-Vietnam Free Trade Agreement with the European bloc to comprehensive trade agreements with Asian countries via the CPTPP and RCEP, Vietnam’s commitment to international trade has become a driving force behind its economic growth.
Did you know that Vietnam actually has 14 active free trade agreements as of 2022? That’s just one short of the number of FTAs of the U.S. These FTAs allow for much lower tariffs for both imports and exports (and full exemptions in some cases) between Vietnam and over 50 countries around the world.
Read our full article along with other insights on the market to find out more.
Operating costs in Vietnam
Vietnam, along with Cambodia and Myanmar, has some of the lowest average operating expenses in the area.
Vietnam comes in fifth in terms of business climate, talent, logistics, and digitalization among nations in Southeast Asia.
With an average total labor cost of $108,196 per year, Vietnam is the fourth most cheap market behind Cambodia, Myanmar, and the Philippines, accounting for 55 percent of total expenditures. Compared to the USA labor costs are 85% cheaper in Vietnam.
Incorporation Entities available to Foreign Companies
Limited Liability Company (LLC)
The most common structure you can utilize for setting up
operations in Vietnam requires only one founder. This entity is the fastest and easiest entity to establish for foreign investors. It can be established as a 100% foreign-owned entity or as a local partnership.
Suitable for: SME businesses from 1 to 50 members.
Processing Time: 6 – 8 weeks.
Minimum Capital Requirement: USD45,000
Branch Office
Conduct commercial activities in Vietnam as a dependent
legal entity to a parent company that must have been previously established in your home country for at least 5 years. This entity is ideal for short-to-medium business plans in the country.
Suitable for: Established companies.
Processing Time: 4-6 Weeks.
Minimum Capital Requirements: Sufficient capital for operational costs, transactions & institutional duties.
Representative Office
Gain your presence in Vietnam and take advantage of
researching market data. You are not able to conduct profitable business with this entity, only hire and pay employees. This entity is ideal for a company that wants to observe the market before a full investment in the country.
Suitable for: Companies abroad that want to do market research before fully starting commercial operations.
Processing Time: 4-6 Weeks.
Minimum Capital Requirements: None stipulated
Joint-stock Company
Maximize your opportunities to make a breakthrough with an extensive corporate structure and flexibility. This entity is ideal for medium & large companies that want to eventually be listed on the stock exchange.
Suitable for: Foreign entrepreneurs require a complex corporate structure and commercial activities.
Processing Time: 4-6 Weeks.
Minimum Capital Requirement: USD45,000
