The business exit abroad presents several options, from the simplest – exporting – to the most complex – establishing. In the case of establishment, there are several formulas, from the representative office to the branch, passing through the subsidiary. Sometimes, companies face the decision of how to establish themselves in Vietnam, either due to the lack of a viable business plan, unfamiliarity with the local market, or the shortage of necessary resources to carry out this operation. Since they opened their first office in Southeast Asia, specifically in Malaysia, about seven years ago, they have advised numerous companies in this process, helping them clarify their doubts and make informed decisions on how to establish in Vietnam. Contact us to start your successful business expansion in Vietnam!
Southeast Asia, with projections to become the world’s fourth economy, represents an area of strategic interest for Spanish companies. Among the countries in the region, Vietnam stands out for its excellent economic results, such as a 5.4% increase in GDP in the first semester and a 4.4% rise in foreign direct investments, reaching $22.5 billion in the same period. With promising business niches in sectors like high technology, renewable energies, water sanitation and treatment, logistics and infrastructure, and the digital economy, Vietnam emerges as a market to consider when establishing in the country. Discover how to establish in Vietnam and take advantage of all the opportunities this emerging market has to offer!
While there are restrictions for foreign investors in certain business areas in Vietnam, such as chemicals, minerals, or debt collection, and requirements for sectors like accounting, auditing, or taxation, current laws, like the 2020 Investment Law and Company Law, provide ample opportunities for foreign investors. In addition to acquiring or controlling a local company, forming a “joint-venture” with a local partner or signing a business cooperation contract, traditional forms of establishment include the representative office, branch, and limited liability company. Discover how to establish in Vietnam and leverage the various possibilities that the Vietnamese market offers for foreign investors. Start your path to business success in Vietnam now!
When considering establishing in Vietnam, the representative office is a recommended option for those wishing to explore the Vietnamese market and its opportunities. However, it is important to note that this entity has limited functions, such as conducting market studies, promoting activities of the parent company, and executing contracts with local partners. In the case of opting for a branch, it should be noted that, like the representative office, it also has restrictions, such as not having independent legal personality from the parent company, being subordinate to it both legally and economically, not having its own object or share capital, and its liability is linked to that of the parent company. Discover how to establish in Vietnam considering these options and their implications for your business. Start your informed and strategic approach to the Vietnamese market!
To establish in Vietnam, the best option for a Spanish investor looking to avoid the limitations of a representative office or branch is to create a limited liability company, whether single-member or multi-member. The single-member form, preferred by most foreign investors, does not require an initial minimum capital, except in sectors like banking, insurance, and real estate. The constitution process involves obtaining three main certificates: investment registration certificate, company registration certificate, and tax registration. According to current regulations allowing 100% foreign ownership of capital, the company is subject to corporate tax (20%) and value-added tax (between 0% and 10%). Furthermore, the company must have a resident legal representative. Discover how to establish in Vietnam through a limited liability company and take advantage of the opportunities this business model offers in the Vietnamese market. Start your path to business success in Vietnam today!
Antonio Viñal
Lawyer
AVCO Legal
madrid@avco.legal
