Social Enterprises in Vietnam: Current Legal Regulations

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Short answer: A social enterprise is an enterprise registered and established under the Law on Enterprises, with operating objectives aimed at solving social and environmental issues for community benefit, and committing to reinvest at least 51% of annual profits to implement the registered social and environmental objectives. Social enterprises may receive sponsorships and aid; when terminating the social objectives, they must notify and return or handle the remaining sponsored amounts as prescribed. Basis: Articles 7 and 8 of the Law on Enterprises 2020 (amended by Law No. 76/2025/QH15).

Legal basis

Law on Enterprises 2020, amended and supplemented by Law No. 76/2025/QH15 — Articles 7 and 8 (rights, obligations of enterprises; social enterprises);
Decree 168/2025/ND-CP on enterprise registration — procedures for notifying commitments to implement social and environmental objectives.

What is a social enterprise?

A social enterprise is not a separate enterprise type but an enterprise (LLC, joint-stock…) registered to operate according to social and environmental criteria and objectives. Core characteristics:

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Objectives: solving social and environmental issues for community benefit (supporting vulnerable groups, protecting the environment, community development…);
Reinvestment commitment: using at least 51% of the enterprise’s annual profits to reinvest in implementing the registered social and environmental objectives;
Procedures: the enterprise notifies its commitment to implement social and environmental objectives to the Business Registration Office to be recognized as a social enterprise.

Rights and incentives of social enterprises

May receive sponsorships and aid in money and assets from domestic and foreign organizations and individuals to implement social and environmental objectives;
Enjoy investment incentives and support as prescribed by law (depending on sector and location);
The enterprise name is associated with a social brand, creating advantages in reputation and community resource mobilization;
The remaining profit (up to 49%) is distributed under the regulations of the corresponding enterprise type.

Special obligations of social enterprises

Maintaining the committed social and environmental objectives throughout operations;
Reinvesting at least 51% of annual profits for the registered objectives; the committed reinvestment profit portion may not be distributed;
Publicity and transparency in receiving and using sponsorships and aid;
When terminating the social and environmental objectives: notify the Business Registration Office; remaining sponsorship and aid balances must be transferred to another social enterprise or handled as prescribed, and may not be divided among members or shareholders.

Procedures for registering a social enterprise

Establish the enterprise under the chosen type (LLC, joint-stock…) with the social and environmental objectives stated in the dossier;
Notify the commitment to implement social and environmental objectives to the Business Registration Office using the current form;
Be recognized as a social enterprise on the National Enterprise Registration Portal;
Periodically report on the implementation of social and environmental objectives as prescribed.

Frequently asked questions

Is a social enterprise a non-profit organization?

Not entirely. Social enterprises still operate for profit, but are bound by the commitment to reinvest at least 51% of profits for social objectives — unlike ordinary enterprises which are free to distribute profits.

When ceasing to be a social enterprise, may the sponsored assets be divided?

No. When terminating the social objectives, the remaining sponsorship and aid must be transferred to another social enterprise or handled as prescribed, and may not be divided among members or shareholders.

Do social enterprises enjoy tax incentives?

Tax incentives depend on the investment sector, location and tax and investment law — not every social enterprise is automatically entitled to tax incentives. The current regulations must be checked for each specific case.

Notes on applying current legal provisions

The social enterprise model suits projects creating sustainable community impact, but comes with publicity, reporting obligations and profit distribution limits. Before registering, a financial plan should be built to sustain the 51% commitment. Contact an ANT Legal lawyer at 0966.475.966 for advice.

Common risks to note

Registering as a social enterprise but not implementing the reinvestment commitment;
Using sponsorships and aid for wrong purposes;
Terminating the social objectives but arbitrarily dividing the sponsored assets;
Confusing social enterprises with charities, failing to perform the enterprise’s tax and accounting obligations.

How can ANT Legal help?

ANT Legal advises on the social enterprise model, drafts registration dossiers and social objective commitments; and advises on receiving and managing sponsorships and complying with publicity and reporting obligations. For quick advice, you may contact a lawyer at 0966.475.966.

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