Procedures to establish a representative office of a foreign company in Vietnam

Establishment of representative offices of foreign companiesunder the management of the Ministry of Industry and Trade according to the provisions of Decree 07/2016/ND-CP. Accordingly, companies operating in trade and production can open representative offices in Vietnam to promote trade and promote their products and brands.ANT LEGAL will also advise customers on procedures to establish a representative office according to the legal regulations mentioned above.

Conditions for establishing a representative office of a foreign company

A foreign company is granted a Representative Office Establishment License when it fully meets the following conditions:

• Foreign companies must be established and registered for business in accordance with the laws of countries or territories that participate in international treaties to which Vietnam is a member or recognized by the laws of these countries or territories;
• Foreign company established and operating for at least 1 year;
• The operating term on the Business Registration Certificate or equivalent document must be at least 01 year from the date of application (For example: Business licenses of Hong Kong enterprises are usually only 1-2 years, so please apply for an operating license of 2 years or more to facilitate the application to establish a VPDD)
• The activities of the VPDD must be consistent with Vietnam’s commitments in the WTO Commitment Schedule or international treaties to which Vietnam is a member;
• In case the operational content of a VPDD is not consistent with the WTO Commitment Schedule or international treaties to which Vietnam is a member or the foreign trader does not belong to a country or territory participating in an international treaty to which Vietnam is a member, the establishment of a VPDD must be approved by the Minister or Head of the specialized management agency.

Application for establishing a representative office of a foreign company

1. Application form: Form MD-1 of the Appendix issued with Circular 11/2016/TT-BCT signed by an authorized representative of the foreign company;
2. Business registration certificate or equivalent documents of the foreign company (Copy with consular legalization and notarized translation);
3. Document of the foreign company nominating and appointing the head of the VPDD in Vietnam;
4. Audited financial statements or documents confirming the implementation of tax and financial obligations in the most recent year issued by a competent agency or organization or certifying and proving the existence and operations of the foreign foreign company (Copy with consular legalization with notarized translation);
5. Legal documents of the head of the VPDD: ID card/CCCD if Vietnamese; Consular legalization with notarized translation if foreigner;
6. Documents on the expected location of the representative office include:
7. Office rental contract: Certified copy;
8. Certificate of land use rights of the lessor: Certified copy
9. Certificate of business registration with real estate business function if the lessor is an enterprise: Certified copy; or ID card/CCCD of the homeowner if the homeowner is an individual: certified copy.

Steps to establish a water company representative office 

Step 1: Issue a License to establish a representative office of a foreign company

After preparing all the above required documents and valid documents, the application will be submitted to the Department of Industry and Trade. Depending on the locality, support documents can be submitted online or in person. Processing time is about 7 working days. In cases where traders operate specific industries that are not included in Vietnam’s market opening commitments through International Treaties to which Vietnam is a member, it will take more time for the authorities to consult with Ministries managing the industry.

State fees:3,000,000 VND/time

Step 2: Carve a round seal and register the seal sample of the foreign company’s representative office

Although the VPDD of a foreign company does not have legal status, it still has a seal. The seal of the foreign company’s VPDD must be registered at the Police Agency for Administrative Management of Social Order. The procedure is carried out as follows:

VPDD will submit documents including: Application for seal sample registration; License to operate representative offices of foreign traders in Vietnam; ID card/CCCD of the applicant.

After 7 days from the date of submitting a valid application, a certificate of use of the seal sample will be issued;

After that, the VPDD will contact the seal engraving units to make the seal.

Step 3: Register for a Tax Code Notification of the Foreign Company Representative Office

Other For administrative offices of Vietnamese companies, the certificate of administrative office operations of foreign traders does not have a tax code. Therefore, VPDD needs to apply for a tax code, the documents will be submitted to the Department of Industry and Trade, then the Department of Industry and Trade will contact the tax agency to issue a tax code to VPDD.

Completion deadline: 05 -07 working days.

Step 4: Register for the personal income tax code of the Foreign Office School

The Head of Office is the person who will be paid by the foreign company and has income in Vietnam. Therefore, the VPDD School needs to apply for a personal income tax code to facilitate the declaration and payment of personal income tax.

Step 5: Open a bank account

Open a specialized account in foreign currency and Vietnamese dong with foreign currency origin at the bank that receives money from the parent company and use this account for representative office operations;

Save Note: This bank account is only used to pay reasonable expenses for VPDD such as: Employee salaries, purchasing office equipment, stationery, renting offices… and cannot be used for other purposes such as purchasing samples, purchasing product materials… or receiving payments from other third parties.

Functions of representative offices

Representative offices of foreign companies can only perform the function of The following functions:

• Is a liaison office;
• Market research function;
• Promotion function to promote business investment opportunities of the Parent Company.
• VPDD of a foreign company is only allowed to carry out the above activities within the scope of its registered profession. VPDD is also not allowed to sign any type of contract on behalf of the parent company.

Duration of VPDD

The license to establish a representative office of a foreign company has a maximum term of 05 years but does not exceed the remaining term of the parent company’s Business Registration Certificate or documents of equivalent value.

For example: If the parent company’s business license is only valid for 1 year, the VPDD’s operating term cannot exceed 1 year. Or if the office lease contract of the VPDD in Vietnam is only for 2 years, the operating term of the VPDD cannot exceed 2 years.

Once the term of the license to establish a representative office of a foreign trader in Vietnam expires, the procedure to extend the representative office license can be carried out, the extension period will also comply with the above regulations on the duration. Otherwise, you can dissolve the foreign representative office.

Cases in which a foreign company’s representative office cannot be established

1. Due to not fully meeting the above conditions;
2. The foreign company applies for a License immediately while it is still within the ban period from opening a VPDD for 02 years from the date the License is revoked. return;
3. The establishment harms the national defense and people’s security; affecting the social order, traditions, and ethics of Vietnam; harming people’s health, destroying natural resources and the environment;
4. Submitting an invalid registration application and not fully supplementing it as required by the Department of Industry and Trade;
5. The Head of the VPDD is the director of another company established in Vietnam.

Regular reporting regime period

• Before January 30 every year, VPDD is responsible for sending a report according to Form BC-1 of the Appendix issued with Circular 11/2026/TT-BCT about its activities in the previous year by post to the Department of Industry and Trade.
• VPDD is obligated to report, provide documents or explain issues related to its activities as required requirements of the competent state management agency.
• At the same time, the VPDD must also periodically report on the use of workers at the VPDD to the Department of Labor, War Invalids and Social Affairs.

The following procedures to establish a representative office of a foreign company

• Create a cash book and bank deposits to record all revenues and expenditures during the operation of the company. VPDD;
• Apply for a work permit for foreign workers working at VPDD (if any);
• Sign labor contracts with employees working at VPDD and register to pay social insurance and personal income tax for them;
• Every year the parent company must confirm salary and income (according to the form) for the head of VPDD and employees VPDD;
• Pay personal income tax, insurance for the head of the VPDD and employees of the VPDD. Note, when paying taxes, save all tax declarations and tax receipts from state agencies and finalize annual income tax;
• Other obligations according to current law provisions;Frequently Asked Questions

The above are all consulting opinions of ANT Legal on Procedures for establishing representative offices of foreign companies. The advice/legal documents cited above may have changed; expires at this time. Customers please contact us for accurate advice and support.