Can a director of a subsidiary be the head of a representative office of a foreign trader in Vietnam?

Conditions for being granted a license to establish a Branch in Vietnam?

Pursuant to Article 8 of Decree 07/2016/ND-CP stipulating the conditions for granting a Branch Establishment License as follows:

Foreign traders are granted a Branch Establishment License when they meet the following conditions:

– Foreign traders are established and registered for business in accordance with the laws of countries and territories participating in international treaties to which Vietnam is a member or recognized by the laws of these countries and territories;

– Foreign traders have been operating for at least 5 years from the date of establishment or registration;

– In case the Business Registration Certificate or equivalent document of a foreign trader stipulates an operating term, that term must be at least 01 year from the date of submission of the application;

– The content of the Branch’s activities must be consistent with Vietnam’s market opening commitments in international treaties to which Vietnam is a member and in accordance with the business lines of foreign traders;

– In case the content of the Branch’s activities is not consistent with Vietnam’s commitments 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 the Branch must be approved by the Minister of specialized management.

What documents are included in the application for a Branch Establishment License?

Pursuant to Article 12 of Decree 07/2016/ND-CP stipulating the application for a Branch Establishment License as follows:

– 01 set of documents includes:

+ Application for a Branch Establishment License according to the form of the Ministry of Industry and Trade signed by an authorized representative of the foreign trader;

+ Copy of Business Registration Certificate or documents of equivalent value of foreign traders;

+ Document of the foreign trader appointing/appointing the head of the branch;

+ A copy of the audited financial statement or document confirming the implementation of tax or financial obligations in the most recent fiscal year or documents of equivalent value issued by a competent agency or organization where the foreign trader was established or confirming and proving the existence and operations of the foreign trader in the most recent financial year;

+ Copy of the Branch’s Charter of Operations;

+ Copy of passport or identity card or citizen identification card (if Vietnamese) or copy of passport (if foreigner) of the head of the branch;

+ Documents on the expected location of the Branch headquarters include:

++ A copy of the memorandum of understanding or location rental agreement or a copy of documents proving that the trader has the right to exploit and use the location for the branch headquarters;

++ Copy of documents on the expected location of the Branch headquarters according to the provisions of Article 28 of this Decree and relevant legal regulations.

– Documents specified in Point b, Point c, Point d, Point dd and Point e (in case the copy of the passport of the head of the Branch is a foreigner) Clause 1 of this Article must be translated into Vietnamese and authenticated according to the provisions of Vietnamese law. Documents specified in Point b, Clause 1 of this Article must be certified or consularly legalized by Vietnamese diplomatic missions and consulates abroad in accordance with Vietnamese law.

Can a director of a subsidiary be the head of a representative office of a foreign trader?

Pursuant to the provisions of Clause 6 and Clause 8, Article 33 of Decree 07/2016/ND-CP of the Government detailing commercial law on representative offices and branches of foreign traders in Vietnam.

“6. The head of a representative office of a foreign trader must not concurrently hold the following positions:

a) Head of a branch of the same foreign trader;

b) Head of a branch of another foreign trader;

c) The legal representative of that foreign trader or another foreign trader;

d) The legal representative of an economic organization established in accordance with Vietnamese law.

…

8. The head of a branch of a foreign trader must not concurrently hold the following positions:

a) Head of the Representative Office of another foreign trader;

b) Head of the Representative Office of the same foreign trader;

c) legal representative of an economic organization established under Vietnamese law Male.

Thus, if your foreign enterprise is a foreign trader, the head of the representative office cannot also be the director of a subsidiary established in Vietnam.

Above are our advices related to regulations when working as head of a representative office of a foreign trader in Vietnam.