Establishing a Branch of Foreign Traders in Vietnam

On January 25, 2016, the Government issued Decree 07/2016/ND-CP detailing the Commercial Law on Representative Offices and Branches of Foreign Traders in Vietnam, replacing Decree No. 72/2006/ND-CP dated July 25, 2006, which detailed the Commercial Law on Representative Offices and Branches of Foreign Traders in Vietnam. Decree 07/2016/ND-CP took effect on March 10, 2016.

Accordingly, foreign traders will only be granted a Branch Establishment License if they meet the following conditions:

The foreign trader is established and registered according to the laws of their country or territory that is a member of an international treaty to which Vietnam is a party or is recognized by the laws of those countries or territories;

The foreign trader has been in operation for at least 5 years, from the date of establishment or registration;

If the foreign trader's business registration certificate or equivalent documents specify a period of operation, the remaining time must be at least 1 year from the date of submission of the application;

The activities of the Branch must align with Vietnam's market opening commitments in international treaties to which Vietnam is a member and must be consistent with the foreign trader’s business scope;

If the Branch's activities do not align with Vietnam's commitments or the foreign trader is from a country or territory not part of an international treaty to which Vietnam is a party, the establishment of the Branch must be approved by the Minister of the relevant managing ministry.

Conditions in points 4 and 5 above are new requirements aligned with international treaties to which Vietnam is a member, signed after the enactment of the 2005 Commercial Law. These conditions ensure that the establishment of branches by foreign traders complies with Vietnam's international commitments.

Documents required to establish a branch of a foreign trader include:

• Application for the Branch Establishment License using the form from the Ministry of Industry and Trade, signed by the authorized representative of the foreign trader;

• A copy of the business registration certificate or equivalent document of the foreign trader;

• A letter from the foreign trader appointing the head of the branch;

• A copy of audited financial reports or a document confirming the tax or financial obligations for the most recent fiscal year or equivalent documents issued by the competent authority in the country where the foreign trader is based, verifying the existence and activities of the foreign trader;

• A copy of the branch’s operational charter;

• A notarized copy of the passport, ID card, or citizenship card of the branch head;

• Documentation about the proposed branch office location, including a copy of the memorandum or lease agreement, or a document proving the foreign trader has the right to use the location; The branch location must comply with Vietnam’s laws on security, order, occupational safety, and other legal requirements. The branch office cannot sublet the premises.

Foreign traders must submit the application in person, by post, or online (if eligible) to the licensing authority (Ministry of Industry and Trade). Within 3 working days of receiving the application, the licensing authority will review the documents and request additional information if necessary. This request for additional documents can be made only once during the review process.

Branch Establishment License validity:

The Branch Establishment License for a foreign trader is valid for 5 years, but it cannot exceed the remaining validity of the foreign trader’s business registration certificate or equivalent documents if those documents specify a period of operation.

Conditions for the Branch Head:

The Branch Head must be responsible to the foreign trader for their activities and the branch's operations within the scope authorized by the foreign trader.

The Branch Head must be accountable for activities outside the scope of their authorization.

If the Branch Head leaves Vietnam, they must delegate authority to another person in writing to carry out their duties, with the foreign trader's consent. The Branch Head remains responsible for the delegated duties.

If the Branch Head does not return within the authorized time and has not delegated their authority, the person authorized may continue carrying out the Branch Head’s responsibilities until the Branch Head returns or the foreign trader appoints a new Branch Head.

If the Branch Head is absent from Vietnam for more than 30 days without delegating their responsibilities, or in case of death, disappearance, detention, imprisonment, or legal incapacity, the foreign trader must appoint a new Branch Head.

The Branch Head cannot hold the following positions:

• Head of the representative office of another foreign trader;

• Head of the representative office of the same foreign trader;

• Legal representative of an economic organization established under Vietnamese law.

Authority to issue the Branch Establishment License:

Foreign traders submit their branch establishment applications to the Ministry of Industry and Trade.

Publication of Branch Information:

Within 15 days from the date of issuance, reissuance, modification, extension, or revocation of the Branch Establishment License, the licensing authority is responsible for publishing the following information on its official website:

• The name and address of the branch office;

• The name and address of the foreign trader;

• The Branch Head’s name;

• The license number, issuance date, validity, and the issuing authority;

• The branch’s operational activities;

• The date of reissuance, modification, extension, or revocation of the branch’s license.

If you encounter any difficulties or need consultation, please contact us for more details.