PLF Tutorials

LEGAL TUTORIALS FOR DOING BUSINESS IN VIETNAM

Actions to be taken after an enterprise is established in Vietnam


After establishing a company, investors still have some actions to be taken so that the company can be put into operation.

Checking enterprise registration information

The information on the Enterprise Registration Certificate and the National Enterprise Registration Information Portal can have shortcomings, lack of information or mistakes in comparison with the information registered by investors.

Upon discovering the incorrect information, investors can request for amendment right at the time of receiving Certificate or send a Request for Amendment to the Enterprise Registration Office where your head office is located.

Request for Amendment Form

Article 13, Article 17 Circular 20/2015/TT-BKHDT
 

Preparing Members’ Register and Shareholders’ Register

Members’ Register and Shareholders’ Register are lawful documents recording the contributed capital value of each shareholder.

A limited liability companies with two members or more shall prepare a Members’ Register.

A joint stock companies shall prepare a Shareholders’ Register.

Article 49, Article 121 2014 Law on Enterprises
 

Opening Bank Accounts

Transactions having the value over 20 million Vietnamese Dong shall be paid via the bank account of companies in order for the VAT deduction to be applied and to be recorded in the deducted expenses upon CIT calculation.

For some exceptions such as: with respect to purchase invoices of agricultural products, forest products, maritime products from direct makers, catchers; purchase of handicraft products; expenses contributed to national defence, security…

So, companies should contact Vietnamese banks or international banks in Vietnam to open accounts.

Within 10 days from the opening day of the account, a company has the obligation to inform its account to the Department of Planning – Investment where its head office is located.

Notice of Bank Account Form to be performed with Change of Enterprise Registration Information Form

II-1 Form, Circular 20/2015/TT-BKHDT.      

 

License Tax Declaration and Payment

Organizations which are newly established but have not yet operated shall declare and pay license fee within 30 days from the date of which the license is granted.

Upon newly commencing business operation, organizations declare and pay license fee no later than the last day of the month in which their production and business commences.

Payable license tax rate is based on the charter capital or investment capital:

Charter Capital/ Investment Capital

Annual License Tax

~435 million US dollars

130 US dollars

Less than ~435 million US dollars

87 US dollars

If an Enterprise Registration Certificate is issued in the period from January to the end of June, license tax shall be paid for the entire year.

If an Enterprise Registration Certificate is issued in the period from July to the end of December, license tax shall only be paid for half a year.

Article 5, Circular 302/2016/TT-BTC
 

Using Value-Added Invoice (VAT)

Invoice Usage

Companies may use self-printed invoices or order the printing from other entity or use electronic invoices.

Clauses 1 & 2 Article 5 Decree 51/2010/ND-CP

Notice of Invoice Usage

Companies shall inform the invoice issue and sample invoice to their direct tax regulatory agency no later than 2 days before commencing the invoice usage.

In case there is any change on the content of notice of issue, business organizations and individuals shall perform procedure on new notice of issue.

Article 1 Circular 37/2017/TT-BTC

 

Hanging Signboard

Company’s signboard shall be written and placed close to the gate of the front façade of its head office or business place.

Companies can show abbreviated name, international transaction name and foreign name on the signboard with full name in Vietnamese but it shall be put below and the size is smaller than that in Vietnamese.

Logo shall not occupy more than 20% of the signboard area and shall not show information and advertising images for any kind of goods and services.

In addition, companies shall note that signboard shall be made with content, form and size in accordance with the provision.

Hanging signboard is a compulsory obligation. A fine of ~435 - ~652 US dollars shall be imposed to companies violating this provision.

Article 38 2014 Law on Enterprises

Articles 22 & 23 Decree 103/2009/ND-CP
 

Labor Declaration and Registration

Report on Labor Use

A company shall perform the report on labor use to the Division of Labor –Invalids and Social Affairs where its head office is located within 30 days from the commencement date of its operation.

If a company has its head office in the industrial zone, it shall perform the declaration and submission within the aforesaid period at the Department of Labor – Invalids and Social Affairs.

Companies shall prepare labor management book in their head office.

Clause 1, Article 7 Circular 23/2014/TT-BLDTBXH

Article 8, Article 9 Decree 03/2014/ND-CP

Social Insurance Registration and Payment

Companies have responsibility to take part in contributing compulsory social insurance, health insurance and unemployment insurance for employees upon signing labor contracts.

Companies shall prepare dossiers so that employees are granted social insurance books, paid and entitled to social insurance.

Insurances payment rate:

Total Rate

Company

Employee

32%

21.5%

10.5%

Article 4, Article 13, Article 17 Decision 595/QD-BHXH in 2017

Article 5, Article 14, Article 18 Decision 595/QD-BHXH in 2017

Foreign Laborer Usage

Companies shall only recruit employees being foreign citizens for the positions of managers, managing directors, experts and technical employees of which Vietnamese employees have not yet satisfied the requirements based on the demand of production and business.

Upon having demand of foreign employee usage, companies shall conduct procedures to apply for work permit.

Some cases are exempted from work permit:

  • intercompany transfer;
  • employees entering into Vietnam to advice on professional and technical matters;
  • employees granted license by the Ministry of Foreign Affairs…

Clause 1 Article 169 2012 Labor Code

Clause 1 Article 170 2012 Labor Code

Preparation of Internal Labor Regulations

If a company use 10 employees or more, an Internal Labor Regulations shall be registered at the Department of Labor – Invalids and Social Affairs.

Please note that the companies must consult the Union about the Internal Labor Regulations before it is registered at the Department of Labor – Invalids and Social Affairs.

In case a company does not establish the Union, that company shall consult a direct higher level Union.

Article 119 2012 Labor Code

Clients who Start a business in Vietnam shall be supported by PLF for all legal works from pre-establishment until putting it into operation.

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