Vietnam Company Formation for Foreign Investors: Requirements, Benefits & Costs

Are you a foreign entrepreneur looking to start your business in Vietnam? Learn the complete procedure for Vietnam company formation for foreign investors in this article. Speak with our company formation experts to register your business in Vietnam today.


    Note: This form is not for job seekers.

    Table of Contents

    vietnam company formation for foreign entrepreneurs

    Vietnam is an emerging market with a rapidly growing economy, making it a desirable location for international investors. The government of the nation has put in place a number of changes to make it easier for foreign investors to register a company in Vietnam, creating an atmosphere that is conducive to business. 

    This article will provide an in-depth information on Vietnam company formation for foreign investors, the types of business entities available, the registration process, and the benefits of investing in this vibrant market.

    Why Choose Vietnam for Business Formation?

    Vietnam is a popular target for foreign investment due to its advantageous Southeast Asian location and rapid economic expansion. The nation has a sizable and youthful labor force, affordable labor prices, and a burgeoning consumer market. The government of Vietnam has also implemented measures to promote foreign investment, such as tax breaks and streamlined administrative processes.

    • Rapidly Expanding Economy: Vietnam’s economy is among the fastest-growing in the world, with a GDP growth rate consistently exceeding 6% in recent years.
    • Favorable Investment Climate: The Vietnamese government aggressively promotes international investment by providing tax benefits, reducing red tape, and streamlining the process for foreign investors to register a firm in Vietnam.
    • Low Labor Costs: Vietnam has comparatively lower labor costs than its neighbors in the region, giving it a competitive edge.
    • Advantageous Location: Vietnam’s advantageous position in Southeast Asia gives them access to a sizable and expanding regional market, making it an ideal base for regional expansion.
    • Young and Skilled Workforce: Vietnam has a young and well-educated population, offering a readily available pool of skilled and talented workers.
    • Political Stability: Vietnam’s political climate is stable, providing a predictable and secure backdrop for business operations.

    Types of Legal Structures for Vietnam Company Formation for Foreign Investors

    Foreign investors have several options when choosing the type of business entity to establish in Vietnam. Each type has its own advantages and regulatory requirements.

    Limited Liability Company (LLC)

    limited liability company in Vietnam is the most well-liked option for overseas investors, providing members with limited liability protection.

    Joint Stock Company (JSC)

    Ideal for companies looking to raise money through initial public offerings. Offers greater flexibility in ownership structure compared to an LLC.

    Representative Office

    A non-trading organization that serves as the overseas parent company’s liaison office.

    Branch Office 

    branch office in Vietnam is an extension of a foreign business that, in contrast to an LLC or JSC, has fewer operational competencies.

    Step-by-Step Process to Register a Company in Vietnam for Foreign Investors

    The process of company registration in Vietnam for foreign investors involves several steps, each requiring careful attention to detail.

    Market Research and Business Plan 

    Conduct thorough market research to understand the Vietnamese market and develop a detailed business plan.

    Select the Proper Business Entity 

    Choose the business entity that best fits the goals and organizational structure of your company.

    Get the Required Documents Ready 

    Obtain your business plan, financial accounts, and identity documents, among other documents needed for the registration process.

    Submit Application for Investment Registration Certificate (IRC) 

    Apply for the IRC at the Department of Planning and Investment (DPI) in the province where your business will be located.

    Obtain Enterprise Registration Certificate (ERC)

    After obtaining the IRC, apply for the ERC, which officially registers your company in Vietnam.

    Tax Registration 

    Register for tax with the local tax authority and obtain a tax code.

    Set up a Bank Account

    Set up a business bank account in Vietnam for your business transactions.

    Documentation Needed for Company Registration in Vietnam for Foreign Investors

    The documents required for company registration in Vietnam for foreign investors can vary based on the type of legal structures and the nature of the business. Generally, the following documents are needed:

    Investment Registration Certificate (IRC) Application:

    • Application form
    • Investment proposal
    • Financial statements
    • Passport copies of investors
    • Lease agreement for the business premises

    Enterprise Registration Certificate (ERC) Application:

    • Application form
    • Charter of the company
    • List of members or shareholders
    • Identification documents of members or shareholders
    • Bank statements showing sufficient capital

    Additional Documentation:

    • Power of attorney (if applicable)
    • Business cooperation contract (for BCC)
    • Relevant sector-specific permits and licenses

    Requirements to Register a Company in Vietnam for Foreign Investors

    Vietnam company formation for foreign investors involves meeting certain legal and financial requirements. These include:

    • Minimum Capital Requirement: The required minimum capital depends on the business sector and the type of business entity. Some sectors may require a higher capital investment.
    • Local Office Address: A registered office address in Vietnam is mandatory for company registration.
    • Business License: The kind of business will determine what licenses and permits are needed.
    • Compliance with Local Laws: Foreign investors must comply with Vietnamese laws and regulations, including labor laws, tax laws, and environmental regulations.

    Cost and Timeline for Establishing a Company in Vietnam for Overseas Entrepreneurs

    The cost and timeline for establishing a company in Vietnam can change depending on the kind of corporate structure and the complexity of the company’s operations.


    • IRC Application Fee: Approximately USD 50-100
    • ERC Application Fee: Approximately USD 50-100
    • Notarization and Translation Costs: Varies based on the number of documents
    • Legal and Consultancy Fees: Varies depending on the complexity of the business and the consultancy firm


    • Preparation of Documents: 1-2 weeks
    • IRC Processing: 3-4 weeks
    • ERC Processing: 1-2 weeks
    • Total Timeline: 6-8 weeks

    Benefits and Incentives for Foreign Investors in Vietnam for Overseas Entrepreneurs

    Vietnam offers numerous benefits and incentives to attract foreign investment, making it an desirable location for overseas entrepreneurs.

    • Tax Incentives: Vietnam offers a range of tax incentives, such as exemptions for specific industries, lower corporate income taxes, and preferential tax rates for projects located in special economic zones.
    • Investment Protection: To safeguard foreign investors’ money, Vietnam has ratified many bilateral investment treaties.
    • Skilled Workforce: Many Vietnamese professionals are competent in English and other foreign languages, and the nation has a youthful, talented labor force.
    • Expanding Consumer Market: Vietnam, home to more than 97 million people, boasts a sizable and expanding consumer market with rising purchasing power.

    Tax Advantages for Overseas Investment in Vietnam

    Vietnam’s tax regime offers several advantages for foreign investors, including:

    • Corporate Income Tax (CIT): The standard CIT rate is 20%. However, certain sectors and locations benefit from preferential rates as low as 10%.
    • Value Added Tax (VAT): VAT is applied at three rates: 0%, 5%, and 10%. Exported goods and services are subject to 0% VAT, which is advantageous for export-oriented businesses.
    • Personal Income Tax (PIT): Foreign employees working in Vietnam are subject to PIT, with progressive rates ranging from 5% to 35%.
    • Double Taxation Agreements (DTAs): Vietnam has signed DTAs with over 70 countries, preventing double taxation and reducing the tax burden for foreign investors.


    Establishing a business in Vietnam offers numerous opportunities for foreign investors. The country is a great place to create a business because of its advantageous economic climate, advantageous location, and pro-business government regulations. Although foreign investors must complete a number of stages and provide supporting papers to register a company in Vietnam, the advantages greatly exceed the difficulties. Foreign investors can successfully traverse the process and benefit from Vietnam’s dynamic market by understanding the regulations and procedures.

    At OnDemand International, we can assist you in simply registering your business in Vietnam. Our proficiency and local understanding guarantee a seamless and effective registration procedure, allowing you to concentrate on expanding your enterprise in this auspicious industry. Speak with our business formation experts right now to register your firm in Vietnam.


    Foreign investors can choose from several business entities, including Limited Liability Companies (LLCs), Joint Stock Companies (JSCs), Representative Offices, Branch Offices, and Business Cooperation Contracts (BCCs).

    Indeed, Vietnam provides a range of tax breaks, such as lowered corporate income tax rates, industry-specific tax exemptions, and advantageous rates in special economic zones.

    The application forms for the Enterprise Registration Certificate (ERC) and Investment Registration Certificate (IRC), financial statements, identity documents, lease agreement, and any sector-specific licenses and permits are among the required materials.

    LLCs offer a simpler and faster registration process, require less paperwork, and have fewer ongoing administrative requirements. However, JSCs provide greater flexibility in ownership structure and are better suited for companies seeking to raise capital through public offerings.

    Yes, foreign investors can own 100% of a limited liability company (LLC) or a joint-stock company (JSC) in Vietnam, with some exceptions for certain business sectors that may require a Vietnamese partner.