Granting of License for Establishment of Representative Office of Foreign Traders in Vietnam

Granting of License for Establishment of Representative Office of foreign traders in Vietnam is an administrative procedure carried out by competent state agencies of Vietnam to allow foreign traders to establish a legal commercial presence in Vietnam through the form of a Representative Office. Thoroughly understanding the dossier appraisal process helps minimize risks for businesses during the market entry phase. The following article details current regulations on conditions, order, and dossiers required for this procedure.

Conditions for foreign businesses to establish representative offices in Vietnam

Based on regulations in Article 7 of Decree 07/2016/ND-CP, foreign traders must ensure the following conditions:

• Legal Status: The foreign trader is incorporated or registered for business lawfully under the laws of countries or territories that are parties to international treaties to which Vietnam is a signatory, or is recognized as a legal entity by these laws.
• Operational Time: The foreign trader must have been in operation for at least 01 year from the date of establishment or registration. This aims to prove actual operational capacity and stability.
• License Validity: In case the Business Registration Certificate or equivalent document has an expiration date, that remaining term must be at least 01 year from the date of submission of the dossier in Vietnam.
• Scope of Operation: The content of operation of the Representative Office must be consistent with Vietnam’s commitments in international treaties.
• Special Approval: If the content of operation is inconsistent with Vietnam’s commitments or the trader is not from a country participating in treaties with Vietnam, the establishment must be approved by the Minister or Head of the ministerial-level agency managing the specialized sector.

The competent authority is responsible for issuing licenses for the establishment of representative offices of foreign traders in Vietnam

According to Article 5 of Decree 07/2016/ND-CP, the authority is delineated as follows:

• Department of Industry and Trade (DOIT): Performs the granting, re-granting, adjustment, extension, and revocation of Licenses for Representative Offices located outside industrial parks, export processing zones, economic zones, and hi-tech parks.
• Management Boards (of industrial parks, export processing zones, economic zones, hi-tech parks): Perform these functions for Representative Offices located inside their respective zones.

Note: For special cases prescribed in Clause 5, Article 7 of Decree 07/2016/ND-CP, the licensing agency must consult the specialized Ministry before issuing a decision. Clients should note that coordination between administrative agencies may extend the appraisal time compared to standard cases.

>>> See more: License for Foreign Publisher Rep Office in Vietnam

Required documents for applying for a license to establish a representative office of a foreign trader in Vietnam

Traders need to prepare full documents proving legal status and financial capacity. Article 10 of Decree 07/2016/ND-CP lists the mandatory components:

1. Application form for License for Establishment of Representative Office (Form in Circular 11/2016/TT-BCT) signed by a competent representative.
2. Copy of the Certificate of Business Registration or equivalent document of the foreign trader.
3. Letter of appointment of the Head of the Representative Office.
4. Copy of audited financial statements or confirmation of fulfillment of tax/financial obligations in the latest fiscal year; or equivalent documents proving the existence and operation of the foreign trader in the latest fiscal year.
5. Copy of Passport or ID card/Citizen ID (if Vietnamese) or Passport (if foreign) of the Head of the Representative Office.
6. Documents regarding the location of the Representative Office:
   • Copy of MOU or office lease agreement, or documents proving the trader’s right to exploit/use the location.
   • Copy of documents regarding the location (e.g., Land Use Right Certificate of the landlord) per Article 28 of the Decree.

Important Note: Documents such as the Business Registration, Appointment Letter, and Financial Statements must be translated into Vietnamese and notarized. Furthermore, the Business Registration and Financial Statements must be certified or consularly legalized by Vietnamese diplomatic missions abroad according to Vietnamese law. Documents issued by foreign authorities without this legalization step have no legal value in Vietnam.

Procedures for Granting of License for Establishment of Representative Office of Foreign Traders in Vietnam

The process follows the timeline and strict appraisal steps prescribed in Article 11 of Decree 07/2016/ND-CP:

Step 1: Submission The foreign trader submits the dossier directly, by post, or online (if the system allows) to the Licensing Agency where the office is expected to be located.

Step 2: Validity Check (03 working days) Within 03 working days from receipt, the Licensing Agency checks preliminarily. If the dossier is incomplete or invalid, the agency issues a written request for supplementation (allowed only once maximum).

Step 3: Appraisal and Licensing (07 working days) For standard cases, within 07 working days from the date of receiving a complete and valid dossier, the Licensing Agency shall grant the License. If refused, a written reason must be provided.

Step 4: Ministry Consultation (Special Cases) For sensitive sectors or unregulated cases (Clause 5, Article 7):

• The Licensing Agency sends a consultation request to the specialized Ministry within 03 working days.
• The Ministry replies within 05 working days.
• The Licensing Agency issues the decision within 05 working days after receiving the opinion.

>>> See more: Representative Office License Renewal in Vietnam

Long Phan Consulting Company provides consulting services for obtaining licenses to establish representative offices of foreign traders in Vietnam

Long Phan Consulting Company provides comprehensive and in-depth consulting solutions for foreign traders intending to establish a commercial presence in Vietnam. Our team supports Clients in thoroughly resolving issues arising during the preparation and submission process, ensuring legal compliance and optimizing time efficiency. We structure our support into the following key area:

Comprehensive Licensing Support and Post-Licensing Compliance

• Support 1: Consult on legal conditions, draft the complete dossier (Application, Appointment Letters), and guide the Client through Consular Legalization procedures in the home country and judicial notarized translation in Vietnam.
• Support 2: Represent the Client to submit the dossier, work with the Department of Industry and Trade or Management Boards, monitor progress, and explain dossier details to officials.
• Support 3: Assist with essential post-licensing procedures such as seal engraving, tax code registration for the Representative Office, opening bank accounts, and advising on annual periodic reporting obligations.

Using Long Phan Consulting Company services helps clients eliminate common technical errors, ensuring the dossier is approved in the shortest time. We act as a reliable legal partner, allowing foreign traders to focus resources on core trade promotion activities.

>>> See more: License for Foreign Advertising Representative Office in Vietnam

Frequently Asked Questions about Granting of License for Establishment of Representative Office of Foreign Traders in Vietnam

Below are frequently asked questions regarding the procedures for obtaining a Representative Office License for a foreign trader in Vietnam:

What is the validity period of a Representative Office Establishment License?

The license has a maximum term of 5 years, but it must not exceed the remaining term of the business registration certificate or equivalent document of the foreign trader (if a term is stipulated). The license can be renewed multiple times, each time for 5 years.

(Legal basis: Article 9 of Decree 07/2016/ND-CP.)

Are representative offices permitted to directly sign commercial contracts and generate profits?

No. According to Clause 2, Article 44 of the 2020 Enterprise Law, a representative office is a dependent unit and is not permitted to conduct direct profit-generating activities in Vietnam. The head of the representative office may only sign contracts when legally authorized by the foreign business entity to serve the essential activities of the office or in special cases as stipulated by specialized laws.

(Legal basis: Article 30 of Decree 07/2016/ND-CP.)

What should the representative office do if a foreign business changes its name or registered office address?

Businesses must amend their Representative Office Establishment License within 60 working days from the date of any legal change in the host country. Delays in this procedure may result in administrative penalties.

(Legal basis: Clause 1, Article 15, Clause 1, Article 17 of Decree 07/2016/ND-CP.)

Can foreign businesses establish multiple representative offices in Vietnam?

Yes. A foreign trader is allowed to establish multiple representative offices in Vietnam; however, no more than one representative office with the same name is permitted within the same province or centrally-governed city.

(Legal basis: Article 3 of Decree 07/2016/ND-CP.)

What is the fee for issuing a license to establish a representative office?

The current fee for issuing new licenses to foreign individuals and organizations is 3,000,000 VND per license. This fee is payable at the time of application submission or before receiving the results, depending on the regulations of each local Department of Industry and Trade.

(Legal basis: Article 4 of Circular 143/2016/TT-BTC.)

What specific requirements are needed for documents proving the location of the company’s headquarters?

Documents regarding the proposed location of the Representative Office include: a copy of the memorandum of understanding or lease agreement, or a copy of documents proving the business entity’s right to exploit and use the location for the Representative Office; a copy of documents stating that the proposed location must comply with regulations on security, order, occupational safety and hygiene, and cannot be located in residential-only apartment buildings. Furthermore, the representative office is prohibited from lending or subleasing its premises.

(Legal basis: Point g, Clause 1, Article 12, Article 28 of Decree 07/2016/ND-CP.)

Conclusion

The process of granting a License for the Establishment of a Representative Office of a foreign trader in Vietnam requires careful preparation of documents and a deep understanding of legal regulations. Authorizing a professional consulting unit helps clients save opportunity costs and ensure absolute legal safety.

Long Phan Consulting Company is ready to provide optimal technical solutions. Clients needing in-depth advice please contact Hotline  1900636389 for timely support.