Conditions for Establishing a Homestay Business Enterprise

Conditions for establishing a homestay business enterprise is a matter of concern for many individuals and organizations in the context of growing experiential tourism and the popularity of the homestay accommodation model. Business entities must fully meet conditions regarding accommodation facilities, security and order, fire prevention and fighting, as well as other specialized regulations before actual operation. The following article by Long Phan Consulting Company will provide current legal regulations for this type of service.

What conditions must be met to obtain a homestay business license?

Based on Clause 3, Article 48 of the Law on Tourism 2017, homestay is a form of tourist apartment, thus it is also considered a tourist accommodation establishment. To be granted a homestay business license, you need to meet the conditions prescribed in Clause 1, Article 49 of the Law on Tourism 2017, including:

1. Have business registration according to the law.
2. Meet conditions on security and order, fire prevention and fighting safety, environmental protection, and food safety according to the law.
3. Meet minimum conditions on technical facilities and services serving tourists as prescribed in Article 28 Decree 168/2017/ND-CP (amended by Article 5 Decree 142/2018/ND-CP), including: having a reception area; having areas for setting up tents/camps; having shared bathrooms/toilets; having a first aid kit; having security staff on duty when there are guests.

>>>See more: Short-Term Accommodation Business Licensing Service

What licenses are required to operate a homestay business?

According to Clause 1 Article 49 Law on Tourism 2017, Clause 1 Article 5 Decree 96/2016/ND-CP, and Point a Clause 1 Article 11 Law on Fire Prevention, Fighting and Rescue 2024, business owners need to prepare:

1. Business License: Household business registration certificate or Enterprise registration certificate.
2. Certificate of eligibility for security and order.
3. Certificate of eligibility for fire prevention and fighting (or equivalent approval documents).
4. Written notification of the time of starting homestay business operations.

Procedures for applying for a homestay business license

The tourism accommodation business, especially the homestay model, is a conditional business sector. To ensure legal operation and avoid unnecessary legal risks, investors need to complete all procedures for obtaining licenses in accordance with current laws.

Required documents for applying for a homestay business license

According to Clause 2 Article 87 Decree 01/2021/ND-CP (amended by Clause 2 Article 99 Decree 168/2025/ND-CP):

• Household business registration application.
• Legal documents of the individual/household members.
• Meeting minutes of household members on establishment.
• Authorization letter for the household head.
• Documents proving eligibility for security, order, and fire safety.

If the homestay owner chooses to operate as a business entity, depending on the type of business entity, the homestay owner will prepare the appropriate documents in accordance with Clauses 1, 2, 3, and 4 of Article 24 of Decree 168/2025/ND-CP, including the following documents:

Depending on the type of enterprise, prepare documents according to Article 24 Decree 168/2025/ND-CP:

• Enterprise registration application.
• Copies of legal documents of individuals/members/shareholders/legal representatives.
• Company Charter.
• Note: If providing food services, a Certificate of Food Safety is required (Law on Food Safety 2010).

Procedures for applying for a homestay business license

According to Clause 3, Article 99 of Decree 168/2025/ND-CP, the steps to apply for a homestay business license for a household business model are:

Step 1: Submit the homestay business registration application

Individuals wishing to register a homestay business should submit their application to the commune-level business registration authority where the accommodation facility is located.

Step 2: Wait for your application to be reviewed

After submitting the application, the business registration authority will review it within 3 working days.

If the application meets the eligibility requirements, the commune-level business registration agency will issue a business registration certificate and send a notification to the tax authority directly managing the business within 3 working days from the date of receiving the application.

If the application is not eligible for issuance, the commune-level business registration authority shall notify the applicant in writing within 03 working days from the date of receipt of the application.

Step 3: Obtain a homestay business license

After your application is reviewed and completed, you will receive a license to operate accommodation services. If any amendments or additions to your application are required, you must do so within 3 working days of receiving notification from the registration authority.

In addition, according to the provisions of Articles 21, 22, and 23 of the 2020 Enterprise Law, amended and supplemented by Article 24 of Decree 168/2025/ND-CP, when opening accommodation services under the enterprise model, the applicant needs to follow these steps:

Step 1: Submit your application

Applications can be submitted online through the National Business Registration Portal or directly to the Department of Planning and Investment of the province/city where you register your business.

Step 2: Application review and results

After submitting the application, the registration authority will review it within 3 working days.

If your application is valid, you will receive a homestay business license.

If your application is incomplete or contains errors, the registration authority will notify you and request that you amend or supplement the application.

Step 3: Pay the fee and receive the accommodation service business license.

After receiving your homestay business license, you need to pay the prescribed fees.

After completion, you will receive your business registration results at the results delivery department of the Department of Planning and Investment.

>>>See more: Is it difficult to apply for an Accommodation Service Business License?

Long Phan Consulting Company provides consulting services on conditions for establishing a homestay business enterprise

Long Phan Consulting Company proudly offers in-depth consulting services, helping clients quickly obtain the necessary permits for their homestay business. Our services include:

• Accommodation business license: Required to operate in the room rental business.
• Land use rights certificate (or land lease contract): Provides legal assurance regarding the property.
• Security and order permit: Complies with regulations regarding the safety of customers and the community.
• Fire safety certificate: Ensures fire safety for guests.
• Food safety and hygiene certificate (if providing meals to guests): Ensures the quality of food service.
• Building permit (if repairs or new construction are involved): Necessary to ensure the project meets standards.
• Advertising permit: To legally promote your homestay on online platforms.

We will assist our clients with consulting on licensing requirements, documentation, procedural guidance, and represent them in the process quickly and efficiently.

Frequently Asked Questions about conditions for establishing a homestay business enterprise

Below, Long Phan Consulting Company provides some frequently asked questions regarding conditions for establishing a homestay business enterprise. We invite interested clients to refer to this information:

What are the rights and obligations of individuals and organizations operating homestay services?

Individuals and organizations operating tourist accommodation services or homestay services have the rights stipulated in Clause 1, Article 53 of the 2017 Tourism Law, including:

• Refusing to accept tourists who violate the law, violate the regulations of the tourist accommodation establishment, or when the tourist accommodation establishment is no longer able to meet the tourist’s requirements;
• Cancel the service contract with tourists who violate the law or the regulations of the tourist accommodation establishment.

In addition, individuals and organizations operating homestay services must also fulfill certain obligations as stipulated in Clause 2, Article 53 of the 2017 Tourism Law, including:

• Ensure the maintenance of business conditions for tourist accommodation services as prescribed in Clause 1, Article 49 of the 2017 Tourism Law;
• Prices for goods and services, as well as the regulations of tourist accommodation establishments, must be publicly displayed.
• Compensation for damages to tourists in accordance with civil law;
• Provide written notification to the provincial tourism authority where the tourist accommodation establishment is located when there are changes to the establishment’s name, scale, address, or legal representative;
• The word “star” or images of stars may only be used to advertise the classification of tourist accommodation establishments after the establishment’s classification has been officially recognized by the competent state authority.
• Implement reporting, statistical, and accounting procedures in accordance with the law.

What are the penalties for violations by individuals and organizations operating homestay services?

According to Article 10 of Decree No. 45/2019/ND-CP on administrative penalties in the field of tourism (amended and supplemented by Decree No. 129/2021/ND-CP), individuals and organizations operating homestay services may be subject to administrative penalties if they commit the following violations:

• For operating without a business registration license and failing to meet fire safety and security requirements: A fine of 20,000,000 to 30,000,000 VND will be imposed, business operations will be suspended for 1-3 months, and any illegally obtained profits will be required to be returned.
• For the act of failing to publicly display prices of goods and services as required and failing to fully or promptly notify the provincial tourism authority where the tourist accommodation facility is located before commencing operations: A fine of VND 500,000 to VND 1,000,000 will be imposed.
• For failing to notify about changes in the scale, legal representative, address, or name of a tourist accommodation establishment: A fine of VND 1,000,000 to VND 3,000,000 will be imposed.
• For the act of failing to post regulations at tourist accommodation establishments: A fine of 3,000,000 to 5,000,000 VND will be imposed.
• For the act of selling goods and services at prices different from the listed prices in tourist accommodation establishments: A fine of 5,000,000 to 10,000,000 VND will be imposed.
• For failing to ensure the legitimate rights and interests of tourists as stipulated in the contract: A fine of VND 10,000,000 to VND 15,000,000 will be imposed.
• For acts of continuing to operate tourist accommodation services after having notified of temporary suspension or termination of operations, or after being suspended by a decision of a competent state agency: A fine of VND 15,000,000 to VND 20,000,000 will be imposed.

Is a hotel with fewer than 10 bedrooms allowed to operate?

No. According to Article 22 of Decree 168/2017/ND-CP, one of the minimum conditions for being recognized as a hotel is having at least 10 guest rooms. Establishments with fewer than 10 rooms can only register as tourist guesthouses or homestays.

Is it possible to build a homestay on agricultural land?

According to Article 172 of the 2024 Land Law, agricultural land can be used in combination with homestay business if it conforms to local planning, without requiring a change in land use purpose. However, if permanent structures are built, it is necessary to convert the land to commercial and service land according to Article 59 of the 2024 Land Law to avoid penalties under Decree 123/2024/ND-CP.

Do homestays need a Fire Safety Certificate?

Currently, small homestay businesses are not required to have a Fire Safety Certificate, but they must submit a fire safety design assessment document and a fire safety acceptance test result approval document, as stipulated in Point c, Clause 1, Article 4 and Article 12 of Decree 105/2025/ND-CP. This helps ensure guest safety and avoid administrative penalties under Article 295 of the 2015 Penal Code.

Conclusion

Business results depend heavily on legal compliance from the start. Enterprises need to proactively consolidate their apparatus and infrastructure according to current technical standards.

Please contact hotline 1900636389 for direct advice from Long Phan Consulting Company.