Retail distribution activities conducted by foreign investors in Vietnam are subject to a dedicated licensing framework, under which the Business License and the Retail Outlet License are the two key approvals that foreign-invested enterprises (FDI enterprises) should consider before commencing operations. Depending on the scope and nature of their business activities, FDI enterprises may be required to obtain a Business License, a Retail Outlet License, or both.

Business License

Article 3.7 of Decree No. 09/2018/ND-CP defines retail sale as the sale of goods to individuals, households, or other organizations for consumption purposes. In essence, retail distribution refers to the supply of goods to end consumers and represents the final stage of the distribution chain.

Pursuant to Article 5.1 of Decree No. 09/2018/ND-CP, a foreign-invested economic organization wishing to engage in the purchase and sale of goods and activities directly related thereto, including retail distribution rights, must obtain a Business License in accordance with applicable regulations.

The Business License serves as the legal basis authorizing a foreign-invested enterprise to conduct retail distribution activities in Vietnam. It is a prerequisite licensing requirement that must be satisfied before the enterprise may commence operations in this sector.

However, market access for foreign investors may be restricted or subject to additional conditions with respect to certain sensitive or regulated categories of goods under Vietnamese law and Vietnam’s international commitments. Such categories commonly include lubricants and oils, rice, sugar, pharmaceuticals, recorded media products, books, newspapers, and magazines.

Retail Outlet License

In addition to obtaining a Business License, a foreign-invested economic organization intending to establish a retail outlet in Vietnam must apply for a Retail Outlet License.

This requirement applies both to newly established FDI enterprises seeking to set up retail outlets and to existing enterprises operating retail outlets in Vietnam that subsequently receive foreign investment and become foreign-invested enterprises.

Unlike the Business License, a Retail Outlet License is issued in respect of a specific business location. Accordingly, each retail outlet—such as a supermarket, store, shopping center, or standalone sales point—must obtain a separate license as required by law.

For the first retail outlet, the licensing authority generally assesses the application based on compliance with the applicable statutory conditions. However, where an enterprise intends to establish a second or subsequent retail outlet, it may be required to undergo an Economic Needs Test (ENT).

The ENT is a regulatory mechanism used to assess the potential impact of a proposed retail outlet on commercial development planning, retail outlet density, and the competitive landscape of the local market.

Under Vietnam’s market access commitments in certain free trade agreements, including the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU–Vietnam Free Trade Agreement (EVFTA), the ENT requirement has been abolished for investors from certain member jurisdictions.

Competent Authorities

Under the current regulatory framework, authority to issue Business Licenses and Retail Outlet Licenses rests with the provincial Department of Industry and Trade where the enterprise is headquartered or where the proposed retail outlet is to be established.

In certain specific cases prescribed under Decree No. 09/2018/ND-CP, the DOIT must obtain approval from the Ministry of Industry and Trade before issuing the relevant license.

Notably, as part of the Government’s ongoing efforts to promote decentralization and delegation of administrative authority, the draft amendments to Decree No. 09/2018/ND-CP propose transferring licensing authority from the MOIT to provincial-level People’s Committees. This proposed reform is expected to simplify administrative procedures and shorten processing times.

Notes:

• The Business License and the Retail Outlet License are two separate licenses serving different regulatory purposes and are not interchangeable.
• In practice, enterprises may submit applications for both licenses simultaneously as part of a single licensing dossier.
• These licensing requirements apply exclusively to foreign-invested economic organizations and do not apply to wholly domestic enterprises.