PROCEDURES FOR ISSUANCE OF LICENSES FOR ESTABLISHMENT OF FOREIGN BRANCH IN VIETNAM

Establishment of a foreign trader’s branch in Vietnam (“foreign branch”) requires compliance with certain procedures and conditions to obtain approval from the licensing authority. Complying with regulations on issuance of Licenses for establishment of foreign branch helps ensure business activities take place legally, ensures the rights and interests of foreign traders and builds a solid foundation for development, operate later. Violations of regulations on Licenses for establishment of foreign branch can result in the penalty up to VND 50 million. Then, how are these contents regulated? Please follow the article below.

1. Conditions for issuance of Licenses for establishment of foreign branch in Vietnam

Foreign traders will be issued a Licenses for establishment of foreign branch in Vietnam when they meet the following conditions:

– The foreign trader is incorporated and registers for doing business in accordance with provisions of laws of countries or territories being parties to treaties to which Vietnam is a signatory or is recognized by the aforesaid countries or territories;

– The foreign trader has come into operation for at least 05 year from the date of establishment or registration;

– The Certificate of Business registration or equivalent document is valid for at least 01 more year from the date of submission of the application;

– The scope of operation of the branch is conformable with Vietnam’s Commitments to market access stipulated in treaties to which Vietnam is a signatory shall be consistent with lines of business of the foreign trader;

– Where the businesses of the branch is inconsistent with Vietnam’s Commitments or the foreign trader is not located in one of countries or territories being parties to treaties to which Vietnam is a signatory, the branch can be established only if they obtain a prior consent of the relevant Minister for establishment of the branch.

2. Procedures for issuance of Licenses for establishment of foreign branch in Vietnam

a. The order of execution

– Dossiers submission:

Foreign traders submit applications for issuance of Licenses for establishment of foreign branch by one of the following methods: directly, by mail or online (if eligible).

Dossiers include:

+ An application form for license for establishment of the branch using the promulgated form;

+ Copies of the Certificate of Business Registration or equivalent documents of the foreign trader;

+ A letter of appointment of the head of the branch;

+ Copies of audited financial statements or certificates of fulfillment of tax liabilities or financial obligations of the last fiscal year or equivalent documents as proof of existence and operation of the foreign trader issued or certified by competent authorities where such foreign trader is established;

+ Copies of the branch charter;

+ Copies of the passport or ID card (for Vietnamese) or copies of the passport (for foreigners) of the head of the branch;

+ Documents on the expected location of the branch.

– Competent authority handles procedures for issuance of Licenses for establishment of foreign branch:

Within 03 working days from the date of receiving the dossier, the competent authority granting the Licenses for establishment of foreign branch shall check and request additional documents if the dossier is not complete and valid. Requesting additional documents is made at most once during the process of processing documents.

Except for the cases specified above, within 07 working days from the date of receipt of complete and valid documents, the Licensing Agency shall issue or not issue a Licenses for establishment of foreign branch to the foreign trader. In case of refusal to grant a permit, there must be a written statement clearly stating the reason.

In case otherwise regulated and in cases where the establishment of a branch has not been regulated in specialized legal documents, the Licensing Agency for branch establishment shall send a document to seek opinions from the Ministry of specialized management within 03 working days from the date of receipt of complete and valid documents. Within 05 working days from the date of receipt of the document from the Licensing Agency, the specialized management Ministry shall issue a document clearly stating its agreement or disagreement to grant a license to establish a Branch. Within 05 working days from the date of receipt of the document from the Ministry of specialized management, the Licensing Agency shall issue or not issue a Licenses for establishment of foreign branch to the foreign trader. In case of not granting license, there must be a written statement clearly stating the reason.

b. Authority to grant Licenses for establishment of foreign branch

The Ministry of Industry and Trade shall issue, re-issue, adjust, extend, and revoke Licenses for establishment of foreign branch and terminate Branch operations in cases where the establishment of a Branch has not been prescribed in regulatory documents of specialized law.

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3. Cases of not granting a Licenses for establishment of foreign branch

The foreign trader will not be granted the Licenses for establishment of foreign branch in the following cases:

– Fail to satisfy one of stipulated requirements stipulated for applications for Licenses for establishment of foreign branch;

– Apply for the license or establishment of branch within 02 years from the date of revocation of the Licenses for establishment of foreign branch;

– Be subject to restrictions from the establishment of branches for reasons of national defense and security, social order, social ethics and community health.

– Be restricted by provisions of laws.