WHAT SHOULD BE NOTED ON FOREIGN REPRESENTATIVE OFFICE OPERATION?

Upon foreign representative office operation (representative office of foreign trader) in Vietnam, there are several factors to consider to ensure the smooth functioning of the foreign representative office, including compliance with the law, alongside a deep understanding of Vietnam’s market and business culture. This can help foreign traders seize opportunities and effectively deal with challenges.

Foreign representative office operation in Vietnam must comply with the regulations of laws

According to current Vietnamese law, the foreign representative office performs the function of a liaison office, market research, and trade promotion for the business it represents, excluding service sectors not specified in legal documents.

The rights and obligations of foreign representative office in Vietnam need to be carefully guaranteed

Rights and obligations of the foreign representative office:

– To operate for the purposes, within the scope and duration stipulated in their establishment licenses.

– To rent offices, rent and purchase equipment and facilities necessary for their operations.

– To recruit Vietnamese and expatriate employees to work for them according to the provisions of laws.

– To open accounts in foreign currencies or foreign currency-based Vietnam dong at banks licensed to operate in Vietnam, and to be allowed to use those accounts solely for their operations.

– To have seals bearing their names according to the provisions of the laws of Vietnam.

– To have other rights as defined by laws.

Rights and obligations of the foreign representative office:

– Not to directly conduct profit-generating activities in Vietnam.

– To conduct commercial promotion activities within the scope permitted.

– Not to enter into contracts, not to amend or supplement contracts already entered into by foreign traders, except where chief representatives obtain valid letters of authorization from foreign traders or other cases specified:

+ To rent offices, rent and purchase equipment and facilities necessary for their operations.

+ To recruit Vietnamese and expatriate employees to work for them according to the provisions of the law of Vietnam.

+ To open accounts in foreign currencies or foreign currency-based Vietnam dong at banks licensed to operate in Vietnam, and to be allowed to use those accounts solely for their operations.

– To pay taxes, fees and charges, and fulfil other financial obligations provided for by the law of Vietnam.

– To report on their operations according to the law of Vietnam.

– To have other obligations as defined by the law of Vietnam.

>> HANDLE OF FOUNDING SHAREHOLDERS’ INSUFFICIENT CAPITAL CONTRIBUTION https://linconlaw.vn/handle-of-founding-shareholders-insufficient-capital-contribution/

>> HEAD OF FOREIGN REPRESENTATIVE OFFICE, HOW IS REGULATED https://linconlaw.vn/head-of-foreign-representative-office-how-is-regulated/

The headquarters of foreign representative office in Vietnam must comply with regulations

Representative office shall be headquartered at locations that satisfies requirements for security, occupational hygiene and safety and others stipulated in laws of Vietnam.

Noted that, representative office shall not lend or sublet their offices.

The name of the foreign representative office in Vietnam needs to comply with legal rules

Representative office shall be named using letters in Vietnamese alphabet, letters F, J, Z and W, numbers and symbols. The name of a representative office shall be the name of its head office enclosed with the phrases “representative office” .

The nameplate of every representative office shall be put up at their office. The size of the name of the representative office printed in their transaction documents, records and publications shall be smaller than that of its head office .

Head of foreign representative office are not allowed to concurrently hold several positions

The head of a representative office shall not concurrently hold the following titles:

– The head of a branch of the same foreign traders;

– The head of a branch of another foreign trader;

– The legal representative of the same foreign trader or others;

– The legal representative of a business organization incorporated in accordance with Laws of Vietnam.

The head of foreign representative office performs the function of representing foreign traders in Vietnam under authorization and must comply with Vietnamese laws related to the regime of sub-authorization for people to perform their obligations of head of foreign representative office.