Vietnam’s rapidly developing economy and expanding consumer market make it an appealing choice for entrepreneurs seeking global growth. With a thriving manufacturing base and a burgeoning middle class, the country presents numerous opportunities across diverse sectors.

However, setting up a business in Vietnam involves its own rules and complexities. From determining the most suitable company structure to meeting local tax obligations, understanding these nuances is vital for long-term success.

In this guide, we will outline the process of establishing a company, address key legal and financial considerations, and provide insights on cultivating robust business networks in Vietnam.

Why Register a Company in Vietnam?

You may be wondering—why set up a business in Vietnam? Since the country began implementing economic reforms in 1986, it has maintained robust growth, lifting millions out of poverty. In the first half of 2024, Vietnam’s economy grew by around 5%, driven by consumer spending on services, exports, and investments in manufacturing and public infrastructure.

One of the main attractions of doing business in Vietnam is its population of over 98 million, providing a substantial customer base for entrepreneurs. As a rising manufacturing powerhouse, Vietnam also offers efficient supply chains, skilled labor, and well-established industrial zones that support diverse sectors. Moreover, government initiatives often include incentives for foreign investors, particularly in technology, renewable energy, and healthcare.

Vietnam’s investments in AI, 5G networks, cloud services, and e-commerce foster a forward-thinking setting for innovation. However, challenges do exist. Entrepreneurs must navigate various legal complexities—such as regulatory compliance—and adapt to cultural distinctions that shape business interactions and communication styles.

Choosing the Right Business Structure

Determining your business structure is one of the first steps you need to take. A business structure provides a legal framework for your operations, defines who owns the organization and who is liable for the decisions that are made, and determines how you will be taxed. 

Here are the most common business structures in Vietnam. 

Limited Liability Company

Often fully owned by foreign investors, the limited liability company (LLC) offers complete control over operations and flexibility in business activities like manufacturing, trading, or consulting. 

Joint Venture (JV)

A partnership between a foreign investor and a local Chinese company, combining local market expertise with foreign resources, often best for regulated industries.

Representative Office (RO)

A limited entity for non-commercial activities like market research or overseeing quality control. This structure is easier to set up and has few maintenance requirements.

Joint Stock Company

A Joint Stock Company (JSC) in Vietnam offers a flexible structure for foreign entities partnering with local organizations or individuals. With share-based ownership and established governance mechanisms, a Vietnamese JSC can effectively manage risks and foster growth opportunities.

Comparison of Common Business Structures in Vietnam

StructureCommon PurposeProsCons
Limited Liability CompanyFully owned by foreign investors to conduct activities like manufacturing, trading, or consulting.It offers full operational control, flexibility in business scope, and profit retention.It has a longer setup process, higher costs, and requires adherence to stringent regulations.
Joint Venture (JV)A partnership between foreign investors and local Chinese entities, typically for regulated industries.A JV provides access to local market expertise, easier entry into restricted sectors, and shared resources.It may create conflicts between partners, requires shared profits, and results in a loss of full control.
Representative Office (RO)A non-commercial entity for market research, liaison, or quality control activities.An RO offers a simplified setup process, lower operational costs, and is suitable for initial market exploration.It cannot engage in direct business activities and has a limited operational scope.
Joint Stock CompanyFlexible structure enabling pooling of capital from multiple shareholders.This structure is highly flexible and allows businesses to pool diverse resources.

It can be more expensive to set up than other options and is less common, which may lead to complexities.

So how do you choose? We’re glad you asked. Here are the factors to consider when deciding which structure is best for your business.

  • Industry Regulations: Determine if your industry allows full foreign ownership or requires a local partnership.
  • Control Over Operations: Decide if you need complete control (through an LLC) or are open to shared decision-making (JV).
  • Business Activities: Confirm the structure aligns with your goals, such as profit-generating activities (LLC, JSC, JV) or non-commercial tasks (RO).
  • Startup Complexity: Evaluate the time, cost, and paperwork involved in setting up each structure.
  • Taxation and Compliance: Consider how each structure is taxed and the level of regulatory compliance required.
  • Partnership Opportunities: Assess the benefits of partnering with local entities or operating independently.

3 Best Partners for Vietnam Company Registration

If you are considering expanding into Vietnam, it is important to choose the right partner to support your Vietnam company registration and incorporation. 

Below we set out the top three providers for Vietnam company incorporation and corporate services. 

MSA

MSA homepage

With offices throughout Asia, and a deep specialization in Vietnam expansion and company registration, MSA is the ideal partner for registering your company in Vietnam and ongoing corporate and accounting services.

Their affordable prices make them the ideal Vietnam expansion partner for SMEs and startups. 

Deloitte

Deloitte homepage

Renowned for their management consulting, assurance and audit functions, Deloitte can also register your company in Vietnam and in most international locations. With it’s deep expertise in international corporate affairs, Deloitte is a good company registration partner for large multi-nationals. 

PWC

PWC homepage

PwC offers deep expertise in navigating Vietnamese regulations, ensuring your company registration process is efficient and compliant. Their extensive network in Vietnam provides valuable market insights and support for ongoing business needs. With a dedicated team of bilingual professionals, PwC can handle both local requirements and global considerations for a seamless setup.

Step-by-Step Process to Set Up a Company in Vietnam

One of the best things you can do when setting up a business is to create a robust and well-documented business plan. While this is not something you can simply whip up in a few hours, the time you take will be well worth it in the long run. A business plan effectively summaries the products or services you plan to sell, your target audience, how you will approach the market and your target audience, projected revenue, marketing strategies, etc. 

With your business plan in place and research conducted, the following steps will be far easier to tackle.

1

Define Your Business Scope

Clearly outlining your business scope is essential for regulatory approval and operational clarity. It specifies the nature of your business activities, such as manufacturing, trading, or consulting. Align your business scope with local regulations to avoid complications during the approval process, and make sure you operate within legal boundaries.

2

Choose a Location

Vietnam’s major business centers, including Ho Chi Minh City, Hanoi, Da Nang, and Binh Duong, offer notable advantages depending on your industry. Consider factors like proximity to suppliers, availability of skilled talent, and government incentives. Logistics and access to infrastructure also play a critical role in choosing the most suitable location for your operations.

3

Register Your Company Name

Your company name must comply with Vietnamese naming regulations, including any specific requirements on language and format. It should also reflect the products and services you offer without duplicating existing businesses.

Submit your proposed name to the Department of Planning and Investment (DPI) for approval. This step is compulsory and should not be overlooked, as the name will be used throughout the entire registration process.

4

Prepare and Submit Required Documents

Prepare documents such as the Charter, identification of legal representatives, and a lease agreement for your business premises. Each document must be accurate and translated into Vietnamese where required. Mistakes in documentation can cause delays, so double-check all submissions to avoid setbacks.

5

Open a Bank Account

A corporate bank account is required for handling daily business transactions and fulfilling tax obligations. Choose between local banks or international banks operating in Vietnam. Consider the services offered, such as multi-currency accounts, which may benefit foreign investors.

6

Capital Contribution

Determine the registered capital amount for your company, as specified in your Articles of Association. The capital contribution can be made in installments, depending on the agreement. This amount demonstrates your company’s financial capability to operate in Vietnam and is subject to approval by regulatory authorities.

7

Obtain Business Licenses and Permits

Apply for your business license through the local Department of Planning and Investment (DPI), which validates your company’s legal standing. Depending on your industry, additional permits may be necessary, such as a food business permit or an e-commerce license for online operations. Processing times vary, so plan your timeline accordingly.

8

Register for Taxes

Obtain a tax identification number and register with the local tax office. Familiarize yourself with Vietnam’s tax system, including Value Added Tax (VAT)—currently at 10%—and corporate income tax rates, which vary by industry.

Financial Management and Reporting

Proper financial management is a cornerstone of successful business operations in Vietnam. After completing your company registration, setting up an accounting system is one of your first financial tasks. This system must comply with Vietnamese Accounting Standards (VAS) to accurately track revenue, expenses, and taxes.

Businesses in Vietnam must submit regular financial reports, including monthly tax filings and annual financial statements. Additionally, an annual audit by a certified Vietnamese accountant may be required depending on the company’s scope and industry. Companies should also prepare for periodic inspections by the Department of Planning and Investment (DPI) to ensure compliance with local regulations.

Common Pitfalls to Avoid

  • Incorrect Tax Filing: Misreporting tax information or failing to submit on time can result in penalties.
  • Non-Compliant Accounting Practices: Using accounting methods that don’t align with local standards may lead to fines or audit issues.
  • Lack of Documentation: Not keeping detailed records of transactions can complicate audits and inspections.
  • Overlooking Currency Rules: Mismanaging foreign currency exchange regulations can disrupt financial operations.
  • Inadequate Financial Planning: Underestimating startup costs or operational expenses can create cash flow issues.

Why Now is the Right Time to Register a Company in Vietnam

Vietnam offers exceptional opportunities for businesses, boasting a rapidly growing economy, expanding infrastructure, and an emerging consumer market. Serving as a dynamic hub for innovation and manufacturing, Vietnam provides strong access to Southeast Asian markets and ample growth prospects in sectors like technology, e-commerce, and renewable energy.

With a sizable, increasingly skilled workforce, government incentives for foreign investment, and a focus on technological advancement, Vietnam is a prime destination for international entrepreneurs looking to broaden their global reach.

Want to learn more about global expansion strategies? Follow the Remote People blog for expert insights on scaling your business internationally.