Establish a foreign-invested company providing sports and entertainment services in Vietnam

In order for investors to have a comprehensive view when investing in sports and entertainment services in Vietnam, Viet An Law Firm summarizes the contents related to the establishment of a foreign-invested company sports and entertainment services.

Conditions for establishing a foreign-invested company in entertainment services, including theatre, live bands and circus

CPC code classification

CPC 9619: Entertainment services (including theatre, live bands and circus services).

Market access conditions

Provisions in the WTO

The establishment of joint ventures in which the foreign capital contribution cannot exceed 49% is permitted.

Additional provisions in CPTPP

Three (03) years from the date of entry into force of the Agreement, it is permissible to establish a joint venture or purchase shares of a Vietnamese enterprise with the capital contribution of a foreign party not exceeding 51%.

Conditions for establishing a foreign-invested company in video game business services

Classification of CPC codes

CPC code 964: Electronic games business

Conditions on market access

Provisions in the WTO

Only in the form of a business cooperation contract or a joint venture with a Vietnamese partner has been allowed to provide this service. The foreign capital contribution in the joint venture must not exceed 49% of the legal capital of the joint venture

Additional provisions in CPTPP

After no more than 2 years from the date of entry into force of the CPTPP Agreement, Vietnam will allow foreign investment at the rate of 51% in video game services provided via the internet. After 5 years from the date of entry into force of the CPTPP Agreement (since 2025), Vietnam will remove the restriction on the percentage of foreign capital contribution for these service providers.

Vietnamese domestic law provisions:

• Electronic games business – Clause 4, Article 31 of Decree No. 72/2013/ND-CP
• Foreign organizations and individuals providing online video game services to users in Vietnam must establish an enterprise in accordance with Vietnamese law to provide electronic games services in accordance with the provisions of this Decree and regulations on foreign investment.

Conditions for establishing a foreign company in the business of other entertainment services

Classification of CPC codes

CPC code 9649: other entertainment services.

Conditions on market access

Regulations in AFAS: Amusement park services

Allowed to provide services through a joint venture with a Vietnamese partner. The capital contribution of the foreign side must not exceed 70% of the legal capital of the joint venture.

Regulations in CPTPP – Appendix NCM I-VN-27: Amusement parks services

• Foreign investment of less than $1 billion USD in the construction and management of amusement parks or theme parks will not be approved unless the competent Vietnamese authorities notify the applicant that the investment is that benefits Vietnam. The above decision was made on the basis of the following factors:
  • The suitability of the investment project with the regional socio-economic development strategy;
  • Ability to meet people’s demand for cultural enjoyment;
  • Conformity with local cultural characteristics;
  • Project impact on local budgets, jobs, consumption of components, components and services made in Vietnam and competition with services of cultural locally provider.
• Investments over $1 billion USD will not be subject to the above restrictions.

Conditions for establishing foreign companies in sports and other entertainment services

Conditions on market access

Regulations at VJEPA

Opened unrestrictedly for Library Services, Archives Services (96311, 96312) and Sports Services (CPC 9641)

Regulations in AFAS

Opened unrestrictedly for Library Services (CPC 96311) except for online library services; at the same time opening gym and fitness services (CPC 96413) with the charter capital ownership rate of foreign investors in economic organizations not exceeding 70%.

Regulations at VJEPA

Opened unrestrictedly for Library Services, Archives Services (96311, 96312) and Sports Services (CPC 9641)

Regulations in CPTPP: Appendix NCM II – VN – 26

• Opened for Sporting and other recreational services, excluding electronic games business
• Viet Nam reserves the right to adopt or maintain any measure with respect to martial art clubs and extreme sports.

Regulations according to Vietnamese domestic law

Conditions for establishing libraries of foreign organizations and individuals serving Vietnamese people are specified in Article 21 of Decree 93/2020/ND-CP.

Procedures for establishing a foreign-invested company dealing in sports and entertainment services

Step 01: Apply for an Investment Registration Certificate for a foreign-invested company

If the projects do not use land (without direct land lease from the state) that do not use technologies on the list of restricted transfers), the procedures for approval of investment policies are not required. Foreign investors carry out the procedures for applying for an Investment Registration Certificate.

Dossier for issuance of Investment Registration Certificate to a foreign-invested company:

• A written request for implementation of an investment project;
• Documents on investor’s legal status:

• • For individual investors: Copy of citizen identity card, identity card or passport
  • For institutional investors: copy of Certificate of Establishment or other equivalent document certifying legal status;

• The investment project proposal includes the following contents: investor implementing the project, investment objectives, investment scale, investment capital and capital mobilization plan, location, duration, and investment schedule. , demand for labor, proposal for investment incentives, assessment of the project’s socio-economic impact and efficiency;
• Copy of one of the following documents:

• • The investor’s financial statements for the last 2 years;
  • Commitment to financial support of the parent company;
  • Commitment to financial support of financial institutions;
  • Guarantee on the financial capacity of the investor;
  • Documents explaining the financial capacity of the investor;

• Proposing land use needs; In case the project does not request the State to allocate or lease land or permit the transfer of land use purpose, a copy of the location lease agreement or other document certifying that the investor has the right to use the site for implementation current investment project;
• The explanation on the use of technology includes the following contents: technology name, technology origin, technological process diagram; Main technical parameters, usage status of main machinery, equipment and technological lines for projects using technologies on the List of technologies restricted from transfer
• BCC contract for investment projects in the form of BCC contract.

The agency that submits the application for the Investment Registration Certificate to the company with 100% foreign capital at the investment registration agency:

• If the company is located in an industrial park, it is the Management Board of industrial parks.
• If the company is located outside the industrial zone, it is the Department of External Economic Relations – Department of Planning and Investment at the provincial level.

Step 02: Establish a business and issue an Enterprise Registration Certificate

After obtaining the investment registration certificate, investors need to prepare documents to set up a business.

Dossier of establishment of a foreign-invested company

• Enterprise registration application form;
• Company charter;
• List of members/shareholders;
• Copies of the following papers: Identification cards, Citizen identity cards, Passports or other lawful personal identification of members being individuals;
• The establishment decision, the Enterprise Registration Certificate or other equivalent documents of the organization and the power of attorney; Citizen’s identity card, people’s identity card, passport or other lawful personal identification of the authorized representative of the member being an organization;
• For a member being a foreign organization, a copy of the Enterprise Registration Certificate or an equivalent document must be consularly legalized;
• Investment Registration Certificate for foreign investors in accordance with the Law on Investment.

The agency that submits the application for an Enterprise Registration Certificate to a company with 100% foreign capital.

Enterprise registration agency: Provincial Department of Planning and Investment.

Time limit to issue business registration certificates for companies with 100% foreign capital: 05 working days from the date of receipt of complete and valid documents

Step 03: Posting the statement of establishment of a foreign-invested company

After an enterprise is granted an Enterprise Registration Certificate, it must make a public announcement on the National business registration portal according to the order and procedures and pay fees as prescribed.

The content to be announced includes the contents of the Enterprise Registration Certificate and the following information:

• Business lines;
• List of founding shareholders and shareholders being foreign investors for joint-stock companies.

Executing agency: Reporting division of the Enterprise Registration Authority – Provincial Department of Planning and Investment.

Step 04: Engrave the seal of the foreign-invested company

After obtaining the Enterprise Registration Certificate and having posted the enterprise establishment statement. The enterprise conducts seal engraving at one of the licensed seal engraving units. Enterprises decide by themselves the number and form of seals within the scope permitted by law.

Step 05: Apply for the License to qualify for sports and entertainment service business corresponding to the content of activities

For you further information, kindly refer to the previous article: Things enterprises have to do after establishing in Vietnam of Viet An Law.

Customers wishing to establish a foreign-invested company, provide legal advice during the implementation of an investment project in Vietnam, please contact Viet An Law Firm for the best support!