Wholesale alcohol license in many provinces of Vietnam

In Vietnam in recent years, alcohol investment and business activities have been increasingly developing, especially alcohol wholesale activities. Alcohol is one of the special goods, so the business of this product belongs to the list of conditional business and investment industries. In the article below, Viet An Law will present current regulations related to wholesale alcohol license in many provinces of Vietnam.

Legal basis

• Law on Commercial 2005;
• Law on Enterprise 2020;
• Law on Investment 2020;
• Decree 105/2017/ND-CP regulating alcohol business, as amended and supplemented by Decree 17/2020/ND-CP.
• Decree 98/2020/ND-CP on sanctioning administrative violation of commercial activities, production, and trading of counterfeit and banned goods and protecting consumer rights.

What is alcohol wholesale?

Currently, Decree 105/2017/ND-CP, as amended and supplemented by Decree  17/2020/ND-CP does not introduce the concept of alcohol wholesale as stipulated in the old Decree  94/2017/ND-CP previously. Accordingly, “wholesale of alcohol products” can be understood as the activity of purchasing alcohol products from alcohol product distributors, organizations and individuals that produce alcohol, to sell to retailers of alcohol products. Alcohol wholesalers receive supplies from two  (02) main sources: buying from alcohol distributors or buying directly from licensed alcohol producing organizations or individuals.

The alcohol product that is the subject of this sale must be finished alcohol, that is, bottled, boxed, barreled,… fully labeled according to legal regulations. Alcohol wholesalers are not allowed to buy and sell finished alcohol or ingredients used to prepare finished alcohol. Wholesalers of alcohol products will supply to retail merchants, not sell directly to the market.

Distinguish between alcohol wholesale and alcohol distribution in many provinces of Vietnam

Conditions for wholesale alcohol in Vietnam

Alcohol business is a conditional business as prescribed in Appendix IV of the Investment Law 2020 and Clause 1, Article 4 of Decree  105/2017/ND-CP, amended and supplemented by Decree  17 /2020/ND-CP. Wholesaling alcohol is an alcohol business activity, so the law also sets conditions for this activity. According to Article 12 of Decree  105/2017/ND-CP, amended and supplemented by Decree  17/2020/ND-CP, the conditions for wholesale alcohol are:

Subject conditions

• Entities permitted to wholesale alcohol products must be enterprises established according to the provisions of the law.
• Alcohol wholesale businesses can be established as joint stock companies, limited liability companies, partnerships, and private enterprises according to the provisions of the Enterprise Law 2020.

Conditions on scale of operations

The law sets conditions for alcohol wholesalers to have an alcohol wholesale system in the province or centrally run city where the enterprise is headquartered with at least 1 alcohol retailer. In case an enterprise establishes a branch or business location outside the head office to sell alcohol, confirmation from the alcohol retailer is not required.

Other conditions

There is a written introduction or principle contract of an alcohol producer, alcohol distributor, or other alcohol wholesaler.

Compared to Decree 105/2017/ND-CP, Decree 17/2020/ND-CP has abolished several conditions imposed on alcohol wholesale activities such as conditions on facilities and safety food, fire prevention, and fighting conditions. This flexible regulation aims to ensure freedom of business, under the needs and development of the market.

Wholesale alcohol license in many provinces of Vietnam

According to Clause 2, Article 4 of Decree 105/2017/ND-CP, wholesalers of alcohol with an alcohol content of 5.5 degrees or more must have a license. Thus, traders who wholesale alcohol products with an alcohol content of 5.5 degrees or more must apply for an Alcohol Wholesale License. Alcohol wholesalers in many provinces need to apply for an alcohol wholesale license at the Department of Industry and Trade of the provinces with alcohol wholesale activities.

It is necessary to distinguish between the wholesale and distribution activities of an enterprise to determine whether the enterprise needs to apply for a distribution license or an actual alcohol wholesale license. For the most accurate advice, please contact Viet An Law.

Grant of alcohol wholesale license in Vietnam

Authority to issue alcohol wholesale licenses

The Department of Industry and Trade is the competent authority to issue Alcohol Wholesale Licenses in provinces. If businesses sell alcohol wholesale in multiple provinces, you will have to apply for an alcohol Wholesale License at the Department of Industry and Trade of each province. According to regulations, alcohol wholesalers must have at least 1 alcohol retailer in the province under the system. These alcohol retailers may be in different districts and the Sub-Department of Industry and Trade cannot cover and manage them all. Therefore, the authority to issue alcohol wholesale licenses belongs to the Department of Industry and Trade. If a trader carries out alcohol distribution activities in many provinces, the authority to issue a Distribution License belongs to the Ministry of Industry and Trade.

Application dossier for an Alcohol Wholesale License

Application dossier for an Alcohol wholesale license (01 set) includes:

• Application for an Alcohol Wholesale License according to Form 01 issued with Decree 105/2017/ND-CP, amended and supplemented by Decree  17/2020/ND-CP.
• Copy of business registration certificate or document of equivalent legal value.
• Documents on the alcohol wholesale system include one of the following two types: (a) Copy of the principle contract, confirmation letter or commitment to participate in the alcohol wholesale system with a copy of the trader’s alcohol retail license plans to participate in the alcohol wholesale system; (b) Copy of the enterprise’s branch operation registration certificate or the enterprise’s business location registration certificate to sell alcohol.
• Documents related to alcohol suppliers: (a) Copies of introductory documents or principle contracts of domestic producers, distributors, or other wholesalers, clearly stating the types the proposed alcohol business is consistent with the activities of other producers, distributors, or wholesalers; (b) Copy of Alcohol Wholesaler License of alcohol suppliers.
• Power of Attorney for Viet An Law.

Procedures for applying for an Alcohol wholesale license

• Traders submit applications directly or by post or online to the Department of Industry and Trade.
• Within 15 working days from receipt of complete and valid documents, the Department of Industry and Trade will review, appraise, and issue a license to the trader. In case of refusal, a written response must be made stating the reason.
• In case there are not enough valid documents, within 03 working days from receiving the documents, the licensing agency must issue a written request for supplementation.

Term of Alcohol Wholesale License

The term of the Alcohol Wholesale License is 5 years. The license is made in multiple copies: 02 copies are kept at the licensing agency; 01 copy is sent to the licensed enterprise; 01 copy is sent to the Ministry of Industry and Trade; 01 copy is sent to the Market Management Department; 01 copy sent to each alcohol producer or other alcohol business listed in the license.

Some questions related to Alcohol Wholesale License in many provinces

When do I need to apply for an Alcohol Wholesale License?

Traders who wholesale alcohol products with an alcohol content of 5.5 degrees or more must apply for an Alcohol Wholesale License.

Authority to issue alcohol wholesale licenses in many provinces?

The Department of Industry and Trade is the competent authority to issue Alcohol Wholesale Licenses in provinces and centrally run cities. Thus, if you sell alcohol wholesale in multiple provinces, you will have to apply for an alcohol Wholesale License at the Department of Industry and Trade of each province.

Dossier to apply for an Alcohol Wholesale License in many provinces?

• Application for an Alcohol Wholesale License.
• Copy of business registration certificate or document of equivalent legal value.
• Documents about the alcohol wholesale system.
• Documents related to alcohol suppliers.
• Power of Attorney.

Procedures for applying for an Alcohol Wholesale License in many provinces?

• Traders submit applications directly or by post or online to the Department of Industry and Trade.
• Within 15 working days from receipt of complete and valid documents, the Department of Industry and Trade will review, appraise, and issue a license to the trader. In case of refusal, a written response must be made stating the reason.
• In case there are not enough valid documents, within 03 working days of receiving the documents, the licensing agency must issue a written request for supplementation.

Alcohol wholesale license duration?

The term of the Alcohol Wholesale License is 5 years. At the end of the term, the trader can apply for a reissue of the Alcohol Wholesale License.

What are the penalties if I do not apply for an Alcohol Wholesale License?

According to Clause 3, Article 6 of Decree  98/2020/ND-CP on sanctioning administrative violations in commercial activities, production and trading of counterfeit and banned goods, and protecting consumer rights, traders Wholesaling alcohol without a license in the case of “Trading in goods and services in conditional investment and business lines without a business license as prescribed” can be subject to administrative penalties ranging from 10,000,000 VND to 15,000,000 VND.

The above article by Viet An Law advised on the wholesale alcohol license in many provinces of Vietnam. Clients who have related questions or need support in applying for an Alcohol wholesale license in many provinces, or other business sub-licenses, please contact Viet An Law Firm for the best support!