Alcohol Distribution License in Vietnam

The import and distribution of alcohol are regulated by Vietnamese law as conditional business lines, managed by the Ministry of Industry and Trade. The distribution of alcohol in major cities, including Hanoi, is strictly controlled and supervised. In this article, Viet An Law provides information related to the legal regulations on the Alcohol Distribution License in Vietnam.

Legal Basis

• Decree No. 105/2017/ND-CP on alcohol business, amended and supplemented by Decree 17/2020/ND-CP;
• Decree 09/2018/ND-CP guidelines  for the Law on Commercial and the Law on Foreign Trade Management regarding the sale of goods and other activities related to the sale of goods of foreign investors and foreign-invested business entities in Vietnam;
• Circular 168/2016/TT-BTC on the rates, collection, transfer, management, and use of fees for endorsing the trading of restricted and conditional good and services in the industry of commerce and the charge for licensing the establishment of commodities exchanges, amended and supplemented by Circular 120/2021/TT-BTC, Circular 74/2022/TT-BTC, Circular 44/2023/TT-BTC.

What is an Alcohol Distribution License?

An Alcohol Distribution License is a certificate for the importation of alcohol, purchasing alcohol from domestic alcohol producers and other alcohol distributors to sell alcohol to alcohol distributors, alcohol wholesalers, alcohol retailers, and on-site alcohol consumers within the licensed provinces and centrally-run cities, selling to traders for export, or directly retailing alcohol at the business locations of traders within the licensed provinces and centrally-run cities.

Conditions for Obtaining an Alcohol Distribution License in Vietnam

The conditions for applying for an Alcohol Distribution License in Vietnam are stipulated in Article 11 of Decree 105/2017/ND-CP, including:

• Being an enterprise established by the law;
• Having an alcohol distribution system in at least two provinces or centrally-run cities (including the location of the enterprise’s headquarters), with at least one alcohol wholesaler in each province or centrally-run city. If the enterprise establishes branches or business locations outside the headquarters to trade alcohol, confirmation from the alcohol wholesaler is not required;
• Have an introduction letter or principle contract from alcohol producers, other alcohol distributors, or foreign alcohol suppliers.

According to Article 9 of Decree 09/2018/ND-CP, foreign investors wishing to distribute alcohol in Vietnam must meet the conditions to be granted a business license. Conditions for foreign investors to obtain an Alcohol Distribution License in Vietnam include:

For foreign investors from countries or territories participating in international treaties to which Vietnam is a member with commitments to open the market for alcohol distribution activities:

• Meeting market access conditions under the international treaties to which Vietnam is a member;
• Having a financial plan to carry out the proposed business activities;
• Not having overdue tax debts if established in Vietnam for more than one year.

For foreign investors not from countries or territories participating in international treaties to which Vietnam is a member:

• Having a financial plan to carry out the proposed business activities;
• Not having overdue tax debts if established in Vietnam for more than one year;
• Meeting criteria set by specialized legal regulations; the competitiveness of domestic enterprises in the same field; the ability to create jobs for domestic labor; the ability and level of contribution to the state budget.

Authority to Issue Alcohol Distribution Licenses in Vietnam

The Ministry of Industry and Trade is the competent authority to issue Alcohol Distribution Licenses as stipulated in point a, clause 1, Article 25 of Decree 105/2017/ND-CP.

Address: No. 54, Hai Ba Trung, Hoan Kiem, Hanoi.

Phone: (024) 22202108; Fax: (024) 22202525.

Application Dossier for Alcohol Distribution License

The application dossier for an Alcohol Distribution License includes: According to Article 21 of Decree 105/2017/ND-CP, amended by Decree 17/2020/ND-CP, the application for a wholesale alcohol license includes:

• Application form for an alcohol distribution license according to Form No. 01 issued with the Decree;
• A copy of the enterprise registration certificate or equivalent document;
• Documents on the wholesale alcohol system, including one of the following:
  • A copy of the principle contract, confirmation letter, or commitment to participate in the alcohol distribution system, along with a copy of the alcohol retail license of the trader expected to participate in the alcohol distribution system;
  • A copy of the branch operation registration certificate of the enterprise or the business location registration certificate of the enterprise for alcohol trading.
• Documents on the alcohol distribution system, including one of the following:
  • A copy of the principle contract, confirmation letter, or commitment to participate in the alcohol distribution system, along with a copy of the alcohol wholesale license of the trader expected to participate in the alcohol distribution system;
  • A copy of the branch operation registration certificate of the enterprise or the business location registration certificate of the enterprise for alcohol trading.

Procedure for Issuing Alcohol Distribution License in Vietnam

Step 1: Submit the application

Traders apply directly or by post or online (if eligible) to the competent authority. The application for an Alcohol Distribution License is as specified above.

Step 2: Review the application and issue the license

• Incomplete or invalid application: Within 03 working days from the date of receipt, the licensing authority shall issue a written request for supplementation.
• Complete and valid application: Within 15 working days from the date of receipt of the complete and valid application, the competent state authority shall review, appraise, and issue the license to the trader. In case of refusal, a written response stating the reason must be provided.
• The license is made in multiple copies: 02 copies are kept at the licensing authority; 01 copy is sent to the licensed enterprise; 01 copy is sent to the Market Management Department; 01 copy is sent to the Department of Industry and Trade where the enterprise is headquartered; 01 copy is sent to the Department of Industry and Trade where the enterprise registers to distribute alcohol; 01 copy is sent to the alcohol producer or other alcohol trading enterprise named in the license.
• The validity period of the Alcohol Distribution License is 05 years. When the license expires, the trader must apply for renewal at least 30 days before the license expires.

State fees for the Alcohol Distribution License in Vietnam

In Vietnam, the state fees are stipulated in clause 1, Article 4 of Circular 168/2016/TT-BTC of the Ministry of Finance, which stipulates the collection of certain state fees to support people and businesses. The fees for issuing an Alcohol Distribution License in Vietnam are as follows:

• For organizations and enterprises: 1,200,000 VND/business location/appraisal;
• For business households and individuals: 400,000 VND/business location/appraisal.

These fees may change according to state policies at specific times to serve socio-economic goals. For example, in 2023, according to Circular 44/2023/TT-BTC, from July 1, 2023, to December 31, 2023, the fees for issuing an Alcohol Distribution License in Vietnam are halved, as follows:

• For organizations and enterprises: 600,000 VND/business location/appraisal;
• For business households and individuals: 200,000 VND/business location/appraisal.

Rights and Obligations of Traders

During the distribution of alcohol, traders must comply with legal regulations on environmental protection, food safety, fire prevention, and firefighting. This is also one of the commitments traders must establish when applying for an Alcohol Distribution License.

Once granted an Alcohol Distribution License, alcohol distributors have the following rights and obligations:

• Publicly display a valid copy of the license at the trader’s alcohol sales locations and only buy and sell alcohol according to the content stated in the issued license, except for traders selling alcohol for on-site consumption;
• Purchasing alcohol with a legal origin;
• Fulfill reporting obligations and other duties;
• Import alcohol, buy alcohol from domestic alcohol producers and other alcohol distributors according to the content stated in the license;
• Sell alcohol to alcohol distributors, alcohol wholesalers, alcohol retailers, and on-site alcohol consumers within the licensed provinces and centrally-run cities;
• Sell alcohol to traders for export;
• Directly retail alcohol at the trader’s business locations within the licensed provinces and centrally-run cities.

For any further questions about licensing in Vietnam, please contact Viet An Law Firm for prompt and timely support. Best regards!