Establish foreign-owned price-appraising company in Vietnam

Price appraisal is regulated in the Law on Prices and Decree No. 89/2013/NĐ-CP providing detailed implementation of some articles relating to price appraisal of the Law on Prices. In accordance with clause 15 Article 4 of the Law on Prices 2012, price appraisal means “determination of value in money of types of properties by agencies, organizations having function of price appraisal as prescribed in the Civil Code that is suitable with market price at a point of time, a certain location, for a certain purpose according to standard of price appraisal”. Nowadays, demand on price appraisal is quite high, especially in private sectors such as real estate, securities… Price appraisal also play a vital role in Merger and Acquisition. The Law on Prices 2012 allows foreign price-appraising companies to invest in Vietnam. Those with expert knowledge and experiences have special advantages when practicing in Vietnam market.

However, price appraisal is a conditional business sector regulated in the Law No. 03/2016/QH14. Hence, if any foreign price-appraising company plans to invest in Vietnam, they should conduct legal research in order to satisfy those conditions. To give our Clients a hand, Viet An Law Firm collects and provides some information as follows:

Company forms of foreign-owned price-appraising company in Vietnam:

Foreign price-appraisal companies established and providing price-appraising services legally in their local countries are eligible to corporate with Vietnamese price-appraising companies to establish foreign-owned price-appraising company in Vietnam under the two forms:

• Multi-member limited liability company;
• Joint-stock company.

Limitation on capital contribution:

• Member or founding shareholder which is an organization can contribute maximum 35% of charter capital;
• If there are many organizations, the total proportion of charter capital they can own is 35%.

Step 1: Apply for the Investment Registration Certificate

An application includes:

• A written request for permission for project execution;
• Individual investors: copies of ID or passport of each individual;
• Organization investors: copies of Establishment Certificate or equivalent paper confirming the legal status;
• Project proposal;
• Copies of financial statements in the current 02 years or financial support commitment of the parent company or financial institutions; guarantee for investors’ financial capacity, description of investors’ financial capacity;
• Land use demand. If the project does not use land allocated or leased by the State or does not require the State to change land use purpose, the copies of the lease agreement or equivalent papers proving that investors have rights to use the location shall be submitted;
• If the project use any technology in the List of technologies restricted from transfer, investors have to submit the explanation on technology transfer.

Submit the application at: The Department of Planning and Investment.

The process: Within 15 days from the receipt date of the valid application, the Department of Planning and Investment will grant the Investment Registration Certificate to foreign investors. If the Department of Planning and Investment refuse to grant, they will respond in notices and explain the reasons.

Step 2: Establish foreign-owned price-appraising company in Vietnam

Apply for the Business Registration Certificate:

An application includes:

• A written request for business registration;
• The Articles of Associates;
• The list of members of the multi-member limited liability company or the list of partners of partnership;
• Notarized copies of ID or valid passport of each individual member; notarized copies of the Business Registration Certificate/Establishment Certificate of each organization member; notarized copies of ID or valid passport of each legal representative of each organization;
• Power of attorney (Clients grant to Viet An);
• Certificate of Investment Registration of foreign investors.

Submission place: The Department of Planning and Investment.

Duration: 03 – 06 working days.

Announce the business registration contents:

• Business registration information must be announced publicly on the National Portal of Business Registration within 30 days from the date of issuance of the Business Registration Certificate. The contents of the announcement are all the information stated in the Business Registration Certificate.
• Notice: In accordance with Clause 1 Article 26 of the Decree 50/2016/NĐ-CP, if the company does not announce or lately announce the business registration information on National Portal of Business Registration, they are fined an amount of money from 1.000.000 VND to 2.000.000 VND.

Engrave the seal and publish the seal sample:

• The company can authorized Viet An Law Firm or can engrave the seal by itself then announce the seal sample to the Department of Planning and Investment. The company is allowed to decide about the appearance, quantity and the contents of the deal but it must contain the name and the code of the company.

Step 3: Apply for the Price-appraising business certificate:

In accordance with clause 2 Article 38 of the Law on Prices, a price-appraising company shall be granted the Price-appraising business certificate by the Ministry of Finance before officially providing price-appraising services.

Conditions to be satisfied in order to apply for the Price-appraising business certificate of foreign-owned price-appraising company in Vietnam:

• Be granted the Business Registration Certificate or Investment Registration Certificate as prescribed by the laws;
• Has at least 03 appraisers practicing in the company; among them must have at least 02 members/founding shareholders;
• Legal representative, Director or General Director must be appraisers practicing in the company;
• Complying with the capital contribution limitation as mentioned above.

An application for the Price-appraising business certificate includes:

• A written request for Price-appraising business certificate (using the form in the Annex 2 – Circular No. 38/2014/TT-BTC);
• Notarized copies of the Business Registration Certificate of each company;
• Price-appraising practice of each appraiser practicing in the company which is confirmed by the company; Certificate of Price-appraising Knowledge Training of appraisers (if any);
• Copies of Labor Contracts or Labor Contract Appendixes (if any) of appraisers practicing in the company;
• Documents proving the capital contribution of organizations to the company;
• Receipt of fee payment as prescribed by the laws;
• Notarized copies of appointment of legal representative of the company; authorization documents in price appraisal (if any).

Submission place: the Ministry of Finance.

Duration: Within 15 working days from the date of receipt of the valid application the Ministry of Finance will issue the Price-appraising business certificate. If the Ministry refuse to issue, within 05 working days from the date of receipt of the application, the Ministry will grant a written respond providing explanation.

Foreign investment services in Viet An Law Firm:

• Consult about regulations on foreign investment in Vietnam for foreign investors;
• Consult about process and procedures relating to foreign investment certificates in Vietnam;
• Consult about business sectors and conditions of each applied to foreign investors;
• Draft the application for Business Registration Certificate. Investment Registration Certificate, registration of capital contribution/shares purchase/capital contributions purchase;
• Represent for Clients to prepare and submit the application at the state-authorized agencies;
• Consult about after-establishing such as labor, contracts, tax, social insurance…

If you are looking for advice to establish foreign-owned price-appraising company in Vietnam as well as other information relating to foreign investment, please feel free to contact Viet An Law Firm to get detailed information!