Fee for granting a license to establish a representative office of a foreign company in Vietnam

The establishment of representative offices by foreign companies in Vietnam has become an increasingly popular avenue for expanding global business reach. However, prospective businesses must navigate the regulatory landscape, including the fee for granting a license to establish such an office. Viet An Law hereby explores this fee and its significance in the process of establishing a representative office in Vietnam.

Legal basis

• Law on Enterprise 2020.
• Law on Fees and Charges 2015.
• Decree 07/2016/ND-CP detailed regulations on establishment of representative offices or branches of foreign traders in vietnam under laws on commerce.
• Circular 47/2019/TT-BTC, amended and supplemented by Circular 74/2022/TT-BTC on amounts, collection, payment, management and use of fees for providing information about enterprises, charges for business registration.
• Circular 143/2016/TT-BTC providing for fees for processing of applications for the license to establish representative offices of foreign trade promotion organizations or foreign traders in Vietnam, and the collection and transfer thereof.
• Circular 165/2016/TT-BTC, amended and supplemented by Circular 74/2022/TT-BTC providing for fees for processing of applications for the license for establishment of representative offices of foreign advertising enterprises in Vietnam, and the collection and transfer thereof.
• Circular 33/2018/TT-BTC stipulating the collection rate, mode of collection, payment and management of fees for appraisal and grant of international travel service business license, domestic travel service business license; fees for assessment and issuance of tourist guide cards; fee for granting a license to establish a representative office in Vietnam of a foreign travel service business.

Functions of the representative office of the company

• Representative office is an affiliated unit of the enterprise, has the task of representing by authorization for the interests of the enterprise and protecting those interests.
• Representative offices have no business function, only authorized representatives or sign transactions for office administrative activities at the location where the representative office is established.
• Representative offices of foreign traders perform the functions of liaison offices, market research, and promotion and promotion of business investment opportunities of the traders they represent, excluding the service industry that the establishment of Representative offices in that field are specified in specialized legal documents.

General provisions on fees for registration of the establishment of a representative office of a company

For a representative office established by a Vietnamese foreign company

Payers of fees and charges here are Vietnamese companies, or more specifically, companies registered under Vietnamese law, having Vietnamese nationality (despite having foreign investment capital).

Fees and charges

Fees and charges collection agency

• Fees for providing business information are collected by:
  • The Business Registration Support Center belongs to the Business Registration Management Department (Ministry of Planning and Investment).
  • Provincial Departments of Planning and Investment.
• Enterprise registration fee (including new, re-issue, change content of operation registration certificate of representative office of enterprise) is collected by:
  • Provincial Departments of Planning and Investment.
  • The investment registration agency collects fees from foreign investors and foreign-invested economic organizations in case of carrying out procedures for investment registration and enterprise registration through the interlinked single-window system..

Note

Enterprises that carry out procedures for registration of representative office operations online (National Business Registration Portal) are exempt from enterprise registration fees (excluding other fees).

For representative offices established by foreign companies in general

Foreign traders who are granted a license to establish a representative office in Vietnam must pay fees according to a separate circular (Circular 143/2016/TT-BTC).

Fees and charges

Fees for licensing the establishment of representative offices of foreign traders in Vietnam are as follows:

• New issue: 3,000,000 VND/license;
• Re-issuance, amendment, supplement, extension: 1,500,000 VND/license.

Fees and charges collection agency

Depending on the location where the representative office of the foreign company (expected) is located, the fee-collecting agency is also the agency that grants the license to establish a representative office, including:

• Provincial  Departments of Industry and Trade where the foreign limited company is expected to locate Representative offices outside industrial parks, export processing zones, economic zones, high-tech zones.
• Management boards of industrial parks, export processing zones, economic zones and high-tech zones.

Currency unit

Fees for issuance of licenses for establishment of representative offices of foreign traders in Vietnam shall be collected in Vietnam Dong.

Comment

• Compared with the regulations on fee rates and fee collection organizations prescribed before 2017 (according to Circular 133/2012/TT-BTC), the fee for granting a license to establish a representative office of a foreign trader is not changes in the content of regulations.
• The fee for licensing the establishment of a representative office of a foreign trader is much higher than that of a representative office of a company established under Vietnamese law (or business registration fee in general). This promotes direct investment capital into Vietnam, especially after foreign traders have had a period of promotion and market research through their representative offices in Vietnam.

Specific regulations on fees for registration of establishment of representative offices of foreign companies operating under specialized laws

Any foreign advertising enterprises that apply for issuance, re-issuance or modification of the license to establish representative offices in Vietnam must pay fees for processing of applications in compliance with regulations in Circular 165/2016/TT-BTC.

Fees for licensing the establishment of representative offices of foreign advertising enterprises in Vietnam

Fees for licensing the establishment of representative offices of foreign advertising enterprises

• New issue: 3,000,000 VND/license.
• Re-issuance, amendment and supplement: VND 1,500,000/license.

This fee is unchanged from the previous Circular (Circular 66/2014/TT-BTC) of the Ministry of Finance.

Currency unit

Fees for licensing the establishment of representative offices of foreign advertising enterprises in Vietnam shall be collected in Vietnam Dong.

Fees and charges collection agency

Provincial People’s Committee where the Representative Office is located.

Fee for issuance of a license to establish a representative office of a foreign travel service business in Vietnam

A foreign travel service business enterprise, when granted a license to establish a representative office in Vietnam of a foreign tour operator, must pay fees as prescribed in Circular 33/2018/TT-BTC.

Fees for issuance of a license to establish a representative office in Vietnam of a foreign travel service business

• New issue: 3,000,000 VND/license.
• Re-issuance, adjustment, extension: VND 1,500,000/license .

Fees and charges collection agency

Provincial Department of Tourism, Department of Culture, Sports and Tourism.

Comment

• This fee is unchanged from the previous Circular (Circular 177/2016/TT-BTC) of the Ministry of Finance.
• In general, the fee for licensing the establishment of a representative office of a foreign company is the same, whether regulated by specialized law or not.

Key note

The above fees and charges are fees and charges fixed by the state. When conducting the business, it is also necessary for foreign traders to pay additional legal service fees (when carrying out the establishment procedures through the other organization), stamp engraving fee, sign making fee, bank account opening fee for businesses, etc. Therefore, businesses need to anticipate the maximum costs incurred, or hire a package service from a service organization. to maximize efficiency when setting up a representative office in Vietnam.

Viet An Law provides professional legal services in the field of business. In which with more than 15 years of experience, we are ready to provide the most efficient and satisfying service. Customers wishing to establish a representative office of foreign traders in Vietnam, please contact Viet An Law Firm for the best support!