Before opening a company In Ho Chi Minh City, many foreign investors have questions related to customs, conditions, and operations of businesses, and what to keep in mind when opening a company or not. Viet An Law with a team of lawyers with in-depth knowledge and many years of experience has successfully supported foreign investors starting businesses in Ho Chi Minh City. Viet An Law Firm would like to present some important Notes for establishing a company in Ho Chi Minh City are as follows.
When establishing a business in Ho Chi Minh City, investors have different investment conditions depending on their business goals.
Investment conditions need to be met: Conditions on capital ownership ratio in the enterprise; conditions on investment form; conditions on investment scope; Conditions according to specialized laws.
Investment conditions when establishing a company in Ho Chi Minh City are still regulated in detail according to the commitment schedule when Vietnam joined the WTO; Investment Law 2020 and guiding documents, amendments and supplements; Vietnamese legal documents directly regulate business conditions for various industries.
Investors who want to establish a business in Vietnam must carefully study the investment conditions and meet these conditions. Investors contact Viet An Law Firm for detailed instructions on investment conditions in the investment field they wish to make in Vietnam.
Investors choose 3 popular types of company: single-member limited liability company, multiple-member limited liability company, or joint stock company to implement the project.
In fact, the biggest difference between a joint stock company and a limited liability company is that a joint stock company can flexibly mobilize capital and participate in the stock market, so the minimum number of shareholders is 03 people and no maximum restrictions, easy to transfer after no longer being a founding shareholder, transfer of capital after the capital contribution period does not need to be notified to the Department of Planning and Investment. The biggest advantage of a limited liability company is that the participation of members in the company is very strict, the number of participants is limited from 01 to 50 people.
In addition, only when the company needs to participate in the stock market in the future should it choose the type of joint stock company because of the joint stock company’s operations, organizational structure and regulations on internal issues is relatively complicated, but with just a small negligence, the enterprise may have violated the provisions of law related to the internal legal issues of the joint stock company.
Foreign investors often name the company after a foreign company and add the Vietnamese suffix to distinguish it from a foreign enterprise. However, it is necessary to avoid registered business names and famous names that have registered exclusive trademarks because the business may be at risk of being asked to change its name due to being identical to a trademark that has been exclusively protected in Vietnam. Investors can contact Viet An Law for detailed advice and preliminary research on the company name before establishing a business in Ho Chi Minh City.
Investors are not allowed to locate their headquarters in a dormitory or apartment building when renting a house as their headquarters. Foreign investors often turn to serviced office buildings because they are easy to find and the service provider has enough headquarters documents to provide investors to register to establish a business.
Investors need to keep the rental contract and business headquarters records. Enterprises must hang signs at the company’s headquarters, and state agencies must be able to contact and have someone receive the notification, to avoid cases where tax authorities or government agencies business registration If a business sends a letter without a recipient, it will fall into the category of not doing business at its headquarters and have its tax code and business code closed.
Ho Chi Minh City has a detailed planning of areas allowed to locate headquarters for a number of industries such as manufacturing, selling goods, restaurants, hotels. Depending on the content of business registration, company can register an office at or not at the headquarters for business lines not included in the planning.
When establishing a business in Ho Chi Minh City, at the headquarters, the business is required to register the business’s contact phone number in the business registration dossier.
Investors rely on investment needs and conditions to register their business lines. Unlike local businesses, foreign investors are limited in their business lines in Vietnam, so they cannot register all business lines in all fields in their registration documents to set up the company. Normally, investors will register to invest in a specific field to do business in Vietnam, not many investment fields.
When establishing a business in Ho Chi Minh City, investors do not need to present conditions for professions that require a practicing certificate, only professions that require legal capital such as real estate business, investment. Investing in education, healthcare… investors must meet capital conditions right in the business registration dossier.
The law does not have minimum capital regulations for most business sectors, except for some fields such as real estate business, education, healthcare… However, investors base their business on operational needs such as: the level of contracts signed with partners, participation in projects, the amount of capital to be managed for some specific industries, and tax rates. For the license that the enterprise wants to close, the enterprise chooses a reasonable and appropriate charter capital level and takes into account the responsibility of the business/company owners when committing to its capital level. Investors need to pay attention to their capital contribution to be granted a temporary residence card in Ho Chi Minh City. Currently, businesses with low capital have been temporarily suspended from issuing visas to seek approval. After July 2020, when the new Immigration Law takes effect, investors with capital under 3 billion VND will only be granted visas for no more than 12 months.
Enterprises should pay attention to the capital contribution deadline of 90 days from the date of issuance of the Enterprise Registration Certificate. In case the investor does not contribute enough capital after the deadline, he/she will be sanctioned by inspection and must adjust the capital contribution period.
According to the law, the procedure for increasing the company’s charter capital is relatively simple, while the procedure for reducing the company’s charter capital has relatively many conditions and requires a certain amount of time, so investors need to choose the appropriate capital level.
When establishing a business in Ho Chi Minh City, investors must declare the tax calculation method right in the business registration dossier. Normally, investors will choose the deductible value-added tax calculation method.
Viet An Law supports investors, so the establishment procedure is very simple, but in order to operate a business, it is necessary to fully comply with post-business registration regulations on business registration, investment registration and tax registration.
Other tax declaration procedures such as added value, corporate income; insurance declaration procedures; Invoice issuance procedures are still carried out normally according to legal regulations.
Above are consults of Viet An Law about notes when establishing a foreign invested company in Ho Chi Minh City. Viet An Law provides support services after business establishment, tax declaration service for foreign invested enterprises in Ho Chi Minh City. Investors wishing to contact Viet An Law for detailed advice.
Above article has given Clients some notes for establishing a company in Ho Chi Minh City. If you have any difficulties or problems, please contact or email us for the fastest and most timely support!
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