Before establishing a company in Ho Chi Minh city, many investors have questions about the procedures, conditions, and operations of the business, what should be noted when establishing a company. Viet An Law has a team of lawyers with in-depth knowledge and long-term experience – has successfully supported foreign investors to establish a business in Ho Chi Minh city. Viet An Law would like to provide important notes with foreign investors wishing to establish a business when establishing a company in Ho Chi Minh city in 2020 as follows:
When setting up a business in Ho Chi Minh city, depending on the business goal, investors have different investment conditions.
Investment conditions need meeting: Conditions on the rate of capital contribution in the business, conditions on the form of investment; investment scope conditions; Specialized legal conditions.
Investment conditions when establishing a business in Ho Chi Minh city in 2021 are still detailed according to the commitment when Vietnam joins the WTO; Law on Investment 2020 and guiding documents, amendments, and supplements; Vietnam’s legal documents directly regulate business conditions.
Investors wishing to establish a business in Vietnam must carefully pay attention to the investment conditions and meet these conditions. Investors should contact Viet An Law for a detailed guide on investment conditions in the investment fields.
Investors choose 3 popular types of business: one-member limited liability company, two or more members limited company, joint-stock company to implement the project.
In fact that, 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 maximum limit, easy to transfer after not being a founding shareholder, the transfer of capital after the time of capital contribution is not required to notify the Department of Planning and Investment. The biggest advantage of a limited company is that the participation of the members in the company is very tight, 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, they are advised to choose the type of joint-stock company because of joint-stock company operations, the organizational structure, and the regulations on internal matters. A joint-stock company is quite complicated, but a small business mistake may have violated the provisions of the law related to the internal legal issue of a joint-stock company.
Company naming notes:
Foreign investors usually name a company after the company that already has the foreign and add a Vietnamese suffix to distinguish it from the foreign company. However, it is important to avoid registered business names and well-known names that have exclusively registered trademarks because there may be a risk of the enterprise being asked to change its name due to the coincidence of an exclusively protected trademark in Vietnam. Investors can contact Viet An Law for detailed advice and a preliminary search about the name of the company before establishing a business in Ho Chi Minh city.
Investors are not allowed to set up headquarter in a collective house or an apartment building when renting a house for an office. Foreign investors often aim for serviced office buildings because they are easy to find and the service provider has enough head-office documents to provide investors for business registration.
Investors need to keep the rental contracts and records of headquarters in the business. Companies must hang signboards at the company’s headquarters, state agencies must be able to contact them, companies also need to have a person who received the notices, to avoid cases when the tax authority, the business registration office sends the email without a recipient, the company will belong to the case of not doing business at the head office and the tax code, the enterprise identification number is closed.
Ho Chi Minh city has a detailed plan on the areas where headquarters are allowed for several industries such as manufacturing, selling goods, restaurants, hotels… Depending on the content of business registration, enterprises will register the business at the head office or not at the head office for the business lines not included in the planning.
When establishing a business in Ho Chi Minh City, at the head office, enterprises are required to register the enterprise’s contact phone number in the enterprise registration dossier.
Investors rely on demand and investment conditions to register their business lines. Unlike local business, foreign investors are limited in terms of business lines in Vietnam, and therefore cannot register all business lines in all sectors in their application. Normally, investors will register to invest in a specific field to do business in Vietnam, they do not use to register many investment fields.
When establishing a business in Ho Chi Minh city, investors do not need to present the conditions for occupations requiring a practicing certificate, only occupations requiring legal capital such as real estate business, investment in education, health, etc… investors must meet capital requirements in their application for business registration.
Registration and declaration of charter capital notes:
Law does not have a minimum capital requirement for most business lines, except for some areas such as real estate trading, education, medical… However, investors can base their business activities based on their business needs such as the amount of capital to be cleared for some specific industries, tax rates. If the business wants to close, the enterprise chooses a reasonable and appropriate charter capital and takes into account the responsibility of the business owner/company when committing its capital. Investors need to pay attention to the capital contribution to get a visa, temporary residence card in Ho Chi Minh city. Currently, with low-capital businesses, they have been suspended to grant visas to ask for approval. After July 2020 when the new Law on Immigration comes into effect, investors with a capital of less than 3 billion VND can only be granted a visa for no more than 12 months.
Enterprises shall pay attention to the time limit for capital contribution is 90 days from the date of the Business Registration Certificate issuance, in case the investor cannot contribute enough capital, they will be sanctioned by the inspection and must follow procedures for rescheduling the capital contribution period.
According to the law, the procedure for increasing the company’s charter capital is relatively simple while reducing the company’s charter capital procedure is relatively conditional and takes a certain time so investors need to choose the suitable capital level.
When establishing a business in Ho Chi Minh city in 2021, investors must declare the tax calculation method in the business registration dossier. Usually, investors will choose the value-added tax deduction method.
Viet An supports investors so the establishment procedure is very simple but to operate a business, it is necessary to fully comply with the following regulations on business registration on business registration, investment registration, and tax registration.
Other tax declaration procedures such as value-added, corporate income; insurance declaration procedures… are still carried out normally following the law. Viet An Law provides post-establishment support services, tax declaration services for foreign-invested enterprises in Ho Chi Minh city. Investors wishing to contact Viet An Law for detailed advice.
Viet An Law is always ready to accompany and support business/company establishment procedures and post-establishment procedures for customers. All difficulties and problems, please contact Viet An Law for the fastest and most timely support!
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