Set up a company in Vietnam providing goods leasing with foreign capital

Leasing of goods is a commercial activity whereby one party transfers the right to possess and use goods (referred to as lessor) to another party (referred to as lessee) for a certain period of time in order to receive rental payment. Currently, the demand for renting goods for use and business is increasing, promoting the establishment of goods rental companies. In order for foreign investors to understand the process of establishing a rental company in Vietnam, Viet An Law Firm would like to advise as follows:

Legal basis

• The Law on Investment 2020;
• The Law on Enterprise 2020;
• Decree No. 09/2018/ND-CP detailing the Commercial Law and the Law on Foreign Trade Management on goods purchase and sale activities and activities directly related to the purchase and sale of goods by foreign investors. economic organizations with foreign investment capital in Vietnam;

Invesment Conditions

Foreign investors want to establish a goods leasing company when meeting the conditions to be granted a business license as prescribed in Article 9 of Decree No. 09/2018/ND-CP of the Government.

Procedure to set up a company in Vietnam providing goods leasing with foreign capital

Step 1: Investment registration

The investor applies for an investment certificate at the Investment Registration Authority. An application file for an investment certificate to exercise the right to import includes the following documents:

• A written request for implementation of an investment project to set up a company in Vietnam providing goods leasing with foreign capital;
• A copy of the ID card or citizen identification card or passport for the investor being an individual; A copy of the Certificate of Establishment or other equivalent document certifying the legal status of the investor being an organization;
• Proposing investment projects;
• Proposal for land use demand or a copy of the location lease agreement or other document certifying that the investor has the right to use the site to implement the investment project;
• BCC contract for investment projects in the form of BCC contract, Joint venture contract if investment is in the form of joint venture;
• An explanation on the use of technology for investment projects, for projects using technologies on the list of technologies restricted from transfer in accordance with the law on technology transfer;
• An explanation of the satisfaction of conditions for performing goods purchase and sale activities

• Documents proving the financial capacity of the investor;
• Power of Attorney for Viet An Law Firm to carry out investment registration procedures.

Within 15 days from the day on which the complete application is received, the Investment Registration Authority shall consider and grant the Investment Registration Certificate to the investor.

In case of refusal, the investor must be notified in writing and clearly state the reason.

Step 2: Enterprise registration

After receiving the Investment Certificate, the investor shall submit an enterprise registration dossier at the Department of Planning and Investment or the Management Board of industrial parks, export processing zones, high-tech zones, etc., where the enterprise is located.

An application file for enterprise registration includes the following documents:

• Enterprise registration application form;
• Company charter;
• List of members or shareholders of the company (if it is a multiple-member limited liability company or a joint stock company);
• Copies of documents:
  • A copy of the citizen’s identification card, ID card, passport or other lawful personal identification of the founding members or shareholders;
  • A copy of the company’s establishment decision, enterprise registration certificate or other equivalent document of the organization; a copy of the valid ID card or passport of the legal representative of the organization;
  • Power of Attorney for Viet An Law Firm to carry out enterprise registration procedures.

After receiving the complete application, within 03 – 05 working days, if the application is valid and complete, the Department of Planning and Investment will grant a enterprise registration certificate.

After receiving the enterprise registration certificate, the enterprise must publicly announce the enterprise registration information on the National Business Registration Portal within 30 days from the date of publication.

Step 3: Engrave the seal

The company makes seal engraving. Enterprises have the right to decide for themselves on the form, quantity and content of their seals. Enterprises can authorize Viet An Law Firm or self-engrave the seal and notify the seal sample to the Department of Planning and Investment.

Step 4: Apply for a Business License

According to the provisions of Decree No. 09/2018/ND-CP, a foreign-invested goods leasing company must have a business license before operating.

Accordingly, the Investor carries out the procedures for applying for a Business License at the competent authority. The investor submits the application to the Licensing Authority. Dossier include:

• An application for a business license (made according to form 01);
• Explanatory statement;
• Documents from tax authorities proving that there is no longer overdue tax debt;
• Copy: Enterprise Registration Certificate;  Investment Registration Certificate in the project of goods trading and activities directly related to the purchase and sale of goods (if any);
• Power of Attorney for Viet An Law to carry out the procedure.

Within 15 – 20 working days from the date of receipt of complete and valid dossiers, the licensing agency shall consider and issue a business license to the applicant company.

Note: Authorities competent to issue business licenses:

The Department of Industry and Trade where the foreign-invested economic organization is headquartered shall grant, re-grant, amend and revoke business licenses.

The licensing agency shall consult with the Ministry of Industry and Trade and line ministries in the following cases:

• Consult with the Ministry of Industry and Trade and line ministries before granting and adjusting business licenses for activities of exercising the right to retail distribution of goods specified at Point c, Clause 4, Article 9 of Decree 09/2018/ND-CP;
• Consult the Ministry of Industry and Trade before granting and adjusting business licenses for activities specified at Points b, d, dd, e, g, h and i, Clause 1, Article 5 of Decree No. 09/2018/ND-CP ;

If you have inquiries or demand to set up a company in Vietnam providing goods leasing with foreign capital, please contact Viet An Law Firm for the best support.