Establishing a representative office in Vietnam can be a strategic move for foreign trade promotion organizations looking to expand their presence in Southeast Asian.

Vietnam has emerged as a dynamic and attractive destination for foreign trade and investment, thanks to its robust economic growth, strategic location, and supportive government policies. For foreign trade promotion organizations (FTPOs), establishing a representative office in Vietnam offers an invaluable opportunity to foster business relations, facilitate trade, and promote economic cooperation between Vietnam and respective countries. This article provides a step-by-step guide to help you navigate the process to establish a representative office in Vietnam, highlighting the legal framework, and procedural steps involved.

Legal Framework and Authority

The establishment of representative offices of FTPOs in Vietnam is governed by several key regulations:

• Law on Foreign Trade Management dated June 12, 2017
• Decree No. 28/2018/ND-CP on elaboration of the law on foreign trade management regarding some measures for foreign trade development (“Decree 28”).
• Decree No. 14/2024/NĐ-CP adjusting and supplementing some Articles of Decree 28 (“Decree 14”)

From 25 March 2024, the responsibility for licensing the Representative Office (“RO”) has been transferred from VieTrade under the Ministry of Industry and Trade (MOIT) to the provincial Department of Industry and Trade (DOIT). This change aims to streamline the process and bring it closer to the local level.

Key requirements

Parent Entity Eligibility:  The parent entity must be an organization of a foreign government (or equivalent), established in accordance with the applicable laws of its jurisdiction, and is directed to support trade promotion, except for organizations specifically regulated under other Vietnamese laws, such as the Law on Commerce and Decree 07/2017/ND-CP.

Sole RO per province: FTPOs are allowed to establish only one representative office per province or centrally-affiliated city in Vietnam. This representative office acts as an extension of the foreign trade promotion organization and is not permitted to establish any subsidiary representative offices.

RO’s Scope of Operation: The RO’s activities are limited to conducting activities relating to trade promotion in Vietnam such as serving as a liaison office; facilitating and supporting foreign enterprises in accessing and operating in the Vietnamese market; providing economic, trade, and market information to foreign enterprises and organizations; promoting foreign trade with Vietnam; and engaging in other activities aimed at establishing trade connections with foreign enterprises and Vietnamese organizations and businesses.

Steps to Establish a Representative Office

Note: To apply for an RO license, the foreign FTPO needs to prepare the following typically required documents. A detailed and comprehensive checklist relevant to the appropriate Province’s processes can be actioned upon commencement.  Typical documents include:

• Legalised Establishment License of the FTPO
• Legalised proof of having authority of the FTPO to establish the RO.
• Legalised Charter or operating regulation of the foreign trade promotion organization;
• Legalised letter of appointment and profile of the Chief of RO, and profiles of other RO’s personnel
• Charter or operating regulations of the RO in Vietnam;
• Report on the FTPO’s operation in the latest year

Foreign-issued documents will need to be translated into Vietnamese before filing. The translator needs to be a licensed translation agent. Alitium can support to recommend the agent and working with the agent on your behalf if required.

Timeline and filing method

The application can be filed by post or in-person. The timeline for the licensing authority to review and evaluate the application is 20 days from the receipt date of sufficient application.

Validity Duration of the RO License

5 years but not exceeding the remaining validity duration of the Establishment License of the FTPO, which can be renewed.

Operational Considerations

Notification on the RO Operation: Within 45 days from the issuance, reissuance, amendment, or extension of the establishment license, the RO must announce its operations in a licensed print or online newspaper in Vietnam for three consecutive issues.

Staffing and Management: The RO can hire local and expatriate staff, subject to compliance with Vietnam’s labor laws and regulations and registration with the licensing authority. The head of the RO, appointed by the parent company, is responsible for the overall management and operation of the office.

Compliance and Reporting:  By 31 January of the succeeding year, the RO needs to submit an annual report on its operation using Form No. 06 to the licensing authority.

In addition, the RO must comply with financial statements, statistical reports tax reporting, annual compliance reports, and other administrative requirements as required by Vietnamese laws and regulations. It is advisable to engage local legal and accounting professionals to ensure compliance.

Applying for Work Permit for foreign employees: The representative office can recruit foreign employees who will need to obtain a Work Permit before appointment/commencement.

Update to the RO License:  Within 30 working days from the date of any changes, the FTPO must submit application documentation to the licensing authority to update the RO License. Changes include:

• Change of the Chief of RO, or their information
• Change of the RO address within the same province or centrally-affiliated city where the office is currently located
• Change of the name or activities of the RO
• Change of the FTPO’s address or name or activities

If the representative office’s location is to be changed to another province or centrally-affiliated city, the FTPO will need to submit the application to re-issue the RO License. If this arises, either the FTPO or the RO must notify creditors, employees and other parties with rights, obligations, and related interests about this change no later than 90 days before the expected date of the relocation. This notification must be publicly posted at the RO’s current location and published in three consecutive issues of a printed or electronic newspaper.

Conclusion

Establishing a representative office in Vietnam offers foreign trade promotion organizations a strategic advantage in facilitating trade and investment opportunities. By understanding the legal framework, following the necessary procedures, and ensuring compliance, FTPOs can successfully set up an RO in Vietnam and enhance their trade promotion activities in this dynamic and growing market.

This guide provides an overview of the key steps and considerations involved in establishing an RO in Vietnam. However, given the complexity of the legal and regulatory landscape, it is recommended to seek professional legal and business advice to navigate the process smoothly and efficiently.

Phuong Vo is Founder & Managing Partner at Alitium Vietnam, providing market entry and professional support for foreign investors in Vietnam. Contact Phuong via Alitium.com for further assistance and advice.