Can Foreigners Own Businesses in Vietnam?
Yes, foreigners can own businesses in Vietnam, and the country continues to be one of Southeast Asia’s most attractive destinations for foreign investment. Vietnam allows foreign individuals and companies to establish and own businesses, but ownership rights, procedures, and limitations depend on the industry and business structure.
Permitted Business Structures
Foreign investors commonly establish or invest in businesses in Vietnam through the following structures:
- 100% foreign-owned companies, where the foreign investor holds full ownership
- Joint ventures with Vietnamese partners
- Capital contributions or share acquisitions in existing Vietnamese companies
A 100% foreign-owned company is permitted in many sectors, particularly in manufacturing, trading, technology, and services.
Industry-Specific Restrictions
Vietnam generally welcomes foreign investment. However, certain industries are either entirely restricted or subject to conditions. In telecommunications, logistics, education, healthcare, and advertising, for instance, there might be limits on foreign ownership or a requirement for a special license. These regulations reflect Vietnam's international trade obligations as well as domestic investment laws.
Legal and Licensing Requirements
To own a business in Vietnam, foreign investors must typically obtain:
- An Investment Registration Certificate (IRC)
- An Enterprise Registration Certificate (ERC)
- Relevant business licenses, depending on the industry
The approval process may involve multiple government authorities, and timelines vary based on project complexity.
Land and Property Considerations
Foreign-owned companies in Vietnam can lease land or commercial premises, but the legal framework does not generally allow them to own land. In most cases, local authorities grant long-term land-use rights through leasing arrangements.
Tax and Compliance Obligations
Foreign-owned businesses in Vietnam must pay corporate income tax (CIT), value-added tax (VAT), and other applicable taxes. They also have to ensure that they meet all legal requirements in terms of ongoing compliance, accounting, and reporting.
Foreigners can own businesses in Vietnam by law, including 100% foreign-owned companies in a wide range of sectors. Nevertheless, the existence of industry-specific regulations and licensing requirements mandates the involvement of professionals. Professional service providers such as One IBC Vietnam can assist foreign investors with company formation, licensing procedures, and ongoing compliance to ensure a smooth business setup and operation in Vietnam.
