The Government has issued the Decree no.07/2016/ND-CP regulating the right to establish branches of foreign traders. This Decree was created to promote the integration process of Vietnam and attract more potential investment from foreign investors, thereby contributing to the development of Vietnam’s economy.
According to Article 3 of the Decree no.07/2016/ND-CP, there are some cases in which foreign traders are allowed to establish branches in Vietnam:
– Foreign traders are entitled to establish their representative offices or branches in Vietnam according to Vietnam’s Commitments to treaties to which Vietnam is a signatory.
– Each foreign trader shall not establish more than one representative office or branch that has the same name within a province or centrally-affiliated city.
To be licensed to operate a branch in Vietnam, foreign traders or enterprises must fulfill all legal requirements listed in Article 8 of the Decree no.07/2016/ND-CP:
– Being established or registered for business under the laws of countries or territories being parties to treaties to which Vietnam is a signatory or is recognized by the aforesaid countries or territories.
– Have been operated for at least 05 years from the date of establishment or registration.
– In case the foreign trader’s business registration certificate or equivalent document stipulates the operation period, such time limit must be at least 01 year from the date of submission of the application.
– The operation scopes of the branch must be consistent with Vietnam’s Commitments to open the market in treaties to which Vietnam is a signatory and with the business lines of foreign traders.
– In case the operation scope of the branch is not consistent with Vietnam’s Commitments or the foreign trader is not a country or territory participating in treaties to which Vietnam is a signatory, the establishment of the branch must be approved by the Minister of a specialized management ministry.
