Vietnam's food trade industry is one of the most dynamic sectors in the country. Fueled by an expanding middle class, rising disposable incomes, and shifting consumer preferences, the increasing demand for high-quality food products is undeniable. From bustling markets in Ho Chi Minh City to modern supermarkets in other major cities, the opportunity for both […]
Vietnam's food trade industry is one of the most dynamic sectors in the country. Fueled by an expanding middle class, rising disposable incomes, and shifting consumer preferences, the increasing demand for high-quality food products is undeniable. From bustling markets in Ho Chi Minh City to modern supermarkets in other major cities, the opportunity for both […]
Struggling to navigate the complexity of setting up your business in Vietnam? You’re not alone. Many pioneering companies see the massive potential but are unsure how to get started. This guide will demystify the process, highlight common pitfalls to avoid and show how expert support can help you launch your Vietnamese venture faster and safer. Let’s get started and see how strategic insight can be your next big win.
Here are your key takeaways for a smoother market entry:
Vietnam offers economic incentives and a strategic ASEAN location, making it a prime target for foreign direct investment (FDI).
Understanding the difference between Limited Liability Companies (LLCs) and Joint Stock Companies (JSCs) is crucial to choosing the right legal structure.
The company setup process involves getting an Investment Registration Certificate (IRC) and Enterprise Registration Certificate (ERC), among others.
With over two decades of experience guiding businesses through the FDI landscapes of dynamic markets like Vietnam, China and Malaysia, I’ve seen firsthand how a well-planned market entry can be a game-changer. My focus has always been on turning regulatory mazes into clear pathways for growth, especially in FDI-driven sectors and manufacturing.
Setting up a Company in Vietnam
Setup foreign company in Vietnam can be a complex process but with the right guidance, it can be a fun experience. Vietnam has become an attractive destination for foreign investors due to its strategic location, skilled workforce and business friendly environment. The country has various types of companies, including limited liability companies, joint stock companies and representative offices. Foreign investors can choose the most suitable type of company based on their business needs and goals. It’s essential to understand the Vietnamese company law, registration process and licensing requirements to ensure a smooth setup.
Vietnam’s Foreign Investment Landscape
For those of you who are new to Vietnam, the “why Vietnam?” question has great answers. The country actively encourages foreign investment through various mechanisms. Key economic incentives often include preferential tax rates, import duty exemptions for certain goods and streamlined administrative procedures in designated economic zones. Plus its strategic location within ASEAN provides a gateway to a growing regional market, acting as a key hub in many international supply chains.
Foreign citizens looking to set up a business in Vietnam must meet certain requirements, including getting an investment certificate, which is required for setting up legal operations and compliance with local regulations.
Economic Incentives for Foreign Investors
Vietnam offers many benefits to foreign investors. These include tax holidays, reduced corporate income tax rates and import duty exemptions for certain goods and machinery for certain projects. Companies in high-tech, environmental protection and education sectors can get more incentives. Understanding these incentives can make your investment more financially viable.
Strategic Location Advantages
Located in the heart of Southeast Asia, Vietnam is a strategic gateway to the ASEAN market. With free trade agreements such as CPTPP and EVFTA, Vietnam has better access to global markets. This makes it an attractive destination for businesses looking to expand.
When planning your business structure in Vietnam, choosing the right legal entity is the first step. The two most common forms for foreign investors are Limited Liability Company (LLC) and Joint Stock Company (JSC). LLC can be single-member or multiple-member and is often preferred for its simpler corporate structure. JSC can issue shares and is chosen by larger companies or those who want to list on the stock exchange. Representative Offices (ROs) and Branch Offices (BOs) serve different purposes: ROs are for market research and liaison activities without conducting profit-generating activities, while BOs can conduct commercial activities but within the scope permitted by their parent company’s license in Vietnam.
1. Limited Liability Company (LLC)
LLC is a popular choice for foreign investors due to its flexible structure and limited liability protection. Listing company members is an important part of the documentation required for setting up an LLC. It can be established with one or more members and does not require a board of directors. This simplicity makes it ideal for small to medium-sized enterprises looking to operate efficiently. The company’s management responsibilities can be handled by legal representatives, who may also be foreign citizens eligible to obtain necessary work and residence permits.
💡An LLC allows 100% foreign ownership, giving more control over operations and strategy. A Joint Venture (JV) on the other hand involves partnering with a local Vietnamese entity, providing valuable local market knowledge and networks. The choice depends heavily on your business goals, the industry and regulatory requirements.
2. Joint Stock Company (JSC)
JSC is suitable for larger companies or those who want to raise capital through public offerings. It allows for share issuance and requires a minimum of three shareholders. JSC is often chosen by companies who want to list on the stock exchange, providing more opportunities for capital mobilization.
3. Representative Offices and Branch Offices
Representative Offices are suitable for foreign companies who want to explore the Vietnamese market without engaging in direct business activities. They focus on market research and building relationships. Branch Offices, however, can conduct commercial activities and are an extension of the parent company, providing a more direct presence in Vietnam. A branch is an authorized representative of the enterprise, performing the functions of a legal entity within the corporate structure.
Vietnam Company Setup Process (Step-by-Step)
For your compliance teams, understanding the full incorporation process is key. The process starts with the Investment Registration Certificate (IRC), which checks the foreign investor and the proposed investment project. Then the Enterprise Registration Certificate (ERC) is required, which officially registers the company as a legal entity in Vietnam.
As ASEAN Briefing explains in their guide on Business Registration Certificates in Vietnam, these are two separate but consecutive licensing steps. Depending on the industry, specific sub-licenses or permits may be required and there are minimum capital requirements for certain sectors. Foreign investors must also comply with local laws and regulations which may include restrictions on foreign ownership in certain business lines. A comprehensive business plan is necessary to outline your investment capital, business activities and projected financial statements to meet the competent authority’s requirements.
According to the Enterprise Law, charter capital must be fully contributed to a bank account within 90 days from the date of ERC issuance. Within 10 days after fully contributing capital, carry out the procedure for changing the business registration – at the Business Registration Office – to update the new charter capital.
Once all necessary licenses and permits are obtained, the next steps are to set up a registered office address, open a corporate bank account and appoint a legal representative to manage the business. Partnering with a local law firm or professional services can help streamline the registration process and navigate Vietnam’s regulatory landscape.
Minimum Capital Requirements
The minimum charter capital requirements for setting up a company in Vietnam vary significantly depending on the specific business line and industry. For most common business sectors, there is no fixed minimum charter capital required by law for Limited Liability Companies (LLCs) or Joint Stock Companies (JSCs). Instead, the charter capital declared by the founders must be deemed sufficient to cover the initial operational expenses and the scope of the proposed business activities, as assessed by the licensing authorities. However, certain regulated industries (e.g. real estate, banking, finance, education, specific services) do have explicit and often substantial minimum requirements.
1. Bank Account Setup
Setting up a bank account is an important step in the company registration process in Vietnam. The company must open a capital bank account to deposit the charter capital and a corporate bank account for daily business operations. Foreign investors can choose from various banks in Vietnam, including local and international banks. It’s recommended to work with a bank that has experience in handling foreign transactions and has a good reputation. The bank account setup process takes a few days to a week depending on the bank and the complexity of the application.
2. Business Licensing and Registration
Business licensing and registration are key steps in setting up a company in Vietnam.
⚠️ Business registration and licensing for certain business sectors (such as finance, insurance, telecommunications services, science and technology) are carried out at specialized management agencies of relevant ministries and sectors. Contact us for tailored advice!
The company must also register for tax and get a tax identification number. The company must also comply with post-licensing procedures such as registering with the local authorities and obtaining necessary permits.
3. Vietnamese Company Law
The Vietnamese company law is governed by the Enterprise Law which provides the framework for company establishment, operation and management. The law applies to all companies in Vietnam, including foreign-invested companies. The law requires companies to have a company charter which outlines the company’s purpose, structure and management. The company must also have a legal representative who is responsible for the company’s operations and decision-making. Foreign investors should note that the Vietnamese company law is subject to change and it’s important to work with a law firm or professional assistance to ensure compliance with the latest regulations. The law also provides for joint ventures which are popular among foreign investors. A joint venture company is a company that is owned by two or more parties including foreign investors and local partners. The company must have a joint venture agreement which outlines the terms and conditions of the partnership.
Post-Incorporation Essentials
Once your company is officially incorporated, the work for your CFOs and operations teams begins in earnest. Key post-incorporation steps include registering for a tax identification number, obtaining the official company seal (a legal requirement for validating official documents) and completing labor registrations for your initial employees. Also, companies are required to file audited financial statements annually. DLA Piper Intelligence notes in their Vietnam corporate guide that setting up corporate bank accounts is another immediate priority to manage capital contributions and operational finances.
Understanding and complying with local regulations including tax obligations is crucial to avoid potential penalties or closure.
Managing Financial Operations
Setting up corporate bank accounts is important for managing your company’s financial operations efficiently. Bank account opening is a critical step in the process of setting up a company in Vietnam, necessary for fulfilling legal and operational requirements. This involves selecting a bank that aligns with your business needs and understanding the requirements for account opening such as providing necessary documentation and fulfilling minimum deposit requirements. A well-managed financial operation ensures smooth capital contributions and operational transactions providing a strong financial foundation for your business.
Navigating the First Month of Operations
What often gets missed in standard checklists is the real-world experience of the first month of operations. Expect a period of intense activity: finalizing office setups, onboarding initial staff, ensuring all initial tax and social insurance declarations are correctly filed and familiarizing your team with local banking and payment systems. This initial phase is critical for setting the operational tempo.
Legal and Regulatory Challenges
For your legal heads, prevention is better than cure. Common pitfalls for foreign investors lie in labor law compliance, lease agreement complexities (especially land use rights) and ensuring land suitability for the intended business purpose. In M&A, specific clauses related to warranties, indemnities and dispute resolution mechanisms need to be carefully scrutinized to protect your interests.
Compliance with Vietnamese law is crucial to avoid serious legal consequences such as issues arising from using a nominee shareholder or missing deadlines for capital contributions.
Understanding local regulations, especially those related to restricted industries, is key. Certain sectors in Vietnam require foreign businesses to have a local partner due to foreign ownership limitations. Identifying whether a local partner is required for your specific business type can help avoid complications in control and profit distribution.
Managing Compliance
It’s important to proactively manage regulatory compliance to avoid fallout. For foreign investors, obtaining an investment license is essential to set up a company in Vietnam. This means staying updated on changes in legislation, keeping meticulous records and having transparent communication with relevant government authorities. Regular audits and consultations with legal experts can help ensure ongoing compliance and mitigate risks associated with regulatory changes. Legal representatives whether foreign or Vietnamese must have the necessary work permit and residency status to act on behalf of the company legally.
Land Use and Lease Agreements
Navigating lease agreements and land use rights can be complicated for foreign investors. Understanding local regulations and ensuring the land is suitable for your business activities is crucial. Engaging with local legal experts can provide clarity and help negotiate favorable terms, minimize legal disputes and ensure smooth operations.
Working With Local Experts
For decision-makers the question of “why go guided?” often comes down to risk and efficiency. Working with local experts who have deep knowledge of Vietnam’s legal and administrative systems can significantly reduce compliance risks from day one. Such expertise can also reduce setup time by as much as 40% allowing you to focus on your core business activities rather than bureaucratic processes. However, involving a local partner unnecessarily can lead to complications and risks, so it’s important to understand industry specific requirements. ASL Law Firm outlines the process of setting up a foreign company in Vietnam and implies the value of expert guidance through the detailed steps involved. Among the various business structures available such as LLCs, joint ventures, branch offices and Public-Private Partnership (PPP) models, each has different implications for investment time, cost and risk.
The Value of Guidance
The ROI on advisory services becomes clear when you think about the cost of delays, compliance errors or missed strategic opportunities. Expert services don’t just cut through red tape; they provide strategic thinking that can help you optimize your investment structure, anticipate market challenges and ultimately position your business for long term success.
Success with Local Partnerships
Ready to unlock unprecedented growth in one of Southeast Asia’s fastest growing economies? Partner with Viettonkin to turn challenges into wins—because when it comes to your next big breakthrough, there’s only forward! Setting up a compliant and suitable local company structure is key to navigating the complexities and legal hurdles in Vietnam. Let’s make your Vietnam venture a success.
Vietnam intellectual property law is one of the fastest growing areas within the legal arena in Vietnam. According to the US Chamber International IP Index report 2020, which assesses IP ecosystems in 53 countries across 9 categories of protection, Vietnam progressed the most in Asia with a 5.93 percent higher than last year, notably in membership and ratification of international treaties with an almost 50% increase. Regardless, Intellectual Property rights (IPRs) protection and enforcement in Vietnam still leaves much room for improvement, and a constantly changing regulatory environment can expose businesses to various risks and setbacks. This article provides the first guide on IP laws and protection to assist foreign businesses in their early days of investment in Vietnam.
Why should business understand IP laws and protection in Vietnam
Even though Vietnam participates in various international conventions and treaties in relation to IPRs protection, they do not automatically become domestic laws. The state would then transfer the provisions of treaties into domestic laws or decide on the application of all or part of them. This makes understanding and dealing with domestic IP laws in Vietnam crucial for businesses looking to invest in Vietnam.
Likewise, under the Vietnamese judicial system, the courts are not bound by prior decisions of other national or international bodies, except for precedents passed by the Supreme People’s court, but instead consider the case based only on the applicable laws.
With Vietnam intellectual property law being in constant flux, it is difficult to keep pace with changes taking place in IP laws. Thus, building a good defence and understanding the legal protection to which you are entitled are important to keep your business smooth sailing.
Principal IP laws endorsed by Vietnam
Vietnam presently partakes in the following IP international conventions and bilateral agreements:
WIPO Berne Convention for the Protection of Literary and Artistic Works 1971.
Brussels Convention relating to the Distribution of Program-Carrying Signals Transmitted by Satellite.
WIPO Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations 1961.
WTO Agreement on Trade-Related Aspects of Intellectual Property Rights 1994 (TRIPS).
Vietnam-United States Copyright Agreement.
Vietnam-Switzerland Bilateral Agreement.
Vietnam-United States Trade Agreement.
Thus in accordance with these cross-border agreements, any work having copyright protection in Vietnam is also protected in member countries.In addition to international conventions and treaties, the principal domestic legal sources from which Vietnamese IP laws derive are the:
Law No. 42/2019/QH14 Amendments to some articles of law on insurance business and law on intellectual property
IP regulating bodies in Vietnam
In Vietnam, the government bodies regulating Vietnam intellectual property law and protection include the Ministry of Science and Technology Inspectorate, Ministry of Culture, Sports and Tourism Inspectorate Ministry of Industry and Trade’s Market Surveillance Agency, Ministry of Public Security’s Economic Police, Vietnam People’s Court (Civil Court), and Ministry of Finance Customs Office.
Within specific areas, designated organizations are in charge of exercising management and providing services for IP protection. In particular,
According to Article 5 No. 22/2018/ND-CP, Copyright and related rights are administered by the Copyright Office of Vietnam (COV) under the Ministry of Culture, Sports and Tourism;
Among these, NOIP is the chief coordinator of the Ministry of Science and technology that administers the registration of patents, trademarks, and other industrial property rights. However, neither the National Intellectual Property office nor the Copyright Office has jurisdiction in copyright litigation. Copyright and IP related cases are tried in the civil or criminal court of the People’s Court system.
What types of IP rights are covered by Vietnamese jurisdiction?
Patent
Registration for patent applies for Inventions, Industrial design and Layout design.
Regarding inventions, Vietnam distinguishes between invention patents and utility solution patents (or ‘utility models’, ‘minor patents’), for which the item is not required to demonstrate an “inventive step” such as the case of invention patents.
To receive protection, a patent application is examined and granted by the National Office of IP (NOIP).
According to Article 93 IP Law, the patent shall be valid throughout the entire territory of Vietnam. Invention patents give protection for a maximum of 20 years, while utility solution patents are valid for 10 years after the filing date, with possible extension upon expiry date. Industrial designs are given protection for a maximum of five years, renewable for two consecutive periods, each of five (5) years.
According to Article 91 IP Law and Decree No. 103/2006/ND-CP, Vietnam’s patent law operates under the ‘first to file’ principle. Thus it is advisable that businesses obtain patent registration the sooner the better.
Trademarks
This protects symbols, colours, three-dimensional objects, and other visual devices used to identify a business’ products or services.
Registration of trademarks is filed with NOIP. Registration takes up to 15 months and a trademark is valid for ten years.
Trade names also constitute a form of industrial property in Vietnam, with rights established through their use rather than under a formal registration system. SEE MORE: Regulations of Company names in Vietnam
READ FURTHER: How to register for trademarks in Vietnam
Copyright
This protects unpublished or published literary, artistic and scientific works such as books, songs, films, web content, and computer programs (See Article 14 of IP law of 2005 for a full list of types of work covered by copyright). Derivative works from these literary, artistic and scientific works are also protected.
In accordance with Article 6 IP Law 2005 amended 2009, a copyrightable work has automatic protection if it is fixed in some material form irrespective of its content, quality, form, mode and language and irrespective of whether or not such work has been published or registered. Registration with the Copyright Office of Vietnam is not mandatory for protection but nevertheless recommended.(See below for how to maintain IPRs effectively in Vietnam)
In accordance with Article 18, 19 IP Law 2005 amending 2009, Copyrights include economic rights and moral rights. Moral rights are rights to be acknowledged as the author of the work and the right to prevent any actions to modify, mutilate, or distort the work. Economic rights are the rights to make derivative works, display, reproduce, distribute, publish, communicate the work, import and lease the original or copies of cinematographic works and computer programs.
Vietnam is a signatory of the Berne Convention on copyright, which is incorporated into Vietnam regulations (Article 27 IP Law 2005 amending 2009). Accordingly, the terms of copyright protection are as follows:
The moral rights, including: To give titles to their works; to attach their real names or pseudonyms to their works; to have their real names or pseudonyms acknowledged when their works are published or used; and to protect the integrity of their works; and to forbid other persons to modify, edit or distort their works in whatever form, causing harm to the honour and reputation of the author shall be protected for an indefinite term.
The economic rights and and the right to publish their works or to authorize other persons to publish their works shall be protected for the whole life of the author and for fifty (50) years after his or her death. In the case of a work of joint authors, the term of protection shall expire in the fiftieth year after the death of the last surviving co-author.
However, cinematographic, photographic, dramatic, applied arts and anonymous works have a term of protection of 75 years from the date of first publication.
Others
Confidential information that is valuable to business and provides commercial advantage can be protected under business secret in Vietnam. To obtain protection, owners can implement protective measures such as stamping the documents with “confidential”, requiring non-disclosure agreements to be signed, and generally limiting access to the information.
Vietnam also grants protection for satellite signals, circuit board layouts and plant variety under its Law on Intellectual property and the Brussels Convention.
Geographical indications if the bearing product (1) originates from the area, locality, territory corresponding to such indication and (2) has a reputation, quality or characteristic attributable to the geographical conditions. A certificate of registered geographical indication shall have indefinite validity starting from the grant date.
How to maintain IP rights effectively in Vietnam
Registration
It is always recommended to get your IP registered in case of conflict. Consequently, the burden of proof will not fall upon the owner/authors, unless rebutting proofs are adduced. As Vietnam is part of many international conventions and treaties, designating Vietnam in the international application is an effective way to extend protection to Vietnam while saving time and money. “Priority rights” under the Paris Convention can help in the local registration of trademarks, designs and patents by allowing rights previously registered elsewhere to become effective in Vietnam if filed within a time limit.
Licensing
Licensing is applicable to most IPRs. Strict terms and regulations on controlled use of IP should be mentioned in the licensing contract in order to prevent abuse from the licensee.
Technology transfer
Technology transfer is the transfer of the right to own or use part or whole of a solution, process, or know-how that converts resources to products from one party to another. With registration of technology transfer being made mandatory in Vietnam from 2018, both parties should revise the provisions of the contract carefully before registering it with the competent authority.
Franchising
Franchising is governed by the Trade Law 2005 and the Decree 35/2006/ND-CP. Though still new in Vietnam, franchising seems to be interesting for both Vietnamese and foreign partners and worth being put into consideration.
In case where legal action is needed to protect your IPRs, there are three levels at which rights may be enforced in Vietnam:
Administrative action - this is the usual route in dealing with infringements, offering a fast, low-cost, and comparatively straightforward method. However, the deterrent effect is limited because of the low penalties and lack of compensation.
Civil court action - this is rare in Vietnam because of the poor standard of training of the judiciary in IP matters, the lack of specialist IP courts and Vietnamese tradition. Preliminary injunctions and compensation for damages are available through the civil courts.
Criminal prosecution - government authorities, including Customs, can also bring prosecutions.
Self-help tips
Take advice from Vietnamese IP experts, agents, distributors, and suppliers on how to safeguards your rights;
Carry out risk assessment and due diligence checks on any organizations or individuals you deal with;
Stick to your normal business instincts;
Prevention is better than the cure
Have clear IP-related clauses in employment contracts when hiring employees and make sure employees are educated on IPRs matters.
Have confidentiality clauses in any contracts signed with suppliers, partners or employees, preferably having non-disclosure agreement (NDA) / confidentiality agreement (CA) to restrict the disclosure of certain proprietary or confidential information explicitly outlined in the agreement.
Check production overruns to make sure genuine products are not being sold under a different name.
Now that you get a broad picture of Vietnam intellectual property law and protection, you are ready to advance into the next step of applying IP laws in business transactions such as maintaining an IP portfolio, taking security over IPRs, IP and M&A transactions. Use this article as a first-hand advisor along the way, and should problems arise, our legal experts are ready to assist.
Confused by the many business entity types of company in Singapore? You’re not alone—and believe me, picking the wrong one can cap your funding, stunt your growth or even give you compliance headaches. As a strategic business consultant with over two decades of FDI and manufacturing experience across dynamic markets like Vietnam, China and Malaysia, I’ve seen how important this step is. This guide is designed to simplify every legal entity for you, the first-time entrepreneur, so you can launch in Singapore with clarity and confidence.
Here’s what you’ll learn:
Singapore’s business structures are critical for funding, growth and compliance.
Singapore’s pro-business environment offers many advantages but entity choice is key.
Each entity type—from Sole Proprietorship to Public Limited Company—has its pros, cons and risks.
Common mistakes include confusing structure with tax, misjudging compliance and ignoring residency rules.
Making the right decision upfront can save you a lot of restructuring costs and legal headaches later.
As a trusted advisory firm, Viettonkin Consulting has guided over 2,000 clients across ASEAN. We empower founders like you to make informed, future-ready decisions. From the sole proprietorship to the public limited company, you’ll learn about the advantages, disadvantages, potential risks and best-fit strategies for each. Let’s unlock your business potential in one of Asia’s most exciting hubs!
Singapore Business Landscape
Why does Singapore punch above its weight, attracting entrepreneurs globally? It’s not just the skyline; it’s the deep-seated pro-business environment that truly favors strategic choices among the many business entities. This environment can be a game-changer but only if you align your structure with your vision from day one.
Why Entrepreneurs Choose Singapore
My experience in international investment strategies always puts Singapore as a top destination. Here’s why it’s a magnet for founders:
100% foreign ownership policies simplified: For many business activities, you can own your company outright, a big draw for international investors. Foreign individuals can also benefit from these policies, making it easier for them to invest and operate businesses in Singapore.
Ranked top globally for ease of doing business: The efficiency and transparency here cuts down on red tape, so you can focus on growth.
Tax treaties and corporate tax benefits: Singapore has attractive corporate tax rates and a wide network of double taxation agreements.
Legal certainty for cross-border ventures: The strong rule of law and respected legal framework provides a solid foundation for your operations.
Common Mistakes for First-Time Founders
Despite the supportive environment, I’ve seen many promising ventures trip up early. It’s like building a skyscraper on a weak foundation; the cracks will show up later.
Confusing company structure with tax category: These are related but different; your entity type affects your tax obligations but they’re not the same.
Misjudging compliance obligations by entity: A Private Limited company has different and often more stringent compliance requirements than a Sole Proprietorship.
Ignoring residency/director requirements: Singapore has specific rules on local directorship that catch many foreign founders off guard.
Over-relying on templated online advice: While helpful for general knowledge, generic advice never accounts for your specific business model or long-term goals. Strategic insight is key.
Overlooking the impact of personal income tax rates on profits from sole proprietorships and partnerships: These entities do not have a separate legal identity and individual owners are taxed at their personal income tax rates which can often be higher than corporate tax rates.
Choosing your business structure from the many business entities in Singapore is like choosing the right vehicle for a cross-country race; the choice determines your journey and success. Matching your entity with your long-term vision isn’t just paperwork—it’s a distinct advantage. The Singapore government through its GoBusiness portal provides a basic overview of these structures.
Sole Proprietorship
This is often the starting point for individual entrepreneurs.
Who it’s ideal for: Freelancers, independent consultants and small local traders often find this the simplest way to start a business owned by a single individual.
Legal risk: full personal liability explained: This is the key point. There’s no legal separation between you and the business. If the business incurs debt or faces lawsuits, your personal assets are at risk as you are personally liable for the business’s debts. This is a risk many overlook when chasing simplicity.
Renewal obligations and business name rules: Registration is straightforward and typically needs annual renewal. Your business must be registered with the Accounting and Corporate Regulatory Authority (ACRA).
Real example: local founder’s growth bottleneck: I recall a local designer whose sole proprietorship hit a ceiling. She couldn’t attract investment or limit her liability as her client base grew, forcing a later, more complex restructuring.
Partnership
A partnership involves two or more partners carrying on business together for profit.
General vs. Limited vs. LLP—legal distinctions:
General Partnership: All partners share in the business’s management and are personally liable for its debts.
Limited Partnership (LP): Consists of at least one general partner (with unlimited liability) and one limited partner (whose liability is limited to their investment, and who cannot participate in management).
Limited Liability Partnership (LLP): Offers partners protection from personal liability for business debts arising from the wrongful acts of other partners. It’s a separate legal entity.
Partnership agreement: A partnership agreement is essential for the continuity and smooth operation of the partnership.
Shared liability and tax structure implications: In general and limited partnerships (for general partners), personal assets are still on the line. Income is typically taxed at the individual partners’ rates. An LLP, however, offers some protection.
Use cases: Family businesses, professional service firms like law or accounting practices and joint advisory ventures often use partnership structures.
When LLP is preferred over standard partnerships: Professionals seeking to collaborate while mitigating personal liability for the actions of their partners often choose an LLP. It combines the operational flexibility of a partnership with the limited liability benefits of a private limited company.
Private Limited Company (Pte Ltd)
This is the most common and scalable business structure in Singapore and for good reason.
Legal personhood and asset separation: A Pte Ltd is a separate legal entity. This means the company can own assets, enter into contracts, sue and be sued in its own name. Crucially, your personal assets are generally protected from business debts and liabilities. This is a big deal for risk management.
Tax incentives and grant eligibility: Pte Ltds often qualify for significant tax exemptions and government grants to spur growth in SMEs.
What SMEs overlook during setup: Many underestimate the ongoing compliance and the potential for raising capital through share issuance. Appointing a company secretary, maintaining a registered office address and holding Annual General Meetings (AGMs) are common requirements.
Statutory filings and secretarial compliance: Regular filings with ACRA, including annual returns, are mandatory. A qualified company secretary must be appointed within six months of incorporation. The Accounting and Corporate Regulatory Authority (ACRA) website has detailed guides on these obligations.
Exempt private company: An exempt private company is a specific type of private limited company with a maximum of 20 individual shareholders, none of whom can be corporations.
Pros vs. Cons Matrix for Pte Ltd:
Feature
Pros
Cons
Liability
Limited liability for shareholders
Higher setup and compliance costs compared to sole proprietorship
Credibility
Higher perceived credibility and permanence
More complex administrative and reporting requirements
Fundraising
Easier to raise capital through share sales
Less flexibility in profit distribution compared to partnerships
Taxation
Access to corporate tax exemptions and incentives
Potential for double taxation (corporate tax, then dividend tax) in some cases
Perpetual Succession
Business continuity is unaffected by changes in ownership/management
Stricter regulatory oversight
Public Limited Company (Ltd)
This is for large enterprises or those planning to list on a stock exchange.
When to consider IPO-readiness early: If your long-term vision includes raising substantial capital from the public through an Initial Public Offering (IPO), structuring as a public company limited (or converting to one) is necessary.
Higher compliance = stronger public trust: These companies face the highest level of regulatory scrutiny which in turn can build greater public and investor confidence.
Use case: regional conglomerate setup: A large business with operations across multiple countries might set up its Singaporean headquarters as a Public Limited Company to facilitate investment and governance.
Director/shareholder thresholds simplified: A public company can have more than 50 shareholders and can offer shares to the general public. It generally requires at least three directors.
Shares public company limited: A public company limited by shares can offer shares to the general public, making it suitable for larger businesses looking to raise capital.
Foreign Company Subsidiary, Branch or Representative Office
For foreign companies looking to set up in Singapore, these are the main options. Each has its own legal and operational implications.
Key legal and tax differences between three:
Subsidiary: A subsidiary company is a locally incorporated Pte Ltd owned by the foreign parent. A separate legal entity. Taxed on Singapore-sourced income.
Branch Office: A Singapore branch office is an extension of the foreign parent company, not a separate legal entity. The parent company is liable for the branch’s debts. Taxed on Singapore-sourced income.
Representative Office (RO): A temporary setup for market research or liaison activities only. Cannot engage in profit-generating activities. No corporate tax as it doesn’t earn income.
When to choose branch vs subsidiary: A subsidiary is often preferred for long-term operations due to its separate legal status and ring-fenced liability. A branch might be simpler if the activities are closely tied to the foreign company operating in Singapore and separate liability isn’t a prime concern.
Pros/cons table for reference:
Feature
Subsidiary (Pte Ltd)
Branch Office
Representative Office
Legal Entity
Separate
Extension of parent
Not a separate legal entity
Liability
Limited to subsidiary’s assets
Parent company fully liable
Parent company responsible
Permitted Activity
Full business operations
Full business operations
Market research, liaison only
Taxation
On Singapore profits
On Singapore profits
Not applicable (no income)
Compliance
Higher (local incorporation requirements)
Moderate (agent, annual filings)
Lower, but very restricted
Regulatory checklist for each:
This includes appointing local agents/directors, registering with ACRA, and understanding specific reporting requirements based on the chosen structure. Compliance depth is important; an RO for instance has strict limitations on its activities and duration.
Which One to Choose
This can feel like a complicated maze, but a structured approach can save months of potential restructuring and legal costs down the line by choosing the right business structure. Think of it as creating a blueprint before construction – it’s essential.
Decision Tree: Entity Match by Business Goal
While a visual decision matrix is very effective (and we create one for our clients), here are the key questions to guide your thinking:
Raise investment vs. stay lean:
Raise Investment: Private Limited Company almost always the answer due to share issuance capabilities and investor familiarity.
Stay Lean: Sole Proprietorship or Partnership might be suitable initially if liability is less of a concern and simplicity is key.
Limit liability vs. go solo:
Limit Liability: Private Limited Company (Pte Ltd) or Limited Liability Partnership (LLP) are your best options.
Go Solo (and accept risk): Sole Proprietorship.
Speed to market vs. long-term governance:
Speed to Market (simple ops): Sole Proprietorship is the quickest.
Long-term Governance & Scalability: Private Limited Company provides a more robust framework.
Checklist of traits to identify founder-fit:
Number of owners?
Willingness to take on personal liability?
Plans for external funding?
Complexity of operations anticipated?
Long-term exit strategy?
Real-World Scenarios for New Entrepreneurs
Let’s see how this plays out:
Scenario A: Local founder starting digital agency
Entity Used: Started as Sole Proprietorship, converted to Private Limited Company soon after.
Why it was strategic: The initial Sole Proprietorship was for a fast, low-cost start. As client contracts grew bigger and the founder wanted to hire staff, converting to a Pte Ltd was necessary for liability protection and a more professional image to secure bigger projects.
Scenario B: Expat launching fintech product
Entity Used: Private Limited Company from day one.
Why it was strategic: Fintech often requires significant investment, faces regulatory scrutiny and needs strong data protection. A Pte Ltd structure offered the necessary liability protection, credibility for fundraising and framework for future compliance with financial authorities.
Scenario C: Corporate investor setting up presence
Entity Used: Subsidiary (as a Private Limited Company).
Compliance, Licensing and Operational Considerations
Setting up is just the beginning. Staying compliant and operational requires ongoing attention, especially with local regulations. Understanding the Business Registration Act is key to compliance.
Residency, Nominee and Director Requirements
This is where many foreign entrepreneurs need guidance.
Who is a local director: A local director must be an ordinary resident of Singapore (e.g. Singapore Citizen, Permanent Resident or EntrePass holder). Every Pte Ltd needs at least one.
Nominee director use cases and risks: If you’re a foreign founder without a local resident director, a nominee director service can fulfill the statutory requirement. But be aware the nominee’s role is usually non-executive. The risk lies in ensuring the nominee service is reputable and understanding the scope of their role versus your own as the business operator.
Common mistakes for expats:
Not securing a local director before incorporation.
Misunderstanding the ongoing responsibilities even with a nominee director.
Not having a valid registered office address in Singapore (a P.O. Box is not sufficient).
Not understanding the requirements of the Companies Act for local directorship and compliance.
Avoiding missteps in local appointment strategy: Plan early. If you intend to relocate on an Employment Pass or EntrePass, understand the timelines. If using a nominee, ensure clear agreements are in place.
Licensing and Industry-Specific Needs
Depending on your business activity, you’ll need specific licenses or permits.
Retail, F&B, finance—what permits you need:
Retail: May need a general retail license, plus specific permits for certain products (e.g. tobacco, alcohol).
Food & Beverage (F&B): Food shop license from the Singapore Food Agency (SFA).
Finance: Activities like fund management or advisory require licensing from the Monetary Authority of Singapore (MAS).
Professional firms: Professional firms like law and accounting practices may need specific licenses to operate in Singapore.
Online-only vs. physical office requirements: Even online businesses need a registered office address. Certain activities may require a physical presence even if sales are digital.
MAS, MOM, URA—what they regulate:
MAS (Monetary Authority of Singapore): Regulates financial institutions and financial services.
MOM (Ministry of Manpower): Oversees employment matters, work passes and workplace safety.
URA (Urban Redevelopment Authority): Governs land use and development, relevant if you’re setting up physical premises.
Resource: The Singapore GoBusiness portal (often found at gobusiness.gov.sg) is a great government resource to find out what licenses you need.
How Viettonkin Can Support First-Time Entrepreneurs
Navigating this landscape, especially for the first time or as a foreign investor, can be tough. That’s where strategic partnership comes in. My firm, Viettonkin Consulting, offers the kind of strategic insight that turns challenges into opportunities. We have expertise in foreign investment to help you set up a business in Singapore with ease.
End-to-End Formation Advisory
We help you build a solid foundation for your Singapore venture:
Incorporation strategy + compliance planning: We don’t just file forms; we help you choose the right entity and map out your compliance journey.
Banking, nominee and leasing support: From opening corporate bank accounts to securing nominee director services and finding office space, we take care of these critical steps.
Cross-border tax structuring for ASEAN investors: For clients looking at Singapore as a regional hub, we advise on tax efficient structuring. We also advise on setting up a company limited by guarantee for non-profit ventures, ensuring compliance with local regulations.
Real client example: We recently helped a tech startup from Europe to set up their Pte Ltd in Singapore. Our team streamlined their incorporation, secured passes for their key personnel and connected them with local banking partners, so they could become operational and start their ASEAN market penetration strategy within weeks. This was a game-changer for their expansion timeline.
Long-term Governance and Growth Support
Our support doesn’t stop at incorporation. We believe in building sustainable businesses.
Post-incorporation compliance roadmap: We provide a clear schedule of ongoing obligations to keep you on track.
Quarterly health checks + risk alerts: Proactive reviews to identify potential compliance issues or strategic risks before they become problems.
Branding, HR and digital go-to-market: Through our network and expertise, we can connect you with resources to build your brand, team and market presence.
Regional expansion strategy for Series A+ companies: For companies looking to scale beyond Singapore into markets like Vietnam or Malaysia, our regional expertise is invaluable.
For non-profit organizations, we advise on setting up entities limited by guarantee to meet their public service objectives.
Conclusion
Company types in Singapore is more than a compliance checkbox; it’s the foundation of your entire business journey, given the many types of companies in Singapore. It’s about choosing the right vehicle, fuel and map for your journey ahead. Get this right and you’ll unlock growth.
With over 2,000 consulting projects across ASEAN, Viettonkin Consulting has been the trusted launch partner for many entrepreneurs and businesses. We’ve seen firsthand how the right structure can be a game-changer for sustainable success and navigating the FDI landscape with confidence.
Ready to set up in Singapore and turn challenges into strategic wins? Your gateway to sustainable and resilient manufacturing and service operations in Asia starts with the right foundation. Contact us for a customized consultation. Let’s partner to choose and register the right business structure, because when it comes to securing your next breakthrough, the only way is forward! Invest in tomorrow’s breakthrough, today.
In the world of integration, working abroad or studying abroad is common sense. People travel and collaborate to exchange knowledge and broaden their horizons on culture and religion. Working/ studying abroad tends to last for a certain period of time and in order to settle down in a foreign country for such a period, foreigners have to obtain a long-term visa and temporary resident card. This article provides you with essential pieces of information about a long-term visa and temporary resident card in Vietnam.
Long-term visa
In general, a long-term visa can be classified into a 6-month multiple entry visa and a 1-year multiple entry visa. There are two ways for foreigners to apply for multiple entry visas. The first one is to get a visa on arrival and the second one is to get a visa at the Vietnam Embassy. However, since 1st January 2019, a 6-month or 1-year multiple entry visa for Vietnam on arrival is inaccessible, apart from a 1-year multiple entry visa for US passport holders.
Required documents
So as to obtain a long-term visa in Vietnam, foreigners should prepare the following documents.
In terms of visa on arrival, US residents with a passport want to obtain a 1-year multiple entry visa. Regarding getting a visa at Vietnam Embassy, foreigners need to complete an application form, prepare original passport, photos, a sponsor letter of a Vietnam-based company for business via the application.
Besides, when you apply for a visa in Vietnam, be sure that you provide the correct option of types of visa that correspond with your travel purpose. Please refer to Vietnam’s Ministry of Foreign Affairs website for information detailing visa categories. If you plan to work in Vietnam, you must obtain a work permit before applying for your visa. If you change the purpose of your visit after you have received your visa, you must obtain a new visa outside of Vietnam appropriate for your new activities before beginning those activities. Please consult the Embassy of Vietnam website for more information.
Procedure
To get a visa on arrival, first, you need to complete the online application form with some information including full name, passport number, passport expiry date, and pay for a service fee by credit cards. After that, you get the visa approval letter via email within a certain period of time (2 working days for a tourist visa or 7 working days for a business visa). Finally, a foreigner will get a visa stamped upon arrival at Vietnam airport by showing the visa approval letter, 02 passport photos, entry and exit form and stamping fee at the VOA (visa on arrival) counter at Vietnam airport upon landing there.
To get a visa at Vietnam Embassy, you go to the office of Vietnam Embassy/ Consulate to submit the application and pay the visa fees or send all the documents and fees to Vietnam Embassy/ Consulate by post. After the embassy approves your documents and your application, you will receive your visa and original passport by post.
Processing time and fees
For Embassy visa, the visa fees depend on the Embassy that you applied at and you only pay once at the embassy.
For visa on arrival, two kinds of fees shall be covered composing of service fee and standing fees.
Temporary visa resident card
What is a temporary resident card? A temporary resident card is a type of card granted by the government for foreign individuals working, studying, or doing some duties at a host country for a certain period.
According to Vietnam Visa Immigration, a temporary resident card in Vietnam is granted for seven cases. If you belong to one of seven cases below, you are eligible to apply for a temporary resident card.
- A foreigner who is a member of the two members limited liability company
- A foreigner who is owner of one-member limited liability company (except for authorized representative)
- A foreigner is a member of a broad director of the stock company
- A foreign lawyer who is licensed to practice Vietnamese law by the Ministry of Justice of Vietnam
- A foreigner who has a working permit in all kinds of businesses or representative offices of foreign enterprises
- Professional, students, trainees who are in international programs signed by the two ministries
- Relatives of a temporary resident cardholder: parents, spouse, and children.
Require documents to register a temporary visa resident card
With a view to registering a temporary resident card, foreigners must prepare:
- A written request for issuance of temporary residence card for a foreigner by the guarantor
- Information form for temporary residence card attached with photo 3cm x 4cm (Form NA8)
- Copy of passport and a valid visa( bring an original for comparison);
- 02 3*4cm photos (01 one to attach to the Information form, 01 one is kept separately)
- 01 copy of Business Registration Certificate of the legal entity of guaranteeing agency, organization, or enterprise.
- Depending on the circumstances, one of the following is required:
+ Investment certificate or business registration certificate,
+ License for establishment of representative office, branch of the company,
+ Certificate of a member of the Board of Directors,
+ Work permit
+ Investment certificate or Business registration certificate
+ License for establishment of representative office, branch of the company
+ Certificate of member of the Board of Directors
+ Work permit
+ Birth certificate, marriage certificate, family register… if applying for temporary residence cards for husband, wife, child… who are foreigners
+ Proof of temporary residence declaration or Certification of temporary residence in the locality with the seal of the Commune Police
Note: Consular legalization and notarized translation into Vietnamese are necessary for all documents in a foreign language.
The result will be released in five working days if sufficient documents are provided. Moreover, the fee of a 1-year temporary resident card is USD 80, 1 year to 2 years is USD 100 and 2 years to 3 years is USD 120.
To replicate, obtaining a long-term visa and temporary resident card is necessary for foreign individuals who would like to settle down in a foreign country in a certain period of time. The article provides key information such as required documents, the procedure of registering to eligible individuals. If you would like to have the assistance of getting a visa and temporary resident card, Viettonkin is ready to support you.
It can be said that the Vietnamese economy witnessed positive signals despite the unstable context of the global economy and regional economy. Vietnamese export and import in the past 2019 had a lot of improvements and brought considerable achievements to our economy. Currently, although the coronavirus pandemic has posed difficulties, Vietnam is trying the best to gradually recover economic activities to boost bilateral trade. This article focuses on import in Vietnam presenting statistics in 2019 and provides you legal policies of conducting import.
Overview of export and import in Vietnam in 2019
In 2019, export and import in Vietnam gained achievements which marked a highlight in the commercial trade yet still had challenges to identify Vietnamese products in the international market.
Achievements
- The high growth of the export scale reached targets of the National Assembly.
- Export from domestic enterprises experienced a sharp increase.
- The export structure shifted and export goods were more diversified.
- The export market was extended and focused on markets of FTAs’ partners.
- Import ensured production and manufacturing.
- Trade surplus was maintained.
Challenges
- Agricultural and aquatic products for export still faced difficulties in accessing markets with high requirements on quality and food safety.
- Agricultural products relied heavily on Asian market.
- The technology was still behind to support the quality and production scale.
- The competitiveness and instability of the global and regional economies have been such a challenge.
Key import goods in Vietnam in 2019
According to the World’s Top Export, top import goods in Vietnam in 2019 were:
Regarding agricultural and aquatic products, soy, wheat, corn, feeding products, and vegetables were the top imported goods. The import turnover of soy was 1.71 million tons, equal to USD 681 million despite there was a 12% decrease in 2018. The US, Brazil, and Canada were major import markets of soy. Meanwhile, the import of wheat dropped in either weight or total import value. The total import value reached 2.79 million tons of wheat. On the contrary, there was an increase of corn in importing in 2019 with regard to both weight and value.
In terms of industrial products, the import turnover of textile material in 2019 increased by 0.4% compared to 2018, reaching USD 21.8 billion. Despite the slight rise in textile material, the import of cotton witnessed a considerable decline in terms of weight and import turnover, 7.4% and 17.4% respectively.
With regard to plastic and plastic products, the import of plastic was 6.34 million tons (USD 899 billion). The pattern of plastic product imports experienced an upward trend in 2019 with USD 6.54 billion, increasing 11% from 2018. China, Korea and Japan were the three biggest importers of plastic products in Vietnam.
The import of coal rocketed sharply, recording 43.9 million tons and USD 3.79 billion of import value in 2019. Besides, the import of petrol also decreased considerably in 2019 because the amount of petrol produced by Vietnam increased.
Regulations of import in Vietnam
This part will provide you useful information about import policies in Vietnam consisting of licensing procedures, banned import goods, duties applied to import, and tax on import.
Licensing procedures
Vietnam does not require a company to have an import license to set up a trading company. However, to be able to conduct import business, a foreign investor must register with the Department of Planning and Investment (DPI). In addition, foreign investors who wish to engage in import activities in Vietnam are required to obtain an Investment Certificate. Companies that wish to expand their current business operations to engage in import activities must follow the procedures for adjusting their Investment Certificates.
All imports must comply with the relevant government regulations on quarantine, food safety, and quality standards, and must be inspected by the relevant government agencies before clearing customs.
Importers are also required to submit a customs dossier which includes a customs declaration as per Appendix II of Circular no 38/2015/TT-BTC. The customs declaration can be filed electronically here.
Certain goods require the trading company to obtain import permits from the government, as per Appendix II of Decree 187/2013/ND-CP. These include:
Goods subject to import control in accordance with international treaties to which Vietnam is a contracting party; and
Chemicals, explosive pre-substances and industrial explosives.
Banned import goods
According to Circular 34/2013/TT-BCT, goods banned from import into the country include cigars, tobacco, petroleum oils and oils obtained from bituminous minerals, newspapers, journals, and periodicals; discs, tapes, and other recorded media; second-hand items (including electronics and automotive); aircraft, helicopters, satellites, spaceships and their parts.
Duties applied to import
Most goods imported across the borders of Vietnam, or which pass between the domestic market and a non-tariff zone, are subject to import duties. Exceptions to this include goods in transit, goods imported from foreign countries into non-tariff areas for use in non-tariff areas only, and goods passing from one non-tariff zone to another.
Consumer goods, especially luxury goods, are subject to high import duties, while machinery, equipment, materials and supplies needed for production, especially those items which are not produced domestically, enjoy lower rates of import duties, or even a zero percent tax rate.
Depending on the trade conditions, Vietnam imposes several different types of duties on the import of goods. Companies wishing to find in-depth information on a range of goods would be well advised to visit the website of Vietnam Customs.
Import duties declarations are required upon registration of customs declarations with the customs offices. For imported goods, import duties must be paid before receipt of consumer goods.
Imports are subject to import tax, Value-added tax (VAT) and, for certain goods, Special Consumption Tax (SCT) and Environmental Protection Tax (EPT). In the aspect of SCT, some consumer goods are classified as luxury items and an additional tax will be imposed on those products. The special consumption tax or also known as the luxury tax applies to certain imported goods, e.g alcoholic beverages, tobacco products, and petroleum products. SCT rates start at 7% and can be more than 100% for some products such as cars with a higher engine capacity. Besides, EPT is a tax imposed on products that have a harmful effect on the environment. According to Law No. 57/2010/QH12, goods such as plastic bags, gasoline, coal, etc. are subject to the environmental protection tax. Tax rates are calculated based on the amount of money paid on one unit. For example, plastic bags are subject to 30,000-50,000 VND (~1,32-2,2 US dollars) of EPT per kilogram.
Tax rates applicable to imported goods include preferential tax rates, special preferential tax rates, and ordinary tax rates:
- Preferential tax rates apply to goods originating from countries, groups of countries, or territories, which apply the most favored nation treatment in their trade relations with Vietnam.
- Special preferential tax rates apply to goods originating from countries, groups of countries, or territories, which apply special preferences on import tax to Vietnam. Currently, it is mainly applicable to ASEAN nations under common preferential tariffs (CEPT).
- Ordinary tax rates apply to goods originating from countries, groups of countries, or territories, which do not apply the most favored nation treatment of special preferences on import tax to Vietnam. Ordinary tax rates will be no more than 70% higher than the preferential tax rates specified by the government.
VAT rates range from zero to 10 percent, with 10 percent being the most common rate. Detailed information can be found in Circular No 83/2014/TT-BTC.
- Goods imported for processing for foreign partners then exported
- Goods imported to create fixed assets for projects entitled to investment incentives or investment projects funded with official development assistance (ODA) capital sources;
- Goods imported in service of petroleum activities; and
- Goods imported for direct use in activities of scientific research and technological development.
In conclusion, the article focuses on import in Vietnam. The first part is to focus on the achievements and challenges of export and import in Vietnam in 2019. The second part listed top import goods into Vietnam with three main groups containing agricultural and aquatic products, industrial goods and fuels and minerals. The article concludes with import policies in Vietnam so that enterprises are able to follow the rules in case they would like to import products from overseas companies. If you want to be consulted about the legal framework when investing in Vietnam, Viettonkin is always ready to support you at any time.
Business expansion in foreign countries is a part of a strategic plan of many giant companies with a view to creating a business network worldwide as well as finding talents in these countries. Regarding the latest achievements, Vietnam has become a favourable destination for many foreign investors to invest in and establish businesses. In order to set up a business in Vietnam, it is vital to understand the available types of legal entity in the country. This article provides you helpful information about two main types of legal entity in Vietnam and introduces you to the procedure of establishing a company in Vietnam.
What is a legal entity?
For one thing, we have to know the concept of a legal entity. According to the Cambridge Dictionary, a legal entity is defined as “a company or organization that has legal rights and responsibilities, for example, the right to make contracts and the responsibility to pay debts”. The Business Dictionary provides a more in-depth definition, a legal entity is “an association, corporation, partnership, proprietorship, trust or individual that has legal standing in the eyes of law.
A legal entity has the legal capacity to enter into agreements or contracts, assume obligations, incur and pay debts, sue and be sued in its own rights and to be held responsible for its action.” Hence, generally, a legal entity has the responsibility for the legal obligations of a company.
Two main types of legal entity in Vietnam
This part focuses on two main types of legal entity in Vietnam including limited liability company and joint-stock company and provides advantages and disadvantages of these types of companies.
Limited Liability Company
There are two types of LLC depending on the number of members. A Limited Liability Company (LLC) with one member is called "Single Member LLC", and the one with 2 to 50 members is called "Multiple Member LLC." An LLC has its own charter and board of members (BOM). Members of LLC are responsible for the liabilities of the company to the extent of the amount of capital the member has contributed. Besides, LLC is also authorized to establish independent units like branches and representative offices domestically or abroad. Additionally, an LLC does not issue shares.
In fact, there is no requirements for capital contributed to an LLC. However, for some sectors, such as foreign-owned banks, the company is required to have at least VND 3000 billion capital investment.
Regarding single-member LLC, this type of company is owned by one organization or one individual who is liable for the debt of the company to the point of the charter capital. The company owner can appoint a representative or create a board of manager (BOM)of 3-7 people to exercise the rights of the owners. Moreover, a general director (CEO) will be appointed by the president to oversee the everyday operations of the company. The company owner can decrease or increase its charter capital. In the event of transferring capital, the company must register to convert into a multiple LLC or a JSC within 10 days.
With regard to multiple-member LLC, members have certain privileges such as attending meetings of BOM, voting rights in proportion to their capital contribution, be distributed profits proportional to their capital contribution, given priority in contributing additional capital. When members want to transfer all or part of their capital, they must offer to sell their capital to other members first.
BOM in multiple-member LLC is the body with the most decision-making power. BOM with more than 11 members must also establish a Control Committee. Resolutions can be passed if approved by a number of votes that represent more than 65% of the company's contributed capital. The proportion is 75% if the resolutions concern decisions on sales of assets or reorganization of a company or amendment to the company's charter. Plus, BOM must appoint one director responsible for the operations of the companies.
Then what are advantages and disadvantages of LLC?
Advantages
- This type of business entity is safer because decision-making authority is concentrated in fewer hands and the law restricts the penetration of outsiders into the company. Also, the management structure is more cost-effective and gives people in charge of easier control of business activities.
- The structure that is most appropriate for small and medium enterprises with a limited number of associates, registered capital of reduced values and liabilities of its members are limited to the share of capital.
- Perpetual existence: the transfer of ownership does not impact business operations and therefore not affect a business's ability to continue its financial activities and achieving its objectives.
- LLC is more stable in regard to corporate governance.
- According to Vietnamese law, regarding the expansion of LLC by capital rising, the company owner has to sell to members first before selling to investors, then the process is fairly complex.
- Create concerns about the company's capacity among clients, investors, or partners because of low charter capital.
- With the limited scope of liabilities, LLC is less attractive in terms of creditworthiness to investors, customers, and partners in trading relationships.
Joint Stock Company
Joint Stock Company (JSC) is a limited liability entity formed by the subscription for shares in the company. This is the only type of business entity that can issue shares under Vietnam legislation. It is required to have at least three shareholders (no cap on the number of shareholders maximum). Shareholders are responsible for the debts and liabilities of the enterprise to the extent of the amount of their contributed capital.
JSC can be managed under two structures. The first one includes four parties. General Shareholders Meeting (GSM), Board of Management, Control Committee and General Director (CEO). When there are fewer than 11 shareholders owning less than 50% of the company's shares, there are no requirements for the control committee.
The second one includes GSM, Board of Management, General Director. With this structure, at least 20% of the board members must be independent and the board of management has to organize an internal auditing committee.
- General Shareholders Meeting (GSM)'s responsibilities: adopt a company's strategies, decide on shares outstanding and dividend rates, elect members of Board of Management and Control Committee, decide on investments or sales of assets, amend company's charters, decide on reorganization or dissolution decisions.
- Board of management: 3-11 members, elected from GSM. Has the authority to make decisions regarding the company's strategies and perform the companies' rights and obligations not assumed by GSM.
- Director: Appointed by the board of management for a term of up to 5 years. Responsible for the daily operations of the company.
- Control committee: when the JSC has more than 11 or more shareholders. The committee is appointed by GSM and must be full-time workers at the company except otherwise stated. Plus, 3-5 members must regularly reside within the territory of Vietnam.
Then what are the advantages and disadvantages of JSC?
Advantages
- The ability to acquire large capital: issuing shares and bonds allows JSC to garner enough capital required by the operations of the company in a short amount of time.
- Limited liability: the liability of the shareholder is only limited to the capital contributed. Plus, there being a large number of shareholders means that risk is diffused across different agents, so there is less at stakes for the investors.
- Perpetual existence: the transfer of ownership does not impact business operations and therefore not affect a business's ability to continue its financial activities and achieving its objectives.
- Too much transparency: JSC is required to have their documents, accounts, reports audited and made accessible to the public. This creates confidence for its customers, investors, partners in working with the company while it may present a threat to the company's internal.
- Instability because of capital raising and share buying is easy and flexible.
How to register a legal entity in Vietnam
Step 1: Investment Registration Certificate (IRC)
Foreign investors must have investment projects and obtain IRC by submitting an application dossier to the Management Authority of the provincial industrial/economic zone (for projects located inside an industrial zone, export processing zone, high-tech zones or economic zones) or the provincial department of planning and investment (for projects located outside an industrial zone, export processing zone, high-tech zones or economic zones). The process usually takes 15 days from the submission of the application.
The registration includes enterprise Income Tax (EIT)(20% from 2016), value-added tax, foreign contractor tax, special consumption tax, import, export duties, tax incentives and personal income tax.
In conclusion, there are two types of legal entity in Vietnam consisting of Limited Liability Company and Joint Stock Company. Each type of legal entity has its own advantages and disadvantages, hence investors should consider carefully the legal entity that you would like to establish in Vietnam.
Furthermore, the article also provides you detailed steps of registering a company in Vietnam within three steps. Each step must be followed by the legal guide and submitted essential documents to the relevant authority. Hope that the article is helpful to you and Viettonkin is always willing to offer you the most professional consulting service.
Globalization and integration have created many opportunities for people travelling around the world, working in foreign countries, and even owning property in those countries. These days, overcoming difficulties from the post-war period, Vietnam is putting its name on the map as a great example of how to reform the economy.
The country is becoming a fertile land for many foreign investors and employees because of its strategic geography and its stable economic growth. With opener policies, foreigners can buy lands in Vietnam. This article will guide you through three main parts: policies of owning properties in Vietnam, the procedure, and steps to have a right of owning properties.
Policies of owning property in Vietnam for foreigners
The information of this part is extracted from the Vietnam Law Housing published by the Ministry of Justice (MOJ).
The right to owning lands belongs to the government and foreigners are not allowed to own lands. They can buy houses but not buy land. However, to create favorable conditions for investors, foreigners are able to lease the land from the State.
Foreign entities eligible for the property owner in Vietnam
According to Clause 1 Article 159 Vietnam Law of Housing 2014, foreign entities eligible for property owner in Vietnam consists of:
- Foreign entities who invest in project-based housing construction in Vietnam as prescribed in this Law and corresponding regulations of law.
- Foreign-invested enterprises, branches, representatives offices of foreign enterprises, foreign-invested funds and branches of foreign banks in Vietnam.
- Foreign individuals who are allowed to enter Vietnam.
Forms of Property Ownership
According to Clause 2, Article 159 of the 2014 Law of Housing, the foreign entities eligible for the homeownership in Vietnam if they:
- Invest in project-based housing construction in Vietnam as prescribed in this Law and corresponding regulations of law
- Buy, rent and purchase, receive or inherit commercial housing including apartments and separate houses in the project for housing construction, except for areas under management relating to national defense and security as prescribed in regulations of the Government.
Requirements for foreigners to buy property
According to Clause 3, Article 160 of the 2014 Housing Law, foreigners are required to have permission to enter Vietnam and are not granted diplomatic immunity and privileges.
According to Clause 1, Article 74 of Decree 99/2015 / ND-CP, Foreigners must have a valid passport with a stamp of entry verification of the Vietnam Immigration Department.
According to Clause 2, Article 119 of the 2014 Housing Law, foreigners must have full civil capacity to enter into transactions in housing, qualify for the homeownership in Vietnam and are not required to register temporary or permanent residence in the place where the house under transactions is located.
According to Clause 2, Article 161 of the Law of Housing, foreign individuals may own houses as agreed upon in purchase and sale contract transactions, but for no more than 50 years from the date of being granted the certificate and can be extended if required. In case a foreign individual married to a Vietnamese citizen or a Vietnamese citizen residing overseas, he/she is entitled to own stable and long-term housing and the rights of the owner like Vietnamese citizens.
Moreover, the government also points out some regulations for foreigners in property ownership regarding the number of apartments that a foreigner can own or buy.
According to Clause 2 Article 161 of the 2014 Law on Housing, Foreigners are only allowed to buy, rent and purchase, receive, inherit and own less than 30% of apartments in an apartment building; or less than 250 houses regarding separate houses including villas, row houses in an area whose population is equivalent to a ward-administrative division.
According to Article 76 of Decree 99/2015 / ND-CP, in case population's area is equivalent to a ward-level administrative unit which has an investment project on construction of commercial houses, including separate houses for sale, foreigners may own a number of houses according to the following provisions:
- In case there is only one project with a number of separate houses of less than 2,500 houses, foreign organizations and individuals may own no more than 10% of the total number of houses in that project;
- In case there is only one project with the number of separate houses equivalent to 2,500 houses, foreign organizations and individuals may own no more than 250 apartments;
- In case there are two or more projects where the total number of separate houses in these projects is less than or equal to 2,500 units, foreign organizations and individuals may own no more than 10% of the dwelling houses of each project.
Procedures and steps of owning property in Vietnam
Necessary documents that foreigners should prepare to own property in Vietnam
Foreigners need to prepare a house purchase dossier and ownership certificate of property. These documents will provide the eligibility of owning property in Vietnam.
First, a house purchase dossier. Foreign individuals must have passports or passport substitutes (hereinafter collectively referred to as passports) issued by competent foreign agencies together with one of the following papers which is suitable for each situation.
- In case of being a person who invests in Vietnam directly, foreigner's name must be stated in the Investment Certificate or in the papers corresponding to the investment activities issued by the competent authority of Vietnam with a term of one year or more or a paper proving that the foreigner is a member of the Board of Directors or the Management Board of the enterprise operating in Vietnam.
- In case the person is hired by enterprises operating in Vietnam under the law of the enterprise to hold the positions of general director, director and deputy of the enterprise or the chief or deputy of units attached to the enterprise; there must be a contract for hiring a manager position or an appointment decision made in Vietnamese.
- In case of being a person is deserved well of the country, there must be a medal or decoration awarded by the President of the Socialist Republic of Vietnam.
- In case of being the person with a special contribution to the country, the foreigners must have a certification of the ministry-level agency in charge of the foreign individual's field of contribution and send it to the Ministry of Construction for consideration and submission to the Prime Minister.
- In case of entering Vietnam to work in the fields of economics, science, technology, environment, education-training, culture, information, physical training, sports, health, social affairs, and lawyers, the foreigners need documents proving of having bachelor's degree or higher degree issued by a competent Vietnamese or foreign agency, enclosed with one of the following papers: a work permit issued by a Vietnamese competent agency; and a professional practicing certificate in Vietnam issued by a Vietnamese competent agency.
Besides relevant documents to submit for a house purchase dossier, it is suggested that foreigners prepare permanent residence card or temporary residence card or residence certificate in Vietnam for one year or more issued by the immigration agency of the Ministry of Public Security.
Second, ownership certificate of property. Five kinds of documents that foreigners should prepare are:
- Passport
- A personal income tax receipt
- Registration fee receipt
- Permanent residence card or temporary residence card or proof of not eligible for privileges and immunities.
- Request for ownership certificates of property (Form 04 / DK Circular 23/2014 / TT-BTNMT)
Steps of owning property for foreigners in Vietnam
In order to own property in Vietnam, a foreigner has to go through a five-step procedure:
- Step 1: Prepare all necessary documents proving eligibility for housing ownership in Vietnam.
- Step 2: Sign house purchase contract, the contract must contain the contents as prescribed in Article 121 of the 2014 Housing Law, and be notarized or authenticated.
- Step 3: Register Ownership Certificates of Property: The file will be submitted at Land and House Registration Authority. After receiving the dossier, the authority will examine the dossier. In case the dossier is not valid or incomplete as prescribed by law, after 3 days from the date of receipt, the authority will notify to resend and guide the submitter to supply and complete as prescribed by law.
- Step 4: Complete financial obligations: pay tax, fee in the notice of financial obligations when buying property.
- Step 5: Receive the Ownership Certificates of Property.
To reduplicate, the article introduces policies of owning property in Vietnam regarding foreign entities eligible for the property owners, forms of property ownership, and requirements to buy a property. Additionally, necessary documents and steps of owning property are also presented in this article to help readers understand clearly the procedure of property ownership in Vietnam.
If you are foreigners and have the intention of owning property in Vietnam, hope that the article is helpful to you. Viettonkin is always by your side to offer you professional services in terms of law consultant. Please contact us if you have any problems, we will try our best to help you because your concern is our concern.
When travelling overseas, besides inevitable documents such as passport, visa, criminal record, foreigners are advised to know some regulations related to their benefits. A tax refund is a term that foreigners should keep in mind. So what is a tax refund? What should you know about tax refund in Vietnam?
This article will provide you with useful information about tax refunds in Vietnam regarding locations of paying tax, procedures of a tax refund, and necessary documents.
What is a tax refund for foreigners?
Tax refund for tourists permits travellers (foreign passport holders) to claim back Value Added Tax (VAT) on items purchased in any stores registered as a “Tax Refund for tourists” participants.
Who will follow the VAT refund?
According to Article 1 of the Circular No 72/2014/ TT-BTC issued on 30 May 2014, two subjects of VAT refund are “foreigners and overseas Vietnamese, except for members of the flight crew in accordance with the Aviation Law, member of sailor crew in accordance with the Maritime Law (hereinafter referred to as foreigners) whose passports or entry/exit documents are issued by foreign authorities and valid for entering and exiting Vietnam, purchasing and bringing goods overseas through ports of entry/exit where VAT refund is available”.
Locations of tax refund declaration
Two locations that tourists should keep in mind are locations for physical inspection of goods, checking VAT refund declaration, and location for VAT refund payment.
When foreign travelers arrive at Noi Bai or Tan Son Nhat airport, the location for physical inspection of goods, checking VAT refund declaration is located at the baggage check-in counters and/ or boarding-pass checking areas in order for physical inspection of refunded goods sent by luggage; at the isolated areas in order for physical inspection of refunded portable goods.
Besides, to receive the tax refund, VAT refund counters at international seaports, which have separate counters (kiosks) and are qualified for cash management and accounting documents in accordance with laws.
Stage 1: Foreigners purchasing goods at enterprises selected for selling VAT refund goods (as published on the website of General Department of Tax www.gdt.gov.vn) shall be noticed to check the information in invoice cum tax refund declaration (date of issuing invoice; full name, passport number of buyers…).
If the information is not correct and completed, foreigners shall request for correction; but if it is correct and complete, they shall sign in the invoice cum tax refund declaration.
Stage 2: Foreigners shall be requested to submit invoice cum tax refund declaration and present refunded goods to the customs authority. In Noi Bai and Tan Son Nhat International Airport, foreigners shall submit invoice cum tax refund declaration and present goods to the customs authority at invoice cum tax refund declaration checking counters outside of the restricted areas in order for customs officers to check before conducting procedures for sending baggage.
After customs authority checks invoice cum tax refund declaration and goods, foreigners shall continue to conduct procedures for sending goods and take their boarding-pass.
In case foreigners request for refund payment to their hand luggage, after coming into the restricted areas, they shall submit invoice cum tax refund declaration and present refunded goods as requested. Customs Authority shall check invoice cum tax refund declaration and goods (if necessary) and calculate the VAT amount refunded to foreigners.
In the other places of a tax refund, refunded hand goods or baggage shall be subjected to customs inspection outside the restricted areas (in international airports) and in the refund areas (in international seaports).
Stage 3: Foreigners shall present their boarding-pass card and invoice cum tax refund declaration checked by Customs Authority in terms of identifying kinds of goods and calculating VAT amount refunded to foreigners, and stamp at tax refund counters in restricted areas.
Necessary documents for tax refund
In order to fulfill the procedure of checking and submitting VAT refund, foreign tourists should pay attention to two kinds of documents consisting of documents for checking invoice cum tax refund declaration and goods and documents for VAT refund payments to the foreigner on exit.
In terms of necessary documents for checking invoice cum tax refund declaration and goods, foreigners shall present to the customs officials at the invoices cum tax refund declaration and goods checking counter the following documents: passports or exit and entry permits; invoice cum tax refund declaration and goods.
With regard to necessary documents for VAT refund payments to the foreigner on exit, foreigners should prepare boarding pass and invoices cum VAT refund declaration. After the customs inspection on invoices cum VAT refund declaration and goods has been completed, foreign passengers shall present to the commercial banks at the refunding counter with the documents mentioned previously.
“ - Goods are not included in the list of goods prohibited from exportation; the list of export goods under permits of the Ministry of Trade (now the Ministry of Industry and Trade) or export list subject to specialized management according to the Decree No 187/2013/NĐ-CP dated 20/11/2013 of the Government and the guidelines thereof.
- Goods are subjected to VAT as stipulated in Article 3 of the VAT Tax Law No 13/2008/QH12 dated 3/6/2008 and the guidelines thereof.
- Goods are not in the list of goods prohibited in airplanes as stipulated in Article 12 of the Vietnam Civil Aviation Law dated 29/6/2006 and the guidelines thereof.
- Goods are not subjected to VAT refund of foreigners according to Circular 08/2003/TT-BTC dated 15/1/2003 of the Ministry of Finance which guides VAT refund for diplomatic missions, consular posts, and representative offices of international organizations in Vietnam.
- Goods purchased in Vietnam with invoice cum tax refund declaration which is issued within a maximum 60 days before the date of departure of foreign passengers from Vietnam.
- The minimum value of goods in the invoice cum tax refund declaration purchased at the same seller on the same day (including accumulation of many same-day invoices from the same seller) is at least 02 million VND.”
Some difficulties about tax refund system for foreigners in Vietnam
Currently, the procedure of inspecting VAT refund still depends much on paperwork. The customs agencies, established by the General Development of Vietnam Customs, check invoices by paper presented by passengers without electronic invoices. Besides, the process also faces some limitations when tourists have to make the declaration with hand-writing paper.
According to the Hanoi Custome Department, the Noi Bai Customs Brach reported that some cases caused difficulties for the Customs office to calculate the VAT refund such as clothes with general brands, missing labels, badges, missing red marks on invoices or inaccurate contact number.
Meanwhile, the Da Nang Customs Department, through the implementation VAT refund of goods for overseas tourists and Vietnamese expat on exit, reported that the office had difficulties in determining the sales companies’ tax refunds when checking invoices and VAT declaration. Therefore, it takes much time for the office to collect the refunded VAT with invoices made by these sales companies.
Solutions to improve the quality of the VAT refund system
This part is adapted from the article published on Customs News. With a view to building a more efficient system, authorities and organizations should coordinate with each other. It is advised that VAT refunding businesses work with the General Department of Taxation so, the management is tight and more convenient.
Furthermore, enterprises involving in sales tax refund should have clearly defined rights and obligations as well as sanctions for cases where enterprises do not update the information to the Customs office to handle in advance.
The Hanoi Customs Office suggested that tighter regulations on VAT refund conditions should also be applied for new or second-hand goods. The actual inspection of goods which are of great value from high-end brands namely Rolex Watches, Cartier, Hermes, Chanel is difficult to determine whether they are real or fake goods.
The application of technology in the VAT refund system should be implemented. It will create higher productivity and ensure transparent information between the Customs, banks, and VAT refund businesses.
All in all, a VAT refund is significant for foreign tourists entering and exiting Vietnam to ensure their benefits when traveling overseas. Foreigners should prepare in advance necessary documents to declare their VAT refund and follow the instruction of the Customs Office. The VAT refund system in Vietnam still has difficulties in creating a smooth workflow between relevant enterprises.
Therefore, it is an important point for the authority to upgrade the procedure of VAT refund. Hope that the article is helpful to you and if you have any problems relating to law, please contact Viettonkin, we will support you by our hearts.
Indonesia government has lowered the income tax rate for small and medium-sized businesses (SMEs) in July 2018, making it easier to open up business in Indonesia. According to Government Regulation (PP-23) effective in July 2018, the reduced income tax rate in Indonesia is 0.5% from previous 1%.
In this article, we provide you all the information you need to know about reduced income tax for small and medium-sized enterprises (SMEs) and how to apply for it.
Who is eligible to apply reduced income tax?
According to the PP-23, individual taxpayers, as well as companies with gross income below IDR 4.8 billion per year (~ USD 340,000), can apply for reduced income tax rate in Indonesia. Individual taxpayers can enjoy the reduced tax rate for seven years, whereas companies can enjoy for three years.
If your company’s annual income exceeds IDR 4.8 billion during this period, you need to pay the income tax according to the general tax rates (12.5-25% of the profit). Moreover, you also cannot proceed with the reduced tax rate.
Even if your annual income does not exceed IDR 4.8 billion, the new government regulation PP-23 allows you to choose between two income tax rates:
Income tax rate (0.5% of the revenue/gross income)
General tax rate (12.5-25% of the profit)
What if your company gross income greater than IDR 4.8 billion per year?
The answer for this question is, you can set up several legal entities in Indonesia to keep the income per company below the required IDR 4.8 billion. If you have two legal entities in Indonesia, you can have a total income of IDR 9.6 billion. This method would allow you to still pay the reduced income tax rate in Indonesia, as long as you divide the income between the companies.
Please note that to use this method, you will have to pay attention to the status of each entity. If one entity is registered as a branch office and the other as the headquarter, the income should be combined, therefore you cannot apply for reduced income tax. If the companies are independent (not registered as part of the branch of one another), then these incomes can be separated. This also means that reducing tax pay is possible.
When to apply for reduced income tax?
Companies that complete their tax registration starting from 1 January 2019 must send the notification letter to the tax office during the tax ID registration. Keep in mind that you also need to send a notification letter to the tax office if you prefer the standard tax rate instead of the final income tax. The deadlines are the same as in the table above.
How to apply for reduced income tax?
To apply for the 0.5% income tax, you need to obtain a statement letter first. You can do that by sending an application to the tax office in which you received your tax ID. Below are the requirements to apply for reduced income tax:
The Director of the company has to sign the application letter
You need to submit the latest annual tax report (except newly-registered companies or companies that are not obliged to file a yearly tax report)
The tax office will then issue a statement letter or a rejection letter within three working days after the complete application is received. If the tax office rejects your claim, you can re-apply for a new statement letter. The validity period of a statement letter starts from the day of issuance up to the limit of the final income tax period or until you decide to use the general tax rate (12.5-25%).
When to pay income tax?
The monthly payment of the final income tax is the 15th day of the month. However, the deadline for paying the withholding and employee taxes is the 10th day of each month.
Still have your question unanswered? You can contact us anytime at info@viettonkin.com.vn. Our qualified accountants are always ready to assist you. For more information about Indonesia, consult our local blog!
Definition of a nominee shareholder
A nominee shareholder is a person or company that is the registered holder of shares of a company on behalf of the real owner. This means that their name appears on the share certificate and their personal details are logged on all public documentation in place of the actual shareholder. The shareholder, or beneficiary owner, remains totally anonymous. Most of the time, the nominee does not have power in the operational business.
Two main reasons why company use nominee shareholders in Indonesia
Restrictions on foreign ownership in Indonesia (Negative Investment List)
The total permitted foreign ownership of Indonesian shares depends on a company's business classification (“KBLI”). This could range from 100 percent open, to completely closed to foreign ownership.
The allowed foreign ownership is regulated by the Negative Investment List (DNI). This means that in order to start a business in an industry that falls under the negative investment list, foreign investors need to have a local partner.
In the event that a business is closed (either partially or completely) to foreign ownership but the investor would still like to maintain 100.0% control, the ideal solution is to start a locally held company using nominee shareholders.
Minimum requirements for capital in Indonesia
To start a foreign company in Indonesia, investors need to submit an investment plan for at least Rp. 10 billion (~US$ 750,000) to show the sustainability of their business. Rp. 2.5 billion (~US$ 190,000) of the investment plan, however, needs to be paid up immediately.
When all shareholders of the company are local nominees, on the other hand, the capital requirements are a lot lower (start from Rp 51 million ~US$ 3,800).
Is it safe to use a nominee shareholder?
Ideally, the investor choosing this structure will work with nominees that they have a very high degree of trust, perhaps a member of the family or someone with whom they have a close personal relationship.It is important to remember that in the eyes of the law, the nominee shareholders are the rightful owners of the business. Using an individual nominee shareholder, especially without a legal set of agreements is very risky.
However, this does not mean that all nominee arrangements are unsafe. The right kind of nominee agreement is a set of complex legal agreements that protect your assets and are drafted by professionals.
Do you still have any questions unanswered regarding nominee shareholders in Indonesia? You can always email us!
About Us
Founded in 2009, Viettonkin Consulting is a multi-disciplinary group of consulting firms headquartered in Hanoi, Vietnam with offices in Ho Chi Minh City, Jakarta, Bangkok, Singapore, and Hong Kong and a strong presence through strategic alliances throughout Southeast Asia. Our firm’s guiding mission is aimed towards facilitating intra-ASEAN investments and connecting investors in Southeast Asia with the rest of the world, thus promoting international business relationships and strengthening inter-nation connections.
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