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Establishing a branch of a Hong Kong-invested company in Vietnam
In the course of doing business, Hong Kong enterprises tend to want to expand their business scope or expand their business model. One of the most common options that businesses can choose is to establish a branch or business location in Vietnam. However, the choice between a branch and a business location depends on the company’s operational needs. So, what are the conditions for establishing a branch of a Hong Kong-invested company in Vietnam? Let’s explore this through the following article by Siglaw Firm!
Conditions for establishing a branch of a Hong Kong-invested company in Vietnam
A branch of a Hong Kong-invested company in Vietnam is a unit that belongs to an enterprise/company with Hong Kong capital in Vietnam. The branch is established with the aim of expanding the scale and market of the Hong Kong-invested company. As a dependent unit of a legal entity, a branch of a Hong Kong-invested company does not have a legal personality.
A Hong Kong-invested company shall only be granted a Branch Establishment License when it meets the following conditions:
- The Hong Kong-invested company must be established and registered for business by the law of the country or territory participating in the international treaty to which Vietnam is a member or recognized by the law of the country recognized by Vietnam;
- The Hong Kong-invested company must have been operating for at least 5 years, from the date of its establishment or registration;
- In case the business registration certificate or equivalent document of the Hong Kong-invested company has a specified term of operation, such term must be at least 1 year from the date of submission of the application;
- The business activities of the Branch must be consistent with Vietnam’s market-opening commitments in the international treaties to which Vietnam is a member and must be consistent with the business lines of the Hong Kong-invested company;
- In case the business activities of the Branch are not consistent with Vietnam’s commitments, the establishment of the Branch must be approved by the Minister of the relevant specialized management agency.
Cases in which a Branch Establishment License for a Hong Kong-invested company is not granted in Vietnam
– Does not meet one of the conditions for establishing a branch of a Hong Kong-invested company in Vietnam.
– Is within a period of 2 years from the date of revocation of the Branch Establishment License in Vietnam.
– Cases where the establishment of a Branch is restricted as prescribed by law for reasons of national defense, national security, social order, safety, social ethics and public health.
– And other cases as prescribed by Vietnamese law.
Advantages of establishing a Hong Kong-invested branch in Vietnam
– Establishing a Hong Kong-invested branch in Vietnam helps businesses be more proactive in organizing business operations and other internal issues of the branch.
– Establishing branches in different countries generates high revenue for businesses. At the same time, it brings confidence, convenience, and good customer service to customers.
– The branch is allowed to conduct business activities like a business enterprise;
– The branch is entitled to register its own seal and sign economic contracts on behalf of the company (within the authorized scope).
– The branch can separately declare and pay taxes as an independent unit if registered as an independent branch.
– The branch can choose the method of independent or dependent tax declaration and is allowed to open a separate accounting system.
– The branch has the right to establish business locations under the branch.
Application for establishment of a branch of a Hong Kong-invested company in Vietnam
To establish a branch of a Hong Kong-invested company in Vietnam, the following documents are required:
- Application for a branch establishment license in Vietnam
- A copy of the articles of association of the branch of the Hong Kong-invested company in Vietnam
- Documents equivalent to a business license (if any);
- Appointment letter for the head of the representative office;
- A copy of the financial report or tax obligation confirmation of the most recent fiscal year;
- A copy of the ID card/passport of the head of the representative office;
- Documents proving the right to use land for the representative office.
Above is some information about establishing a representative office of a Hong Kong-invested company in Vietnam that we would like to introduce to you. If you have any questions related to establishing a representative office of a Hong Kong-invested company in Vietnam, please contact Siglaw Firm directly for support!
Phone: (+84) 961 366 238
Email:
Headquarters: No.44/A32-NV13, Gleximco A, Le Trong Tan street, An Khanh, Hoai Duc, Ha Noi, Vietnam.
Southern branch: A9.05 BLOCK A, SkyCenter Building, 5B Pho Quang Street, Ward 2, Tan Binh District, Ho Chi Minh City, Vietnam.
Central branch: 177 Trung Nu Vuong, Hai Chau District, Da Nang City
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