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Establishment of a branch of a foreign-invested construction company in Vietnam
Foreign enterprises, especially construction companies, wishing to establish their branches in Vietnam must comply with the provisions of Vietnamese law. So what are the conditions, documents and procedures for establishing a branch of a foreign construction company in Vietnam? Let’s follow the article below to grasp the basic and necessary information.
Legal basis for establishing a branch of a foreign construction company in Vietnam
According to Clause 7, Article 3 of the Commercial Law, a branch of a foreign trader in Vietnam is a subsidiary unit of a foreign trader, established and conducting commercial activities in Vietnam in accordance with the provisions of Vietnamese law or international treaties to which Vietnam is a member. Therefore, in case the competent authority grants a Certificate to establish a branch in Vietnam, for some expected contents of the branches’ operations mainly related to the field of construction activities and related technical services, when participating in construction activities, the above branches of foreign traders in Vietnam must meet the conditions on operational capacity as prescribed in:
- Law on Construction;
- Decree 59/2015/ND-CP on management of construction investment projects;
- Circular 14/2016/TT-BXD providing guidance on granting construction operation licenses and managing foreign contractors operating in construction in Vietnam;
- Circular 17/2016/TT-BXD providing guidance on the capacity of organizations and individuals participating in construction activities; other relevant legal provisions.
Conditions for establishing a branch of a foreign-invested construction company in Vietnam
Foreign construction enterprises are licensed to establish a branch in Vietnam when they meet the following conditions:
- Being legally established and registered for business in a country that is a member of an international treaty to which Vietnam is a party;
- Having been in operation for at least 5 years since the date of establishment/business registration;
- If there is a term of operation, the remaining term must be at least 01 year from the date of application submission;
- The branch’s operations are consistent with Vietnam’s market opening commitments and the enterprise’s business lines;
- In case it is inconsistent with the commitments or is not a member of Vietnam’s international treaties, approval from the Minister of the specialized management ministry is required.
Dossier for establishing a branch of a foreign-invested construction company in Vietnam
According to Decree 07/2016/ND-CP, the dossier for establishing a branch of a foreign construction company in Vietnam includes:
– Application for a license to establish a branch according to the form of the Ministry of Industry and Trade;
– Certified copy and Vietnamese translation of the Certificate of Business Registration of the foreign enterprise;
– Vietnamese translation of the document appointing/assigning the head of the branch;
– Vietnamese translation of the latest audited financial report;
– Vietnamese translation of the branch’s charter;
– Certified copy of the passport/ID card of the head of the branch;
– Documents on the proposed location of the head office:
- Copy of the memorandum of understanding/location lease agreement/copy of documents proving that the trader has the right to exploit and use the location to establish the branch office;
- A copy of the document on the proposed location of the branch office.
– Authorization letter if the foreign enterprise authorizes another person to carry out the procedure.
Note: All foreign documents must be consular legalized, translated and certified in accordance with the provisions of Vietnamese law.
Procedures for establishing a branch of a foreign construction company in Vietnam
The order and procedures for establishing a branch of a foreign construction company according to the instructions in Article 13 of Decree 07/2016/ND-CP are as follows:
Step 1: The applicant submits the application directly / by post / online (if eligible) to the Ministry of Industry and Trade.
Step 2: Within 03 working days from the date of receipt of the application, the Ministry of Industry and Trade shall check and request additional information if the application is incomplete and invalid. The application may be requested for additional information up to 01 time during the application processing process.
Step 3: Within 07 working days from the date of receipt of a complete and valid application, the Ministry of Industry and Trade shall issue a written notice of whether or not to grant a License to establish a branch to a foreign trader. In case of refusal to grant a license, a written notice stating the reasons must be provided.
Step 4: In case the branch’s operations are not in accordance with Vietnam’s commitments or the foreign trader is not from a country or territory participating in an international treaty to which Vietnam is a member, the Ministry of Industry and Trade shall send a document to seek the opinion of the Minister of the specialized management ministry (Ministry of Construction) within 03 working days from the date of receipt of a complete and valid dossier.
Within 05 working days from the date of receipt of the document from the Ministry of Industry and Trade, the Minister of the specialized management ministry (Ministry of Construction) shall issue a document stating whether or not it agrees to grant a license to establish a branch.
Within 05 working days from the date of receipt of the document from the Minister of the specialized management ministry (Ministry of Construction), the Ministry of Industry and Trade shall issue or not issue a license to establish a branch to a foreign construction enterprise. In case of refusal to grant a license, a document stating the reasons must be issued.
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