FOREIGN COMPANIES PROVIDING TRAVEL AGENCY SERVICES AND OPERATING TOURS

FOREIGN COMPANIES PROVIDING TRAVEL AGENCY SERVICES AND OPERATING TOURS

In recent years, Vietnam’s tourism industry has witnessed a strong growth rate and has always been among the countries with the fastest growth rate of tourists in the world. This attracts foreign investors to participate in the tourism industry in Vietnam. However, along with that, many legal questions are raised. Can foreign investors do business in travel agency services and operate tours? Is there any conditions, requirements, and procedures for the establishment of this service company? Let’s find out with Siglaw in this article!

LEGAL BASIS FOR FOREIGN COMPANIES TO PROVIDE TRAVEL AGENCY SERVICES AND OPERATE TOURS IN VIETNAM 

1. Vietnam’s commitments in international treaties;
2. Law No. 61/2020/QH14, Law on Investment; 
3. Law No. 09/2017/QH14, Law on Tourism; 
4. Law No. 59/2020/QH14, Law on Enterprises;
5.  Decree 31/2021/ND-CP detailing and guiding the implementation of a number of articles of the Law on Investment; 
6. Decree 01/2021/ND-CP on business registration;

CONDITIONS FOR FOREIGN COMPANIES TO PROVIDE TRAVEL AGENCY SERVICES AND OPERATE TOURS IN VIETNAM

 Investment conditions: (Pursuant to the provisions of the National Investment Portal) 

According to the WTO, FTAs, AFAS: No restrictions, except 

• Form of investment: joint venture 
• Capital contribution rate: There is no limit on the capital contribution of foreign investors;
• Scope of operation: foreign-invested economic organizations are only allowed to provide services of bringing international tourists into Vietnam (inbound) and domestic travel for tourists entering Vietnam as part of tourism to Vietnam; it is not allowed to provide services to bring tourists from Vietnam abroad (outbound); 
• Guides in foreign-invested economic organizations must be Vietnamese citizens.

ACCORDING TO VIETNAMESE LAW 

In addition to the provisions of the WTO’s Schedule of Service Commitments, investors must meet the conditions prescribed by Vietnamese law. Specifically, according to the provisions of the Law on Tourism, foreign investors who want to provide travel agency services and operate tours must meet the following conditions: 

• The enterprise is established as prescribed by the law on enterprises;

 

•  The enterprise has paid a deposit to a bank;

 

• The person in charge of provision of travel services holds a college degree or higher in travel; in case he/she holds a college degree or higher in another major, a certificate of training in international tour operation is required.

FORMS OF INVESTMENT 

According to the provisions of Clause 1, Article 38 of the Law on Tourism, foreign investors are allowed to contribute capital with Vietnamese partners to establish travel service enterprises in accordance with Vietnamese law and international treaties to which the Socialist Republic of Vietnam is a signatory. Thus, foreign investors can choose one of the following two forms of investment to establish a tourism joint venture company in Vietnam: 

• Invest in the establishment of new economic organizations, or; 
• Investment in capital contribution, purchase of shares, purchase of contributed capital;

PROCEDURES FOR FOREIGN COMPANIES TO PROVIDE TRAVEL AGENCY SERVICES AND OPERATE TOURS IN VIETNAM 

Step 1: Apply for an Investment Registration Certificate (IRC) 

Dossier of application for an investment registration certificate:

• A written request for the implementation of the investment project on travel agency and tour operator services, including a commitment to bear all costs and risks if the project is not approved; 
• Documents on the legal status of foreign investors: ID cards, passports, identity cards for individual investors; a copy of the Certificate of Establishment or other equivalent documents certifying the legal status of the investor being an organization certified by a consular 
• Documents proving the financial capacity of the foreign investor include at least one of the following documents: financial statements of the foreign investor for the last 02 years; commitment to financial support of the parent company; financial support commitments of financial institutions; guarantee of the investor’s financial capacity; other documents proving the financial capacity of the foreign investor;
• Proposals for investment projects on travel agency and tour operation services include the following principal contents: investors or forms of investor selection, investment objectives, investment scale, investment capital and plans for capital mobilization, location, etc duration, implementation schedule, information on the current status of land use at the project location and proposals on land use needs (if any), labor demands, proposals for investment incentives, impacts and socio-economic efficiency of the project, preliminary assessment of environmental impacts (if any) in accordance with the law on environmental protection.

In case the law on construction provides for the preparation of a pre-feasibility study report, the investor may submit a pre-feasibility study report instead of the investment project proposal; 

• In case the investment project on business of travel agency and tour operator services does not request the State to allocate land, lease land or permit the change of land use purpose, it shall submit copies of papers on land use rights or other documents determining the right to use the location for the implementation of the investment project;
• Explanations on technologies used in projects on investment in travel agency services and tour operators for projects subject to appraisal and collection of opinions on technology in accordance with the law on technology transfer;
•  Other documents related to the investment project, requirements on conditions and capacity of investors in accordance with law (if any). 
• Number of dossiers: 01 set 
• Time limit for settlement: The investment registration authority shall issue an investment registration certificate to the foreign investor within 15 days from the date of receipt of a valid dossier. 
• Authority: Department of Planning and Investment of the province where the company intends to establish its headquarters

Step 2: Apply for an Enterprise Registration Certificate (ERC) 

After being granted the Investment Registration Certificate, the investor shall carry out the procedures for applying for a certificate of registration of an enterprise providing travel agency services and operating tours by one of the following three methods: 

• Register your business directly at the Business Registration Authority; 
• Business registration via postal services; 
• Business registration via the electronic information network.

The dossier includes the following documents:

 

• Application for establishment of an FDI enterprise providing travel agency and tour operation services;
• Company charter;
• List of members or shareholders of the company (if it is a limited liability company with two or more members or a joint stock company);
• Copies of legal documents of members, shareholders, and representatives (For individual investors: Copy of citizen identification card, identity card, passport or other legal personal identification of members or founding shareholders; For investors being economic organizations: Copy of the decision to establish the company, business registration certificate or other equivalent documents of the organization; copy of valid identity card or passport of the legal representative of the organization);
• Investment Registration Certificate
• Other necessary documents (if any);
• Issuance period: within 03 working days from the date of receipt of the dossier, the Business Registration Authority is responsible for reviewing the validity of the business registration dossier and granting the business registration; in case the dossier is invalid, the Business Registration Authority must notify in writing the contents that need to be amended or supplemented to the business founder. In case of refusal to register the business, it must notify in writing the business founder and state the reason.
• Issuing authority:

+) At the provincial level: Business Registration Office under the Department of Planning and Investment

The Business Registration Office may organize points to receive dossiers and return results under the Business Registration Office at different locations in the province;

+) At the district level: Finance – Planning Office under the District People’s Committee

Step 3: Apply for an International Travel Service Business License

According to the provisions of the Law on Tourism, travel agency and tour operator businesses must have a Certificate of eligibility for security and order.

The application for an International Travel Service Business License includes:

1. a) An application for an International Travel Service Business License according to the form prescribed by the Minister of Culture, Sports and Tourism;
2. b) A certified copy of the Certificate of Business Registration or the Certificate of Investment Registration issued by a competent state agency;
3. c) A certificate of deposit for travel service business;
4. d) A certified copy of the diploma or certificate of the person in charge of travel service business as prescribed in Point c, Clause 2, Article 31 of this Law;

đ) A certified copy of the appointment decision or labor contract between the travel service business enterprise and the person in charge of the travel service business.

• Number of documents: 1 set
• Place to submit documents: General Department of Tourism

• Time limit for completing the issuance of a Sub-license for international travel service business: within 10 days from the date of receiving valid documents, the General Department of Tourism shall appraise, issue an International Travel Service Business License to the enterprise and notify the provincial tourism authority where the enterprise is headquartered; in case of refusal, a written notice must be given stating the reason.

_____________________________________________________

 

For comprehensive free CONSULTATION ON TRAVEL AGENCY SERVICES AND TOUR OPERATORS FOR FOREIGN INVESTORS IN VIETNAM, please contact:

Siglaw Law Firm

Phone: (+84) 961 366 238

Email:

• vphn@siglaw.com.vn
• vphcm@siglaw.com.vn

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

Facebook: https://www.facebook.com/hangluatSiglaw