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FOREIGN INVESTORS ESTABLISH COURIER SERVICE COMPANIES
The rising demand for domestic and international couriers has attracted many foreign investors to participate in this field. But how can foreign investors do courier service business in Vietnam? Does the establishment of this service business company have any conditions or procedures requirements? Let’s find out with Siglaw in this tutorial!
Legal basis:
- Vietnam’s commitments in international treaties such as WTO, AFAS, VJEPA, VKFTA, CPTPP, and EVFTA;
- Law No. 61/2020/QH14, Law on Investment;
- Law No. 59/2020/QH14, Law on enterprises;
- Law No. 49/2010/QH12, Law on Post;
- Decree 31/2021/ND-CP detailing and guiding the implementation of some articles of the Investment Law;
- Decree 01/2021/ND-CP on business registration;
- Decree 47/2011/ND-CP detailing the implementation of some contents of the Postal Law;
- Decree No. 25/2022/ND-CP amending and supplementing some articles of the Government’s Decree No. 47/2011/ND-CP detailing the implementation of some contents of the Postal Law;
- Decision 27/2018/QD-TTg promulgating the system of Vietnamese economic sectors;
Courier service industry code
Industry code According to Decision 27/2018/QD-TTg promulgating the system of Vietnamese economic sectors, foreign investors can provide courier services according to the industry code below:
- Industry Code 5310: Postal
This group includes Postal operations according to common and uniform regulations. Postal operations use a common infrastructure to carry out the receiving, sorting, packing, and delivery of letters, postcards, newspapers, magazines, brochures, mailers, parcels, goods, or documents along routes and zones.
This group also includes: Other services that directly support this activity such as:
- Receiving, sorting, transporting and distributing (domestic or international) letters, mail, and parcels by postal service via the postal network is regulated by uniform service covenants. This activity may use one or more modes of transport, which may use a transport owned by a post office or a public transport;
- Receive letters or mail, parcels from public mailboxes or postal facilities;
- Distribution and distribution of letters, mail, and parcels.
Exclusions: Postal transfers, postal savings, and postal money transfers are classified under the heading 64190 (Other Currency Intermediary Operations).
- Industry Code 5320: Delivery
This group includes:
- Receiving, sorting, transporting, and distributing (domestic or international) letters, mail, and parcels of businesses not operating under a common service covenant. This activity may use one or more modes of transport, which may use enterprise transport or public transport;
- Distribution and distribution of letters, mail, and parcels.
This group also includes Home delivery services.
Exclusions: Freight transport by transport modes is classified: 4912 (Rail Freight Transport), 4933 (Road Freight Transport), 5012 (Coastal and Ocean Freight Transport), 5022 (Inland Waterway Freight Transport), 5120 (Air Cargo Transport).
Market access conditions for foreign investors in the field of courier delivery
Based on international treaties Vietnam has acceded to, foreign investors who want to invest in the field of express delivery, namely postal services (CPC 7511), and delivery services (CPC 7512), need to meet the following market access conditions:
- WTO, AFAS, VJEPA, VKFTA, CPTPP:
Vietnam only has regulations for delivery services (CPC 7512**): no restrictions.
* Express service, i.e. service including picking, packing, shipping, and delivery domestically or internationally:
(a) Information in written form, expressed in any physical form, including:
– Hybrid mail service;
– Direct mail information.
Except for the handling of written submissions with service rates less than 10 times the rate of a standard domestic letter at the first volume of US$9 internationally; provided that the total mass of these items is not more than 2000 grams.
(b) Package (including books and catalogs) and other goods.
* Handling non-addressed items.
The services and service providers of the Members shall be accorded treatment no less favorable than that accorded to Vietnam Post or its subsidiaries in competitive activities.
- EVFTA:
Annex 8-B: Postal services (CPC7511** and 7512**) (Except for public services and reserved services) are unrestricted.
The Services and service providers of the Members shall be accorded treatment no less favorable than that accorded to Vietnam Post or its subsidiaries in competitive activities.
- Vietnamese Law:
According to Section B Appendix I of Decree 31/2021/ND-CP, postal services in industries with conditional market access for foreign investors
(Source: At the National Investment Portal)
Foreign investors need to satisfy the following:
- Financial conditions: previously but this has been abolished by Decree 25/2022/ND-CP. Therefore, at present, foreign investors investing in courier delivery by registering postal operations will not be required for financial ability as before.
- Satisfy the conditions for a postal license, specifically: Having a certificate of business registration of postal activities or an investment certificate in the postal sector; having personnel suitable to the business plan according to the contents of the license application; Having a feasible business plan under regulations on freight rates and quality of postal services; Take measures to ensure information security and safety for people, post and postal networks.
- Capital contribution rate: after 5 years from the time of joining the WTO, Vietnamese law allows foreigners to invest in the field of courier services with a capital ratio of 1-100%. That is, there is no limit on the ratio of contributed capital for foreign investors.
Forms of investment in the courier field for foreign investors
- Establishment of foreign-invested economic organizations;
- Capital contribution, share purchase, purchase of capital contribution of economic organizations providing courier services;
- Investment in the form of BCC contract;
- Joint venture with domestic investors;
Procedures for establishing a courier service company for foreign investors
Step 1: Apply for an Investment Registration Certificate (IRC)
Dossier of application for an Investment Registration Certificate:
- A written request for the implementation of an investment project for provision of courier services, including a commitment to bear all costs and risks if the project is not approved;
- Documents on the legal status of the investor: ID card, passport for individual investors; a copy of the Certificate of Incorporation or other equivalent document confirming the legal status of the investor being an organization certified by the consular
- Documents proving the financial capacity of the investor include at least one of the following documents: financial statements of the last 02 years of the investor; commitment to the financial support of the parent company; commitment to the financial support of the financial institution; guarantee on the financial capacity of the investor; other documents proving the financial capacity of the investor;
- A proposal for an investment project on courier service business includes the following principal contents: investor or form of investor selection, investment objectives, investment scale, investment capital and capital mobilization plan, location, duration, implementation schedule, etc information on the current status of land use at the project site and proposal of land use demand (if any), labor demand, proposal for investment incentives, impacts, socio-economic efficiency of the project, preliminary environmental impact assessment (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 the pre-feasibility study report instead of the investment project proposal;
In case the investment project does not request the State to allocate land, lease land, permit change of land use purpose, submit copies of land use right papers or other documents determining the right to use the location for the implementation of the investment project;
Contents of explanation of technologies used in investment projects on provision of courier services, for projects subject to appraisal and collection of opinions on technologies under the law on technology transfer;
BCC contract for investment projects in the form of BCC contract;
Other documents related to the investment project, requirements on conditions and capacity of the investor as prescribed by law (if any).
Number of documents: 01 set
The investment registration agency shall issue the Investment Registration Certificate to the investor within 15 days from the date of receipt of a valid dossier
Competence granted: Department of Planning and Investment of the province
Step 2: Apply for an ERP
After being granted an Investment Registration Certificate, investors shall carry out procedures for applying for an enterprise registration certificate by one of the following three methods:
- Business registration directly at the Enterprise Registration Office;
- Business registration via postal service;
- Business registration via electronic information network.
The dossier includes the following documents:
- An application for establishment of a courier service enterprise;
- The company’s 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 papers of members, shareholders, representatives (For individual investors: Certified copies of citizen identity cards, identity cards, passports or other lawful personal identification of founding members or shareholders; For investors being economic organizations: A copy of the company’s establishment decision, business registration certificate or other equivalent document of the organization; copy of valid identity card or passport of the legal representative of the organization);
- Investment registration certificate
- Other required documents (if any);
Within 03 working days from the date of receipt of the dossier, the business registration agency is responsible for considering the validity of the enterprise registration dossier and granting business registration; in case the application is not valid, the business registration agency must notify in writing the contents that need to be amended and supplemented to the enterprise founder. In case of refusal to register an enterprise, it must notify in writing the enterprise founder by clearly stating the reason.
The authority granted:
- At the provincial level: Enterprise Registration Office under the Department of Planning and Investment
The Enterprise Registration Office may organize points to receive dossiers and return results under the Enterprise Registration Office at different locations in the province;
- At the district level: Finance and Planning Department under the District People’s Committee
Step 3: Apply for a license for business in courier services
According to the Postal Law, a mail service provider with a receiving address with a single weight of up to 02 kilograms (kg) must have a license for provision of postal services (hereinafter referred to as a postal license) issued by a competent state agency in charge of post.
A dossier of application for a postal license made in 1 set is the original including:
- Application for a postal permit (in the form in Appendix I);
- A copy of the certificate of registration of postal business or investment certificate of postal activities in Vietnam certified by the enterprise itself and responsible for the accuracy of the copy;
- Charter of organization and operation of the enterprise (if any);
- Business plan;
- Form of contract for supply and use of postal services under the provisions of postal law;
- Logos, trademarks, distinctive symbols or elements of the enterprise’s identity system shown on the post (if any);
- The tariff list of postal services under the provisions of the law on postage;
- Published postal service quality standards shall be applied under the provisions of the law on postage;
- Stipulate the limit of liability for compensation for damage in case of damage, the process for settling customer complaints, the time limit for settling complaints under the provisions of the law on postage;
- Agreement with other enterprises or foreign partners in Vietnamese, in case of cooperation in supplying one, some or all stages of the postal service applying for a license;
- Consular legalized documents proving the legal status of the foreign partner specified at Point k, Clause 2 of this Article.
- Commercial franchise contract with the enterprise providing postal services (if any).
Within 30 days from the date of receipt of a valid dossier, the competent agency shall grant a license for the provision of postal services to the requesting enterprise.
Note: Postal permits are issued for a period not exceeding 10 years. Therefore, at least 30 days before the expiry date of the license, the investor shall carry out procedures for re-issuance of the postal license for extension.
Phone: (+84) 961 366 238
Email:
Headquarters: Floor 12A Sao Mai Building, 19 Le Van Luong Street, Nhan Chinh Ward, Thanh Xuan District, Hanoi City.
Southern branch: No. 99 Cong Hoa, Ward 04, Tan Binh District, Ho Chi Minh City.
Central branch: 177 Trung Nu Vuong, Hai Chau District, Da Nang City
Facebook: https://www.facebook.com/hangluatSiglaw
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For free ADVICE ON ESTABLISHING A COURIER SERVICE COMPANY FOR FOREIGN INVESTORS in Vietnam free of charge, please contact:
Siglaw Law Firm Head Office: 12A Floor, Sao Mai Building, No. 19 Le Van Luong Street, Nhan Chinh Ward, Thanh Xuan District, Hanoi City.
Hotline: 0961 366 238 Email: [email protected]
Branch: Commercial service and residential complex at 16/9 Bui Van Ba Street, Tan Thuan Dong Ward, District 7, Ho Chi Minh City.
Representative Office in Da Nang: 177 Trung Nu Vuong, Hai Chau District, Da Nang City.
