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Types of Licenses Required for a Chinese-invested Company
China is not only a vast country with a large population but also a major, rapidly growing economy with the potential to become a global leader. For a long time, China has been regarded as an important partner for Vietnam’s economy. Every year, Vietnam and China export a significant volume of goods across the border through various transportation routes.
With the rapid growth of China’s economy, Chinese investors are constantly seeking potential markets for development and expansion. Vietnam, with its geographical advantages and labor force, has always been a priority for Chinese investors. As a result, the number of Chinese investors present in the Vietnamese market each year is significant. To effectively manage and control the flow of capital from Chinese investors into Vietnam, the Vietnamese government has introduced several licensing requirements for Chinese investors when investing or establishing companies in Vietnam.
Three types of Licenses Required for a Chinese-invested Company in Vietnam
Investment Registration License
The Investment Registration License (also known as the Investment Certificate or Investment License) is a license issued by the competent authority to foreign investors who meet the requirements to carry out investment projects in Vietnam. The Investment License may be in the form of a paper document or an electronic record containing the investor’s registration details for the project, including: the name of the investment project; the investor; the project identification code; information about the project’s location, such as the site and land area used; the objectives and scale of the project; the investment capital, including both contributed and raised capital; the project’s duration and implementation schedule; any applicable incentives or investment support (if any); and conditions that investors must meet to implement the project (if any). Obtaining the Investment License is a prerequisite for establishing a Chinese-invested company in Vietnam.
Chinese investors typically engage in construction projects in Vietnam. Therefore, information regarding the construction site, location, land area, project timeline, and capital sources is crucial for the state to monitor and inspect when necessary.
In terms of significance, the investment license is a mandatory requirement for Chinese investors to legally establish a company in Vietnam. For state authorities, the issuance of the investment license allows them to monitor the flow of capital from China into the Vietnamese market, manage the investment projects, and track the progress of these projects undertaken by Chinese investors.
To apply for an investment license for Chinese investors in the Vietnamese market, the following documents must be prepared:
- A copy of the passport for individual investors, or a certificate of incorporation for institutional investors to confirm their legal status.
- A proposal for the investment project including details about the investor, the project’s objectives, scope, capital, fundraising methods, labor requirements, any request for investment incentives (if applicable), and an assessment of the project’s economic and social impact.
- A copy of one of the following documents: The investor’s financial statements for the last two years; A financial support commitment from the parent company or a financial institution; Documents proving the investor’s financial capacity.
- Documents proving the investor’s right to use the project site, which may include a certificate of land or housing use rights or a lease agreement for the site.
Chinese investors submit their application documents, including the aforementioned materials, either by mail or in person to the Department of Planning and Investment or to the Management Board of the industrial park, export processing zone, high-tech zone, or economic zone receiving the investment.
Business Qualification License
The Business Registration License (also known as the Enterprise Registration Certificate or Business Registration Certificate) is a document, either in paper or electronic form, that records information about the business registration granted by the business registration authority to the enterprise. The Business Registration License must include the following information: the enterprise identification number; the address of the headquarters; the name of the company or enterprise; charter capital and investment capital; personal information of the legal representative; and information about the members contributing capital to the enterprise.
After obtaining the investment license, Chinese investors need to apply for a business registration license in Vietnam. The application package for the business registration license includes:
- A business registration application form as per Circular No. 01/2021/TT-BKHĐT;
- The company charter;
- A copy of the passport/ID card of the legal representative;
- The investment license issued by the Department of Planning and Investment or the Management Board of the industrial park to the Chinese investor;
- A power of attorney for the authorized person or organization/individual establishing the Chinese-invested company in Vietnam.
The authorized person for establishing a Chinese-invested company submits the application package to the Business Registration Office of the Department of Planning and Investment in the province/city where the headquarters is intended to be located.
Processing Time: Within 3 working days from the receipt of a valid application, the Business Registration Office will issue the business registration license or provide a written notification stating the reasons for refusing to grant the business registration certificate.
Conditional Business License
The Conditional Business License is a license issued by the competent state authority to legalize businesses in sectors or industries that are subject to specific conditions when the enterprise has a need and meets the requirements as stipulated by law.
The list of conditional business sectors is specified in Appendix IV of the Investment Law 2020. Therefore, if Chinese investors wish to know whether the sector or industry they intend to establish a business in Vietnam falls under the category requiring permission, they can consult Appendix IV of the Investment Law to determine the necessary documents and procedures for obtaining a conditional business license.
The above outlines the types of licenses that Chinese investors need to acquire when investing in Vietnam through the establishment of companies. If you have any questions related to investment or the establishment of Chinese-invested enterprises in Vietnam or need assistance with obtaining licenses for establishing or operating Chinese-invested companies in Vietnam, please contact Siglaw Firm for detailed assistance!
For more details, please contact:
Phone: (+84) 961 366 238
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