Establishing a representative office in Vietnam is an important step for foreign traders looking to expand their presence in the Vietnamese market. However, to be granted a license, businesses must comply with specific legal conditions to ensure alignment with the legal system and international commitments of Vietnam.

This article will outline the conditions, regulations, and important considerations in the process of establishing a Representative Office (RO) in Vietnam.

1. Conditions for Establishing a Representative Office

1.1. Legal Formation and Recognition
Foreign traders must be legally established and registered in a country/territory that is a member of international agreements to which Vietnam is a party, or they must be recognized by the laws of that country/territory.

1.2. Duration of Operation
The business must have been in operation for at least 1 year from the date of its establishment or business registration.

1.3. Valid Business Registration Certificate
If the business registration certificate has a term limit, it must still be valid for at least 1 year from the date of submission of the application.

1.4. Compliance with Vietnam’s International Commitments
The activities of the Representative Office must comply with the international agreements that Vietnam is a part of.

1.5. Special Approval (if necessary)
If the conditions for compliance with international commitments are not met, the establishment of the Representative Office must be approved by the Minister or the head of the relevant specialized authority.

2. Regulations for Establishing a Representative Office

2.1. Number of Representative Offices
A foreign trader may not establish more than 1 Representative Office with the same name within a province or centrally governed city.

2.2. Name of the Representative Office

• Must be written in Vietnamese letters, with the option of including F, J, Z, W, numbers, and symbols.
• Must include the foreign trader’s name followed by the phrase “Representative Office.”
• The name must be displayed at the Representative Office’s headquarters, and on transaction documents, the Representative Office’s name must be printed smaller than the foreign trader’s name.

2.3. Headquarters of the Representative Office

• The Representative Office may rent a location for its headquarters, but it cannot sublet or lend it to others.
• The location must meet security, hygiene, and legal requirements under Vietnamese law.

2.4. Duration of Operation
The Representative Office license is valid for a maximum of 5 years and can be renewed.

2.5. Activities of the Representative Office
The Representative Office is only allowed to carry out activities such as communication, market research, and trade promotion. It is not permitted to directly engage in business activities.

2.6. Reporting Obligations

• By January 30th each year, the Representative Office must submit a report on its previous year’s activities to the licensing authority.
• The Representative Office must provide any requested information or documents as required by the relevant regulatory authorities.

📌 Note:

• Failure to submit regular reports → fines of 10–40 million VND for individuals or organizations.
• Failure to report for 2 consecutive years → the Representative Office license may be revoked.

3. Rights of the Representative Office

The Representative Office of a foreign trader in Vietnam is considered a dependent unit of the foreign trader, with the following rights:

• Operate within the scope, objectives, and timeframe stipulated in the license.
• Rent office space and acquire necessary equipment.
• Hire Vietnamese and foreign workers in accordance with Vietnamese law.
• Open bank accounts in foreign currency or VND with foreign-origin funds at authorized banks.
• Have a seal in accordance with Vietnamese law.
• Enjoy other rights as prescribed by Vietnamese law.

Conclusion

Establishing a Representative Office in Vietnam provides foreign traders with the opportunity to access the market and expand business operations. However, businesses must understand the legal regulations and fully comply with their obligations to ensure stable and legal operations. Regular updates on legal information will help foreign traders effectively capitalize on business opportunities in Vietnam.

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Metasource specializes in consulting and supporting businesses in managing global teams, with a focus on culturally diverse and dynamic markets. Operating in Vietnam, Thailand, Cambodia, and Indonesia, we provide seamless workforce solutions, ensuring compliance, efficiency, and strategic growth for companies expanding in Southeast Asia.

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