Hiring and growing your business in Vietnam is an exciting time for your company during which you can form new business relationships, onboard skilled team members, and create new revenue streams. However, the Vietnam subsidiary setup process can take a significant amount of time, from weeks to even months.
As an EOR, G-P can take that time down to a few days using our existing Vietnam subsidiary. When you work with G-P, you can bypass the entity setup process and start operations in a fraction of the time.
How to set up a Vietnam subsidiary
When you’re ready to set up your subsidiary, you should consider where you want to incorporate and what business factors are important to you. Vietnam might have strict requirements for international investments, so it’s crucial to carefully research Vietnam subsidiary laws. In certain sectors, companies need to apply for a license and obtain an Investment Registration Certificate.
The location where you choose to base your Vietnam headquarters will also play a role in the Vietnam subsidiary setup process. Different regions and cities can have separate rules, costs, and availability that impact your subsidiary. If you decide to go through the process alone, you may need to hire consultants, lawyers, and other experts to make sure you’re compliant with the local legislation.
Vietnam has up to 5 different types of legal entities available to incorporate as — a joint stock company, a limited liability company with 2 or more members, a limited liability company with 1 member, a partnership, and a private enterprise. While each type of legal entity has different subsidiary laws and processes, the most common option is to incorporate as a limited liability company (LLC). The process for establishing an LLC includes:
- Defining the owner of the company.
- Establishing a group of investors (if applicable).
- Instituting a management structure.
- Meeting specific accounting and auditing requirements.
Vietnam subsidiary laws
The Vietnam subsidiary laws governing LLCs can be complex. There are numerous requirements to comply with, and it can turn into a difficult and costly process. Although there isn’t a minimum capital requirement, you might need to find investors to establish an LLC. Companies can choose either a single investor or multiple investors. The investor can be the parent entity as well. Companies can operate as an internationally owned enterprise or a joint-venture company with both international and domestic investors.
Your company’s management structure needs to include a members’ council with a chairman, a director or general director, and a controller. In Vietnam, companies might be required to have at least 1 legal representative who resides in Vietnam.
In Vietnam, companies need to prepare financial statements and file a balance sheet and profit and loss account with the Ministry of Finance and local tax authorities. Internationally invested businesses also might have to undergo an annual audit by an independent auditor from Vietnam.
Benefits of setting up a Vietnam subsidiary
The biggest benefit of setting up a Vietnam subsidiary is that you can begin hiring in the country. An LLC also helps the parent company and the subsidiary operate independently. This means that the parent company won’t have to worry about incurring any liability arising from the subsidiary’s operations. In addition, the subsidiary can function independently with its own company culture.
If you partner with G-P, you won’t have to go through the lengthy subsidiary setup process. Instead, you can use our established Vietnam subsidiary to start working in a few days. We’ll also manage compliance, so you can focus on growing your business.
Other important considerations
Prior planning can help you succeed in setting up a Vietnam subsidiary. You’ll need to set aside time to hire employees, establish your business, and set up your payroll. Since the subsidiary process can often be expensive, we recommend budgeting the right amount to set up your subsidiary. Work with your accounting department to make sure you have the right amount of money set aside.
Enter new markets with G-P — no new entities required.
Beat the competition and enter new markets in minutes, not months, with G-P. We’ve paired our industry-leading team of in-region HR and legal experts with our #1 Global Growth Platform™ to help you hire compliantly in 180+ countries, eliminating the need to set up local entities or subsidiaries.
Get in touch today to learn more about how we can streamline the global growth process.