WHAT INDUSTRIES CAN FOREIGN-INVESTED ENTERPRISES OPERATE IN?
QUESTION
Dear TLK Law Firm, we hope to have your company answer the following question: I am a Korean investor. Currently, I need contributing capital to establish a business in Vietnam. However, I still do not understand the business lines that foreign businesses can conduct in Vietnam. So, lawyer, let me ask: What business lines can foreign-invested enterprises operate in? Looking forward to your company's answer. Thank you!
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Thank you for your trust and sending questions to TLK Law Firm. Based on legal regulations and practical solutions, we would like to send you the following consulting content:
LEGAL BASIS
1. Investment Law No. 61/2020/QH14 passed by the National Assembly on June 17, 2020;
2. Decree No. 31/2021/ND-CP issued by the Government on March 26, 2021 detailing and guiding the implementation of a number of articles of the Investment Law;
3. Decree No. 122/2021/ND-CP issued by the Government on December 28, 2021 regulating penalties for administrative violations in the field of planning and investment;
4. Other legal documents providing relevant guidance.
CONSULTATION CONTENT
Currently, the Vietnamese Government has introduced policies to promote trade activities between Vietnam and countries around the world. That's why more and more foreign investors come to Vietnam to invest in the form of establishing foreign-invested enterprises. When establishing a business, investors are only allowed to conduct one or several business lines permitted by Vietnamese law. However, not all foreign investors understand all the provisions of Vietnamese law on business sectors and lines of business that are allowed to register their operations. Therefore, choosing a business line that is suitable for your business and does not violate the law is extremely important. You must be very confused and do not clearly understand Vietnam's regulations on the business lines that foreign-invested enterprises are allowed to conduct in Vietnam. Through the article below, we - TLK Law Firm will help you answer questions related to what industries foreign-invested enterprises can do business in?
Photo 1. What industries can foreign-invested enterprises operate in? _ Hotline: 0972118764
I. SOME IMPORTANT LEGAL ISSUES RELATED TO BUSINESS SECTORS THAT FOREIGN-INVESTED ENTERPRISES ARE PERMITTED TO PERFORM IN VIETNAM
1. What is a foreign-invested enterprise?
The Investment Law 2020 regulates several issues related to foreign-invested enterprises as follows:
- An economic organization is an organization established and operating under the provisions of Vietnamese law, including enterprises, cooperatives, cooperative unions and other organizations carrying out business investment activities.
- A foreign-invested economic organization is an economic organization that has foreign investors as members or shareholders.
- Investment capital is money and other assets according to the provisions of civil law and international treaties to which the Socialist Republic of Vietnam is a member to carry out business investment activities.
Thus, a foreign-invested enterprise is understood as an enterprise established under the provisions of Vietnamese law. In which the founder of the enterprise or the shareholder of this enterprise is a foreign investor.
=> See more: What types of periodic reports must be submitted by foreign companies?
2. What lines of business can foreign-invested enterprises operate in?
Pursuant to the Investment Law 2020, foreign investors are entitled to apply market access conditions as prescribed for domestic investors, except for cases in the list of industries and occupations with limited market access for foreign investors.
Pursuant to Decree No. 31/2021/ND-CP, the list of industries and occupations with limited market access for foreign investors includes: 25 industries and occupations do not have market access and 59 industries and occupations have conditional market access.
Thus, foreign-invested enterprises can carry out the same business lines as Vietnamese enterprises. However, for some industries and professions that do not have market access, foreign-invested enterprises are not allowed to invest and do business in these industries. For industries and professions with conditional market access, foreign investors must meet the conditions depending on each industry registered to operate in accordance with the law.
3. Market access conditions for foreign investors
Pursuant to the Investment Law 2020, market access conditions for foreign investors specified in the List of industries and occupations with limited market access for foreign investors include:
(1) Charter capital ownership ratio of foreign investors in economic organizations;
(2) Investment form;
(3) Scope of investment activities;
(4) Investor's capacity; partners participating in investment activities;
(5) Other conditions as prescribed in laws and resolutions of the National Assembly, ordinances and resolutions of the National Assembly Standing Committee, decrees of the Government and international treaties to which the Socialist Republic of Vietnam Nam is a member.
Note: The above are the criteria to determine market access conditions for foreign investors. Specific conditions for each occupation will be posted and updated regularly according to the provisions of Decree No. 31/2021/ND-CP.
4. Conditions for conducting business investment activities in Vietnam
Pursuant to Decree No. 31/2021/ND-CP, in addition to market access conditions for industries and occupations prescribed by law, foreign-invested enterprises and economic organizations with investment capital. When conducting business investment activities in Vietnam, foreigners must meet the following conditions:
(1) Use of land and labor; natural resources and minerals;
(2) Production and supply of public goods and services or state monopoly goods and services;
(3) Owning and trading in housing and real estate;
d) Applying forms of State support and subsidies to several industries, fields, or developing regions and territories;
(4) Participate in programs and plans to equitize state-owned enterprises;
(5) Are other conditions specified in laws and resolutions of the National Assembly, ordinances and resolutions of the National Assembly Standing Committee, Government decrees and international treaties on investment stipulated? Allow or restrict market access for foreign-invested economic organizations.
Note: These conditions are not mandatory in all cases but only arise when foreign-invested enterprises carry out business investment activities related to one or several of the above issues.
=> See more: Where to submit an application to establish a foreign-invested enterprise?
II. SUMMARY OF THE ANSWER SECTION: WHAT INDUSTRIES ARE FOREIGN-INVESTED ENTERPRISES PERMITTED TO DO BUSINESS IN?
Dear Customers, from the above synthesis and analysis, TLK Law Firm would like to give the following answer:
According to current Vietnamese law, foreign-invested enterprises can register the same business lines as Vietnamese enterprises. However, for some industries and professions that do not have market access, foreign-invested enterprises are not allowed to invest and do business in these industries. For industries and occupations with conditional market access, foreign investors must meet market access conditions according to legal regulations.
=> See more: Can a foreign company establish a subsidiary in Vietnam? What are conditions?
Photo 2. What industries can foreign-invested enterprises operate in? _ Hotline: 0972118764
III. HOW SHOULD YOU BEST CHOOSE AN ORGANIZATION THAT PROVIDES LEGAL SERVICES?
An organization providing quality and reputable legal services should have the following criteria:
First: Must be an official legal organization with a legal operating license;
Second: It is better if the Board of Directors must be lawyers, experienced and have high degrees;
Third: Have a team of lawyers and a systematic, professional, and thoroughly trained human resources system;
Fourth: Friendly, dedicated and make every effort for the benefit of customers. Consider customer satisfaction and work quality as your own honor;
Fifth: Professional, thoughtful, flexible and logical service provision process to optimize work performance and save customers' time;
Sixth: Reasonable and competitive service prices;
Seventh: Rich services in both fields of supply and service packages in the same field for customers to choose the appropriate service package, as well as comprehensive support for customers throughout the operation process. movement;
Eighth: Have the ability to Connect - Promote commercial relationships for customers if customers have needs,...
Finding a comprehensive, professional and reputable legal consulting organization is what every customer wants. Because no one wants to risk losing both money and time when the results are not as expected. However, finding such an organization is not easy because the number of service providers in the Vietnamese market today is very large with varying quality.
A suggestion for you: Although our TLK Law Firm does not dare to claim to be the best legal service provider on the market, we satisfy all of the above criteria and more will definitely be a good choice for you.
=> See more: Can foreign individuals establish a company in Vietnam? What are conditions?
IV. SOME QUESTIONS RELATED TO BUSINESS SECTORS WHICH FOREIGN-INVESTED ENTERPRISES ARE ALLOWED TO PERFORM IN VIETNAM
Question 3: I want to establish a foreign business in Vietnam doing business in 02 service industries with market access conditions: advertising services and printing services, and publication distribution services. So does my business only need to meet the business conditions for one of the two service industries above or must it meet both?
Reply:
The answer is to meet the business conditions of both industries.
Pursuant to Decree No. 31/2021/ND-CP, foreign investors carrying out business investment activities in industries and occupations with different market access conditions must meet all conditions for access to the market. market access for those industries and occupations.
=> See more: What are the benefits of foreign-invested enterprises?
Above is some general advice that we would like to offer to our customers. As a service provider, we always understand and are ready to accompany and solve the needs and difficulties that customers are facing. If you still have questions or need more in-depth advice, please contact the hotline: 0972118764 to receive direct advice from a lawyer (completely free consultation).
Thank you very much!
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