A Vietnam Limited Liability Company (LLC) is one of the most common and advantageous business structures available for investors in Vietnam. This article provides a comprehensive guide on how to establish an LLC in Vietnam, while optimizing the use of the keyword “Vietnam Limited Liability Company” to enhance searchability.
1. What is a Vietnam Limited Liability Company (LLC)?
A Limited Liability Company (LLC) in Vietnam is a legal entity in which the liability of its members is limited to the capital they have contributed. There are two types of LLCs:
- Single-Member LLC: Owned by one individual or entity.
- Multi-Member LLC: Has from 2 to 50 members who contribute capital.
LLCs in Vietnam cannot issue shares to the public to raise capital but may issue bonds.
2. Advantages of Establishing a Vietnam Limited Liability Company
- Limited Liability: The members of the LLC are only liable for the company’s debts up to the amount of their capital contribution. This shields personal assets from business liabilities.
- Separate Legal Entity: An LLC is a distinct legal entity, meaning it can enter into contracts, own property, and engage in business activities in its own name.
- Flexibility in Management: LLCs offer flexibility in management structures and internal operations. Owners can appoint a director or general director to manage day-to-day business operations.
- Ease of Ownership Transfer: Ownership can be transferred easily between members or new investors through capital assignments.
3. Key Requirements for Establishing a Vietnam LLC
- Capital Requirements: There is no minimum capital requirement to establish an LLC in most sectors, except in certain regulated industries like finance or real estate where capital thresholds are imposed.
- Founding Members: For a single-member LLC, only one individual or legal entity is required. For a multi-member LLC, at least two but no more than 50 members are required to contribute capital.
- Registered Office Address: Every LLC must have a registered business address in Vietnam. This cannot be a residential address unless the property has been approved for business use.
- Business License: To officially establish a Vietnam LLC, a business registration certificate (BRC) must be obtained from the Department of Planning and Investment (DPI). This includes submitting all necessary documentation, including the company’s charter and capital contribution records.
4. Steps to Establish a Vietnam Limited Liability Company
Step 1: Prepare the Required Documents
- Charter of the company.
- List of founding members and their capital contributions.
- Copies of identification documents for all founding members (individuals) or legal documents for founding companies.
- Confirmation of the LLC’s registered office address.
Step 2: Submit Business Registration Application
Submit the application along with the necessary documentation to the Department of Planning and Investment (DPI). This process typically takes 5-7 working days. After approval, the company will be issued a Business Registration Certificate (BRC), officially recognizing it as a legal entity in Vietnam.
Step 3: Tax Registration and Licensing
After obtaining the BRC, the company must:
- Register for a tax code with the tax department.
- Open a corporate bank account.
- Register for social insurance for employees (if applicable).
- Obtain necessary permits or additional licenses, depending on the business activities (e.g., construction permits, food safety certificates).
Step 4: Capital Contribution
Founding members must fully contribute the registered capital within 90 days from the date of the company’s establishment.
5. Compliance Obligations of a Vietnam LLC
Once established, an LLC must meet ongoing compliance obligations, including:
- Annual Financial Reports: The company must prepare and submit annual financial statements to the tax authorities.
- Tax Compliance: Vietnam LLCs must comply with corporate income tax (CIT) rates, value-added tax (VAT), and other applicable taxes.
- Labor Laws: If the company hires employees, it must comply with Vietnam’s labor laws, which include provisions for minimum wage, social insurance, and employment contracts.
6. Conclusion
Setting up a Vietnam Limited Liability Company provides many benefits, including limited liability, flexibility in management, and ease of ownership transfer. By following the necessary legal steps, obtaining the required licenses, and ensuring ongoing compliance, businesses can enjoy a stable and profitable operation in Vietnam.
For more detailed advice and support in establishing your Vietnam LLC, feel free to contact Unilaw. We offer expert legal consultation tailored to your business needs.
Contact Unilaw
- Phone: +84 (091 226 6811)
- Email: legal@unilaw.vn