Company Setup & Business Licensing in Vietnam for Foreign Investors: 2026 Guide

Setting up a company in Vietnam as a foreign investor involves navigating a dual-licensing system — the Investment Registration Certificate (IRC) and the Enterprise Registration Certificate (ERC) — alongside sector-specific conditions, capital requirements, and post-licensing compliance obligations. With the Politburo’s landmark Resolution No. 10-NQ/TW (June 2026) signaling a strategic shift from merely attracting FDI to building a comprehensive foreign-invested economic ecosystem, Vietnam’s business entry landscape is evolving rapidly. This guide breaks down every step of the company setup process, from pre-investment planning to operational compliance, updated for 2026.

1. Vietnam’s FDI Landscape in 2026: Why Now?

Vietnam has attracted nearly US$550 billion in registered foreign investment across more than 46,000 active projects, making it one of Southeast Asia’s premier investment destinations. The government’s ambitious Resolution 10-NQ/TW targets an additional US$200–300 billion in newly registered FDI by 2030, with US$150–200 billion expected to be disbursed. By 2045, the foreign-invested economic sector is projected to account for approximately 25% of total social investment and 30% of GDP.

The resolution introduces six fundamental shifts in Vietnam’s investment attraction strategy:

1. From attracting FDI to developing a foreign-invested economic ecosystem — encompassing FDI, portfolio investment, capital markets, and international financial institutions.
2. From capital scale to quality and value-added — prioritizing projects with advanced technology, innovation, modern governance, and strong spillover effects.
3. From input-based incentives to outcome-based incentives — linking benefits to technology transfer, R&D, workforce training, and green transition commitments.
4. From luring FDI to building a comprehensive capital ecosystem — integrating free trade zones, special economic zones, and international financial centers.
5. From investment administration to enabling environment creation — improving institutions, governance, infrastructure, and human resources.
6. From local competition to nationally coordinated development — strengthening regional connectivity and linkages between foreign and domestic sectors.

These shifts mean that while Vietnam remains open for business, the bar for quality investment is rising. Companies that align with Vietnam’s technology transfer, localization, and sustainability goals will find faster licensing and better incentives.

2. Legal Framework Governing Company Setup

Foreign investors setting up in Vietnam must comply with a multi-layered regulatory framework:

3. Market Access: Conditional vs. Unconditional Sectors

Under the Investment Law and Decree 31/2021/ND-CP, Vietnam classifies business sectors for foreign investors into three categories:

3.1 Unconditional Market Access

Foreign investors receive national treatment — the same conditions as domestic investors. This applies to most manufacturing, trading, and service sectors not listed on the restricted list. Examples include general trading, food processing, software development, and consulting services.

3.2 Conditional Market Access

Foreign investors must satisfy additional conditions under Article 15 of Decree 31/2021, including:

• Use of land, labor force, natural resources, and minerals
• Production and supply of public goods, services, or state monopoly goods
• Ownership and business in residential housing and real estate
• Application of state support and subsidies to specific sectors or regions
• Participation in equitization programs of state-owned enterprises
• Other conditions prescribed by laws, National Assembly resolutions, and international treaties

Sectors commonly subject to conditions include real estate, financial services, education, healthcare, logistics, telecommunications, and advertising. Each has specific foreign ownership caps, minimum capital requirements, or operational restrictions.

3.3 Prohibited Sectors

A limited number of sectors are closed to foreign investment entirely or restricted to specific international treaty commitments. These include certain national security-related activities, specific cultural sectors, and activities explicitly reserved for domestic enterprises under Vietnamese law.

Pro tip: Before committing to a business line, cross-reference your proposed activities against Vietnam’s WTO Schedule of Specific Commitments and applicable FTAs (CPTPP, EVFTA). Vietnam’s market access commitments under these treaties often provide more favorable conditions than domestic law alone.

4. Step-by-Step Company Setup Process

Step 1: Pre-Investment Approval (if applicable)

For large-scale projects, projects in conditional sectors, or projects requiring land allocation from the State, the investor must obtain an in-principle approval (IPA) from the Provincial People’s Committee, the Prime Minister, or the National Assembly, depending on project scale and sensitivity. Processing time: 30–45 working days.

Step 2: Investment Registration Certificate (IRC)

The IRC is the primary license issued by the Department of Planning and Investment (DPI) in the province where the company will be headquartered. Required documents include:

• Investment proposal (project description, objectives, scale, timeline)
• Financial capability proof (bank statements, audited financial reports of the investor)
• Proposed charter of the enterprise
• List of founding members/shareholders (with passport copies)
• Office lease agreement or land use right documents
• Environmental impact assessment (for projects requiring it)

Processing time: 15 working days from receipt of complete and valid dossier. In practice, expect 4–8 weeks total, including document preparation and revisions.

Step 3: Enterprise Registration Certificate (ERC)

After obtaining the IRC, the company must register its enterprise details with the Business Registration Office under the DPI. The ERC establishes the legal entity and contains:

• Company name (Vietnamese, and optionally English/abbreviated)
• Headquarters address
• Charter capital and ownership structure
• Legal representative details
• Business lines (using Vietnam Standard Industrial Classification — VSIC codes)

Processing time: 3 working days after submission of complete documents. The company legally exists from the ERC issuance date.

Step 4: Post-Licensing Compliance (30–60 Days)

Once the ERC is issued, the company must complete a series of mandatory registrations before commencing operations:

5. Capital Requirements

5.1 Charter Capital

Vietnam does not impose a universal minimum charter capital for all companies. However, conditional business lines have specific minimums:

• Real estate: VND 20 billion minimum
• Banking/finance: VND 500 billion – 3,000 billion (varies by license type)
• Insurance: VND 300–800 billion
• Employment services: No specific minimum but must demonstrate financial capacity
• General trading/services: No statutory minimum; practical recommendation of US$50,000–100,000 to demonstrate operational viability

Foreign investors must contribute charter capital in full within 90 days from the ERC issuance date. Late contribution may result in penalties and, in extreme cases, revocation of the IRC.

5.2 Investment Capital vs. Charter Capital

Under Vietnamese law, investment capital (total project cost) can exceed charter capital (equity). The difference is typically funded through loans. The DPI evaluates whether the proposed investment capital is realistic for the stated project objectives. Understating investment capital to appear less scrutinized is a common pitfall — it can lead to operational constraints later.

6. Entity Types Available to Foreign Investors

7. Timeline and Practical Expectations

While statutory processing times are short on paper, the practical timeline for a foreign investor to go from decision to operational readiness typically spans 8–16 weeks:

Accelerated timeline (Hanoi/HCMC): Major cities with FDI-friendly DPIs can process straightforward manufacturing/service projects in as little as 6–8 weeks. Projects in conditional sectors, requiring land, or in provinces with less FDI experience may take 12–20 weeks.

8. Common Pitfalls and How to Avoid Them

8.1 Mismatched Business Lines

Registering business lines that do not precisely match your intended activities is the most common IRC rejection reason. Vietnam uses the VSIC (Vietnam Standard Industrial Classification) system — each activity must be coded correctly. Work with a local consultant to map your proposed activities to the correct VSIC codes and verify market access conditions for each code.

8.2 Understated Investment Capital

Proposing unrealistically low investment capital to minimize scrutiny often backfires. The DPI evaluates whether the capital is sufficient to execute the project as described. If your project plan describes a US$2 million factory but your proposed investment capital is US$200,000, expect rejection or a request for revision.

8.3 Incomplete Legal Representative Documentation

The legal representative must have a valid passport, clean criminal record (in some cases), and can reside outside Vietnam. However, the company must have at least one legal representative residing in Vietnam. If the sole legal representative is a foreigner, they need a valid visa or residence permit.

8.4 Ignoring Post-Licensing Deadlines

Many investors focus entirely on getting the IRC/ERC and neglect post-licensing compliance. Missing the 90-day capital contribution deadline, failing to register labor within 30 days, or not setting up e-invoices before the first transaction can result in administrative fines and, in severe cases, suspension of operations.

8.5 Overlooking FTA Market Access

Vietnam’s commitments under CPTPP, EVFTA, UKVFTA, and RCEP may provide more favorable foreign ownership conditions than domestic law. For example, certain service sectors have higher foreign ownership caps under EVFTA than under the Investment Law. Always check FTA schedules before concluding a sector is restricted.

9. What the New Resolution 10 Means for New Entrants

Resolution 10-NQ/TW does not change the licensing procedures themselves but reshapes the strategic environment:

• Faster approval for high-tech, green, and R&D-intensive projects — the shift from quantity to quality means projects aligned with Vietnam’s development priorities receive prioritization.
• Outcome-based incentives — investors committing to technology transfer, local workforce training, and supply chain integration will access better tax holidays and land incentives.
• 75% of new FDI expected from developed economies by 2030 — investors from OECD countries, Japan, and South Korea with reputational capital are prioritized.
• Localization targets — 40–50% average localization rate in key manufacturing sectors and 10,000 Vietnamese enterprises integrated into FDI supply chains by 2030.

For new entrants, this means building a stronger investment proposal that demonstrates technology transfer, local employment, and supply chain benefits — not just capital deployment.

10. Post-Setup: Ongoing Compliance with Accounting & Assurance Services

Once your company is operational, Vietnam’s compliance calendar kicks in. Key ongoing obligations include:

• Monthly/Quarterly tax declarations: VAT, PIT, CIT provisional payments
• Annual financial statements: Prepared under VAS, audited if required (FDI companies must be audited annually)
• Annual CIT finalization: Due 90 days after fiscal year-end
• Transfer pricing documentation: Under Decree 132/2020/ND-CP for related-party transactions
• Labor reports: Biannual labor usage reports, annual occupational safety reports
• Investment monitoring reports: Quarterly/annual reports to DPI on investment implementation progress

For complete guidance on post-setup compliance, refer to our Accounting & Assurance Services for Foreign Enterprises guide, Tax Risk Management framework, and Bookkeeping Review & Audit Readiness checklist.

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Official sources: Vietnam Government News · Vietnam Laws Portal · Ministry of Finance Portal

Frequently Asked Questions

How long does it take to set up a company in Vietnam as a foreigner?

The practical timeline is 8–16 weeks from project decision to operational readiness. This includes document preparation (2–3 weeks), IRC approval (2–6 weeks), ERC issuance (1–2 weeks), and post-licensing compliance (2–4 weeks). Simple manufacturing/service projects in Hanoi or Ho Chi Minh City can complete in as little as 6–8 weeks.

What is the minimum capital required to set up a foreign-owned company in Vietnam?

There is no universal minimum charter capital. General trading and service companies have no statutory minimum, though a practical recommendation is US$50,000–100,000. Conditional sectors have specific minimums: real estate requires VND 20 billion, banking VND 500 billion–3,000 billion, and insurance VND 300–800 billion. All charter capital must be contributed within 90 days of the ERC issuance.

Can a foreigner be the legal representative of a Vietnamese company?

Yes, a foreigner can serve as the legal representative. However, the company must have at least one legal representative residing in Vietnam. If the sole legal representative is a foreigner, they must hold a valid visa, temporary residence card, or work permit. The legal representative does not need to be a shareholder or employee of the company.

What is the difference between the IRC and ERC?

The Investment Registration Certificate (IRC) is the project-level license issued by the Department of Planning and Investment that approves the foreign investment project. The Enterprise Registration Certificate (ERC) is the entity-level registration that establishes the company as a legal entity, containing its name, address, charter capital, and legal representative. Both are required for foreign-invested companies; domestic companies only need the ERC.

Do I need a Vietnamese partner to set up a company in Vietnam?

No. In most sectors, 100% foreign-owned companies are permitted under Vietnam’s WTO commitments and Investment Law. Joint ventures with Vietnamese partners are required only in specific sectors where foreign ownership is capped, such as certain advertising services (up to 51% foreign), education (varies), and some transportation services. Always verify market access conditions for your specific business lines.

What happens after I get the IRC and ERC — can I start operating immediately?

Not immediately. You must complete several post-licensing steps: engrave and register the company seal, open a Direct Investment Capital Account (DICA) at a bank, contribute charter capital within 90 days, register for tax and e-invoices, declare labor usage, and register for social insurance. Operations can typically begin 2–4 weeks after the ERC issuance once these registrations are complete.