Business License for Trade Promotion Services in Vietnam

Update day: January 23 , 2025

Business License for Trade Promotion Services in Vietnam

In the process of investing in the Vietnamese market, many foreign enterprises have encountered stringent legal requirements and a multi-layered bureaucratic process. Specifically, for businesses providing trade promotion services, adding this new business activity to their portfolio is only the initial step. To effectively conduct operations, companies must take another critical step: applying for a Business License. This is not only a mandatory requirement under Vietnamese law but also a decisive factor in ensuring the legitimacy and success of the business in the market. A comprehensive understanding of the licensing regulations from the outset will allow investors to make well-prepared decisions, optimize resources, and mitigate unnecessary legal risks.

In this article, we will provide an in-depth overview of the conditions and procedures involved, as well as offer valuable insights to support foreign enterprises planning to operate trade promotion services in Vietnam.

Source: pexels-jakubzerdzicki-16098002

1. Conditions for Obtaining a Business License

Depending on the nationality or territory of the investor, the conditions for obtaining a business license are divided into two specific cases:
Case 1: Foreign Investor from a Country or Territory that Participates in International Treaties to Which Vietnam is a Member
For foreign investors from countries or territories that have signed international treaties with Vietnam, the process of obtaining a business license for providing trade promotion services will be smoother due to market opening commitments. However, the business must meet specific conditions to ensure legal compliance and eligibility to operate. Key points that investors should pay attention to include:

  • Market access conditions: Vietnam is a member of various international treaties such as the WTO, EVFTA, or ASEAN agreements, which commit the country to opening up certain sectors. However, these treaties come with restrictions regarding the scale of operations, capital contribution ratios, or forms of business in which foreign investors can participate. Businesses should carefully check the specific commitments in each treaty to ensure their operations are within the permitted scope.
  • Feasible financial plan: One of the core factors for obtaining a business license is proving the company’s financial capacity. Investors need to prepare a transparent and detailed financial plan, including two main components:

– Audited financial reports: If the business has been operating in Vietnam for over one year, the latest audited financial report is a crucial document to prove financial stability. This serves as the basis for authorities to assess the company’s ability to carry out business activities.

– Capital explanation and fundraising plan: For new businesses or expansion projects, investors must clearly outline the capital sources (own capital, loans, or other fundraising methods), along with supporting documentation. This shows not only financial readiness but also the ability to implement trade promotion activities sustainably.

  • Avoid overdue tax debts: For businesses that have been established in Vietnam for more than one year, not having overdue tax debts is a prerequisite. This demonstrates compliance with the law and builds trust with authorities. Investors should check and resolve any tax obligations before submitting the business license application to avoid rejection due to this reason.

Case 2: Foreign Investor from a Country or Territory Not Participating in International Treaties to Which Vietnam is a Member

For foreign investors from countries or territories that have no market-opening commitments with Vietnam under international treaties, obtaining a business license for trade promotion services will involve additional requirements. In addition to the financial plan and no overdue tax debts, investors must further demonstrate their capabilities in line with other specific criteria to ensure their competitiveness and positive contribution to the Vietnamese economy.

  • Compliance with specialized laws: One important requirement for investors in this case is proving that the business activities of buying goods and related services do not violate specialized laws in Vietnam. This requires the investor to have a clear understanding of the specific legal provisions that apply to their sector, including any restrictions or prohibitions that may apply to foreign businesses.
  • Ensuring competitiveness with domestic businesses: Since there is no international treaty guaranteeing the protection of their rights, foreign businesses in this case must prove that their presence will not negatively impact domestic businesses in the same sector. This is a key factor that Vietnamese authorities will scrutinize to ensure a balance between attracting foreign investment and protecting local businesses.

2. Procedure for Applying for a Business License for Providing Trade Promotion Services

Registering a business license for providing trade promotion services (excluding advertising services) is a strictly regulated process under Decree 09/2018/ND-CP. Foreign enterprises need to understand each step of the process to prepare their documents and follow the procedure correctly, avoiding delays or rejections. The detailed steps in this procedure are as follows:

Step 1: Preparation and Submission of Documents

  • Required documents: The business must prepare two complete sets of documents that comply with the detailed requirements under Article 12 of Decree 09/2018/ND-CP. The documents should include evidence of financial capacity, a business plan, and other required legal documents. Proper and accurate preparation from the outset is crucial to ensure swift approval.
  • Submission location: The documents should be submitted to the Department of Industry and Trade in the locality where the business is headquartered. This ensures effective management and coordination between the business and local authorities.

Step 2: Department of Industry and Trade Processing

Once the documents are received, the Department of Industry and Trade will verify the conditions and validity of the documents within 10 working days. If the documents meet the requirements, the Department will send them to the Ministry of Industry and Trade for feedback. During this stage, incomplete or missing documents may lead to a rejection or a request for additional information, resulting in delays. Businesses should proactively monitor the processing status through communication channels with the Department of Industry and Trade to avoid disruptions.

Step 3: Ministry of Industry and Trade Evaluation and Response

The Ministry of Industry and Trade, as the higher-level evaluation body, will make a decision to approve or reject the application within 15 working days from the time they receive the documents from the Department of Industry and Trade.

  • If approved: The Ministry will issue an approval letter and send it back to the Department of Industry and Trade.
  • If rejected: The Ministry will clearly state the reasons and request the business to amend or add information.

Step 4: Issuance of the Business License

After receiving the approval letter from the Ministry of Industry and Trade, the Department of Industry and Trade will issue the business license to the business within three working days. This is the final step in completing the process, allowing the business to officially operate in the trade promotion sector in Vietnam.

Registering a business license for providing trade promotion services in Vietnam is a complex process requiring careful preparation and strict compliance with legal provisions. Despite the many administrative procedures, this remains a significant opportunity for foreign investors as Vietnam’s market demand for this sector continues to grow. Legal experts’ assistance will help businesses optimize their time, costs, and ensure success in expanding operations.

Time of writing: 13/01/2025

The article contains general information which is of reference value, in case you want to receive legal opinions on issues you need clarification on, please get in touch with our Lawyer  at  info@cdlaf.vn

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