Procedure for foreign commercial franchising registration in Vietnam

In the previous article, we discussed the initial conditions that franchisor and franchisee shall meet in order to conduct franchising activities in Vietnam. After determining the initial conditions that the parties need to meet, what documents do the parties need to prepare and what are the procedures for registering a franchise in Vietnam? The following article will help the parties find the right answer.

1.List of dossier that Franchisor and Franchisee shall prepare

To be permitted to engage in commercial franchising in Vietnam, the parties shall prepare the following documents:

• Commercial franchising registration application;
• An introduction to franchising in the format specified in the legal documents governing the franchising activities;
• Model franchise contract, this is the model contract that the franchisor intends to use to carry out franchising activities in Vietnam. This model contract shall have all of the terms that Vietnamese law requires a model contract to Competent state authority will also review the model contract’s terms to ensure that the contents specified in this Contract are in accordance with regulations;
• Financial statement that has been audited. It should be noted that each country will have its own rules for establishing and signing financial statement. As a result, franchising parties shall ensure that the financial statement expected to be submitted to the competent authority is in accordance with the requirement of the competent State The parties shall also consider when the financial statement will be independently audited in order to balance the time required to complete registration procedures and prepare dossier;
• A copy of the Certificate of Business Registration or equivalent document, certified by the competent authority where the foreign trader is legally established and consular legalization by Vietnamese regulations;
• Copy of patent in Vietnam or abroad in the case that the right to use industrial property objects granted protection titles is transferred. Franchisor and franchisee shall pay attention to the scope of protection to prepare additional documents or explanations to the competent authority (registration of protection under Vietnamese law or protection under the Madrid system);
• Documents proving the original franchisor’s consent to allow re-franchise in the case the trader registering for franchising is a secondary franchisor.

2. Applying the dossier at the Ministry of Industry and Trade 

After assessing the potential for success of the franchise operation expected to be performed in Vietnam, the franchisor shall  prepare dossiers in accordance with the above documents and complete the steps of franchising registration in Vietnam at the Ministry of Industry and Trade. The regulations of the submission and processing of dossier  shall be as follows:

• Submitting a full dossier to the Ministry of Industry and Trade directly or by express delivery, or in any other forms prescribed by the Ministry of Industry and Trade at the time of application submission;
• When the application for registration of commercial franchising is received, the registration authority shall write a receipt. The dossier receipt is made into three copies: one is delivered to the party registering commercial franchising, and the other two are kept at the registration agency;
• Within 05 working days after receiving complete the valid dossier, the competent state authority shall register commercial franchising activities in the commercial franchising register and notify in writing to trader of the registration;
• In the case the dossier is incomplete or invalid, the competent State authority shall send a written notice to the expected franchisor within 02 working days of receiving the dossier to supplement and complete the dossier;
• In the case the competent State authority refuses to register after the time limit specified above, it shall notify the expected franchisor in writing and clearly state the reasons.

In Vietnam, franchising is currently quite developed, and the actual procedure is not overly complicated or time-consuming. Before performing the franchising operation, the franchisor and franchisee should plan specifically about the conditions, ability to meet as well as the time to complete. This will be one of the factors that contribute to the parties’ franchise plan’s success.

Writing Time: 17/03/2023

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