Joint Stock Company in Vietnam

 02.05.2024

Starting company with foreign investment in Vietnam

Business in Vietnam

Vietnamese law regarding foreign investments and business creation allows foreign citizens or entities to take part in a Vietnamese joint stock company as a shareholder. The process of opening is the same for all types of companies - the first step is to establish the company with Vietnamese members, and the second step is to transfer their rights, obligation, and shares to foreign investors.

Many entrepreneurs want to know which is better - a joint stock company or a limited liability company. Let’s outline the differences.

 

Main differences between LLC and JSC in Vietnam:

- Number of members - in JSC there can be any number of shareholders, in LLC there can be up to 50 members;

- The way of transferring or selling shares - in JSC, within the first three years after the establishment of the company, all shareholders must approve the sale or transfer of shares. However, after three years shareholders can independently sell, or dispose of their shares in any way without the approval of other shareholders. In LLC, the procedure for the transfer, and sale of shares is always accompanied by the unanimous approval of all its members;

- Increase the capital of the company - in JSC this is much easier since the company issues shares for borrowed funds - thus investors are guaranteed to participate in the distribution of future profits. LLC must have collateral instruments, or distribute a share in the charter capital to the investor.

 

Our experts will advise you on all issues related to starting a joint stock company in Vietnam. This will save you time and money.

You can book a consultation by following the link below.

Joint stock company in Vietnam

Book a consultation with an expert on starting joint stock company in Vietnam

 

THE COMMON POINTS FOR ALL TYPES OF JSC IN VIETNAM

Registering a  joint stock company in Vietnam

❖ Legislatively, the amount of authorized capital is not regulated, but practice shows that the authorized capital which is less than the indicated amounts entails a refusal to issue work permits.
❖ The founders are responsible for the value limits of their stocks.
❖ Minimum price for 1 stock is 10 000 VND.
❖ Controlling stake is 10 %.
❖ Types of stocks:

  1. Simple stocks;
  2. Preferred stocks with preferential right of the vote;
  3. Preferred stocks with the preferential right distribution of the dividends;
  4. Redeemable preferred stocks prescribed by the Charter of Joint Stock Company.

❖ Each company opening in Vietnam must pay:

  1. The patent at the rate of 2.000.000 VND (90 USD) / per year;
  2. USB flash drive for registration in the tax inspection and submission of tax reports  - 2.500.000 VND (110 USD) /per 18 months;
  3.  If you don’t have a trusted Vietnamese citizen who will allow personal information for the company registration, we can provide such a person and you have to pay a Vietnamese member 300 USD / per year, depending on their shares.

So, choose the most convenient option for you. Prices and terms depend on the total amount of foreign investment:

 

I. FROM 1% TO 50% AUTHORIZED CAPITAL

- Number of members - no less than 3;

- Minimal authorized capital for each member is 22.000 USD. In order to make a capital contribution, foreign investors have to open a personal bank account in any Vietnamese bank.  We offer Techcombank, Vietcombank, VP bank. These are the most convenient banks for this purpose. If you cannot carry out making a capital contribution by yourself for any reason, we can request making this procedure using borrowings (3%);

- Foreign investors can be a director with authorized signatories in the bank;

- Participation of Vietnamese co-founders in the economic activity of the company - Vietnamese shareholders are rightful participants of the company and they have the right to take part in the economic activity of the company, any further actions with the company may only be performed if their signatures in the Record of Board of Directors. Our company provides a trusted person who will not claim to take part in the economic activity of the company. In this instance we will prepare the necessary documents for the total safety of the foreign investors;

- The term of registration - 15 working days;

- The types of business without the additional permissions:

  • Hospitality business (you can build or rent a hotel);
  • Restaurant, cafe, catering (without alcohol);
  • Travel agency (only sales tours of other companies);
  • Advertising;
  • Activity is connected with the IT sphere;
  • Consulting services are not connected with manufacture;
  • Production and sales of wheat products.

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A company with a share of foreign investors in authorized capital no more than 50% doesn't need to get permission for foreign investment or additional activities. If you need additional activities, they're cheaper and quicker.

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There is just one drawback, but it’s significant - Vietnamese partners can interfere with the business. For this reason, our company prepares a set of documents for the safety of foreign investors. As such, this drawback is eradicated. Nevertheless, there are skeptics who don’t like Vietnamese participation.

Anyway, the decision is yours!
The price for registration of the company is from 1.500 USD.

 

II. FROM 50% TO 99% AUTHORIZED CAPITAL OF FOREIGN INVESTOR

- Number of members- no less than 3;

- Minimal authorized capital for each member is 22.000 USD. In order to make a capital contribution, foreign investors have to open a personal bank account in any Vietnamese bank.  We offer Techcombank, Vietcombank, VP bank. These are the most convenient banks for this purpose. If you cannot carry out making a capital contribution by yourself for any reason, we can request making this procedure using borrowings (3%);

- Foreign investors can be a director with authorized signatories in the bank;

- Participation of Vietnamese co-founders in the economic activities of the company - If a Vietnamese member has shares of 10% or more, they are entitled to vote at the meeting of the Board of Directors and cancel the decision. If a Vietnamese member has shares of less than 10%, they cannot take part in the economic activity of the company;

- The term of registration - 35 working days;

- Companies with a share of foreign investment of more than 50% in authorized capital must get permission for its contribution;

- Types of business without the necessity of additional permissions:

  • Hospitality business (you can build or rent a hotel);
  • Restaurant, cafe, catering (without alcohol);
  • Travel agency (only sales tours of other companies);
  • Advertising;
  • Activity is connected with the IT sphere;
  • Consulting services are not connected with manufacture;
  • Production and sales of wheat products.

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You are the sole owner and managing director of the company.

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Higher price and getting additional activities and long term.

Anyway, the decision is yours!
The price for registration of the company is from 2.000 USD.

 

III. 100% AUTHORIZED CAPITAL OF FOREIGN INVESTOR

- Number of members is no less than 3;

- Minimal authorized capital for each member is 22.000 USD. In order to make a capital contribution, foreign investors have to open a personal bank account in any Vietnamese bank. We offer Techcombank, Vietcombank, VP bank. These are the most convenient banks for this purpose. If you cannot carry out making a capital contribution by yourself for any reason, we can request to make this procedure using borrowings (about 3%);

- Foreign investors can be a director with authorized signatories in the bank;

- Participation of Vietnamese co-founders in economic activities of the company - Vietnamese members don't participate;

- The term of registration - 45 working days;

- Companies with a share of foreign investment of more than 50% in authorized capital must get permission for its contribution;

- Types of business without the necessity of additional permissions:

  • Hospitality business (you can build or rent a hotel);
  • Restaurant, cafe, catering (without alcohol);
  • Travel agency (only sales tours of other companies);
  • Consulting services are not connected with the manufacture

++

You are the sole owner and managing director of the company.

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Higher price and getting additional activities and long term.

The price for registration of the company is from 2.500 USD.

 

Leadership TSC will take care of all the work of registering a company in Vietnam and provide you with a ready-made result. All actions and payments are made only on the basis of the Agreement concluded between our company and you.

Contact us now and get a ready-made proposal for starting JS company in Vietnam.