Business Structures for Foreigners in Vietnam
LLC, representative office, or local partnership? The honest breakdown of each structure and what it means for you.
Business Structures for Foreigners in Vietnam
Vietnam law allows foreigners to own and operate businesses, but the options have different implications for control, liability, taxes, and operations. Here are the main structures you need to know.
1. Foreign Direct Investment (FDI) Company — LLC
A 100% foreign-owned limited liability company is the most common structure for foreigners who want full control.
| Aspect | Details |
|---|---|
| Minimum capital | No statutory minimum for most sectors; typically $10,000–$50,000 in practice |
| Setup time | 4–8 weeks with a good lawyer |
| Control | 100% — you own it entirely |
| Business scope | Limited to activities listed in your IRC (Investment Registration Certificate) |
| Cost | $1,500–$3,000 in legal fees; state fees ~$200 |
Best for: Anyone planning to operate long-term, hire staff, sign leases, and run a real business.
2. Representative Office
A rep office lets you establish a presence in Vietnam for market research, liaison, and promotion — but cannot generate revenue or sign commercial contracts.
- Cheaper and faster to set up (~2–3 weeks)
- Ideal for testing the market before committing
- Cannot invoice Vietnamese clients directly
3. Local Vietnamese Company (Partnership)
Register a company in a Vietnamese partner's name, with you as a silent or partial owner. Common in restricted sectors (media, education at certain levels, healthcare).
- Risk: you depend entirely on the trustworthiness of your local partner
- Must have watertight legal agreements — a standard VN company contract will not protect you
- Only recommended if you have a trusted, long-term partner relationship
4. Branch Office
An extension of a foreign parent company. Allowed in limited sectors. Rare for first-time entrepreneurs — skip this unless your lawyer specifically recommends it for your sector.
Recommendation: For most entrepreneurs, the 100% foreign-owned LLC (FDI company) is the right choice. Yes, it takes a few weeks and a few thousand dollars. But it gives you full control, legal protection, and the ability to operate freely.