Types of Companies in Vietnam for Foreign Investors

A limited liability company is a common choice for foreign investors setting up in Vietnam, but it is not the only option. A joint stock company can support share-based investment, while a representative office lets an overseas business establish a local presence without starting commercial operations.

The choice depends on what you want to do in Vietnam and how you plan to own and manage the business. It also affects the parent company’s liability, the way investors join or leave, and the registration process.

In this article, we will walk you through the main types of companies in Vietnam, how they compare, and which structures suit different business plans. We also cover capital, registration, beneficial ownership and the main tax considerations.

Types of Companies in Vietnam

Foreign investors primarily use limited liability companies and joint stock companies under the Law on Enterprises 2020, as amended. Both create a separate Vietnamese company and can support full foreign ownership where market access rules permit.

An overseas business can also enter through a branch, representative office or business cooperation contract. These offer different rights and do not all create a separate legal entity.

1. Limited Liability Company

A limited liability company, or LLC, suits investors who want a separate Vietnamese company with a relatively small ownership group. Members hold capital contributions rather than shares.

A single-member LLC has one owner, which can be an individual or an organization. This makes it a practical structure for an overseas parent establishing a fully owned subsidiary, or an individual investor who wants to own the business alone.

A multi-member LLC has between two and 50 members. Its members’ council makes key decisions, while a director or general director manages daily operations.

The difference becomes important when ownership changes. Under Article 52 of the Law on Enterprises, a member transferring their interest ordinarily offers it to the other members first. If they do not purchase it within the statutory 30-day period, the interest can be offered to an outsider on the same terms.

An LLC can admit new investors through capital contributions, but it cannot issue shares. For a business with a small, stable ownership group, this can provide the structure it needs without a joint stock company’s additional governance.

2. Joint Stock Company

A joint stock company, or JSC, divides its charter capital into shares. It requires at least three shareholders, which can be individuals or organizations, and has no maximum shareholder count.

A JSC can issue shares and, once it meets securities-law requirements, make a public offering or list on a stock exchange. It is therefore useful when the business plans several investment rounds, employee share ownership or a future public listing.

However, the ability to issue shares comes with more governance. A JSC has a general meeting of shareholders, a board of directors and a director or general director. Supervisory arrangements depend on its ownership and chosen governance model.

Shares are transferable subject to statutory and charter restrictions. In particular, Article 120 restricts certain transfers of founding shareholders’ ordinary shares to outsiders during the first three years.

An LLC can also bring in new investors, so raising capital does not automatically require a JSC. The stronger reason to choose one is a business plan that benefits from ownership divided into shares. Read more about setting up a joint stock company in Vietnam.

3. Joint Ventures

A joint venture describes an ownership arrangement rather than a separate company type. Foreign and Vietnamese investors can establish one using an LLC or JSC.

This arrangement can be necessary where market access rules require Vietnamese participation. It can also be a commercial choice when a local partner contributes distribution, industry experience or other resources.

Before registering, agree on decision-making, capital contributions, profit distribution and exit arrangements. These terms become especially important when the partners hold different ownership percentages. The guide to setting up a joint venture in Vietnam explains the structure in more detail.

4. Representative Office

A representative office allows an overseas company to conduct market research, maintain business relationships and promote trade in Vietnam. It can lease premises and employ staff, but it cannot directly sell goods or services, generate commercial revenue or issue sales invoices.

This makes it useful for a business that wants people on the ground while sales remain with the overseas parent. If the plan is to deliver services locally and invoice customers from Vietnam, a company will usually be the more suitable route.

Under Decree 07/2016/ND-CP, the overseas parent must have operated for at least one year. The office’s license can be issued for up to five years, subject to the parent’s remaining registration term, and can be renewed.

Licensing is handled by the provincial Department of Industry and Trade or the relevant zone management board, depending on the office’s location. Read more about opening a representative office in Vietnam.

5. Branch Office

A branch allows an overseas company to conduct permitted commercial activities in Vietnam without incorporating a separate subsidiary. It can sign contracts and earn revenue within its licensed scope, while the parent remains responsible for its obligations.

The main limitation is availability. Vietnam permits foreign branches in specified sectors, including banking, non-life insurance and certain professional services. A branch is therefore not a general alternative to an LLC for every business.

For foreign-trader branches governed by Decree 07/2016, the parent must have operated for at least five years. Licensing authority has been decentralized to the provincial People’s Committee under Decree 146/2025, while sector-specific branches follow their own regulatory frameworks.

For an eligible business, the choice is partly about liability: a subsidiary creates a separate company, whereas a branch leaves the overseas parent directly responsible. See the guide to registering a branch in Vietnam.

6. Business Cooperation Contract

A business cooperation contract, or BCC, lets investors cooperate on a project and share profits or products without creating a new company. It can involve Vietnamese and foreign investors, or foreign investors working together.

The agreement defines contributions, management, allocation of results and responsibilities. However, it does not create a separate limited-liability company, so allocating obligations between the parties requires careful drafting.

Article 77(2) of Decree 96/2026 requires investment registration for BCCs between Vietnamese and foreign investors, or between foreign investors. A partner’s existing licenses also do not automatically authorize every activity proposed under the contract.

How to Choose a Company Structure in Vietnam

Start with the activities you intend to carry out. Market access conditions can determine foreign ownership, partner requirements and the available entry structures before personal preference comes into the decision.

Next, consider the ownership arrangement. One owner can use a single-member LLC, while a small group can use a multi-member LLC. A business planning repeated share issues or a future listing has stronger reasons to consider a JSC.

For an overseas company, the first question may instead be whether it needs local commercial operations. A representative office can support research and relationships, but selling and delivering services locally calls for a structure authorized to perform those activities.

Settle these points before finalizing the company documents, so the ownership, management and licensing applications match the business you plan to run.

Capital and Management Requirements

Minimum Capital

Vietnam has no general statutory minimum capital for an ordinary LLC or JSC. Certain regulated activities have their own capital or investment requirements, and the proposed funding must support the project.

The amount also needs to be realistic. Premises, equipment, recruitment and operating costs all affect how much funding the business will need before it becomes self-sustaining.

Charter Capital and Project Investment Capital

Charter capital is the amount owners commit to the company. Total project investment capital can include charter capital and additional funding, such as loans.

Company-law rules normally require initial charter capital or subscribed shares to be paid within 90 days of enterprise registration. The investment registration certificate separately records the project’s capital and funding schedule.

For a company registered before its investment certificate, confirm how the capital contribution deadline and project funding schedule apply with the registration authority before transferring funds.

Legal Representative in Vietnam

Under Article 12 of the Law on Enterprises, a company must maintain at least one legal representative residing in Vietnam. This person can be a foreign national; the requirement concerns residence rather than Vietnamese ownership.

For investors managing from overseas, the legal representative’s role needs to be planned alongside banking, signing authority and daily management. Remote incorporation does not remove this ongoing requirement.

How Foreign Investors Register a Company in Vietnam

A newly established foreign-owned company carrying out an investment project typically needs an enterprise registration certificate, which establishes the company, and an investment registration certificate, which records the project.

The Law on Investment 2025 took effect on 1 March 2026. Decree 96/2026 took effect on 31 March 2026 under Article 111(1), with specified exceptions taking effect later. It provides for two registration sequences:

Under the company-first route, the registration application includes a commitment to meet foreign-investor market access conditions. The company must also obtain its investment certificate before adding other business lines.

Projects requiring investment policy approval need that approval at the appropriate stage. The company-first option does not remove project approvals or operating licenses.

1. Check Market Access and Select the Structure

Identify the goods the company will trade and the services it will provide. Each activity needs to be assessed against market access conditions and sector licensing requirements.

Once those requirements are clear, confirm the owners, ownership percentages and management structure. This establishes the basis for the company charter and investment application.

2. Prepare the Documents

The documents depend on whether the investors are individuals or organizations. They commonly include passports or corporate records, the company charter, ownership information, a project proposal and evidence of financial capacity.

Foreign corporate documents may require consular legalization and Vietnamese translations unless an exemption applies. Preparing the ownership chain early also helps with beneficial-owner declarations.

3. Obtain the Registration Certificates

Enterprise registration is handled by the provincial business registration authority under the Department of Finance. Investment registration is handled by the competent investment registration authority, which may be the Department of Finance or a relevant zone management board.

Choose the registration sequence based on the project, funding and operational plan. Registering the company first can help with preparation, but it does not permit the project to start before investment registration is complete.

4. Open the Capital Account and Contribute Funds

Arrange the appropriate investment capital account before transferring the investment. The bank will review the company’s ownership, certificates and transaction documents.

For qualifying companies registered before their investment certificate, Article 7(3) of Circular 38/2026/TT-NHNN allows an investment capital account to be opened before the certificate is issued. Its permitted uses are limited at that stage, including receiving charter capital and paying lawful investment-preparation expenses.

5. Complete the Operating Requirements

After registration, complete tax and accounting setup, arrange e-invoices and obtain any operating licenses. Hiring also brings payroll, personal income tax and social insurance obligations.

Emerhub’s Vietnam team handles market access checks, company registration and investment registration on your behalf. We also coordinate the capital account and post-registration requirements. Read more about company registration in Vietnam.

Beneficial Owners and Ultimate Parent Companies

Companies must identify and declare beneficial owners under the amended Law on Enterprises and Decree 168/2025, as further amended by Decree 296/2026.

For an ordinary company, the assessment starts with individuals holding at least 25% of charter capital or voting shares through direct, indirect or combined ownership. The rules also address qualifying group holdings, actual control and a senior-management fallback where ownership and control tests do not identify an individual.

An ultimate parent company and a beneficial owner are different. The ultimate parent is the corporate entity at the top of the group, while a beneficial owner is an individual identified under the statutory tests.

Prepare a group structure chart showing ownership percentages through each level. Supporting documents should establish both the immediate corporate owner and the individuals identified through the assessment.

New companies provide the required information during registration. Changes to declared beneficial-owner information must be notified within 10 days; the July 2026 amendments do not, by themselves, require every existing company to submit an unchanged declaration again.

Taxes for Companies in Vietnam

Choosing an LLC or JSC does not, by itself, change the standard corporate income tax rate. The standard rate is 20% of taxable income, while eligible businesses can qualify for lower rates or exemptions.

The revenue-based rates are 15% for qualifying companies with annual revenue up to VND 3 billion and 17% for those with revenue above VND 3 billion and up to VND 50 billion. Eligibility restrictions apply, including to certain subsidiaries and related enterprises, so a foreign group’s Vietnamese subsidiary does not qualify based on local revenue alone.

The standard VAT rate is 10%. Eligible supplies otherwise taxed at 10% qualify for an 8% rate until 31 December 2026, while excluded supplies retain their existing VAT treatment.

A representative office does not carry out revenue-generating business, so it does not pay corporate income tax on trading profits. However, it still has employee-related tax and compliance obligations.

Set Up Your Company in Vietnam with Emerhub

The right structure should support your planned activities, ownership and future investment. Once those decisions are made, the registration documents, capital and operating permissions need to follow the same plan.

Emerhub’s Vietnam team can help you:

• Check market access and sector requirements.
• Choose an LLC, JSC, branch or representative office.
• Prepare company and investment registration applications.
• Coordinate capital accounts and post-registration setup.
• Handle accounting, tax and ongoing compliance.

Contact our Vietnam team to discuss your plans. Fill out the form below, and we will help you identify the structure and registration requirements for your business.