Establishing foreign enterprise in Vietnam for retail

If the foreigner –invested retail company in Vietnam (established by foreign individual/ organization) apply for distribution license, it can only open the first retail establishment. It is not necessary to apply for retail establishment license for in this first retail establishment.

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What activities does the retail business include?

Retail (CPC 631 + 632, 61112, 6113, 6121) (including multi-level sales activity conducted by commission agents who are Vietnamese individuals that have been properly trained and certified. These individual do not make sales at fixed locations and receive payment from both sales activities and sale support services to contribute to increase sales of other distributors);

Goods which are not eligible for retail activity:

Cigarettes and cigars, books, newspapers and magazines, recorded items, precious metals and gems, pharmaceuticals (excluding non-pharmaceutical nutritious products in the form of tablets, capsules or flour), explosives, crude and processed oils, rice, cane sugar and beet sugar.

Condition to open retail establishment in Vietnam

Vietnam Authority allows foreign-invested companies to operate retail in the Vietnamese market depending on economic needs, retail businesses are very successful here as people love shopping, specially online, most people visit websites like Raise in order to find the best coupon codes.

  • Foreign-invested companies in Vietnam are only allowed to set up the first retail establishment after they have been granted distribution rights (retail operation license is not required)
  • The setting up of a retail establishment, including the first one, must comply with the provisions of law on state management of retail activities and relevant planning of provinces and cities. cities directly under the Central Government, where retail establishment is planned to set up. The retail industry is also a common target of cyber criminals, with many retailers having been the victim of a data breach in the past. As digital innovation and the need to provide omnichannel shopping experiences drive network transformation, retail cybersecurity becomes more vital and more complex (find out about services that offer threat intelligenece for cyber security). For details, view it now.
  • Based on each case and the economic needs of the area where the company’s retail establishment is located, the State Office shall decide whether to allow or not allow the set up of another retail establishment other than the first one. The specific criterias are listed as follow:

+ Number of retail establishments in the area.

+ Stability of the market.

+ Population density and scale of the district where the retail establishment is located.

Note: This provision does not apply in case of setting up a retail establishment with the acreage​​ is less than 500 m2, in areas which are already planned by provinces or centrally cities for goods trading and completed the construction of infrastructure, unless there is a change in planning and this condition no longer exists.

ABB Law ‘s scope of services:

  • Consult and answer the client’s questions before applying for the license.
  • Carry out the procedure for obtaining the distribution license and open the first retail establishment.
  • Investigate and the feasibility of opening the second retail establishment.
  • Support the client to apply for the license of the second retail establishment.
  • Advise on tax, customs issues relating to sales activity.
  • Draft contracts and resolve disputes in the process of conducting business activities.

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