Vietnam’s dynamic and rapidly growing economy, along with its increasing integration into the global supply chain, has made it a desirable destination for foreign investors seeking lucrative opportunities. Over the past decade, the country has seen a significant uptick in company incorporations, largely fueled by a surge in foreign investments. Notably, Vietnam permits the establishment of companies with 100% foreign ownership.
To establish a company in Vietnam, foreign individuals or entities must register with the appropriate state authorities and obtain the necessary certificates and licenses. These procedures are crucial for safeguarding investor rights and preventing investment fraud. Besides the essential Enterprise Registration Certificate (ERC), another critical document required for setting up a foreign direct investment limited liability company in Vietnam is the Investment Registration Certificate (IRC).
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Our incorporation specialists have prepared a comprehensive guide to help you navigate the process of obtaining an Investment Registration Certificate in Vietnam.
What is an Investment Registration Certificate (IRC) in Vietnam?
An Investment Registration Certificate (IRC) in Vietnam is an essential document issued by the Vietnamese government to foreign investors, available in both physical and electronic formats. This certificate serves as the official record of a registered investment project involving foreign direct investment (FDI). It details information about the investment, including the identity of the investors, the objectives of the investment, the project’s duration, and the status of land use if applicable. The IRC Vietnam also outlines the total capital committed to the project, any investment incentives or assistance provided, and specific requirements related to the investment.
Find out more about Industry Capital & Deposit Requirements in Vietnam!
According to the Vietnam Law on Investment 2020, the Investment Registration Certificate is a pivotal document that officially records the registered details of an investment project undertaken by foreign investors. It includes detailed information about the investment project, such as the investor’s identity, the specifics of the company being established (including its name, structure, and charter capital), and comprehensive details of the project (including its name, location, objectives, scale, capital, and implementation schedule). It also includes documentation of the investor’s legal status and financial capability, demonstrated through audited reports, bank statements, or financial guarantees.
To apply for a certificate of investment registration in Vietnam, foreign investors must submit various documents, including:
- Investor Information: Details about the investor;
- Company Information: Name, type, charter capital, and contribution ratio;
- Project Information: Name, location, objectives, scale, capital and plan for capital mobilization, operational term, and implementation schedule;
- Legal Documents: Proof of the investor’s legal status;
- Financial Proof: Documents proving the financial capability of the investor, such as audit reports, bank statements, or financial guarantees;
- Investment Proposal: Details on investor selection, objectives, scale, capital plan, location, duration, schedule, land use, labor needs, investment incentives, socio-economic impact, and preliminary environmental assessment;
- Pre-feasibility Study: If required by construction law, this can substitute the investment proposal;
- Location Rights: Documents verifying the right to use the land for the project.
- BCC Contract: If applicable for certain types of investment projects;
- Additional Documents: Any other documents relevant to the project or required by law.
The application process for an IRC Vietnam typically takes between 15 to 45 working days following the submission of a complete dossier. The process begins with an online registration at the government’s FDI portal.
Duration of Investment Registration Certificate (IRC) in Vietnam
The duration of an Investment Registration Certificate (IRC) in Vietnam corresponds to the operational timeframe of the investment project it covers. The Investment Certificate Authority determines this duration based on the project’s goals, scale, location, and operational needs.
According to Article 44 of the Investment Law:
- Economic Zones: For projects located within an economic zone, the maximum duration is 70 years
- Non-Economic Zones: For projects outside of economic zones, the maximum duration is 50 years. However, projects situated in disadvantaged or extremely disadvantaged areas, or those involving large investments with a slow rate of capital recovery, can be granted a duration of up to 70 years
- Land Allocation Delays: If a project involves land allocated or leased by the State, any delays in land transfer will not count towards the project’s duration or its execution schedule
The duration of an investment project starts from the date when the investor receives the decision on investor approval, the decision on approval for both investment guidelines and the investor or the issuance of the certificate of investment registration in Vietnam for the first time. For projects involving land allocated, leased, or repurposed by the State, the duration begins from the date the investor receives the decision on land allocation, leasing, or repurposing. If there are delays in transferring the land, the project duration starts from the date the land is actually transferred on-site.
Requirements and Process for Securing an Investment Registration Certificate (IRC) in Vietnam
Step 1: Register the Investment Registration Certificate
Authority to Issue the IRC Vietnam
- Industrial and Economic Zones: The management boards of industrial parks, export-processing zones, hi-tech zones, and economic zones handle IRCs for projects within these areas
- Outside Special Zones: The Services of Planning and Investment manage IRCs for projects outside these zones, except for specific cases
- Multiple Provinces or Mixed Locations: The Service of Planning and Investment in the province where the investor’s main office will be located handles projects that span multiple provinces or locations inside and outside special zones
Dossier for IRC Vietnam Application
- A written request for project execution
- Copy of ID or passport for individuals; Certificate of Establishment for organizations
- Detailed investment proposal including objectives, scale, capital, location, duration, and labor needs
- Financial documents: financial statements, commitments from parent companies or financial institutions, or guarantees of financial capacity
- Office lease agreement and proof of the lessor’s rights
- Land use demand and related documents if the project involves State land
- Explanation of technology use for projects with restricted technologies
- Business cooperation contract if applicable
Application Process
- Online Registration: Register the project on the National Foreign Investment Information System
- Submit Application: Within 15 days of online filing, submit the dossier to the Investment Registration Authority
- Track Application: An online account will be provided to monitor the application’s progress
- Receive IRC: If approved, the IRC Vietnam is issued and a project code is provided. If rejected, the authority will provide reasons in writing
Step 2: Register the Enterprise Registration Certificate
Required Dossier
- Application form for business registration
- Company charter
- List of members (for limited companies) or shareholders (for joint-stock companies)
- Certified copies of:
- ID cards or equivalent documents for individual members.
- Establishment decision, business registration certificate, or equivalent documents for organizational members, including consular legalization for foreign organizations.
- The IRC Vietnam of foreign investors as per the Investment Law.
- Power of Attorney for authorized service providers.
Application Process
- Submit the application dossier through the National Enterprise Registration Portal
- Within 3-5 days, the business registration agency issues the Enterprise Registration Certificate
- Make a public announcement on the National Enterprise Registration Portal within 30 days of issuance
Step 3: Register the Business License for Conditional Business Lines
For businesses in regulated sectors, a separate business license is needed before commencing operations. Examples include:
- Retail Business: Foreign investors must obtain a business license to retail goods or establish retail outlets
- International Travel: Foreign investors can conduct international travel business by bringing foreign tourists to Vietnam
- Foreign Language Training: Approval from the Department of Education and Training is required, followed by obtaining an operation license
Components of an Investment Project Approval Application
An application for approval of an investment project in Vietnam comprises several essential components. Here’s a concise overview of what is required:
- Application Form: This includes a commitment from the investor to bear all costs and risks if the project is not approved.
- Investor’s Legal Status: Documents that establish the legal identity of the investor.
- Financial Capacity Proof: At least one of the following documents:
- Financial statements for the past two years.
- The commitment of financial support from a parent company.
- Commitment of financial support from a financial institution.
- Guarantee of the investor’s financial capacity.
- Any other document proving financial capability.
- Investment Proposal: This should detail:
- Investor or method of selecting the investor.
- Investment objectives, scale, and capital.
- Plan for raising capital.
- Project location, duration, and schedule.
- Current land use status and proposed land use (if applicable).
- Labor needs.
- Proposed investment incentives.
- Socio-economic impact and preliminary environmental assessment.
- If required by construction law, a pre-feasibility study report may replace the investment proposal.
- Land Use Documentation: If the project does not require state-allocated or leased land, provide documents proving the right to use the project location.
- Technology Explanation: For projects requiring technology appraisal and feedback, provide a detailed technology explanation.
- BCC Contract: If the investment project is under a business cooperation contract, include this contract.
By adhering to these guidelines and preparing the necessary documentation meticulously, investors can streamline the process of securing an IRC in Vietnam, paving the way for successful and compliant business operations within the country.
Conclusion
Obtaining an Investment Registration Certificate (IRC) in Vietnam is a crucial step for foreign investors looking to establish a business presence in the country. The process involves multiple steps and requires comprehensive documentation, ranging from legal and financial proofs to detailed project proposals.
Understanding the requirements and following the prescribed procedures can help investors navigate the regulatory landscape effectively, ensuring a smooth setup and successful operation of their business ventures in Vietnam. With the support of InCorp Vietnam’s professional services and thorough preparation, foreign investors can leverage Vietnam’s growing market and favorable investment environment to achieve their business objectives.
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