A branch of foreign company Vietnam structure is the only entry vehicle that lets an unincorporated foreign trader earn revenue in Vietnam without forming a local company. It is also the least available: branches are permitted only in a narrow band of sectors, and most manufacturing and trading groups will find the option closed to them.
This guide explains when a branch of foreign company Vietnam structure is possible, what the licensing process involves, and how the tax and liability position compares with a representative office and a subsidiary.
Branch of Foreign Company Vietnam: Which Sectors Allow It
Vietnam permits branches of foreign traders only where its treaty commitments or sectoral law expressly allow. In practice the list is short: banking, insurance, securities, certain legal services, and a limited set of professional and technical services. Outside those lines, the licensing authority has no basis on which to grant a branch licence.
Investors from markets where branch structures are routine frequently assume the same is true in Vietnam. Confirming availability is the first step, because the alternative structures differ materially in cost and timeline. Our market access conditions guide sets out how the sectoral lists work.
Branch of Foreign Company Vietnam: Licensing Conditions
Under the Law on Commerce 2005 and Decree 07/2016/ND-CP, the foreign trader must be lawfully established under the law of a country party to a treaty to which Vietnam is a member, and must have been operating for at least five years from the date of establishment, a materially longer track record than the one year required for a representative office.
The registration certificate must remain valid for at least one further year at the date of filing, and the proposed scope must sit within Vietnam’s commitments. Where the sector is regulated, the specialised regulator licenses the branch instead of the Department of Industry and Trade, and its own capital, governance and personnel conditions apply on top.
Branch of Foreign Company Vietnam: Dossier and Timeline
The dossier mirrors the representative office file but is heavier: application form, registration certificate, audited financial statements, passport of the branch head, lease documents, and in addition the charter of the branch setting out its governance and internal delegation.
All foreign documents require consular legalisation and certified Vietnamese translation. Processing is longer than the seven working days that applies to a representative office, and sector regulators frequently issue supplementary requests. A realistic plan is three to six months from instruction where the sector regulator is involved.
Branch of Foreign Company Vietnam: Tax and Liability
A branch of foreign company Vietnam operations is a taxable presence. It pays corporate income tax on profit attributable to Vietnam, registers for value added tax, issues invoices, and files the same periodic returns as a local company. Related party dealings with the head office fall within the transfer pricing regime under Decree 132/2020/ND-CP as amended by Decree 20/2025/ND-CP.
Critically, the branch has no separate legal personality. The foreign trader is directly liable for all branch obligations, without the limitation that a subsidiary provides. For groups with meaningful contractual or product liability exposure, this is usually decisive against the branch route.
Branch of Foreign Company Vietnam: Licence Validity and Compliance
The licence runs for five years, capped at the remaining validity of the foreign trader’s own registration certificate, and is renewable on application filed before expiry. Amendments are required where the trader or branch changes name, address, head or scope.
The branch files an annual operating report before 30 January each year in addition to its tax filings. Failure to file is an express ground for revocation, and in regulated sectors it also triggers reporting to the sector regulator. Where the branch employs foreign staff, work permits are issued by the provincial People’s Committee under Decree 219/2025/ND-CP.
Choosing Between Branch, Office and Subsidiary
Choose a branch only where the sector expressly permits it, the group accepts direct liability, and a locally incorporated vehicle would create regulatory duplication, which is common in banking and insurance. Choose a representative office where no revenue will be earned. Choose a subsidiary in every other case.
Our comparison of a rep office, branch and subsidiary sets out the cost and timeline trade-offs, and our company incorporation guide covers the subsidiary route in detail.
15 Things to Prepare Before Setting Up an FDI Company in Vietnam
A four-page pre-filing checklist covering structure and market access, capital and the DICA account, licensing and legalisation, work permits, and tax. Current to July 2026, including Decree 96/2026/ND-CP, Decree 219/2025/ND-CP and Decree 236/2025/ND-CP.
Frequently Asked Questions
Can a trading company open a branch in Vietnam?
Generally no. Distribution and trading are served through a foreign-invested company holding a business licence under Decree 09/2018/ND-CP.
Does a branch need charter capital?
Not in the corporate sense, but regulated sectors impose allocated capital requirements set by the sector regulator.
Can a branch own land use rights?
No. Land use rights are held by Vietnamese legal entities; a branch may lease premises for its own operations.
How is branch profit remitted?
After annual tax finalisation and notification to the tax authority, in the same way as dividends from a subsidiary.
Speak to Our Market Entry Team
IVLF Advisors confirms whether a branch of foreign company Vietnam structure is available in your sector, prepares the licensing dossier, and manages the sector regulator interface. See also our foreign investment practice and the official procedures of the Ministry of Industry and Trade. Contact our team.
This article is provided for general information only and does not constitute legal advice for any specific case. Regulations may change – please consult a qualified professional before acting. Should further analysis be required, please contact one of our lawyers below.
