A foreign-invested enterprise that opens its first Vietnamese storefront without a valid retail outlet licence — or misapplies the wrong licensing track — risks suspension of trading, revocation of its Investment Registration Certificate, and the sunk cost of fit-out, staffing, and inventory already committed to the site.
That exposure is rising just as the framework itself is in flux. Vietnam’s Ministry of Industry and Trade (MoIT) is finalising a draft decree to replace Decree 09/2018/ND-CP, having circulated a second consultation draft on 29 September 2025. The revised conditions restructure retail licensing around a sharper distinction between investors from FTA countries and investors from non-FTA countries.
For general counsel and boards planning a Vietnamese retail rollout, this article sets out what retail outlet licensing in Vietnam actually requires under the current regime and the pending draft decree, where the Economic Needs Test (ENT) still bites, and where FIEs most often misjudge their filings.
Business Licence Versus Retail Outlet Licence: Two Separate Approvals
Under the current framework (Decree 09/2018/ND-CP), a foreign-invested economic organisation does not need a Business Licence (BL) for most import, export, and wholesale activity — lubricating oil being the notable exception. Retail trade and a defined set of directly related activities, however, remain subject to a mandatory BL.
Opening a physical storefront additionally requires a separate Retail Outlet Licence (ROL) for each location. Holding an Investment Registration Certificate (IRC) and an Enterprise Registration Certificate (ERC) does not, by itself, authorise retail trading or the opening of an outlet — a point that continues to trip up first-time entrants to the Vietnamese market.
What the Draft Decree Changes
Decree 09/2018/ND-CP took effect on 15 January 2018, replacing Decree 23/2007/ND-CP, and governs goods-trading activity and directly related activities of foreign investors and foreign-invested economic organisations in Vietnam.
The replacement draft currently under MoIT review would extend distribution rights to goods processed or manufactured in Vietnam (not only domestically produced goods) and rewrites the BL and ROL conditions to track more closely whether the investor’s home jurisdiction has a free trade agreement (FTA) with Vietnam. [Note: this is the second consultation draft and has not been officially promulgated as of publication — enterprises should track the final text before relying on it.]
Licensing Conditions Under the Draft Decree: FTA Versus Non-FTA Investors
Under the draft, investors from countries or territories party to an international treaty to which Vietnam is a signatory — notably the EVFTA, CPTPP, UKVFTA, and the VN-UAE CEPA — benefit from materially lighter conditions than investors from jurisdictions without a relevant market-opening commitment for retail.
FTA-origin investors must meet their treaty’s market-access commitments (for example under the WTO Services Schedule or the EVFTA), have no overdue tax liabilities if operating in Vietnam for over a year, and maintain competitive capacity consistent with domestic regulation. The material benefit is duration: their BL runs for the remaining term of the ERC rather than a fixed number of years, avoiding a periodic renewal cycle.
| Investor category | Core condition | BL duration | Risk if unmet |
|---|---|---|---|
| FTA country (EVFTA, CPTPP, UKVFTA, VN-UAE CEPA) | Meets treaty market-access commitment; no overdue tax (if operating ≥1 year) | Remaining term of ERC | Moderate — additional evidence of treaty coverage often requested |
| Non-FTA country — joint venture (≥50% foreign capital) | Commitment to recruit/train at least 100 Vietnamese employees | 5 years, renewable | High — inadequate labour commitment is a common rejection ground |
| Non-FTA country — 100% foreign-owned | Commitment to recruit/train at least 300 Vietnamese employees | 5 years, renewable | High — large headcount threshold requires an early staffing plan |
Non-FTA Investors Face Materially Stricter Conditions
Investors without an applicable FTA market-access commitment face a labour-commitment threshold layered on top of the tax-compliance requirement: at least 100 Vietnamese employees for a joint venture with 50% or more foreign capital, and at least 300 for a wholly foreign-owned enterprise. Their BL is capped at five years and must be renewed.
[State Authority Practice / Verification Required]: how rigorously provincial Departments of Industry and Trade scrutinise the recruitment plan in practice — for example, whether a year-by-year hiring schedule is required — should be confirmed once the decree is finalised.
Where the Economic Needs Test Still Applies
A second outlet in the same province or city generally triggers the Economic Needs Test (ENT) under Article 23 of Decree 09/2018/ND-CP, unless the outlet is under 500 square metres and located inside a shopping mall — both conditions must be met simultaneously. An outlet outside a mall, however small, does not qualify for the exemption. This is the single most common planning error among FIEs mapping out a multi-store rollout, and it is analysed in depth in our companion article on the ENT.
Legal Risk If Licensing Conditions Are Skipped Or Misapplied
Three scenarios recur most often in practice: (1) an investor misclassifies its own FTA status — for instance assuming a treaty covers retail when the relevant schedule does not — leading to a rejected filing or a revoked BL after issuance; (2) the labour-recruitment plan is too vague to substantiate the 100/300-employee commitment, triggering repeated requests for supplementary evidence; (3) the outlet opens for trading before the ROL is issued, exposing the enterprise to administrative penalties and suspension.
Risk rating: High for misclassified investor status and pre-licence trading; Medium for an incomplete labour dossier that can still be remedied through supplementary filings.
Application Process in Practice
As a general matter, a BL application comprises an application form, a statement demonstrating compliance with the conditions applicable to the investor’s category, evidence of financial capacity, and a proposed business plan. A separate ROL application is required for each physical location.
The reviewing authority and statutory processing timeline under the new draft [Verification Required] remain unsettled while the text is finalised; enterprises should prepare their dossiers early and work with counsel to align the filing with the final promulgated version rather than a superseded draft.
Hypothetical Scenario: A Japanese Retailer Entering Vietnam
Hypothetical scenario — not based on an actual matter: a Japanese retail group, Japan being a CPTPP signatory alongside Vietnam, plans to open three convenience stores in Hanoi over 18 months.
Because Japan falls within the FTA investor category, the group’s BL — assuming the draft is adopted as currently written — would run for the remaining term of its ERC rather than being capped at five years, and it would not need to meet the 100–300 employee recruitment threshold. Its second and third outlets, however, would still require a separate ENT review unless their size and location qualify for the shopping-mall exemption.
Checklist Before Filing a Retail Outlet Licensing Application in Vietnam
Before filing a retail outlet licensing application in Vietnam, an FIE should confirm five points: the correct investor category (FTA or non-FTA, and whether the relevant FTA actually covers retail); evidence of no overdue tax liability if already operating in Vietnam; for non-FTA investors, a detailed year-by-year Vietnamese recruitment plan meeting the 100 or 300 threshold; the BL renewal calendar if subject to the five-year cap; and confirmation that no outlet opens or signs a long-term lease before the licence is formally issued.
Frequently Asked Questions
Does an FIE need a Business Licence for wholesale trading in Vietnam?
No. Under the current framework, most import, export, and wholesale activity does not require a BL, with lubricating oil as the main exception. The BL is mandatory for retail trade and a defined set of directly related activities.
What if the investor’s FTA does not actually cover retail market access?
The investor must then meet the conditions applicable to the corresponding non-FTA category, including the labour-recruitment threshold. Reviewing the relevant treaty’s services schedule before classifying the investor is essential.
Does a Retail Outlet Licence expire mid-operation and disrupt trading?
There is a real disruption risk if the renewal filing is not made in time, particularly for the five-year non-FTA category. Renewal should begin several months ahead of expiry.
When will the draft decree take effect?
As of publication, it remains a second-round consultation draft with no confirmed effective date. Enterprises should continue applying Decree 09/2018/ND-CP and monitor the promulgation timeline.
Related Terms
Retail outlet licensing is typically assessed alongside the Business Licence conditions at the initial market-entry stage and the capital-contribution procedures for setting up the licensed entity. For the rules governing a second or subsequent outlet, see our companion analysis of the Economic Needs Test. Official source: Ministry of Industry and Trade portal.
Conclusion
Foreign-invested retailers should treat retail outlet licensing, together with the economic needs test for later outlets, as a workstream that runs in parallel with market entry planning, not a formality to be handled after the lease is signed. Each additional outlet under the draft decree will still require its own retail outlet licensing file, and preparing that file early materially shortens time to store opening.
IVLF Lawyer advises clients to build retail outlet licensing into the site-selection timeline itself, and to confirm current practice with the Ministry of Industry and Trade before committing to a lease, since retail outlet licensing procedures continue to be clarified as the replacement decree for Decree 09/2018/ND-CP moves toward finalization.
Nguyen Trung Nghia — Founder & Managing Partner
Email: info@ivlf-lawyer.com
Every FDI retail outlet project should start with a retail outlet application Vietnam checklist. Understanding the draft decree retail licensing conditions early helps a foreign-invested enterprise retail plan secure its retail outlet licence Vietnam without delay, since the retail outlet approval process under the draft decree remains document-intensive.
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.
