Set Up Business in Vietnam

Vietnam Expansion Guide

Global Upside helps companies set up, hire, and operate in Vietnam. Set up a legal entity quickly and easily with our solutions for branch, subsidiary, and rep office. Looking for an alternative to permanent establishment? Hire and pay employees in Vietnam without a legal entity by using our PEO & employer of record services. Once your business is set up, our teams can support with recruitment and staffing, human resources, employee benefits, payroll, accounting, and tax.

Capital City



Vietnamese Dong (₫)




Socialist Republic of Vietnam

Country Overview

One of the most dynamic emerging nations in the East Asia region, Vietnam has a market economy and is a lower middle-income country. Over the past 3 decades, Vietnam has seen a spurred economic growth with a constant increase in the GDP per capita.

  • Vietnam’s economic model is dependent on exports and foreign investment.
  • The major exports are transmission and electronic apparatus, automatic data processing machines, electronic integrated circuits, and technology products.
  • Vietnam imports petroleum oils, electronic integrated circuits, transmission, and electronic apparatus.

There are 5 types of legal entity setups in Vietnam, however, the JSC, 2M-LLC, and IM-LLC have their own legal status. The IM-LLC is the most popular and commonly used form by foreign stockholders when they plan to set up a legal establishment in Vietnam. The other 2 kinds of establishments i.e., Partnership and Private Enterprise are more appropriate for local stockholders.

Joint-Stock Company (JSC)

A joint-stock company (JSC) is a form of establishment that requires a minimum of 3 shareholders and there are no personal liabilities of the investors.

Multi-Member Limited Liability Company (2M-LLC)

Multi-member limited liability company (2M-LLC) needs a minimum of 2 and a maximum number of 50 investors or legal entities. The investors do not have any personal liabilities and the Members of Council (MC) takes a decision on the prime affairs and also have the management responsibilities.

Single-Limited Liability Company (IM-LLC)

Single-limited liability company (IM-LLC) needs only 1 investor who can either be an individual or a legal entity. The investor does not have any personal liabilities and either the MC or the company’s president has the overall management responsibility, whilst the General Director or the CEO has day-to-day administration responsibility.


Partnership is the kind of establishment that needs a minimum of 2 unlimited liability partners who are individuals and there are no constraints to the number of limited liability partners. That said, there are no personal liabilities of the limited partners but the unlimited partners have to be liable for all forms of obligations. The unlimited partners have day-to-day administration responsibilities, whilst the Partners’ Council has overall management responsibilities.

Private Enterprise

Private Enterprise needs a single individual owner who will have to bear the personal liabilities. The proprietor will administer all day-to-day and overall management responsibilities and also contribute funding to the venture capital of the private enterprise.

It takes a minimum of 4 to 6 weeks to incorporate a legal establishment in Vietnam.

An employment contract must be in writing with a copy for the employer and the employee. The contract may be made orally only if the job is temporary—with a term of three months or less—or if the employee is hired as a domestic servant.

The employment contract must include:

  • Job description
  • Remuneration
  • Working and rest hours
  • Job location
  • Contract duration
  • Workplace hygiene and safety
  • Social insurance terms

A contract may be valid for an indefinite term, for one to three years, or for a seasonal job or a specific job to be carried out in less than one year. (Note: Effective Jan. 1,2021, there will be only two types of labor contracts: definite term contracts up to 36 months in length and indefinite-term contracts.)

Employers must conduct a self-review of their compliance with employment law at least once a year.

Employees are entitled to the following 10 public holidays with full pay:

  • Jan. 1: New Year’s Day
  • Lunar New Year Festival (5 days)
  • Mar. 10: Hung Kings Commemoration Day
  • Apr. 30: Victory Day
  • May 1: International Labor Day
  • Sept. 2: National Day

Foreign citizens working in Vietnam are entitled to one day of their country’s National Day (if any) and one traditional public holiday in addition to the ten public holidays stipulated by law.

The payroll period in Vietnam is semi-monthly or monthly and it is customary to pay a 13th-month salary at Tet holiday or at the year-end.

The International Financial Reporting Standards (IFRS) are universal bookkeeping standards published and governed by the International Accounting Standard Board (IASB) to educate the groundwork and introduction of monetary reports. Vietnam uses IFRS as a reason for its own system, the Vietnamese Accounting Standards (VAS), yet there are key contrasts between the two.

Corporate Tax

The corporate tax rate in Vietnam is 20%.

Value Added Tax (VAT)

The VAT rate here is 10%. However, the reduced rate is 5% on an array of exempt services and products, a few food items, and imports.

In the Constitution 2013 and Civil Code 2015, the right of privacy and right of dignity, honor, reputation, and some fundamental laws of such rights are provided. These rights are protected and inviolable by law. The law states that any individual who wants to collect, store, use or publish anyone’s personal data has to seek prior consent.

Anti-Bribery & Anti-Corruption Law

In Vietnam, the Anti-Corruption Law1 and the Penal Code governs all anti-corruption or anti-bribery acts.

1. Bribery of public officials:

For individuals:

i) Imprisonment for a minimum of 6 months up to 20 years.

ii) Confiscation of the property or fund that has been offered as a bribe.

2. Bribery of private officials:

For individuals:

i) Imprisonment for a minimum of 6 months up to 20 years.

ii) A monetary fine of VND 50 million to VND 100 million.

iii) Accused will be subject to criminal liability.