Corporate Law at Vietnam
Here’s a detailed overview of Corporate Law in Vietnam, capturing the essentials as of 2025:
🇻🇳 Corporate Law in Vietnam: Overview
1. Legal Framework
Governed primarily by the Law on Enterprises No. 59/2020/QH14, effective from January 1, 2021.
Supplemented by the Investment Law and Commercial Law.
The legal framework emphasizes transparency, protection of investors, and streamlined procedures for business formation.
2. Types of Business Entities
| Type | Description | Min. Capital | Liability |
|---|---|---|---|
| Limited Liability Company (LLC) | Most common for SMEs; single-member or multi-member | No statutory minimum but must be "suitable" | Limited to capital |
| Joint Stock Company (JSC) | For larger businesses; can issue shares publicly | No statutory minimum; at least 3 shareholders | Limited to capital |
| Partnership | General or limited partnerships | No min. capital | General partners unlimited liability; limited partners limited |
| Sole Proprietorship | Owned by an individual | No min. capital | Unlimited personal liability |
3. Corporate Governance
LLCs:
Managed by a Board of Members (multi-member LLC) or Chairman (single-member LLC).
Member meetings required for important decisions.
JSCs:
Must have:
General Meeting of Shareholders
Board of Directors (3 to 11 members)
Supervisory Board or a Controller
More complex governance structures to meet public company standards.
4. Company Registration & Compliance
Registration with the Department of Planning and Investment (DPI).
Online business registration portal facilitates quick incorporation.
Businesses must issue and publish annual financial statements according to Vietnamese Accounting Standards.
Regular tax filings and compliance with labor, environmental, and commercial regulations.
5. Foreign Investment
Foreign investors can fully own most business types, except for restricted sectors (e.g., media, security).
Investment activities regulated under the Investment Law 2020.
Incentives such as tax holidays, reduced tax rates, and land use fee exemptions for projects in high-tech, infrastructure, or prioritized sectors.
6. Taxation
Corporate income tax (CIT) rate is generally 20%.
Preferential rates (10%, 15%) available for certain industries or regions.
VAT standard rate is 10%.
Other taxes include personal income tax, import/export duties, and environmental tax.
7. Recent Reforms
Introduction of simplified business registration procedures and e-government services.
Increased protections for minority shareholders.
Enhanced transparency and stricter requirements for disclosures in public companies.
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