Post-licensing is the period in which the representative office of a foreign trader in Vietnam (“Representative Office”) has been licensed by a competent authority to operate legally in Vietnam. From this point on, the Representative Office is allowed to perform its functions within the scope specified in the license. The following notes are suggestions of TTVN Legal for the foreign trader and the Head of Representative Office in managing the operation of Representative Office in Vietnam in this post-licensing period.
A Representative Office is considered as a dependent unit of the foreign trader, therefore, according to Article 4 of Circular No. 105/2020/TT-BTC, a Representative Office must make tax registration at the tax office where it is headquartered.
Tax registration documents usually include:
- Tax registration declaration form;
- Lists of dependent units, business locations, foreign contractors, oil and gas investors, etc. (if any; details in accordance with Circular No. 105/2020/TT-BTC);
- Copy of Representative Office Establishment License.
The above tax registration must be carried out by the Representative Office within 10 working days from the date of issuance of the establishment license as prescribed in Article 33 of the Law on Tax Administration No. 38/2019/QH14.
2. Seal registration
Vietnamese law stipulates that the use of seals shall be decided by enterprises themselves, therefore, the use of the seal of the Representative Office is regulated by the foreign trader and this seal must be permitted to be used in Vietnam. Thus, the seal of the Representative Office can be identified in one of the following two options:
- Using the seal of the foreign trader: In this case, the foreign trader should have a regulation specifying the extent to which the seal can be used in the operation of the Representative Office, and above all, the Representative Office is not allowed to use this seal in business activities of the foreign trader but only within the scope of licensed activities.
- Using a new seal (the representative office’s own seal): In this case, the foreign trader still needs to clearly state that this seal belongs to the right to use the Representative Office.
In order to use the seal according to the above two options, the Representative Office must carry out the procedure for registering the seal at the competent authority of Vietnam according to the provisions of Decree No. 99/2016/ND-CP. The application file usually includes the Representative Office Establishment License and the legal documents of the Head of the Representative Office.
3. Bank account opening
The Representative Office is allowed to open a payment account in Vietnam. This account can be opened in foreign currency or in Vietnamese dong of foreign currency origin at a Bank that is licensed to operate in Vietnam and may only use this account for operations of the Representative Office.
The application for opening a payment account usually includes the following documents:
- Application form for opening a payment account;
- Representative Office Establishment License;
- Legal documents of the Head of the Representative Office and Appointment document of Head of Representative Office;
- Decision on appointment of chief accountant or person in charge of accounting or contract on hiring accounting services of representative office (if any) with legal documents of this person.
4. Other activities
In addition to tax registration, seal sample registration and opening a payment account at a bank, the Representative Office also needs to perform the following activities:
- Recruitment of employees according to the operation plan of the Representative Office;
- Implement the annual reporting regime in accordance with Vietnamese law;
- Periodic tax declaration and full tax payment in accordance with Vietnamese law;
- Exercising other rights and obligations of a Representative Office.