In the development and expansion plan to other provinces, cities, or countries by 2026, using representative office establishment services is the optimal choice for many businesses. This form of operation helps businesses reach potential customers, conduct market research, and promote trade professionally without requiring as many operational resources as a branch or subsidiary.
The concept and role of representative offices for businesses.
A representative office is a subsidiary unit of an enterprise, tasked with representing and protecting the enterprise's interests under authorization. According to Article 44 of the 2020 Enterprise Law, representative offices do not have independent legal personality and are not permitted to directly engage in profit-generating business activities.
The main role of this unit typically includes the following activities:
- Perform communication and transaction functions with customer partners in the new location.
- Conduct market research and surveys to develop a business strategy for the parent company.
- Facilitating economic contracts and monitoring the implementation of commitments between parties.
- Providing support in resolving issues arising in the area where the office is located.
The fundamental differences between a representative office and a branch office are illustrated in the comparison table below, helping businesses easily choose the appropriate model.
| Comparison criteria | Representative Office | Company branch |
|---|---|---|
| Business functions | Not permitted to engage in direct business activities. | Authorized to conduct business and issue invoices. |
| Legal personality | It has no legal personality. | It has no legal personality. |
| Tax obligations | Only pay the business license fee. | Pay business license tax, VAT, and corporate income tax. |
| Purpose of establishment | Market promotion transactions | Expanding production and business operations. |
Note that choosing the wrong operating model can lead to tax and invoicing irregularities in the future. Therefore, businesses need to clearly define their objectives before proceeding with the procedure.
Benefits of using professional representative office establishment services.
Handling the procedures yourself can sometimes be difficult for businesses due to the constantly changing legal regulations. Using a representative office establishment service provides absolute peace of mind thanks to the following practical benefits.
- Minimize processing time through seamless coordination with relevant authorities.
- Ensure that the application is prepared accurately from the start to avoid it being returned or requiring multiple revisions.
- Receive in-depth advice from experts regarding responsibilities and authority to ensure operation is in accordance with the law.
- Minimize unnecessary expenses with a transparent, all-inclusive service package.
Conditions for establishing a representative office in 2026
For the registration process to proceed smoothly, businesses need to meet stringent legal standards. These conditions aim to ensure consistency in state management.
The basic requirements that businesses need to be aware of include:
- The name of the representative office must include the business name followed by the phrase "representative office" and must not cause confusion.
- The registered office address must have legal right of use and cannot be located in apartment buildings designated solely for residential purposes as stipulated by the Housing Law.
- The head of the office must have full legal capacity and not be subject to any prohibitions from managing businesses.
Latest procedures and documents for establishing a new representative office.
The registration process has now been simplified through an online system, but it still requires meticulous document preparation. According to Decree 01/2021/ND-CP on business registration, the steps are as follows.
The necessary documents to submit to the business registration authority include:
- The notice of establishment of a representative office must be signed by the legal representative.
- Minutes of the meeting and decision of the board of members or board of directors regarding the establishment.
- A certified copy of the personal identification document of the head of the representative office.
- Authorization letter for the service provider to establish a representative office.
The entire process, from receiving the information to receiving the results, usually takes within 3 working days from the date the application is accepted as valid on the system.
Detailed information about our representative office establishment service.
We offer comprehensive legal solutions to help businesses get their offices up and running in the shortest possible time. With our team of experts who have practical knowledge, we are committed to providing the most professional service experience.
Our service package includes specific implementation steps.
- Conduct a survey and provide legal advice regarding the proposed office address.
- Prepare the complete set of documents according to the latest template of the Ministry of Planning and Investment.
- Submit your application and provide explanations directly to the specialist at the Department of Planning and Investment when requested.
- We receive the results and deliver the Business Registration Certificate directly to the client.
- Providing advice and support for post-establishment tasks such as seal engraving and signboard installation.
Taxes and financial obligations of representative offices
Although representative offices do not generate revenue, they still have certain financial obligations to the state budget. Understanding these regulations helps businesses avoid unnecessary administrative penalties.
Below are the financial obligations that the office needs to fulfill.
- The business license fee is 1,000,000 VND per year, as stipulated in Decree 22/2020/ND-CP.
- Withdraw and pay personal income tax for office employees if they have taxable income.
- Prepare periodic reports on the employment situation as required by labor laws.
Differences when establishing a representative office for foreign traders
For multinational corporations wishing to establish a presence in Vietnam, the procedures are more complex and subject to Decree 07/2016/ND-CP. Establishing a foreign representative office requires expertise in international treaties.
Key differences include:
- The authority to issue licenses usually rests with the Department of Industry and Trade of the provinces and cities or the Industrial Park Management Board.
- Documents from overseas must be legalized by the consular office and translated into Vietnamese by a certified translator.
- Foreign businesses must have been operating for at least one year since their establishment or business registration date.
Important notes to avoid mistakes when operating a representative office.
During their operations, many businesses often make the mistake of signing commercial contracts directly at their representative offices. This can lead to tax arrears and severe administrative penalties.
Businesses need to keep the following operating principles in mind.
- A representative office is absolutely prohibited from signing economic contracts unless it has valid authorization from the legal representative of the parent company.
- The office seal is to be used only for internal administrative purposes and transactions conducted in accordance with its representative function.
- All financial activities of the office should be accounted for through the parent company's books to ensure transparency.
Frequently Asked Questions about Representative Office Establishment Services
Is registered capital required to establish a representative office? How many representative offices can a company establish in the same province or city? How long does it usually take to complete the procedure? Can representative offices issue invoices?
Commitment to service quality and contact information for support.
We understand that a smooth legal start is fundamental to the sustainable growth of a business. With our comprehensive representative office establishment service, we are committed to transparency regarding costs and assume the highest level of responsibility for the legality of the documentation.
Our team of experienced lawyers is available 24/7 to listen to and answer all your questions. Contact us today to receive expert advice and a detailed quote for your expansion plan.
Contact information for MAN – Master Accountant Network
- Address: 19A, 43rd Street, Tan Thuan Ward, Ho Chi Minh City
- Mobile/Zalo: 0903 963 163 – 0903 428 622
- Email: man@man.net.vn
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Content production is overseen by: Mr. Le Hoang Tuyen – Founder & CEO of MAN – Master Accountant Network, CPA Vietnam with over 30 years of experience in accounting, auditing, and financial consulting.
