Start a Trading Company in Vietnam with Confidence: Step-by-Step Guide for Foreign Investors (2025)

Published by admin at May 9, 2025

What is a Foreign-Owned Trading Company in Vietnam?

If you want to start a trading company in Vietnam, it is important to understand what this business type entails. A trading company is a type of business that specializes in the buying, selling, import, and export of goods without engaging in direct manufacturing. These companies serve as intermediaries between producers and end customers, helping to distribute products efficiently across domestic and international markets. Trading companies typically operate in a wide range of sectors, including consumer goods, electronics, industrial machinery, raw materials, and agricultural products.

Purpose of Establishing a Trading Company

Starting a trading company in Vietnam serves multiple strategic purposes for both domestic and foreign investors. The main objectives include:

Importing goods into Vietnam: A trading company enables businesses to legally import a wide range of products—such as consumer goods, cosmetics, machinery, electronics, and raw materials—for distribution within the Vietnamese market. This helps meet local demand and supports supply chain development.
Exporting Vietnamese products to international markets: Companies can use trading entities to export Vietnamese-manufactured products, including agricultural goods, textiles, processed foods, and furniture, to global markets. This promotes local brands and expands Vietnam’s export capabilities.
Distributing products via wholesale and retail channels: Trading companies can serve as intermediaries in the supply chain by distributing products through wholesalers, retailers, and e-commerce platforms, both domestically and regionally.
Expanding business operations across Southeast Asia: Vietnam’s strategic location in ASEAN makes it an ideal base for companies looking to expand their trading networks across Southeast Asia. A Vietnamese trading company can facilitate regional logistics, cross-border trade, and business growth throughout the region.

By starting a trading company in Vietnam, businesses can take advantage of the country’s growing economy, favorable trade agreements, and competitive labor and logistics costs.

Can a Trading Company in Vietnam Have 100% Foreign Ownership?

If you want to start a trading company in Vietnam with 100% foreign ownership, you will be pleased to know that this is allowed under Vietnamese law. Foreign investors are permitted to establish trading companies in Vietnam with full foreign ownership, provided they comply with Vietnam’s investment regulations and international commitments under the WTO and various free trade agreements.

Under Vietnamese law, foreign-invested trading companies that start business operations in Vietnam are allowed to engage in activities such as importing, exporting, and distributing goods. However, investors should be aware of specific conditions and restrictions that apply when establishing a trading company in Vietnam.

WTO Commitments and Licensing Requirements

Foreign ownership in the trading sector is permitted in accordance with Vietnam’s WTO commitments. However, starting a trading company in Vietnam often requires the following licenses:

A valid Investment Registration Certificate (IRC)
An Enterprise Registration Certificate (ERC)
Trading and distribution business licenses, especially for retail, franchising, and direct sales

These additional licenses are issued by the Department of Industry and Trade and may require detailed documentation about the company’s operational scope and product lines.

Restrictions on Certain Product Categories

Although Vietnam has opened many sectors to foreign investment, not all product categories are freely accessible to foreign-owned trading companies. Some goods are subject to restrictions, special conditions, or licensing requirements, due to their sensitive nature, impact on national security, or strategic importance.

Pharmaceuticals: Foreign trading companies are not allowed to engage in the wholesale or retail distribution of pharmaceutical products. Only licensed Vietnamese entities can distribute medicines directly. However, foreign investors may establish representative offices to promote products or form joint ventures under specific conditions for medical device distribution.
Oil, Gas, and Petroleum Products: The importation, exportation, and trading of petroleum products are tightly controlled by the Vietnamese government. These sectors often require special permits and are typically reserved for state-owned enterprises or require a joint venture structure with local partners.
Printed materials and publications: Trading printed media, including books, newspapers, and magazines, involves content censorship and compliance with cultural and information security regulations. Foreign companies must obtain specialized permits from the Ministry of Information and Communications before engaging in such business.
Explosives and military equipment: These are strictly prohibited for foreign investment due to national defense concerns. The manufacturing, import, and trading of such products are reserved for government-authorized organizations only.

Retail Outlet Restrictions

Foreign-owned trading companies must apply for a retail outlet license to open a physical retail store in Vietnam. For the second retail outlet and beyond, the authorities apply the Economic Needs Test (ENT) to determine market saturation and potential impact on domestic retailers.

How to Start a Trading Company in Vietnam: Requirements and Procedures

Foreign investors looking to start a trading company in Vietnam must meet specific legal and procedural requirements. These conditions are outlined under the Law on Investment and the Law on Enterprises of Vietnam, and are enforced by the Department of Planning and Investment (DPI) and other relevant authorities.

Below are the key requirements for setting up a 100% foreign-owned or joint-venture trading company in Vietnam:

1. Registered Business Address

A valid business address is a mandatory requirement for company registration in Vietnam.

At the registration stage, foreign investors may use a virtual office or shared office space, especially for holding companies or businesses that do not immediately require physical premises.
However, if the company plans to engage in warehousing, logistics, or retail operations, a physical office or warehouse that complies with zoning laws will be required before applying for certain sub-licenses (such as a retail outlet license).

2. Legal Representative

A Legal Representative is the individual responsible for legally representing the company in Vietnam, signing contracts, and dealing with local authorities.

The Legal Representative must reside in Vietnam, either as a Vietnamese citizen or a foreign national holding a valid Temporary or Permanent Residence Card.
It is highly recommended that the appointed Legal Representative be physically present in Vietnam to manage operations and handle urgent legal or compliance matters.

3. Capital Contribution

Vietnam does not impose a fixed minimum capital requirement for setting up a trading company. However, foreign investors must propose a realistic charter capital amount that aligns with the company’s intended business scope, particularly if it involves:

Import and export of goods
Wholesale and distribution activities
Retail sales and e-commerce operations

Recommended Capital Range: USD 10,000 – 50,000

While there’s no legal minimum, in practical terms, a foreign-invested trading company should declare at least USD 10,000 to USD 50,000 in charter capital to:

Demonstrate financial capacity to the licensing authorities
Cover initial operating expenses, including office rental, staff salaries, logistics, and licensing fees
Increase the likelihood of approval for the Business License (required for wholesale and retail activities)

Authorities will assess whether the declared capital is sufficient based on:

The product category the company plans to trade
The scale of operations (e.g., nationwide distribution vs. small-scale trading)
Whether the company will engage in retail, which typically demands higher capital

Capital Contribution Timeline

According to Vietnamese law, the full amount of registered capital must be contributed within 90 days from the date the company receives its Enterprise Registration Certificate (ERC). The contribution must be made via a capital account opened in Vietnam and documented properly.

Failure to contribute capital on time can result in:

Administrative penalties
Suspension of operations
Revocation of the company’s license

4. Required Documents for Company Registration

To register a foreign-invested trading company in Vietnam, the following documents must be prepared and submitted:

Investment Project Proposal (Investment Application Dossier)
Draft Company Charter (Articles of Association)
Valid passports or ID cards of all foreign investors and the legal representative
Proof of registered business address (e.g., lease agreement or property ownership certificate)
Additional documents may be required depending on the business scope, product categories, and number of investors.

Common Trading Business Lines

When establishing a foreign-invested trading company in Vietnam, investors must register specific business lines in accordance with Vietnam’s national classification system. Each business line is assigned a corresponding code, which determines the company’s legal scope of operations.

Below are some of the most commonly registered trading business lines for foreign investors, especially those involved in import-export, wholesale, and retail distribution:

No.	Business Line Description	Business Code
1	Wholesale of automobiles and other motor vehicles (excluding motorcycles)	4511
2	Retail sale of cars with 9 seats or fewer, including both new and used vehicles	4512
3	Automobile and motor vehicle agents, including commercial agency services	4513
4	Wholesale of computers, computer peripherals, and software, including IT hardware	4651
5	Wholesale of electronic and telecommunications equipment, such as phones, routers, etc.	4652
6	Wholesale of agricultural machinery, equipment, and spare parts, used in farming	4653
7	Wholesale of other machinery, equipment, and spare parts, including industrial tools	4659
8	Wholesale of solid, liquid, gaseous fuels and related products, such as gas, coal, oil	4661
9	Wholesale of metals and metal ores, including ferrous and non-ferrous metals	4662
10	Wholesale of construction materials and installation equipment, including cement, steel	4663
11	Other specialized wholesale not elsewhere classified, covers niche trading activities	4669
12	General wholesale trade, covering diverse product categories not requiring specialization	4690

Step-by-Step Process to Establish a Trading Company

Setting up a trading company in Vietnam as a foreign investor involves several legal steps regulated by the Law on Investment and Enterprise Law. Below is a comprehensive and guide to the procedure for establishing a trading company in Vietnam:

Step 1: Apply for the Investment Registration Certificate (IRC)

The Investment Registration Certificate (IRC) is required for all foreign investors to legally carry out investment activities in Vietnam.

Submit an investment project dossier to the Department of Planning and Investment (DPI) of the province/city where the company will be located.
The application includes: investment proposal, investor documents, lease agreement, and draft charter.
Processing time: Approximately 15–20 working days after submission.

Step 2: Obtain the Enterprise Registration Certificate (ERC/BRC)

Once the IRC is issued, the investor can proceed to register the company to obtain the Enterprise Registration Certificate (ERC), also known as the Business Registration Certificate (BRC).

Submit the company incorporation dossier to the DPI, including charter, list of shareholders, and legal representative information.
The ERC confirms the company’s legal status and information, such as business lines, capital, and address.
Processing time: Around 5–7 working days.

Step 3: Create the Company’s Official Seal (Stamp)

After receiving the ERC:

Design and produce the company’s legal seal/stamp, which can be circular or square, and must include the company name and registration number.
There is no longer a requirement to register the seal with the police or any authority.

Step 4: Open a Corporate Bank Account in Vietnam

A Vietnamese business bank account is mandatory for capital contribution and daily business transactions.

Required documents: IRC, ERC, company charter, and legal representative’s passport/residence card.
Choose from local or international banks with operations in Vietnam (e.g., Vietcombank, Techcombank, HSBC, etc.).

Step 5: Inject the Registered Capital

According to Vietnamese law, the investor must transfer the committed charter capital into the company’s capital account:

Capital contribution must be completed within 90 days from the date of ERC issuance.
Capital must be sent from the investor’s overseas account into the company’s foreign direct investment (FDI) account in Vietnam.

Step 6: Register Tax and E-invoice Accounts

To become fully operational, the company must complete tax-related procedures:

Register for a tax code with the local tax department.
Enroll in the electronic invoice system in compliance with Vietnam’s e-invoicing regulations (mandatory for all companies).
Appoint a licensed accounting service provider or in-house accountant for ongoing compliance.

Retailing Function for Trading Companies in Vietnam

Foreign investors establishing a trading company in Vietnam can engage in both wholesale and retail activities. However, retailing—defined as direct sale to end consumers (B2C)—is subject to stricter licensing conditions under Vietnamese law.

1. Wholesale Activities – Allowed Without Separate License

Foreign-invested trading companies are permitted to carry out wholesale trading in Vietnam without needing a specific wholesale license, as long as the following conditions are met:

Wholesale is limited to B2B transactions, where goods are sold to other businesses, distributors, or commercial users—not directly to individual consumers.
The business line must be correctly registered under the company’s Enterprise Registration Certificate (ERC) and Investment Registration Certificate (IRC).
Wholesale products must not fall under restricted or conditional categories (e.g., pharmaceuticals, petroleum).

2. Retail Activities – Require Business License and Retail Outlet License

To engage in retail sales in Vietnam, foreign-owned companies must comply with the following legal requirements:

A. Business License (Giấy phép kinh doanh)

Mandatory for all retail and distribution activities under Decree No. 09/2018/NĐ-CP.
Issued by the Department of Industry and Trade (DOIT).
Required before selling goods directly to end consumers or operating a physical/online retail store.

B. Retail Outlet License (Giấy phép lập cơ sở bán lẻ)

Required for each physical retail outlet (store) the company wants to open.
The first retail outlet is typically exempt from the Economic Needs Test (ENT), making the process faster.
From the second outlet onward, the ENT will apply, evaluating:
- Market saturation
- Potential impact on local retailers
- Population density and infrastructure readiness

3. Compliance with the Law on Consumer Protection (2023)

As of July 1, 2024, all retail operations in Vietnam must comply with the updated Law on Protection of Consumers’ Rights (2023). Key obligations include:

Clear and accurate product labeling, including origin, usage instructions, and expiration dates
Warranties and repair policies for certain product categories
Return and refund rights for consumers within specified periods
Providing full after-sales service and support, especially for electronics, machinery, or cosmetics

Non-compliance may result in administrative penalties or business suspension.

Product Registration for Sale in Vietnam

When a foreign-invested trading company imports or distributes goods in Vietnam, product registration with relevant Vietnamese authorities is often mandatory to ensure legal compliance. The specific requirements depend on the type of product and its regulatory classification.

Common Product Categories Requiring Registration in Vietnam

Product Type	Registration Authority	Key Notes
Cosmetics	Drug Administration of Vietnam (DAV)	Must obtain a Cosmetic Product Notification (CPN) before marketing and selling. This is a mandatory requirement for all imported cosmetics.
Normal Food	Vietnam Food Administration (VFA)	Requires a Self-Declaration Certificate ensuring food safety and hygiene compliance. No full registration needed for low-risk foods.
Medical Devices	Ministry of Health	Registration depends on device classification (Class A, B, C, D). Higher risk devices (C, D) require full registration and approval; low-risk (Class A) may only need notification.
Chemicals	Ministry of Industry and Trade (MOIT)	Certain chemicals, especially hazardous ones, must be registered prior to circulation to comply with safety and environmental regulations.
Food Supplements	Ministry of Health	Must complete food safety registration to confirm compliance with Vietnamese food supplement standards before sale.

Why Product Registration is Critical for Businesses in Vietnam

Legal compliance: Without valid product registration or notification, products cannot be legally imported, advertised, distributed, or sold in Vietnam. Ensuring your products are properly registered is a mandatory step to operate within the country’s regulatory framework.
Consumer safety: Registration ensures that products meet national safety, quality, and labeling standards.
Market access: Registration certificates are required by customs and regulatory agencies for product clearance and sale.
Brand credibility: Registered products build trust with Vietnamese consumers and business partners.

Detailed Notes on Product Registration Procedures in Vietnam

The dossier requirements for product registration in Vietnam vary depending on the product category. Typical documentation includes product formulas, certificates of analysis, manufacturing licenses, safety assessments, labels, and samples.
Self-declaration vs. full registration:
- Self-Declaration applies to low-risk products like some foods and Class A medical devices; it involves submitting documentation without a lengthy approval process.
- Full Registration applies to high-risk categories such as Class C/D medical devices, chemicals, and cosmetics, requiring formal evaluation and issuance of a registration certificate.
Validity and renewal: Registration certificates are typically valid for 3 to 5 years depending on the product type. Renewal must be applied for before expiration to avoid interruption in sales.
Labeling compliance: All products must meet Vietnamese labeling regulations, including Vietnamese language requirements, ingredient lists, usage instructions, and expiry dates.

FAQ: Establishing a Trading Company in Vietnam

1. Can I use a virtual office for company registration?

Yes. A virtual office is acceptable for the registration process. A physical location may later be needed depending on operational needs.

2. How long does it take to establish a trading company?

The full process typically takes 6–8 weeks, depending on document preparation and approval speed.

3. Is a Vietnamese partner necessary?

No. You can own 100% of the trading company as a foreign investor.

4. What taxes will my trading company pay?

Corporate Income Tax (CIT): 20%
Value-Added Tax (VAT): Generally 10%
Import/Export Duties: Applicable based on the type of goods traded

Conclusion

Starting a foreign-owned trading company Vietnam can be a profitable venture, but it requires thorough understanding of the Vietnam trading company law, requirements to establish a trading company Vietnam, and the trading company registration Vietnam process. Obtaining the correct business license for trading company Vietnam, investment registration certificate Vietnam, and enterprise registration certificate Vietnam are essential steps to legally operate in Vietnam’s import export business. Following this guide on how to start a trading company in Vietnam will help foreign investors navigate the legal landscape efficiently and confidently

Ready to start your trading company in Vietnam?

Contact Green NRJ for end-to-end support — from consulting to licensing and compliance.

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