Vietnam is becoming an attractive destination for foreign investors in the high-tech industry thanks to investment incentives, a high-quality workforce, and a potential market. According to the Foreign Investment Agency (Ministry of Finance).
However, to establish an FDI enterprise in the high-tech sector, investors must understand legal procedures, mandatory conditions, and available support policies. DNP Viet Nam Law Firm provides a detailed guide on the procedures for setting up an FDI enterprise in Vietnam’s high-tech sector.
1. Overview of High-Tech FDI Enterprises:
FDI (Foreign Direct Investment) enterprises in the high-tech sector are businesses with foreign capital operating in technology-intensive industries such as: Artificial Intelligence (AI), Semiconductor technology, Blockchain, Renewable energy, Biotechnology, Manufacturing of high-tech equipment.
These enterprises not only contribute to economic growth but also promote innovation, technology transfer, and international competitiveness.
2. Conditions for Establishing an FDI Enterprise in High-Tech Sectors:
2.1 General Conditions:
To establish an FDI enterprise in the high-tech sector in Vietnam, foreign investors must meet the following requirements:
– Compliance with Vietnamese Law: Investors must comply with the Investment Law 2020, Enterprise Law 2020, and Decree 31/2021/ND-CP, which provides guidelines for foreign investment in priority sectors.
– Eligible Business Sectors: Business activities must align with Decision 38/2020/QD-TTg, listing priority high-tech industries such as AI, semiconductor manufacturing, Blockchain & digital transformation, Biotechnology & smart healthcare solutions, Renewable energy & environmental technology, Advanced materials & automation.
– Financial Capacity & Investment Capital:
- Investors must prove their financial capability to implement investment projects.
- Minimum capital requirements vary by industry and are regulated by the Vietnamese government.
– Technology Transfer & R&D Commitment: Enterprises must allocate at least 1% of annual revenue to R&D in Vietnam and High-tech projects must include technology transfer plans and partnership agreements with Vietnamese research institutions.
– Environmental Protection & Sustainability Compliance:
- Enterprises must meet Vietnam’s Environmental Protection Law 2020 standards
- If the business generates industrial waste, an Environmental Impact Assessment (EIA) must be approved before project implementation.
– Labor Regulations & Employment Policies:
- Priority must be given to Vietnamese workers, especially in technical and R&D roles.
- Foreign experts must obtain work permits as per Decree 152/2020/ND-CP
2.2 Specific Conditions by Sector:
Depending on the specific high-tech sector, such as semiconductor manufacturing, AI, blockchain, or renewable energy , additional requirements regarding labor qualifications, capital investment, and technical standards may apply.
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3. Procedures for Establishing an FDI Enterprise in the High-Tech Sector:
3.1 Selecting the Business Model:
Foreign investors must select a business structure suitable for their operations under the Enterprise Law 2020 and Investment Law 2020. The most common legal structures include:
– Limited Liability Company (LLC):
+ Single-member LLC – Owned by one individual or organization, with limited liability.
+ Multi-member LLC – For 2-50 investors, offering a flexible management model.
- Joint Stock Company (JSC): Requires at least 3 shareholders, allowing equity financing through share issuance.
- Representative Office: Cannot conduct business but can carry out market research for parent companies.
- Branch Office of a Foreign Company: A dependent unit that can conduct business activities in Vietnam.
3.2 Procedures for Establishing an FDI Enterprise in the High-Tech Sector:
Legal Basis: Circular 32/2021/TT-BKHCN, Decision 10/2021/QĐ-TTG
Step 1: Applying for the Investment Registration Certificate (IRC)
– Issuing Authority: High-Tech Park Management Board (if investing in a high-tech zone) or Department of Finance of the respective province/city.
– Required Documents:
- Investment Project Proposal.
- Financial Statements of the Investor.
- Enterprise Registration Certificate (for corporate investors).
- Copy of ID card/Citizen Identification Card or Passport (for individual investors).
- Land/Factory Lease Agreement.
Step 2: Applying for the Enterprise Registration Certificate (ERC):
– Issuing Authority: Department of Finance of the province/city where the investment is registered.
– Required Documents:
- Investment Project Application (Form A.I.1, Appendix A, Circular 03/2021/TT-BKHĐT).
- Financial Proof of the Investor (bank statements, audited reports).
- Investment Project Proposal, including: Objectives, scope, total investment capital, and duration.
- Legal Documents of the Investor (passport for individuals, business registration for corporate investors).
- Land/Factory Lease Agreement or Land Use Rights Certificate.
- High-Tech Commitment & R&D Plan (as per Decree 31/2021/ND-CP).
Step 3: Company Seal Registration & Notification: Register the company seal with the National Business Registration Portal.
Step 4: Obtaining Additional Licenses (if required): Apply for industry-specific permits, depending on the business activities.
Step 5: Opening a Bank Account, Tax Declaration & Labor Registration:
- Open an FDI Capital Account at a Vietnamese bank.
- Register for tax obligations with the local Tax Department.
- Register employees and employment contracts with labor authorities.
Step 6: Finalizing Post-Registration Procedures: Ensure compliance with additional regulatory and operational requirements.
The information above is for reference only. If you require further details, please contact us using the information below.
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DNP VIET NAM LAW FIRM
Contact:
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