What are the main contents of the annual operation report?
1. Labor use and employment relations:
- Reports on local employees.
- Reports on foreign employees.
- Total incomes.
- Compulsory
- Personal incomes tax.
- Newly join and terminate labor relations.
2. Operations of the representative office:
- Commercial activities
- Manage and promote local business contracts,
- Market research
- Develop products,
- Seeking opportunities for the purchase or sale of goods and provision of services…
- Other activities
FOREIGN REPRESENTATIVE OFFICE IN VIET NAM
WHAT IS A FOREIGN REPRESENTATIVE OFFICE IN VIETNAM?
The foreign representative office in Viet Nam is a dependent unit supporting business operations of the parent company, which is allowed to do basic business activities such as open a resident office, recruit employees, manage and promote local business contracts, market research., etc. Representative Offices tend to be utilized by foreign investors in fields such as sourcing of products, quality control, and general liaison activities between the Head Office and the Representative Offices overseas.
The representative offices are generally easier to establish than a branch or subsidiary, as they are not used for actual “business” (e.g. sales) and therefore there is less incentive for them to be regulated. The representative office is quite simple and cost-effective: No investment capital, no Value Added Tax, no Corporate Income Tax, no Accounting, no Financial statements, no independent audit required … and easy to extend, terminate or dissolve when necessary.
ALLOWED ACTIVITIES OF FOREIGN REPRESENTATIVE OFFICES
Vietnam-based representative offices of foreign enterprises can conduct these activities:
- Act as a bureau of communication.
- Market research.
- Facilitate investment projects of foreign enterprises.
- Expedite and monitor the implementation of projects in Vietnam, which are sponsored by foreign enterprises.
- Representative offices of foreign enterprises in Vietnam shall not carry out business activities in Vietnam.
MORE ADVANTAGES OF FOREIGN REPRESENTATIVE OFFICES?
- No investment capital required.
- No Value Added Tax, no Corporate Income Tax, no Accounting, no financial statements, no independent audit required.
- Easy to extend, terminate or dissolve when necessary.
- Allowed to recruit local and foreign employees.
- Based on new Labor law in Viet Nam, there is no limit in number of foreign employees for a representative office. In case the office can prove its demand fair with commercial operations, the office entitles to determine the demand for foreign workers for every job position for which Vietnamese workers are underqualified and request for acceptance from the local competent state agencies for work permits.
HOW TO ESTABLISH A FOREIGN REPRESENTATIVE OFFICE IN VIETNAM?
- How to prepare required papers and documents – Procedures – Cases and situations shall be anticipated in advance when setting up a foreign representative office in Vietnam.
- Annually budgeting for establishing – operating – maintaining a foreign representative office in Vietnam.
- Any query about local laws and regulations, direct consultation with the top experts on the establishment and operation of foreign representative offices in Vietnam.
04 STEPS TO ESTABLISH A REPRESENTATIVE OFFICE
- Step 1: Understand scopes of activities, rights, obligations, conditions, and procedures for establishing a foreign representative office
- Step 2: Prepare and complete the required conditions, papers, and dossiers
Establishing a foreign representative office is the optimal option for local customer care, market research, without having to invest capital or pay corporate income taxes. Establishing a foreign representative office shall be executed by professionals only and usually consist of 04 main steps:
- Step 3: Apply and manage procedures for granting of representative office license
- Step 4: Complete the initial compliance procedures after granting representative office license.
Beyond standard required procedures by laws, our tailored service will help to identify the risks in advance, prevent the risks happen, optimize establishment and also operation costs in years ahead.
