Conditions and Procedures for Establishing a South Korean Company in Vietnam

Korean company formation in Vietnam is becoming increasingly common due to the growing economic cooperation between Vietnam and South Korea. With a favorable investment climate, clear legal framework, and an expanding consumer market, Vietnam has emerged as a key destination for Korean investors. However, in order to ensure that their investment activities are legally compliant and effective, investors must thoroughly understand the legal basis, mandatory conditions, and administrative procedures involved in the company formation process.

Legal Framework for Korean Company Formation in Vietnam

Korean company formation in Vietnam is governed by Vietnamese domestic laws and international treaties to which Vietnam is a party. These include but are not limited to:

• Law on Investment No. 61/2020/QH14 (effective January 1, 2021), as amended by Law No. 72/2020/QH14

• Law on Enterprises No. 59/2020/QH14

• Decree No. 31/2021/ND-CP guiding the implementation of certain provisions of the Investment Law

• Decree No. 01/2021/ND-CP on enterprise registration

• Vietnam–Korea Free Trade Agreement (VKFTA), ASEAN–Korea Investment Agreement, WTO Commitments

Additionally, sector-specific laws, decrees, and guiding circulars apply to certain business lines.

Key Conditions for Korean Company Formation in Vietnam

1. Investor Status

A Korean investor may be either a Korean national or a legal entity established under Korean law. The investor must have full legal and civil capacity as per Vietnamese regulations. For organizations, business registration documents must be legalized in Vietnam.

2. Business Lines

Investors may only engage in sectors that are not prohibited and must comply with market access conditions applicable to foreign investors. Business sectors are divided into:

• Prohibited sectors

• Conditional sectors (227 listed in Appendix IV of the Investment Law 2020)

• Non-conditional sectors (freely accessible)

For conditional sectors, investors must meet requirements such as legal capital, experience, expertise, licenses, or ownership restrictions.

3. Investment Forms

Korean investors may choose from the following forms of investment:

• Establishing a new economic entity (e.g. LLC, JSC)

• Capital contribution or share purchase in existing Vietnamese enterprises

• Business cooperation contracts (BCC)

• Public-private partnerships (PPP) for infrastructure-related sectors

This guide focuses on forming a new economic entity.

4. Investment Capital

Vietnamese law does not specify a universal minimum capital, but the capital must be appropriate to the business scope. Some sectors require statutory capital (e.g. real estate, education, job services). Capital must be remitted via a dedicated investment capital account opened at a licensed Vietnamese bank. The usual contribution period is within 90 days from the issuance of the Enterprise Registration Certificate (ERC).

5. Business Location

Investors must secure a legal lease or ownership of the business site. For certain activities such as manufacturing or warehousing, the site must be located in a licensed industrial or economic zone.

Procedures for Korean Company Formation in Vietnam

Step 1: Investment Registration Certificate (IRC)

Issued by the Department of Planning and Investment (DPI) in the project’s province (or Economic Zone Management Board for specific zones). Required documents:

• Proposal to implement the investment project (Form A.I.1, Circular 03/2021/TT-BKHDT)

• Legal documents of the investor

• Financial proof (e.g. bank statements, audited financials)

• Investment project proposal

• Site lease agreement

• Additional documents depending on the industry

Processing time: ~15 working days

Step 2: Enterprise Registration Certificate (ERC)

Once the IRC is issued, investors must apply for enterprise registration at the DPI. Required documents:

• Business registration application

• Company charter

• List of members/shareholders

• Legal documents of the legal representative

• Copy of the issued IRC

Processing time: 3–5 working days

Post-Registration Requirements for Korean Companies in Vietnam

After receiving the ERC, the company must complete the following:

• Open an investment capital account

• Engrave and publish the company seal

• Register tax code and digital signature

• Issue e-invoices

• Contribute registered capital within the legal time frame

• Register for labor, insurance, and fulfill other financial obligations

Important Legal Considerations

• A foreign-invested enterprise is treated as a foreign economic organization and is subject to restrictions on land ownership, indirect investment, and profit remittance.

• Investors should carefully review WTO and bilateral agreements for sector-specific market access limitations.

• Any changes to capital, shareholders, business lines, or project locations must be reflected in the amended IRC before updating ERC details.

Professional Legal Services for Korean Company Formation in Vietnam

At BKC Law, we provide end-to-end support for Korean company formation in Vietnam. Our services include:

• Legal consultation on optimal business models

• Preparation and legalization of all required documents

• Representation before Vietnamese authorities

• Tax and regulatory compliance assistance

• Intellectual property protection (trademark, copyright, patent registration)

Contact us today for a free consultation:

Phone: 0901 3333 41

Email: info@bkclaw.vn

Head Office (District 1): 9th Floor, Diamond Plaza, 34 Lê Duẩn, District 1, HCMC

Branch Office (Bình Tân): 41 Tên Lửa, Bình Tân District, HCMC

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