A Branch Office allows a foreign company to conduct commercial activities in Vietnam under the parent company's name — without incorporating a separate legal entity. It can trade, invoice, and sign contracts, unlike a Representative Office. Forra manages the full establishment process.
A Branch Office (Chi nhánh) of a foreign trader is a dependent unit of the parent company, established in Vietnam to conduct commercial activities consistent with the parent's business scope. Unlike a Representative Office, a Branch can trade, sign contracts, issue invoices, and generate revenue in Vietnam — all in the parent company's name.
The Branch has no separate share capital, no shareholders, and no board of directors. All obligations and liabilities are ultimately the parent company's responsibility. This makes it more commercially capable than an RO while carrying less administrative complexity than incorporating an LLC or JSC.
The critical difference from an RO: A Representative Office is expressly prohibited from commercial activity. A Branch may engage in commercial activities — subject to the scope stated in its establishment licence and Vietnam's WTO and trade agreement commitments. If your goal is to sell, invoice, or enter into commercial contracts in Vietnam, a Branch (or incorporated entity) is required.
A Branch Office has a defined but commercially meaningful scope. Its permitted activities must be consistent with both its establishment licence and Vietnam's international commitments.
Scope restriction is strictly enforced. The Branch may only conduct activities expressly stated in its establishment licence. Engaging in activities beyond the licensed scope is a compliance violation and can result in suspension or revocation. Forra reviews intended activities against current regulations before the application is prepared.
The eligibility requirements for a Branch are more demanding than for a Representative Office — most significantly, the parent company must have been in operation for at least five years (compared to one year for an RO).
The foreign company must have been in active operation for at least five years from its date of establishment. This is the most common reason Branch applications are deferred — companies operating for fewer than five years should consider an RO or LLC structure instead.
The parent must be incorporated in a country that is party to an international treaty to which Vietnam is a signatory. All WTO member states qualify. Forra confirms eligibility for your specific jurisdiction before the application begins.
If the parent's Certificate of Business Registration specifies an operating term, that term must have at least one year of remaining validity at the time of the Branch application. The Branch licence cannot outlast the parent's own registration.
The intended activities must comply with Vietnam's market-access commitments in international treaties (WTO, CPTPP, EVFTA) and fall within the parent's registered business scope. Regulated sectors may require additional ministerial approval.
Vietnam's three main foreign presence structures each serve different purposes. The table below compares them across the factors most relevant to foreign investors.
| Factor | Branch Office | Representative Office | LLC / Company |
|---|---|---|---|
| Legal status | Dependent unit — no separate legal personality | Dependent unit — no separate legal personality | Independent legal entity registered in Vietnam |
| Commercial activity | ✓ Permitted within licensed scope | ✗ Not permitted | ✓ Full commercial operations |
| Issue invoices | ✓ Yes | ✗ No | ✓ Yes |
| Parent operation required | 5 years minimum | 1 year minimum | No minimum |
| Charter capital | ✓ None required | ✓ None required | Required — within 90 days of ERC |
| Corporate income tax | CIT at 20% on attributable profits | Exempt — no revenue activity | CIT at 20% on taxable profits |
| Permanent establishment | Yes — constitutes a PE in Vietnam | Generally not a PE for CIT purposes | Yes — independent PE |
| Establishment timeline | 3–6 weeks from complete dossier | 3–5 weeks from complete dossier | 4–8 weeks from IRC to ERC |
| Licence validity | 5 years — renewable | 5 years — renewable | Indefinite (subject to ongoing compliance) |
Not sure which structure fits? Forra advises on structure selection as part of the initial consultation. See also our Representative Office and Company Registration pages.
Forra manages the full establishment process on behalf of the parent company, including document preparation, authority liaison, and all post-licensing registrations.
All foreign-language documents must be translated into Vietnamese and legalised (consular certification or Apostille) before submission. Forra provides a personalised checklist and country-specific legalisation guidance.
For most trade-related sectors, Forra submits to the provincial Department of Industry and Trade (DOIT) where the Branch will be located. The authority has 7 working days from receipt of a complete application to issue or decline the licence.
The Certificate of Establishment triggers a series of steps that must be completed before the Branch becomes fully operational. Forra handles all of these as part of the establishment service.
Because a Branch can generate revenue and conduct commercial activities, it carries materially different tax obligations from a Representative Office. The Branch constitutes a Permanent Establishment (PE) of the foreign parent in Vietnam — making it subject to the full range of applicable Vietnamese taxes.
The standard CIT rate on the Branch's taxable profits in Vietnam. Taxable profit is revenue less deductible expenses under Vietnamese accounting and tax rules. Quarterly provisional CIT must be filed within 30 days of each quarter-end; annual CIT finalisation is due by 31 March of the following year.
The standard VAT rate applicable from 1 July 2025. The Branch must register for VAT, issue e-invoices for all taxable sales, and file monthly VAT declarations by the 20th of the following month. A 5% rate applies to certain essential goods; 0% applies to exports and qualifying cross-border services.
As an employer, the Branch must withhold and declare PIT for all employees at the progressive rates (5–35% for tax residents; flat 20% for non-residents). Employer and employee social, health, and unemployment insurance contributions are compulsory for Vietnamese employees.
Profit remittance: After fulfilling all Vietnamese tax obligations, the Branch may remit profits to the parent abroad. There is no withholding tax on profit remittances from a Branch to its foreign parent. The remittance must be supported by audited financial statements confirming all tax liabilities have been settled.
A Branch Office carries more substantial ongoing compliance obligations than a Representative Office — reflecting its greater commercial scope. Forra can manage all of these on an ongoing basis as part of our Governance services.
The Branch must submit an annual operations report to the licensing DOIT. The report covers activities during the preceding year. Failure to file for two consecutive years is grounds for licence revocation.
Deadline: 30 January each yearThe Branch must file quarterly provisional CIT within 30 days of each quarter-end and submit the annual CIT finalisation return by 31 March of the following year. Audited financial statements are required for the annual return.
Annual deadline: 31 MarchFor most Branches, VAT declarations must be filed monthly by the 20th of the following month. E-invoices must be issued for all taxable supplies at the point of transaction.
Monthly: by the 20thThe Branch establishment licence is valid for 5 years. An application for extension must be submitted before expiry. Renewal requires re-submission of the parent company's legalised documents confirming continued valid registration.
Apply before expiry dateChanges to Branch licence details — name, address, Head of Branch, or permitted activities — require a formal licence amendment within 60 working days of the change. Failure to amend attracts penalties of VND 20–40 million.
Within 60 working days of changeThe Branch must maintain accounting books under Vietnamese Accounting Standards (VAS), prepare annual financial statements, and have them audited where required. Annual statements must be submitted to the tax authority within the statutory deadlines.
Annual — within 90 days of year-endThe key considerations that favour a Branch over an LLC are:
The main constraint is the 5-year parent operation requirement and the limitation to a single Branch per province. For companies wanting full operational independence or broader capital flexibility, an LLC is typically more appropriate.
No. The parent company does not need to be physically present in Vietnam during the application process. Forra acts as the authorised agent of the parent company throughout — preparing all documents, corresponding with authorities, and handling collection of the licence.
What the parent needs to provide is: a set of properly legalised corporate documents, a signed application form (Form MD-2), and the appointment letter for the Head of Branch. All of these can be prepared and dispatched from the parent's home country. Forra provides a personalised checklist to make this as efficient as possible.
Yes. A Branch may employ both Vietnamese nationals and foreign nationals. Foreign employees must hold a valid work permit (or confirmed exemption) issued by MoLISA before commencing employment. The Branch applies for the work permit on behalf of the employee.
The Head of Branch, if a foreign national, must also obtain a work permit or confirmed exemption before taking up the role. Forra's Global Mobility team manages work permit applications for Branch employees.
Failure to apply for amendment of the Branch establishment licence within the required 60-working-day window attracts a fine of between VND 20,000,000 and VND 40,000,000 (approximately USD 800–1,600).
More seriously, operating with out-of-date licence details — for example, continuing to operate after a change of Head of Branch without filing the amendment — can expose the Branch to suspension of operations. Forra tracks all changes to Branch details and prepares amendment applications proactively.
There is no statutory conversion mechanism — a Branch cannot be directly converted into an LLC under Vietnamese law. If the parent wishes to transition to an independently incorporated entity, it must go through the full company registration process separately. The two structures can operate simultaneously during a transition period.
The transition involves registering the new LLC or JSC, transferring contracts and assets, transitioning employees (requiring new employment contracts), and ultimately closing the Branch through the formal termination procedure. Forra advises on the sequencing and manages both the new company registration and Branch closure process.
Forra confirms eligibility and provides a fixed-fee quote within one business day.
Book a free 30-minute consultation. Forra confirms your eligibility, advises on the correct licence scope, and provides a fixed-fee quote — no commitment needed.