Regulation on retail outlet of foreign investors and foreign-invested business entities in Vietnam

The Government issued decree no. 09/2018/ND-CP on guidelines for the Law on Commerce and the Law on Foreign Trade Management regarding sale of goods and other activities directly related to sale of goods of foreign investors and foreign-invested business entities in Vietnam.

Decree 09/2018/NĐ-CP differentiates the set up of the first retail outlet from the second and subsequent retail outlets:

The first retail outlet must be granted a separate ROEL. To set up their first retail outlet in Vietnam, FOCs will notably have to comply with several conditions:

• Having a financial plan for setting up the retail outlet;
• Having a location for the outlet compliant with local planning; and
• Not incurring any overdue tax.

To set-up the second retail outlets onwards in Vietnam, FOCs will need to undergo an Economic Need Test (“ENT”), the ENT notably demands to the FOC to disclose the following information:

• Scale of the relevant geographic market impacted;
• Number of existing retail outlets in the relevant geographic market;
• Impact on the market stability and operating activities of other retail outlets and traditional markets in the relevant geographic market;
• Impact on local environment (traffic density, environment hygiene, fire safety); and
• Potential contribution to the socio-economic development.

However, the ENT is not necessary for FOCs setting up second and subsequent outlets with a surface of less than 500m², located in a shopping mall and not classified as mini supermarket or convenience store.

The timeline for application of ROEL is  20 working days.
BUSINESS LICENSES
( Dossier and procedure )
Please see detail at Article 9 to artile 13 of decree no. 09/2018/NĐ-CP
Issuance of both business license and license for establishment of retail outlet Please see artilce 20 of Decree no. 09-2018-ND-CP

Article 20. Application and procedures for issuance of both business license and license for establishment of retail outlet

1. An application shall include:

a) Documents prescribed in Article 12 and Clauses 1 and 2 Article 27 hereof;

b) Certificate of registration for project setting up retail outlets (if any).

2. Procedures for issuance of both business license and license for establishment of retail outlet shall be done in accordance with Articles 13 and 28 of this Decree.

LICENSE FOR ESTABLISHMENT OF RETAIL OUTLET
( Dossier and procedure )
Please see detail at Article 22 to artilce 28 of decree no. 09/2018/NĐ-CP

Note: ENT: Article 23 and artilce 24 of decree no. 09/2018/NĐ-CP

Procedures for issuance of the first license for establishment of retail outlet, retail outlet other than the first retail outlet in case of without requiring compliance with ENT procedure Please see detail at Article 29 of decree no. 09/2018/NĐ-CP
Organzation issuing License Decree no.09/2018/NĐ-CP

Article 8. Licensing agencies

1. Department of Industry and Trade of province where a foreign-invested business entity is headquartered shall issuance, reissuance, modifies, or revokes its business license.

2. Department of Industry and Trade of province where a retail outlet is located shall issuance, reissuance, modifies, renew or revoke its license for establishment of retail outlet.

3. A licensing agency shall consult with the Ministry of Industry and Trade and managing Ministry in any of the following cases:

a) Consulting with the Ministry of Industry and Trade and managing Ministry before issuing or modifying a business license related to the business prescribed in Point c Clause 1 Article 5 of this Decree;

b) Consulting with the Ministry of Industry and Trade before issuing or modifying a business license related to the business prescribed in Points b, d, dd, e, g, h, and i Clause 1 Article 5 of this Decree;

c) Consulting with the Ministry of Industry and Trade before issuing or modifying a license for establishment of retail outlet.

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