Questions relating representative office in Vietnam

1.Can a representative office sign a contract?

Pursuant to the Commercial Law no. 36/2005/QH11, Article 18, Clause 3 on Obligations of representative offices:

3. Not to enter into contracts, not to amend or supplement contracts already entered into by foreign traders, except where chief representatives obtain valid letters of authorization from foreign traders or other cases specified in Clauses 2, 3 and 4, Article 17 of this Law..

In case of being a representative of a foreign trader in Vietnam: According to Decree no. 07/2016/ND-CP, Article 33, Clause 7: “If the head office authorizes the head of the representative office to sign, adjust or supplement contracts, the head office shall grant the power of attorney for each conclusion, adjustment, and supplementation.”

In this case, the head of the representative office of a foreign company in Vietnam may enter into a sales contract if it is authorized in writing by the Company. Authorization will be in writing and only for each contract.

Thus, the representative office does not have the function of signing contracts unless it is a representative office of a foreign trader or foreign company in Vietnam.

2.Can a legal representative issue invoice?

During the business process, when the partner wants to sign a business contract, can a legal representative issue invoice?

Pursuant to point b, clause 7, Article 3 of Circular 26/2015 / TT-BTC guiding the invoice as follows

“With regard to the item “Tên, địa chỉ, mã số thuế của người bán” (name, address, TIN of the seller), “tên, địa chỉ, mã số thuế của người mua” (name, address, TIN of the buyer): The buyer must write the full name or abbreviated name if it can help identify the correct buyer/seller. The TIN must be written correctly.

If the name or address of the buyer is too long, the seller may shorten some common nouns (P instead of Phường (ward), Q instead of Quận (district), TP instead of Thành Phố (city), etc.) as long as the house number, names of the street, ward, district, city, name of the company are written and conformable with business registration or tax registration of the company.  

In case goods are sold by an affiliated unit of the organization using a separate TIN, the name, address, and TIN of such affiliated unit must be written. If the affiliated unit does not have a TIN, the TIN of the headquarter shall be written.

When a buyer of goods or services worth VND 200,000 or more does not take the invoice or provide his/her name, address, and TIN, an invoice shall still be issued and say “người mua không lấy hóa đơn” (“the buyer refuses to take this invoice”) or “người mua không cung cấp tên, địa chỉ, mã số thuế” (“the buyer refuses to provide his/her name, address, TIN”).

It can be said that the accounting of representative offices is dependent on head office. Head office shall bear all financial obligations arising from the operations of representative offices.

Therefore, this office does not have any revenue and expenditure activities , so it will not conduct a tax declaration. If in the event of a purchase of goods and a direct payment for the purpose of operation, the invoice may be issued with the name of the representative office and then the invoice will be returned to the head office for make tax declaration. If in the case of the purchase of goods but the costs are directly paid by the head office, the invoice will record the information of the head office at the standard “name, address, tax code of the buyer. “.

3.Does the representative office have its own seal?

According to Article 8 of decree no. 99/2016/ND-CP regarding Bodies and organizations using the seals with or without symbols

“11The foreign organizations which do not have their diplomatic functions legally operate in Vietnam.”

Thus, the representative office has the right to register its own seal to facilitate operation. And seal registration procedures will be conducted at the local police department of the province or city under central authority

4.Is the representative office juridical person?

According to Article 74 in the Law No. 91/2015/QH13

“Article 74. Juridical persons

  1. An organization shall be recognized as a juridical person if it meets all of the following conditions:
  2. a) It is legally established as prescribed in this Code and relevant laws;
  3. b) It has an organizational structure prescribed in Article 83 of this Code;
  4. c) It has property independent from other natural and juridical persons and bears liability by recourse to its property;
  5. d) It participates independently in legal relations in its own name.”

According to Article 84 in the Law No. 91/2015/QH13

“ Article 84. Branches and representative offices of juridical persons

  1. Each branch and/or representative office is an affiliate other than a juridical person.
  2. Each branch shall perform all or part of the functions of the juridical person.
  3. Each representative office shall perform its duties as authorized by the in accordance with within the authorized scope and for the juridical person’s interests.
  4. The establishment or termination of a branch or a representative office of a juridical person must be registered as prescribed by law and announced.
  5. The head of each branch or representative office shall perform his/her duties as authorized by the juridical person within the authorized scope and for the authorized duration.
  6. A juridical person shall have civil rights and obligations arising from civil transactions established and performed by its representative offices and/or branches.”

Thus, it can be affirmed that the representative office has no juridical persons under current Vietnamese law.

4.Does the representative office have a tax code? What kind of tax is representative office incurred

 According to article 5 of circular no. 95/2016/TT-BTC on guidelines for tax registration:

” Article 5. TIN issuance and usage


h) 13-digit TINs shall be issued to:

– Branches and/or representative offices of an enterprise that are eligible for affiliated entities identification numbers of enterprises as prescribed in Law on enterprises; affiliated entities of business entities and other entities established under regulations of law and taking on tax liabilities.

hereinafter referred to as “affiliated entities”. An entity having “affiliated entity/entities” is called “managing entity” for the purpose of this Circular.


Based on the above provisions, representative offices must register tax codes, the registration of tax codes shall comply with the provisions of circular no. 95/2016/TT-BTC on guidelines for tax registration.

Therefore, enterprises that open representative offices and have business activities or on behalf of the company to perform the payment of debts from business activities of the company must pay license fees. In case the enterprise is established for the purpose of displaying and introducing products and does not have any business activities in practice, it is not required to pay license fees.

Amounts of licensing fees according to Article 4 circular no.  302/2016/TT-BTC:

“c) Branches, representative offices, business premises, public service providers, other business entities: VND 1,000,000.The amounts of licensing fees for the organizations specified in this Clause is based on the charter capital written in the certificate of business registration, the certificate of enterprise registration, or the charter of cooperatives. In case of absence of charter capital, it is based on the investment capital written in the certification of investment registration or decision on investment policies.”

If the organizations prescribed in Point a, b of this Clause change their charter capital or investment capital, the ground for determining the amount of licensing fees is their charter capital or investment capital of the year preceding the year of calculation of licensing fees.

Where the charter capital or investment capital written in the certificate of business registration or certificate of investment registration is in foreign currency, it shall be converted into Vietnamese dong as a basis for determining the amount of licensing fees in accordance with the buying rate of commercial banks or credit institutions where the licensing fee payers open their accounts at the time they make payment to the state budget.” 



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