Vietnam has emerged as one of Southeast Asia’s most dynamic business destinations. With strong economic growth, competitive operating costs, and increasing foreign investment, the country continues to attract entrepreneurs and international companies looking to expand into Asia.
The numbers reflect this momentum. In 2025 alone, Vietnam recorded over 195,000 newly registered enterprises , a 24.1% increase compared with the previous year. At the same time, foreign direct investment (FDI) reached more than US$31 billion , confirming strong confidence among international investors.
However, successfully launching a business in Vietnam requires careful preparation. The regulatory framework, administrative procedures, and operational realities can differ significantly from those in Europe or the United States.
For entrepreneurs planning to establish a presence in the country, the following checklist highlights the key steps and considerations when settling a business in Vietnam.
1. Define the Right Business Structure
One of the first decisions entrepreneurs must make is choosing the appropriate legal structure.
Vietnam offers several options for foreign investors, including:
- Limited Liability Company (LLC) – the most common structure for foreign investors
- Joint Venture Company – a partnership with a Vietnamese partner
- Representative Office – suitable for market research or liaison activities
- Branch Office – allowed for certain industries
The LLC structure is generally preferred by small and medium-sized foreign companies because it provides operational flexibility while limiting financial liability.
However, some sectors in Vietnam still have foreign ownership restrictions or require local partnerships , particularly in areas such as logistics, media, education, and telecommunications. Reviewing these regulations early is essential to avoid delays later in the process.
2. Conduct Thorough Market Research
While Vietnam’s economy is growing rapidly, each sector operates differently and local market dynamics can vary significantly.
For example, the manufacturing and processing industry attracts the largest share of foreign investment , accounting for more than half of newly registered FDI projects in recent years.
At the same time, Vietnam’s service sector is expanding quickly , with wholesale, retail, logistics, and technology services seeing strong growth.
Entrepreneurs should carefully evaluate:
- Local demand and consumer behavior
- Competition from both domestic and international firms
- Regulatory requirements specific to the sector
- Supply chain infrastructure
Conducting feasibility studies or working with local consultants can provide valuable insights before committing significant capital.
3. Prepare Investment and Licensing Documentation
Foreign investors must complete several administrative steps before officially launching operations.
The process typically involves two key approvals:
Investment Registration Certificate (IRC)
The IRC confirms the details of the foreign investment project, including:
- Business activities
- Investment capital
- Project location
- Investment timeline
Enterprise Registration Certificate (ERC)
Once the investment project is approved, the company itself must be registered to receive an ERC, which legally establishes the enterprise.
The documentation required for these procedures may include:
- Corporate documents from the parent company
- Financial statements
- Passports of shareholders and directors
- Business plans and investment proposals
For international investors unfamiliar with Vietnamese administrative procedures, working with professionals offering relocation services Vietnam can simplify the process and help ensure compliance with local regulations.
4. Choose the Right Business Location
Location plays a major role in the success of a business in Vietnam.
The country’s three main economic hubs each offer different advantages:
Ho Chi Minh City
- Vietnam’s largest commercial center
- Strong startup ecosystem
- Major logistics and financial hub
Hanoi
- Political and administrative capital
- Strong government presence
- Growing technology sector
Da Nang
- Emerging technology and innovation hub
- Lower operating costs
- Strategic location between north and south Vietnam
For manufacturing operations, many companies choose industrial zones located around major cities, where infrastructure and incentives for foreign investors are often stronger.
5. Understand Tax and Accounting Obligations
Vietnam’s tax system is relatively competitive in the region, but compliance requirements can be detailed.
Key taxes include:
- Corporate Income Tax (CIT): generally 20%
- Value Added Tax (VAT): typically 10%
- Personal Income Tax (PIT) for employees
Companies must also maintain accounting records in accordance with Vietnamese Accounting Standards and submit regular tax filings.
Many foreign investors work with local accounting firms or outsourcing providers to manage compliance and reporting obligations effectively.
6. Plan Your Workforce Strategy
Hiring employees in Vietnam is relatively straightforward, but there are several legal considerations.
Businesses must comply with:
- Labor contracts regulated by the Vietnamese Labor Code
- Mandatory social insurance contributions
- Minimum wage requirements depending on the region
Companies employing foreign staff must also ensure that employees obtain the appropriate work permits or residence documentation , which can require advance planning.
Vietnam’s labor market remains attractive to investors thanks to its young workforce and competitive salary levels , making it an appealing destination for companies seeking regional expansion.
7. Set Up Banking and Financial Infrastructure
Opening a corporate bank account is another essential step in establishing operations.
Foreign-invested companies in Vietnam typically require:
- A capital account for investment funds
- An operating account for daily transactions
Vietnam’s banking sector includes both domestic banks and international institutions, offering a range of services for foreign investors.
Entrepreneurs should also consider currency management strategies, as certain cross-border financial transfers must comply with Vietnamese foreign exchange regulations.
8. Build Local Partnerships and Networks
Doing business in Vietnam often relies heavily on relationships and trust.
Joining local business associations and international chambers of commerce can help companies navigate the business environment and connect with potential partners.
Organizations such as:
- European Chamber of Commerce (EuroCham)
- American Chamber of Commerce (AmCham)
- Japanese Chamber of Commerce (JCCI)
provide networking opportunities, regulatory updates, and advocacy support for foreign businesses.
Building these connections early can make a significant difference when entering a new market.
9. Prepare for Long-Term Growth
Vietnam’s economic trajectory suggests continued expansion over the coming decade. The country has become an increasingly important part of global supply chains and is benefiting from shifts in international manufacturing and trade.
Foreign investment continues to grow, with FDI disbursements reaching more than US$27 billion in 2025 , the highest level in five years.
For entrepreneurs who approach the market strategically, Vietnam offers significant opportunities across industries such as manufacturing, technology, e-commerce, and professional services.
However, success depends on understanding the regulatory environment, building reliable partnerships, and planning carefully for long-term operations.
Final Thoughts
Vietnam is quickly becoming one of the most attractive destinations in Asia for entrepreneurs and international companies. Its growing economy, expanding middle class, and strong integration into global trade networks create compelling opportunities for business expansion.
Yet establishing a company in the country requires more than enthusiasm for a promising market. From legal registration and tax compliance to workforce planning and local partnerships, each stage of the process must be handled with care.
By following a clear checklist and seeking the right professional guidance when needed, foreign investors can navigate Vietnam’s business landscape effectively and position their ventures for long-term success.