[Vietnam] Doing Business in Vietnam: A Guide to Licensing for Foreign Investors

Vietnam continues to attract both domestic and foreign investors, driven by its rapid economic growth and strategic location in Southeast Asia. However, different from domestic investors, the market entry of foreign investors involves more than company registration. Depending on the business sector, enterprises may be subject to various licensing and permitting requirements. It is therefore crucial for foreign investors to understand the applicable frameworks and compliance obligations relevant to their operations.

Business sectors in Vietnam that are classified as “conditional”, meaning they are subject to additional licensing and compliance requirements to safeguard national interests such as public health, security, environmental protection, education, and etc. This article outlines the key licenses and regulatory requirements for lawful business operations in Vietnam, with a focus on sector-specific permits and compliance obligations.

Understanding Vietnam’s Conditional Business Sectors

According to Vietnam’s Law on Investment (Law No. 61/2020/QH14), business sectors are deemed “conditional”, requiring businesses to meet specific criteria or obtain specific approvals before commencing operations. These conditions are designed to align business activities with national priorities and public interest. Some examples of conditional business sectors include: trading and distribution, healthcare and pharmaceuticals, education and training, financial services and fintech, logistics and transportation, environmental services, and cybersecurity and data processing. Each sector is governed by its own set of regulations, often issued by different ministries or authorities, such as the Ministry of Health (MOH), the Ministry of Information and Communications (MIC), the Ministry of Industry and Trade (MOIT), the Ministry of Transport (MOT), the Ministry of Construction (MOC) and many more.

In addition to investment and enterprise registration, businesses in conditional sectors must obtain relevant licenses and permits prior to operations, including:

• Business licenses (trading and distribution business)

• Operating licenses (education and training, healthcare, etc.)

• Construction and environmental permits (construction services, etc.)

• Professional certifications (certification services, etc.) 

• Other sub-licenses (technology and telecommunication, etc.)

Failure to secure these permits may result in administrative penalties, suspension of activities, or even revocation of business licenses.

Once licensed, businesses must ensure continuous compliance with relevant laws, which require: 

• Periodic reporting to regulatory authorities

• Renewal or amendments to licenses

• Compliance with technical standards or staffing requirements

• Inspections and audits by competent authorities

Non-compliance with the applicable regulatory requirements may lead to legal risks and affect the reputation of a company as well as its ability to expand operations in the future.

Final Thoughts

Doing business in Vietnam offers compelling opportunities. However, foreign investors, particularly those operating in conditional sectors, must ensure strict compliance with national and sector-specific regulations. The aforementioned licenses and permits form an integral part of Vietnam’s regulatory framework. Early awareness, thorough due diligence, and timely application are critical to ensuring legal compliance and minimizing the risk of delays or regulatory sanctions. With in-depth local insight, TWL Law Group offers practical legal support to help businesses not only navigate Vietnam’s licensing framework with accuracy and efficiency, but also obtain necessary licenses and permits−ensuring smooth, compliant market entry and operations in Vietnam, and alignment with Vietnam’s complex regulatory environment.