Setting up a Company in Laos: A Detailed Guide (2025)

The ASEAN Economic Community is considered a famous and potential investment destination for businesses and corporations around the world. Among them, choosing to open a company in Laos is a popular decision for foreign companies.

As the economy in Laos grows, many Vietnamese companies see the potential of this market and plan to open companies here.

The following article by GLA will provide businesses with an overview, detailed conditions and procedures for establishing a company in Laos as well as notes when choosing this country.

1. Why should you set up a company in Laos?

Over time, Laos has increasingly proven its attractiveness in the eyes of Vietnamese investors. When talking about the main reasons leading to this increasing investment, we cannot help but mention the following reasons:

• Strategic location: bordering Vietnam, Cambodia, Thailand, Myanmar, Yunnan province (China).

Because of this characteristic, the Lao economy is mainly dominated by businesses from Thailand, Vietnam, China, and in some specific areas, China, France, Japan, India, Malaysia, Singapore and Australia. Meanwhile, American businesses hardly play an important role in this country.

• Stable and safe political background.
• Risk from natural disasters and calamities is low.
• Good relations between Vietnam and Laos. This is the foundation for Vietnamese investors to put their trust in Laos.

Land potential and unique terrain also contribute to Laos' special attraction to investors to implement real estate projects, infrastructure services, minerals and agricultural crops... Looking at investment projects of Vietnamese enterprises, most of them are related to the fields of hydropower, infrastructure and agriculture.

• Easily transfer profits from Laos to Vietnam after paying full taxes.
• Receive intellectual property protection under and protect investments under Lao law.
• Opportunity to easily apply for multiple entry visas for investors and their families.

2. Types of companies registered in Laos for foreign investors

Foreign investors have the following options to consider: Representative offices, branches and limited liability companies.

2.1. Representative office

Representative office is subsidiary of international enterprise in Laos, has the duty to represent the interests of the enterprise abroad and protect those interests.

The representative office in Laos will assist foreign enterprises in such matters as market research, collecting information on investment opportunities, and ensuring coordination between relevant Lao government agencies and ministries with the company's headquarters abroad.

The term of the Representative Office is one year, and can be renewed twice. Unless the Representative Office headquarters has a Memorandum of Understanding (MOU) (a record of bilateral or multilateral agreements between countries) or an agreement with the Lao government to conduct research activities, collect data for a specific project for a long period of time. 

The term of the Representative Office may subsequently be extended pursuant to the validity of the MOU or by agreement signed with the Lao Government.

Representative offices may perform the following activities:

1. Collect data and conduct market research, research the potential of investment projects.
2. Supervise the implementation of any activities specified in the MOU, or agreement between the headquarters and the Lao government.

If the Representative Office has signed a Memorandum of Understanding or an agreement with the Lao government, the Representative Office may enjoy tax incentives when importing equipment and machinery for a specific purpose as specified in the MOU or agreement documents.

Representative offices are not allowed to conduct commercial activities and generate income.

2.2. Company branches 

A branch is a subsidiary unit of an enterprise. The operations of the branches will depend on and fall within the scope of operations of the parent company. 

Foreign investors can only consider establishing a branch in Laos if the parent company's field of operation is in the fields of Aviation, Finance, Banking, Insurance.

2.3. Limited liability company 

Private limited liability company

Limited liability company Private Limited Company (LLC) in Laos or Limited Company (LC) is the most popular choice for foreign investors when investing in this market. In particular, foreign owners are allowed to own 100% of the company.

A private limited company must appoint at least one director and one shareholder of any nationality. The law stipulates that the minimum capital must be US$1. Half of this capital must be paid by the members at the time of establishment, and the remaining capital can be contributed later but not later than 1 years from the date of establishment.

The characteristics of a limited liability company are as follows:

• There are about 2-30 shareholders.
• It is possible to own common and preferred shares with a minimum share value of 2000 LAK.
• Must register with the Ministry of Industry and Commerce (MOIC) and be officially operating at the time stated on the Enterprise Registration Certificate (ERC).
• The company must pay taxes at the minimum level. 20% from 2024 onwards.

Public limited liability company

To form a public limited company, a company must have a minimum paid-up capital of USD 6,100. At least 7 shareholders, 2 directors and 1 worker representative (of any nationality) are required.

CPrivate limited company is the corporate structure used by most foreign enterprises when conducting direct investment in Laos., LLC can be a business 100% foreign capital or partly owned by a Laotian corporate partner.

3. Requirements to know when opening a company in Laos 

Below is a summary list of the documents required to set up a limited liability company in Laos.

Businesses should note that for each specific case, industry and field, there may be additional/reduction in different requirements for documents to be submitted. 

The Lao government requires documents to be translated into Lao, but many foreign investors often choose to submit documents in English or another language depending on their specific situation). It is best advised that documents submitted should be bilingual (English and Lao).

Các giấy tờ bao gồm:

1. Company charter.
2. Joint venture agreement or shareholder information (stating voting and dispute resolution) - if the company has more than one owner.
3. Lease Agreement - The LLC will need to prepare an office lease agreement before filing an application for incorporation.
4. Bank statements show the financial capacity of the investor (Bank statements).
5. Investor(s) personal information such as passport copy, passport photo, resume.
6. Depending on the specific business establishment application, the Lao government may also request to see the employment contracts of all employees or at least the main employees.
7. Business plan - a document outlining the intended business activities, number of employees, training programs for Lao employees.

4. Detailed process of establishing a company in Laos

GLA will support businesses to open companies in Laos at optimal costs, meeting government requirements while still operating the company effectively.

5. Things to do after opening a company in Laos

After receiving the Business Registration Certificate, the company owner needs to continue to complete the following procedures so that the company's future business operations in Laos can proceed smoothly.

The work to be done includes:

1. Apply for a Tax Registration Certificate from the Department of Industry and Trade.
2. Apply for a Practice License from the relevant Government Authority or organization.
3. Apply for a corporate seal at the Seal Engraving Department of the Ministry of Industry and Trade.
4. Register social security for workers at the Lao Social Security Office.

6. How does GLA support businesses opening companies in Laos?

Setting up a company in Laos can bring many business and financial benefits, especially in the technology and services sectors. However, the process and compliance requirements require careful preparation to ensure full compliance with Lao government regulations.

Understanding the steps from registration to post-establishment obligations will help your business get off to a solid start and grow sustainably in Laos.

• Consulting and support for establishing Lao companies.
• Recommend the right company type based on your business model.
• Prepare necessary documents for Lao Enterprises.
• Tax consulting suitable for the type of business activities of enterprises in Laos.
• Support for registration of all types of business licenses in Laos.
• Support opening physical bank accounts, online banking in Laos, etc.
• Prepare financial statements and tax reports in accordance with Lao accounting standards.

7. FAQs on setting up a company in Laos

Highlights

• The Limited Liability Company (LC) is the most popular choice when opening a company in Laos.
• Opening a limited liability company in Laos requires the company to have 1 shareholder, 1 director of any nationality, and a minimum capital of 650 USD.
• The current corporate income tax rate is 20%. from 2024 onwards.
• Some specific fields and industries do not allow foreign investment. Enterprises need to check carefully before opening a company. GLA will support Enterprises to open a company in Laos effectively.