How to open an FDI company in Vietnam: A comprehensive guide (2025)

In recent years, Vietnam has become a popular choice for foreign investors because of its fast-growing economy, stable politics, and efforts to create a better investment environment.

That’s why many international businesses, from large companies to startups, are exploring ways to enter the Vietnamese market.

This guide will help you understand the steps to set up a 100% foreign-owned business (FDI company) in Vietnam. You can make the most of growth opportunities while reducing production and operating costs.

1. Benefits of investing in Vietnam

1.1. Benefit from free trade agreements (FTAs)

Vietnam has signed many free trade agreements (FTAs) with countries and regions, creating favorable conditions for foreign investors. 

FTAs such as the Vietnam-EU Free Trade Agreement (EVFTA), the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), and the Vietnam-Korea Free Trade Agreement (VKFTA) have significantly reduced tariff barriers and promoted free trade.

1.2. Tax incentives for foreign invested companies

According to Article 19, Circular 96/2015/TT-BTC, FDI enterprises enjoy preferential tax rates as follows:

Tax rate

1. New business: 10% for life.
2. Project in difficult area: 17% for 10 years.
3. Agriculture and fisheries in disadvantaged areas: 15%.
4. Credit funds, Cooperative banks, Microfinance institutions: 17%.

Tax exemption

1. Exemption for 4 years, 50% reduction for the next 9 years for projects with 10% incentive for 15 years and socialized projects in difficult areas.
2. 4-year exemption, 50% reduction for 5 years for socialized projects outside difficult areas.
3. 2-year exemption, 50% reduction for 4 years for new projects in industrial parks and 17% tax rate projects for 10 years.

Incentives on land rent exemption and reduction for FDI companies

Government issued Resolution 65/NQ-CP dated October 07, 5, it is expected that there will be a new Decree on reducing land and water surface rents for FDI enterprises. It is likely that Decision 25/2023/QD-TTg will be applied similarly, reducing 30% of land rent payable in 2023.

2. Types of foreign-invested companies for investors

Theo Article 24 of the Investment Law 2020There are two ways to establish a foreign invested company in Vietnam:

1. Invest from the beginning: Foreign investors contribute from 1% to 100% of charter capital when establishing a company in Vietnam, depending on the field of operation.
2. Contribute capital, buy shares: Foreign investors contribute capital to a Vietnamese company that has a Business Registration Certificate, with a contribution ratio from 1% to 100%. After completing the procedures, the Vietnamese company is transformed into a foreign-invested company.

3. Conditions for establishing a company/enterprise with foreign investment capital

Conditions for establishing a company/enterprise with foreign investment capital in Vietnam include:

• Contribute capital to establish a company: Foreign investors must meet the conditions on permitted investment industries, not participate in prohibited industries, and prepare investment projects and Investment Registration Certificates.
• Buy shares, contribute capital: Must meet conditions on market access, ensuring national defense, security, and compliance with land laws.
• Investor nationality: Investors must be individuals over 18 years old or organizations from WTO member countries, or have an investment agreement with Vietnam.
• Financial capacity: Investors need to demonstrate financial capacity suitable for the investment industry.
• Headquarters and project location: Must have a legal land and factory lease contract in Vietnam.
• ExperienceSpecial requirements for capacity and experience in conditional business lines.

4. Detailed and complete process of establishing a foreign-invested company in Vietnam

To be able to open a company in Vietnam, foreign individuals need to have appropriate investment license. GLA will support businesses in registering appropriate licenses in parallel with registering to open a company to invest in Vietnam.

4.1. Process for opening a company to contribute capital from the beginning 

The process of establishing a company with foreign investment (investors contribute from 1% to 100% of capital from the beginning) includes the following 5 steps with support from GLA experts.

4.2. Process for opening a company by purchasing shares

In case an enterprise carries out procedures to establish a foreign-invested company in the form of capital contribution, the process will be as follows:

5. Compliance after establishment of foreign-invested company 

The process after incorproation for a foreign-invested company are similar to those of a Vietnamese company, including:

1. Hang nameplate at headquarters: Ensure the company has a signboard in accordance with legal regulations.
2. Register digital signature: To conduct electronic transactions with tax authorities and other organizations.
3. Proposal to issue electronic invoices: Register with the tax authorities to issue electronic invoices for the company.
4. Project implementation status report: Periodic reports on investment project implementation according to the Investment Registration Certificate.
5. Tax filing and payment: Fulfill tax obligations fully and on time as prescribed by law.

Your company must file annual financial reports, declare taxes, and meet all legal requirements to avoid legal risks during operation.

6. How can GLA help you open an FDI company in Vietnam?

Understanding each step—from company registration to legal and financial obligations after setup—will help your business start strong and grow steadily in Vietnam.

As your trusted consulting partner, GLA offer you full support for opening a foreign-owned (FDI) company in Vietnam at a competitive cost. Our support include:

• Help your business register and set up legally in Vietnam.
• Recommend the right company type based on your business model.
• Prepare necessary documents for Vietnamese Enterprises.
• Offer tax advice based on your company’s business activities.
• Assist with registration for all necessary licenses for operation.
• Support opening physical bank accounts, online banking in Vietnam, etc.
• Prepare financial statements and tax reports in accordance with Vietnamese accounting standards.

7. FAQs about setting up FDI companies in Vietnam

Highlights

• Foreign investors can invest in a Vietnamese company either by contributing capital from the start or by buying shares in an existing company.
• Whether you can do this depends on your nationality and the type of business your company is involved in.
• You need to prepare the required documents and apply for both the Investment Certificate and the Business Registration Certificate. Regulations on capital, ownership, and business activities must be strictly followed.
• Your company must file annual financial reports, declare taxes, and meet all legal requirements to avoid legal risks during operation.