21 Tháng Chín, 2023

Procedures for registering commercial franchising from overseas into Vietnam

At this point, franchising is no longer the new definition. This is a form of commercial activity, whereby franchisors permit and require franchisees to undertake by themselves to purchase or sell goods or provide services on the certain conditions[1]. At present, not only Vietnamese businesses are progressively interested in participating in activities together, but foreign businesses also participated in franchising activities in Vietnam over an extended period of time. So, for foreign companies to carry out franchising in Vietnam, what procedures are necessary? Luat Nghiep Thanh would like to share regulations about these procedures as follows

Registration of franchising

Before conducting franchising activities, Vietnamese traders or foreign traders that intend to franchise must register franchising with the Ministry of industry and trade. [2]

A dossier of registration of commercial franchising with the Ministry of industry and trade shall comprise[3]

– An application for commercial franchising registration, made according to a set form (Form MD1 – Annex II)

– A written description of commercial franchise, made according to a set form (Form Annex III)

– A copy of the foreign trader’s business registration certificate or paper of equivalent validity, certified by a competent agency in the host country*

– The industrial property right protection title in Vietnam or a foreign country, in case of licensing industrial property subject matters for which protection titles have been granted**

Noted: * ** Foreign companies can submit one of three types: Copy from the original; A certified copy; published copy enclosed with the original to compare.

– Papers proving the approval of the primary franchisor’s permission of franchise in case the trader registering franchising is the secondary franchisor.

Where papers are in a foreign language, their Vietnamese translations notarized by state notaries public shall be required. Where copies of foreign traders’ business registration certificates or papers of equivalent validity are in a foreign language, their Vietnamese translations certified by foreign-based Vietnamese diplomatic representations and consular legalized according to the provisions of the Vietnamese law shall be required.[4]

Receipt of dossiers of registration of commercial franchising activities[5]

After submitting the registration dossiers to the Ministry of industry and trade, the foreign companies will receive a receipt. However, it is unlikely that the registration of the franchise will have the approval of the State agency:

–  Incomplete and improper dossiers, within 02 days, the foreign comapanies will receive a written notice to supplement and complete the application. If there are questions about requirements for supplementing and completing dossiers, foreign comapanies can request the Ministry of Industry and Trade to explain.

– Complete and valid dossiers, within 05 days, the registration authority shall notify the foreign companies in writing. If approved, the agency proceeds to register for franchising activities into the Register of commercial franchising activities. If the dossier is refused, the reason will be indicated on the notice.

From January 1, 2017, the regulations on franchise registration fees were abolished. As a result, franchise registration fees are not currently charged under FEES AND CHARGES Law because they are not listed there.

Thus, the procedures for the registration of commercial franchises of foreign companies into Vietnam are conducted according to Vietnamese law. And now, franchising activities are easier and faster because there were many foreign companies doing it before.

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Translator: Nguyen Danh Tri

Content writer: Nguyen Danh Tri

Instructor: Nguyen Linh Chi

Admin: Lawyer Thuan

[1] Article 284 Commercial Law 2020.

[2] Article 17.1 Decree 35/2006/ND-CP

[3] Section II.2 Circular 09/2006/TT-BTM

[4] Section II.4 Circular 09/2006/TT-BTM

[5] Section II.5 Circular 09/2006/TT-BTM

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