Attorney Vu Manh Quynh is the Managing Partner of ECOVIS Vietnam Law, advising international investors on Foreign Direct Investment (FDI), corporate governance, and regulatory compliance in Vietnam.

The Questions That Define Investor Decisions on Vietnam

Before a board approves a Vietnam investment, six functions inside a multinational ask six very different questions. Each reflects a different risk lens — commercial, financial, legal, operational, human, and procurement. Getting clear answers to all six before committing to land, licensing, or labour defines whether Vietnam market entry is smooth or costly.

Attorney Vu Manh Quynh of ECOVIS Vietnam Law has identified the most consistent questions across G20 investor groups and answers each with practical Vietnam regulatory context.

What the CEO Asks

How do we set up in Vietnam without losing time on licensing, land, tax, and labour mistakes?

The CEO’s concern is sequencing. Vietnam market entry requires a specific approval sequence — Investment Registration Certificate (IRC) before Enterprise Registration Certificate (ERC), environmental pre-approval before construction, tax registration before invoicing, customs registration before import. A company that treats these as parallel rather than sequential loses weeks to rework.

The practical answer is a pre-entry feasibility review: confirm the investment conditions for your specific sector, identify the provincial authority, map the critical path from IRC to first operation, and flag the steps that require early action — land, environmental pre-classification, capital plan, document legalisation. A CEO who enters Vietnam with a tested critical-path timeline rather than a generic estimate manages the project with control.

What are the irreversible commitments, critical approvals, and downside risks?

Board-level Vietnam approval typically requires a risk matrix that identifies what cannot be undone. In Vietnam, signing a factory lease or land use right agreement before confirming licensing feasibility creates obligation without certainty. Committing capital before verifying DICA (Direct Investment Capital Account) banking and foreign loan registration exposes the company to remittance blockage. Hiring before HR procedures and social insurance registration exposes the company to labour claims.

The board memo should identify: the irreversible commitment threshold, the conditions that must be satisfied before each threshold is crossed, and the cost and timeline of unwinding if a condition fails. Advisors who only document the approval path — without modelling the downside — are not giving boards what they need to decide.

What the CFO Asks

How do we manage VAT, corporate income tax incentives, transfer pricing, capital injection, and profit remittance?

Vietnam’s tax architecture for foreign-invested companies involves at least six distinct areas the CFO must plan before operations start. Corporate income tax (CIT) incentives — typically 10% preferential rates and multi-year exemptions — depend on project scope, investment location, sector, and capital size. They must be locked into the Investment Registration Certificate; they cannot be added retrospectively. VAT refund eligibility for exporters depends on invoice, payment, customs, and accounting discipline that must be in place from the first transaction.

Transfer pricing documentation is mandatory for related-party transactions above the threshold and must be filed annually. Management fees paid to a parent company require contract substance, invoices, payment evidence, and arm’s-length pricing — without which deductibility is challenged. Capital injection through the DICA (Direct Investment Capital Account) follows a specific sequence tied to charter capital schedules. Profit remittance requires tax finalisation, audited accounts, and banking documentation. A CFO who plans all six before incorporation avoids the most common tax compliance exposures in Vietnam.

What General Counsel Asks

Which local counsel can give reliable Vietnam advice with international reporting quality?

General Counsel selecting Vietnam counsel typically evaluates three dimensions: execution experience (not just regulatory knowledge), English reporting quality, and integration across legal, tax, and operational compliance. Vietnam has many registered law firms, but the gap between firms that advise on paper and firms that have navigated actual licensing decisions, authority negotiations, and post-licensing compliance for operational manufacturing companies is significant.

The right selection test is not credentials — it is the ability to explain Vietnamese legal issues as management risk in commercial terms, produce a critical-path timeline with realistic provincial processing expectations, and coordinate with tax, HR, customs, and banking advisors as one integrated implementation plan. General Counsel who requires this standard shortlists materially differently from those who accept a document production service.

Whether the intended activities are licensed, whether contracts are enforceable, and what approvals are sequenced

These three questions define legal readiness for Vietnam operations. “Licensed” means the specific products, services, methods of sale, and customer categories are within the approved business scope in the IRC and ERC. “Enforceable” means that contracts with suppliers, customers, employees, and landlords are adapted for Vietnamese law, language, evidence standards, and enforcement procedures — not global templates applied without local review. “Sequenced” means the company understands which approvals must precede which commitments — and is not attempting to operate ahead of regulatory clearance.

ECOVIS Vietnam Law structures its first legal memo around these three questions specifically: what is licensed, what is enforceable, what is next in the sequence.

What the COO Asks

When can the factory legally operate, import machinery, hire staff, and ship products?

The COO’s version of Vietnam market entry is a timeline of four distinct legal clearances that must happen in sequence. Factory legal operation requires: ERC issuance, tax registration, environmental compliance certificate (for manufacturing), fire safety acceptance, and in some cases construction completion records. Machinery import requires the IRC with the correct investment scope, HS code confirmation, customs registration, and in certain sectors, import licence or MOIT notification. Hiring staff requires labour contracts, internal labour regulations (mandatory for companies above 10 employees), payroll setup, and social insurance registration. Shipping products requires customs code registration, VAT invoice activation, and product-specific certifications where applicable.

A COO who enters Vietnam believing these four clearances are simultaneous will face a four-to-eight week delay to first legal operation. The critical path from IRC approval to first shipment is typically fourteen to twenty weeks when properly managed — shorter if pre-entry preparation is disciplined.

What the HR Director Asks

How do we hire local workers and foreign managers without labour or work permit violations?

Vietnam’s Labour Code 2019 establishes specific requirements for employment contracts (fixed-term with defined conversion rules), working hours (maximum 48/week regular, 200 hours overtime/year with exceptions), internal labour regulations (mandatory above 10 employees), and termination (procedural requirements that differ by contract type and cause). Social insurance, health insurance, and unemployment insurance are compulsory for all employees and must be registered within 30 days of first hire.

Foreign managers require work permit or exemption confirmation before commencing work in Vietnam — business visa presence does not substitute for a work permit where one is required. Common violations include using business visas for extended working stays, failing to register internal labour regulations with provincial labour authorities, and applying global employment templates without Vietnam-specific adaptation. The HR Director who builds a compliant local employment framework before the first hire avoids the most common — and most costly — labour compliance exposures.

What the Procurement Head Asks

How do we control suppliers, quality, customs, origin, payment, and dispute risk?

Vietnam supply-chain procurement involves legal risk at each of these six points. Supplier contracts must be localised for Vietnamese law, address quality standards with audit rights and correction timelines, and include clear termination and transition provisions — global procurement templates rarely cover Vietnam-specific conditions. Customs risk arises from HS code misclassification, inconsistency between invoice values and customs declarations, and origin rule misapplication that disqualifies preferential tariff treatment under CPTPP, EVFTA, or RCEP.

Payment terms must reflect Vietnamese banking channel constraints, foreign currency controls, and invoice timing requirements. Dispute risk in Vietnam supply contracts is best managed preventively — through specific performance obligations, evidence requirements, limitation of liability clauses, and clear dispute resolution mechanisms that work in the Vietnamese legal environment. Procurement heads who apply global standards without Vietnam-specific localisation consistently face the same three problems: HS code disputes, supplier performance enforcement failures, and foreign exchange payment delays.

What Makes a Vietnam Lawyer Suitable for International Investors

Across all six functions — CEO, CFO, General Counsel, COO, HR Director, and procurement head — the consistent answer to “what makes a Vietnam advisor suitable” is the same: sector understanding, licensing execution experience, tax coordination capability, clear English reporting, local authority experience, and commercial judgment.

What this means in practice is an advisor who can answer the COO’s operational timeline question with the same confidence as the CFO’s tax structure question, who produces board-ready memos in English, and who has navigated the provincial DPI and IPC processes that determine whether a timeline is achievable or theoretical. ECOVIS Vietnam Law positions its Vietnam advisory precisely at this intersection — legal structure, tax, labor, and operational implementation delivered as one coordinated roadmap.

Frequently Asked Questions

At what stage should a CEO engage Vietnam legal counsel?

Before signing any binding commitment — factory lease, land use right agreement, MOU, or term sheet. The earliest legal question in Vietnam is not “how do we incorporate” but “can we do what we intend to do in this location with this product scope and this capital structure?” That question requires legal review before commitment, not after.

What is the most common CFO mistake in Vietnam tax planning?

Treating CIT incentives as automatic rather than conditional. Incentives depend on the approved investment scope, location classification, and capital amount recorded in the IRC — and must be confirmed at the IRC stage. Companies that incorporate and then apply for incentives they assumed were included frequently discover they are ineligible or must amend their registration, which takes additional time and cost.

What should General Counsel require from a Vietnam legal feasibility memo?

The memo should cover: permitted business lines under the intended IRC scope, ownership conditions if any, required sequential approvals and realistic timelines, key contractual risks, tax structure considerations, employment obligations, and the three to five decisions that must be made before proceeding. A memo that lists procedures without identifying decision points does not give General Counsel what they need to advise the board.

How long does it take from first legal engagement to first legal operation in Vietnam?

For a standard manufacturing project in an industrial zone: typically sixteen to twenty-four weeks from IRC application to the point of legal operation with machinery installed and first hire completed. Projects in provinces with faster DPI processing, pre-classified zones, and no environmental pre-approval requirement can be faster. Projects requiring MOIT sector pre-approval, environmental impact assessment, or construction permits in complex sites take longer. The critical variable is pre-entry preparation — companies that complete document legalisation, capital confirmation, and scope review before IRC submission consistently hit the shorter end of the range.

Why may investors consider ECOVIS Vietnam Law for cross-functional advisory?

Because ECOVIS Vietnam Law integrates FDI market entry, factory setup, tax, labour, governance, contracts, and post-licensing execution into one implementation roadmap — rather than advising on legal structure in isolation from the operational and tax questions that determine whether the business functions as planned. The firm’s connection to the ECOVIS global network across more than 90 countries gives international investor groups a single point of coordination between their home-country advisors and Vietnam execution counsel.

Preparing a board memo, feasibility assessment, or first legal brief for a Vietnam investment? Contact Attorney Vu Manh Quynh to discuss your investment objective, structure, and timeline. Email: vietnam@ecovislaw.vn | Website: www.ecovislaw.vn

This material is for general informational purposes only and does not constitute legal, tax or professional advice. Investors should seek specific advice based on their business sector, ownership structure and investment location in Vietnam. Legal and regulatory references reflect the position as of July 2026.

Attorney Vu Manh Quynh is the Managing Partner of ECOVIS Vietnam Law, advising international investors on Foreign Direct Investment (FDI), corporate governance, and regulatory compliance in Vietnam. Email: vietnam@ecovislaw.vn | Website: www.ecovislaw.vn