Legal Compliance Guide for FDI Companies Operating in Vietnam
After obtaining the Enterprise Registration Certificate (ERC) and Investment Registration Certificate (IRC), newly established foreign-invested enterprises (FDI companies) must not overlook the post-licensing stage. This is the most crucial phase to establish a solid legal compliance foundation in Vietnam — especially regarding taxation, labor, and capital regulations.
This article provides a comprehensive, timeline-based checklist to help FDI enterprises avoid compliance risks and administrative penalties.
Mandatory Tasks Within the First 30 Days
1. Display the Company Signboard
The company must clearly display its registered name, tax code, and head office address at the business premises.
The Tax Authority may conduct random inspections and impose fines if the signboard does not meet regulatory requirements.
2. Purchase and Register a Digital Signature (Token)
In line with Vietnam’s e-Government and digital transformation initiatives, nearly all procedures—such as tax declaration, e-invoice signing, and social insurance submissions—are now conducted online using a digital signature.
3. Open a Direct Investment Capital Account (DICA)
This is the only account permitted for capital-related transactions, including receiving capital contributions from foreign investors and remitting profits abroad.
Capital contributions must not be transferred through regular payment accounts.
4. Submit the Business License Tax Declaration
Enterprises must submit the Business License Tax Declaration within 30 days from the date of establishment.
The annual license tax is based on charter capital, typically VND 2,000,000 or 3,000,000 per year.
5. Register for E-Invoice Usage
Before issuing any invoices, the enterprise must register and notify the Tax Authority of its e-invoice issuance, which can only be done after obtaining a digital signature.
⚠️ The first 30 days are the “golden period” for laying the groundwork of compliance. Delays in key tasks—especially opening the DICA or filing the license tax—can lead to administrative fines and hinder capital contribution activities.
Mandatory Tasks Within the First 90 Days
1. Contribute Full Charter Capital
Foreign investors must contribute the full charter capital as committed in the company charter within 90 days from the issuance of the ERC.
Late or incomplete contributions may result in administrative penalties and require a reduction of charter capital.
2. Appoint Key Management Personnel
The enterprise must issue appointment decisions for key managerial positions such as Director/General Director (Legal Representative) and Chief Accountant (or Accounting Officer) to officially operate the company.
3. Register Salary Scale and Initial Labor Declaration
Under Vietnam’s Labor Law, enterprises must:
Register their Salary Scale and Payroll Structure with the local Department of Labor, Invalids and Social Affairs (DOLISA).
Declare initial labor usage to report the number of employees.
Strict compliance within these 90 days helps establish a stable legal and operational foundation, minimizing early-stage risks for FDI enterprises.
Regular Compliance Obligations
Monthly / Quarterly Declarations
Depending on the company’s tax regime and revenue scale, FDI enterprises must declare and pay taxes as follows:
- VAT (Value-Added Tax): Monthly or quarterly declaration.
- PIT (Personal Income Tax): Monthly or quarterly declaration if withholding occurs.
- CIT (Corporate Income Tax): Quarterly provisional payment; the total must not be less than 80% of the final annual tax payable.
Monthly Obligations
- Social Insurance Contributions: Enterprises must pay mandatory social, health, and unemployment insurance for employees by the end of each month, as required under labor laws.
Annual Obligations
- Audited Financial Statements: All FDI companies are required to have their financial statements audited and submitted to both the Tax Authority and the Department of Planning and Investment (DPI) within 90 days from the end of the fiscal year.
- CIT and PIT Finalization: Must be conducted concurrently with the audited financial report—no later than the 90th day after the fiscal year ends.
Maintaining strict compliance with these periodic reporting and payment obligations is essential for FDI enterprises to demonstrate transparency, accountability, and adherence to Vietnam’s regulations on taxation, accounting, and labor.
Frequently Asked Questions (FAQ)
A Direct Investment Capital Account (DICA) is a specialized bank account required for foreign-invested companies in Vietnam. It is used exclusively for capital transactions, such as receiving capital contributions from foreign investors and transferring profits or capital abroad later on.
In contrast, a regular payment account is used for day-to-day business operations — paying suppliers, salaries, taxes, or other local expenses.
👉 Important note:
Foreign investors must not transfer capital contributions through regular payment accounts. All capital-related transactions must go through the DICA to comply with Vietnam’s foreign exchange control regulations.
If a foreign-invested company (FDI) does not fully contribute its charter capital within 90 days from the issuance date of the Enterprise Registration Certificate (ERC), it will be considered non-compliant with investment regulations.
👉 Possible consequences include:
Administrative penalties: The company may face fines from the licensing authorities.
Forced capital adjustment: It must carry out procedures to reduce its charter capital to the actual contributed amount.
Risk of investment certificate revocation: In serious cases, the Investment Registration Certificate (IRC) may be suspended or revoked.
To avoid these risks, investors should plan fund transfers carefully and ensure that the full amount is contributed through the DICA within the legal timeframe.
Yes — even if a newly established FDI company has no revenue or business activity, it is still required to file periodic tax declarations with the Tax Department.
👉 Specifically:
VAT (Value Added Tax): The company must file a monthly or quarterly VAT return, declaring “no revenue” if applicable.
PIT (Personal Income Tax): If the company has no employees or salary payments, it must still submit a PIT return with “no arising obligation.”
Failing to submit these reports on time can lead to administrative fines, even if no tax amount is due.
✅ Tip: You can authorize an accounting service or tax agent to handle these filings to ensure compliance from day one.
References
The information in this article is compiled and cross-checked from the following current legal documents of Vietnam:
- Law on Investment No. 61/2020/QH14 dated June 17, 2020, and its amending, supplementing, and guiding documents.
- Law on Enterprises No. 59/2020/QH14 dated June 17, 2020; Amended Law on Enterprises No. 76/2025/QH14, and related amending, supplementing, and guiding documents.
- Law on Tax Administration No. 38/2019/QH14 dated June 13, 2019.
Conclusion
Ensuring full legal compliance for FDI companies from the very first days of operation is crucial for sustainable and long-term growth. Mastering this FDI compliance checklist — from opening a Direct Investment Capital Account (DICA), contributing full charter capital within 90 days, to fulfilling periodic tax reporting obligations — helps foreign-invested enterprises avoid unnecessary penalties and focus entirely on business development.
As regulations may change over time, both enterprises and foreign employees are strongly advised to seek assistance from professional legal advisors to ensure a smooth and compliant operation in Vietnam.
About FarEast Legal
FarEast Legal is a professional and specialized legal consulting firm based in Ho Chi Minh City, Vietnam. We take pride in providing comprehensive legal solutions in the fields of Labor, Corporate, and Commercial law.
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