INTER-MINISTERIAL CIRCULAR

PROVIDES GUIDELINES FOR THE IMPLEMENTATION OF GOVERNMENT’S DECREE NO.45/2000/ND-CP, DATED SEPTEMBER 6, 2000, THATPROVIDES REGULATIONS ON REPRESENTATIVE OFFICES, BRANCH OFFICES OF FOREIGN BUSINESS PEOPLEAND OF FOREIGN TOURISM BUSINESSES IN VIETNAM

In accordance with Government’s Decree No.45/2000/ND-CP, dated September6, 2000, providing regulations for representative offices, branch offices of foreignbusiness people and of foreign tourism businesses in Vietnam; hereinafter abbreviated as Decree No.45/2000/ND-CP; the Ministry of Trade and the Vietnam National Administration ofTourism provide the following detailed guidelines for consistent implementation of theDecree:

I. RECIPIENTS AND CONDITIONS FOR GRANTING OF A LICENCE TO OPENREPRESENTATIVE OFFICES AND BRANCHES

1. Recipients eligible for a licence

Foreign business people and foreign tourism businesses, hereinafterabbreviated as foreign business people are eligible for receipt of a licence to establishrepresentative offices and branches in Vietnam, if they meet all the requirements andconditions described in Decree No.45/2000/ND-CP and this guiding Circular.

2. Conditions for receipt of a licence

a. For representative offices

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b. For branches

Foreign business people identified in Point 1 of Part I of thisCircular will be granted a licence to establish brand offices in Vietnam if they meet allthe following conditions:

- Have registered businesses in other countries;

- Have operated for at least five years since registering theirbusinesses;

Trade in goods and provide services that are on the list of Permitted Goods and services Branch Offices of Foreign Business People or Foreign Tourism Businessesin Vietnam in consonance with Vietnamese laws applicable for specific periods of time.

II. BODIES PERMITTED TO GRANT LICENCES TO ESTABLISH REPRESENTATIVEOFFICES AND BRANCHES

1. For representative offices

a. The Vietnam National Administration of Tourism shall grant, modify,supplement and revoke licences to establish representative offices of foreign businesspeople operating in the tourism field.

b. Centrally-governed provincial and municipal People’s Committees(hereinafter abbreviated as provincial-level People's Committees) shall grant, modify,supplement and revoke licences to establish representative offices of foreign businesspeople that are:

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- Operating in the fields of trade and tourism, after agreement,confirmed in writing, from the Vietnam National Administration of Tourism in the case oftourist businesses.

2. For branches

a. The Ministry of Trade shall grant, modify, supplement anti revokelicences to establish branch offices of foreign business people:

- Operating in the field of trade;

- Operating in the fields of trade anti tourism, after agreement,confirmed in writing, from the Vietnam National Administration of Tourism in the case oftourist businesses.

b. The Vietnam National Administration of Tourism shall grant, modify,supplement and revoke licences to establish offices of foreign business people operatingin the field of tourism.

III. DOCUMENTS AND PROCEDURES FOR GRANTING A LICENCE TO ESTABLISHREPRESENTATIVE OFFICES AND BRANCHES

1. Documents

Foreign business people applying for a licence to establishrepresentative offices and branches shall send a document to the licence granting body:

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a. A letter of application for a licence to establish a representativeoffice and a branch office of foreign business people (application for a licence toestablish representative offices shall follow Form 1a; and that for a licence to establishbranches shall follow Form 1b, attached to this Circular);

b. A duplicate of the Business Registration Certificate of foreignbusiness people, certified by competent overseas agencies, and a duplicate of thiscertificate, translated into Vietnamese and notarised by a Vietnamese notary body or adiplomatic representative or Vietnamese consulate overseas.

Apart from these documents, foreign business people need not send anyadditional papers.

2. Procedures

a. Within 15 days from the date of receipt of these legal documents,the licence granting body shall grant a licence to foreign business people to establishrepresentative offices or branches in Vietnam. (Licences to establish representativeoffices shall follow Form 2a; and licences to establish branches shall follow Form 2battached to this Circular).

In granting a licence to establish representative offices and branchesoperating in the fields of trade and tourism, the licence granting body shall send adocument, in writing, to the Vietnam National Administration of Tourism, reviewing itbefore deciding to grant a licence to foreign business people. Within five work-days fromthe date of receipt of documents from the licence granting body, the Vietnam NationalAdministration of Tourism shall provide its opinion, in writing, either agreeing ordisagreeing (with clear reasons) so that the licence granting body shall decide whether tolicense those foreign business people in the tourist field.

b. An original licence shall be granted to foreign business people andduplicates of the licence of the licence granting body shall be sent to related bodies asregulated in Points a, b and c of Item 2 of Article 7 of Decree No.45/2000/ND-CP and shallbe filed by the licence granting body.

c. In case of incomplete or unlawful documents, the licence grantingbody must inform foreign business people, in writing, within three work-days from the dateof receipt of documents, of the need for supplementary and complete documents.

IV. LINES OF ACTIVITY OF REPRESENTATIVE OFFICES AND BRANCHES

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Lines of activity of representative offices are detailed in the licenceas regulated in Item 1 of Article 13 of Decree No.45/2000/ND-CP.

2. For branches

a. Branches operating in the field of trade

Lines of activity are noted in the licence to establish the branch andshall include:

- Permission to purchase various types of goods identified in Item I ofthe List of Goods and Services that Offices of Foreign Business People Are Permitted toPurchase in Vietnam for Export;

- Permission to import goods regulated in Item II of the List of Goodsand Services that Branch Offices of Foreign Business People Are Permitted to Purchase inVietnam for sales in the Vietnamese market in form of agenting or opening shops directlydisplaying and selling those categories of goods, under the conditions that they havepreviously earned foreign currency from exporting various types of goods clarified in ItemI of the above list of goods and services, that they possess a licence from the Ministryof Trade and that their import purchases do not exceed export sales;

- The understanding that they must not buy goods in Vietnam for salesin the country.

b. Branches operating in the tourism field

Lines of activity will be detailed according the a List of Goods andServices That Offices of Foreign Business People Are Permitted to Trade in, in Vietnam,over specific periods of time.

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1. If there is a need to change the content of a licence toestablish representative offices or branches, foreign business people must submit aproposal, in writing, to the licence granting body and enclose documents testifying thatthe change corresponds to the laws of localities where they locate their headquarters andto Vietnamese laws.

2. Procedures for granting a new licence that modifies, supplementsand replaces the existing licence shall observe the guidelines in Item 2 of Part III ofthis Circular.

3. When they need to relocate the headquarters of theirrepresentative offices and branches within the same province (city) or seek to change thechiefs of representative offices and branches, there is no need to modify or supplementthe existing licence, but the representative offices and branches must inform the licencegranting body of the change no later than 10 days from the date of relocation of theirheadquarters.

VI. RIGHTS AND OBLIGATIONS OF REPRESENTATIVE OFFICES AND WORKERS FORTHOSE REPRESENTATIVE OFFICES

1. Representative offices are permitted to operate according tolicence;

2. Representative offices are only permitted to rent locations fortheir headquarters; they may rent and purchase necessary equipment and facilities for useat the representative offices;

3. Representative offices may employ Vietnamese and foreign workersfor the representative offices in accordance with Vietnamese laws;

4. Representative offices may open an account for spending inforeign currency and a foreign-currency account for spending in Vietnamese dong, at a bankauthorised to operate in Vietnam; use of these accounts shall be restricted to operationsof the representative offices;

5. Representative offices may import equipment necessary foroperations of representative offices in accordance with the regulations of Vietnameselaws;

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7. Representative offices must make regular reports on theiroperations in accordance with the regulations in Item 4 of Article 14 of DecreeNo.45/2000/ND-CP;

8. Representative offices must not sell or lease their headquartersand must not represent other business people in Vietnam;

9. Chief representatives are permitted to sign contract to purchaseand sell goods and provide services (excluding contracts for travel businesses andtransport of tourists with Vietnamese business people, under the contrition that they showa notarised letter of proxy from foreign business people which is applicable to contracts;

10. Workers for representative offices shall fulfil their rightsand obligations in accordance with Vietnamese laws.

VII. RIGHTS AND OBLIGATIONS OF BRANCHES AND WORKERS FOR BRANCHES

1. Branches are permitted to operate in accordance with theirlicence;

2. Branches are only permitted to rent a site for theirheadquarters and to rent or purchase equipment and facilities necessary for operation ofbranches;

3. Branches are permitted to employ Vietnamese and foreign workersin accordance with Vietnamese laws;

4. Branches are permitted to open accounts for payments in foreigncurrency and in Vietnamese dong, at banks authorised to operate in Vietnam, to serve theoperations of their branches;

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6. Branches may have their own seals according to Vietnamese laws;

7. Branches may transfer profits out of Vietnam according to theregulations of Vietnamese laws;

8. Branches must register, make declarations and pay taxes inaccordance with Vietnamese laws;

9. Branches must follow regulations on accounting and regularreporting in accordance with the regulations in Item 4 of Article 15 of Decree No.45/2000/ND-CP;

10. Branch directors are permitted to sign contracts in accordancewith the business lines of their branches;

11. Workers for branches shall fulfil their rights and obligationsin accordance with the regulations of Vietnamese laws.

VIII. IMPLEMENTATION

Licences to establish representative offices expiring on October 1,2000 will continue in effect, and foreign business people need not apply for a newlicence, but must send a document, in writing, to the licence granting body by November 1,2000 and December 1, 2000, providing the name of the foreign business person, the name ofthe representative office, the location of its headquarters and lines of activity of therepresentative office with a copy of the granted licence.

The Circular takes effect on November 1, 2000.

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P/P HEAD OF THE VIETNAM NATIONAL ADMINISTRATION OF TOURISM
DEPUTY HEAD




Vu Tuan Canh

P/P MINISTER OF TRADE
STANDING DEPUTY MINISTER





Mai Van Dau