In recent years, Vietnam has achieved leaps and bounds in its country’s economic improvements. Encouraging many offshore businesses to venture into Vietnam. Additionally, its countries increasing network of free trade agreements (FTA) and the signing of the TransPacific Partnership are signals from the government as an effort to open its economy. All these create more liberal trade and investment opportunities for foreign entrepreneurs.
Therefore, expanding your business in Vietnam provides excellent opportunities for your overall company growth. What’s more, this country has a young and growing workforce and a cost competitive production base. So, learn more about company formation in Vietnam and the best business structure to set up an offshore business in the country.
Choosing a Business Entity for a Foreign Company in Vietnam
Vietnam is brimming with business opportunities that are appealing to the international business community. Hence, many foreign entrepreneurs are looking to establish their businesses in the country. So, if you want to maximise the benefits of Vietnam’s business policies, it is important to choose the right business entity.
The most common choice of business structure for foreign companies setting up in Vietnam is a Limited Liability Company (LLC). It is a great choice for a start-up company as it has the versatility for future expansion of your business in the country.
Now, how can a foreign company benefit from an LLC business structure?
Top Benefits of LLC for an Offshore Company
A limited liability company has the versatility of a partnership and the asset protection of a corporation. A company can be 100% foreign-owned or a joint-venture. A joint-venture structure is an option if a foreign investor wants to conduct business in restricted industries.
Here are the main benefits of establishing an LLC.
Treated as a separate legal entity
A company with this business structure is treated separately from the members. This means that the company can make its own contracts, investment and buy or own properties
The liability of the members is limited to the extent of their capital contributions. The Members’ individual assets are protected from being used to satisfy an LLC’s obligations.
Even if there are changes in the management or members, the LLC will continue to exist. The LLC can only be dissolved under rare circumstances or members’ consent.
An LLC’s gains, credits and other tax items flow-through to the members. The shares will be reported on the personal income tax which is paid at individual rates. The flexibility of an LLC structure is proven valuable in this regard.
Learn from Experts on Offshore LLC Setup in Vietnam
Choosing an LLC business structure when forming a company in Vietnam is beneficial. In fact, the features of an LLC work well with the governing business policies in the country. Additionally, by approaching a company formation specialist, it will provide you with a more detailed understanding of which business structure is best for you.
Contact a company formation expert today for a FREE consultation on a thorough guide on Vietnam’s registration policies on LLC.
Benefits of Forming a Limited Liability Company (LLC), Ct.wolterskluwer.com