1. Can a foreign investor open a restaurant in Da Nang?

In Vietnam's Schedule of Specific Commitments in Services when joining the WTO, food (CPC 642) and beverage (CPC 643) provision services no longer have any restrictions for foreign investors. That means foreigners can establish 100% foreign-owned companies to conduct business in the restaurant industry in Vietnam.

2. The forms when you open a restaurant in Da Nang

The foreign investors whom are individuals or organization can open restaurants in Vietnam in the form of:

- Open a new restaurant in a form of a setting up a new company, which may be:

• One member liability limited company – the foreign investors hold 100% of the capital.
• Two members or more liability limited company – there are at least two members who put money/property in setting up a company. They share loss and profit under the level of contributing capital.
• Joint stock company - there are at least three shareholders who join the company. They may join the profit and share loss as per the policy of the Two members or more liability limited company but with the joint stock company, it can release stock and be listed on the stock exchange.

- Buy a restaurant which is already exited. You may buy 100% of capital or apart depend on your desire.

- Franchising your restaurant in Vietnam may be a good choice if you have already gained a chain of professional restaurant in your country and meet the requirements according to the law.

Read more about Franchising here: https://phong-partners.com/luat-su-nhuong-quyen-thuong-mai

3. What are basic licenses when you open a restaurant in Da Nang?

The basic licenses that foreign investors must have when they open a restaurant in Da Nang include:

• Investment registration certificate
• Business registration certificate
• Certificate of food hygiene and safety

In addition, foreign investors need to ensure Fire safety requirements.

4. Step-by-step open a restaurant in Da Nang Vietnam

Foreign investors open a restaurants in Da Nang are not subject to investment policy approval from The Office of the National Assembly/ Government/ Provincial People's Committee. Therefore, foreign investors can directly apply for an Investment Certificate.

4.1 Investment Registration Certificate Application

Step 1: The investor submits 01 set of application documents for an Investment Registration Certificate to the investment registration agency. The profile includes the following contents:

• Document requesting implementation of investment project, including commitment to bear all costs and risks if the project is not approved.
• Documents on the investor's legal status.
• Documents proving the investor's financial capacity.
• Proposed investment project. In cases where the law on construction stipulates the preparation of a pre-feasibility study report, the investor may submit a pre-feasibility study report instead of the investment project proposal.
• In case the investment project does not request the State to allocate land, lease land, or allow change of land use purpose, submit a copy of land use rights documents or other documents determining the right to use the location for implementation current investment project.
• Explanation content about technology used in investment projects for projects subject to appraisal and consultation on technology according to the provisions of law on technology transfer.
• BCC contract for investment projects in the form of BCC contract.
• Other documents related to the investment project, conditions and capacity requirements of the investor according to the provisions of law (if any).

Place of application: Department of Planning and Investment of Da Nang city.

Step 2: The investment registration agency considers the dossier and issues the Investment Registration Certificate to the investor within 45 days from the date of receipt of valid documents when the project meets all the regulations of law on: industries or occupations, location, planning of the city, market access conditions and so on.

4.2 Enterprise Registration Certificate application

Step 1: Prepare documents to open a restaurant

• After obtaining the Investment Registration Certificate, investors need to prepare documents to open a restaurant, including:
• Application for business registration.
• Company rules.
• List of members/ List of founding shareholders and shareholders who are foreign investors.
• Copy: Citizen identification card or Identity card or Passport of individual members; Establishment decision, Business registration certificate of the organization and authorization document; Legal personal identification documents of the authorized representative of the organizational member.
• Enterprise registration certificate or equivalent document must be consular legalized for organizational members.
• Investment registration certificate for foreign investors

Step 2: Submit application to Da Nang City Department of Planning and Investment (Business Registration Office)

• Working time: 05-07 working days from the date of receipt of complete and valid documents.

Step 3: Announce the business registration content

• After completing the company registration procedures at the Department of Planning and Investment of Da Nang City, the next step to set up a company is to announce the business registration content.
• Information on business registration must be published on the National Information Portal within 30 days from the date of issuance of the Enterprise Registration Certificate.
• Implementing agency: Announcement publishing department of the Business Registration Agency.
• Working time: within 30 days

Step 4: Company seal

• This is the final step in the process of set up a 100% foreign-owned restaurant. This step is carried out after obtaining the Business Registration Certificate and posting the business establishment announcement.
• The restaurant engraves the seal and announces the use of the seal sample on the National Business Registration Portal. The restaurant has the right to decide the seal model and number of seals.
• Receiving agency: Enterprise registration office - Department of Planning and Investment of Da Nang city - where the business is headquartered.
• Working time: about 5-8 working days
• Note: Documents issued or certified by competent foreign agencies must be consular legalized and translated and notarized according to Vietnamese law. In addition, depending on the case, you must provide some other necessary documents.

4.3 Certificate of food hygiene and safety

Step 1: Application for Certificate of food hygiene and safety:

• Application for issuance of Certificate of establishment meeting food safety conditions;
• Copy of Business Registration Certificate;
• Explanation of facilities, equipment and tools to ensure food hygiene and safety conditions;
• Certificate of good health of the facility owner and person directly producing and trading food issued by a district-level medical facility or higher;
• Certificate of training in food safety and hygiene of the establishment owner and of those directly producing and trading food.

Place of application: Department of Health of Da Nang city.

Step 2: Within 15 days from the date of receipt of complete and valid documents, the Department of Health conducts an actual inspection of food safety conditions at food production and business establishments; If eligible, a Certificate of establishment meeting food safety conditions must be issued; In case of refusal, they must respond in writing and clearly state the reason.

4.4 Ensure fire safety requirements

Foreign Investor must satisfy the following fire safety requirements:

• Regulations, prohibition signs, signage, plans or instruction signs concerning fire prevention, fighting and escape are provided in accordance with fire prevention and fighting regulations and standards or regulations of the Ministry of Public Security;
• There are internal and specialized firefighting forces suitable for the facility’s characteristics and having received training in fire prevention and fighting operation, and on-site combat-ready firefighters according to regulations;
• There is a firefighting plan approved by the competent authority.
• Power system, lightning protection system, antistatic system, electrical equipment, spark-generating equipment, heat-generating equipment, and the use of fire sources and heat sources must ensure fire safety in accordance with regulations and standards on fire prevention and fighting or regulations of the Ministry of Public Security;
• There are sufficient and quality traffic system, water supply system and communication system supporting fire fighting, system for management of database on fire prevention and fighting, incident notification system, fire alarm system, firefighting system, fire blocking system, smoke blocking system, fire escape system, other fire prevention and fighting equipment, and rescue equipment in accordance with regulations and standards on fire prevention and fighting or regulations of the Ministry of Public Security;

5. How can you find legal advice when you open a restaurant in Da Nang?

With more complicated requirements and procedures than domestic investors, it is certain that foreign investors shall encounter difficulties when they open a restaurant in Da Nang. Therefore, to support foreign investors in opening a restaurant in Da Nang, Phong & Partners is honor to introduce and provide you legal services with our knowledgeable and experiences in opening a restaurant in Da Nang.

Find out more legal services of Phong & Partners at www.phong-partners.com  

5.1. Legal Counseling Package:

• Counseling on conditions, choosing investment forms and locations; investment incentive policies, tax policies, labor laws…;
• Counseling, setting up investment projects and conducting investment registration procedures in Vietnam;
• Counseling on legal issues throughout the implementation and operation of the project;
• Counseling procedures to set up company, establish representative offices and branches of foreign companies in Vietnam;
• Counseling all of the other issues when setting up a company in Vietnam.

5.2. Legal Procedures Package:

• Preparing all the documents;
• Guiding Clients to prepare dossiers needed;
• Submitting the application for investment registration and company registration at competent agencies;
• Conducting procedures for applying for sub-licenses for each conditional business line if required;
• And many other legal procedures.

To minimize risks and damages when starting you business in a strange market, it is necessary to "be friends" with lawyers to be provided with quick, timely and effective legal services.

6. FAQ related to open a restaurant in Da Nang

1. How much money do foreign investors need to open a restaurant in Da Nang?

Restaurant business does not belong to an industry that requires legal capital or deposits according to Vietnamese law. Therefore, when foreign investors open a restaurant in Da Nang, they can freely choose a capital level suitable to their abilities and ensure the stable operation of the restaurant.

2. Do foreign investors have to apply for a license to retail alcohol for on-site consumption when open a restaurant in Da Nang?

From March 22, 2020, foreign investors selling alcohol with an alcohol content of 5.5 degrees or more for on-site consumption, traders selling alcohol with an alcohol content of less than 5.5 degrees do not need to apply for a Liquor License for on-site consumption, this procedure has also been abolished according to Vietnamese law.

Currently, foreign investors selling alcohol for on-site consumption only need to register with the Economic Department or the Economic and Infrastructure Department in districts in Da Nang city.

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