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Vietnam is in the midst of a trade boom. Goods are flowing in and out of Vietnam to the tune of billions of dollars every day. Not only is there a growing consumer market that is buying up all manner of goods but a booming manufacturing industry is also sucking in raw materials from all over the world and the region. With this in mind, there are broad opportunities in importing goods into Vietnam.

That said, importing goods into Vietnam for foreign firms can be tricky. Not only are there a number of technical and legal requirements that need to be met, but a myriad of free trade agreements has made navigating tariffs and trade restrictions complex.

Understanding the nuances of importing goods into Vietnam, including how to find a distributor, establish a trading company, and customs procedures, before attempting to access Vietnam’s 100 million-strong consumer market, can make the difference between a foreign firm’s success or failure. In this light, this runs through what new importers should know.

Establishment procedures for trading companies in Vietnam

Trading companies in Vietnam with foreign ownership are generally established as a limited liability company either as a wholly owned foreign enterprise or a joint venture with a Vietnamese partner. This article provides a broad overview of establishment procedures with a more thorough, detailed technical guide available here: How to Form a Company in Vietnam: Technical Guide 2024

Establishing a trading company

Establishing a trading company in Vietnam gives a firm the power to both import and export goods as well as distribute those goods within Vietnam. 

Note that, a trading company is generally formed the same way as any other foreign-invested enterprise. The ‘trading company’ designation is simply a means of notifying the authorities as to the nature of the business conducted.

Wholly foreign-owned trading companies in Vietnam

A wholly foreign-owned trading company in Vietnam allows a foreign investor complete control over the company’s operations. It is, however, generally more costly and time-consuming.

Specifically, before they can apply to register a business, foreign entrepreneurs who want to set up a wholly foreign-owned company will need to first apply for an Investment Registration Certificate (IRC) which they do not have to do with a local partner.

An IRC is basically required to ensure that foreign firms are not engaging in business in restricted or forbidden business lines. The conditions for approving an IRC are outlined in the Law on Investment which also states that IRCs should be issued in between 5 to 15 days. In reality, however, it is usually around 30 to 45 days.

Joint venture trading companies in Vietnam

With a local partner foreign business persons do not need to file for an Investment Registration Certificate, but rather the Vietnamese partner establishes the company and the foreign investor buys a share. In this sense, working with a local business partner can considerably reduce setup costs and application processing times. 

Joint ventures, however, can be risky. A mismatch in work ethics and management styles can cause conflict in the workplace, particularly in cross-cultural settings. For example, whereas in Vietnam it is common to financially penalise staff for arriving late or for using their phone during work hours, in Western countries, this is ususally unacceptable. Understanding these little nuances of cross-cultural communication, in a joint venture environment, may be crucial to a business’s success.

Using a local distributor

Firms that want a quick and easy solution to import goods into Vietnam, rather than establishing a trading company, may find engaging a local trading company the most effective way forward. This is a simple transaction whereby goods are shipped to the local trading company which takes care of the logistics from the port of arrival onwards. This does, however, give firms little control over their goods after they arrive in Vietnam.

Finding a distributor

Professional business matchmaking services in Hanoi and Ho Chi Minh City are a dime a dozen. Most consultancies offer these services and can advise on the right distributor for your product as well as negotiate terms.

For firms that would like a little more control over their goods after they arrive in Vietnam, establishing a local presence is always an option.

Packaging and Labeling

Vietnam has a number of packaging and labeling requirements. These are outlined in Decree 43/2017/ND-CP with amendments to said decree made in Decree 111/2021/ND-CP. Labels for products sold in Vietnam must include:

• The name of the goods;
• The name and address of the organization or individual responsible for the goods; and
• The origin of goods.

There are also additional labeling requirements for different products. For foods, importers must also include on the product labeling the:

• quantity,
• date of manufacture,
• expiry date,
• ingredients and ingredient quantities,
• warnings (if necessary),
• usage instructions, and
• storage instructions.

On a practical level, this often means a sticky label in Vietnamese applied over the information printed on the original packaging.

Shipping to Vietnam

Once you have established your trading company in Vietnam the next step is shipping your goods. If you’re using a local distributor, they will provide you with the delivery details and advise you on the best way to ship your goods. If you have set up your own trading company, however, then there are a number of means by which you can get your goods into Vietnam.

Whereas this section provides a broad overview of logistics in Vietnam, a more complete guide can be found here: Logistics in Vietnam: Ultimate Guide (2024).

Airports

Airfreight is popular for high-value and perishable goods. Most international logistics companies service Vietnam–DHL and FedEx, for example. These companies usually fly to the big cities, Hanoi and Ho Chi Minh City, however, they may also sometimes fly to regional airports if demand warrants it and facilities can accommodate international air freight.

See also: Vietnam Airports: Foreign Investors Guide 2024

Key airports in Vietnam for international freight

IATA – International Air Transport Association, ICAO – International Civil Aviation Organization

Seaports

For non-perishable items, or bulky low-value items sea freight is likely the most effective option for shipping goods to Vietnam.

Vietnam has approximately 36 ports scattered along its coastline. However, Hai Phong and Ba Ria-Vung Tau are by far the largest and can accommodate the biggest volume of goods. These service key manufacturing hubs in northern Vietnam and southern Vietnam respectively.

See also: Vietnam Seaports: Foreign Investors Guide 2024

Key seaports in Vietnam

Port fees

Seaport fees are not standardised in Vietnam. Instead, each port charges its own fees.

Land crossings

Firms that are shipping goods to Vietnam from within Asia could also use land borders. This is common for firms where Vietnam is a part of a longer supply chain. For example, agricultural goods grown in Cambodia might be shipped to Vietnam for processing. There are a number of land border crossings connecting Vietnam to its neighbours scattered along its northern and western borders.

Key landborder crossings in Vietnam

Customs procedures on arrival in Vietnam

When goods arrive in Vietnam, as they must anywhere else in the world, they are subject to customs inspection. Customs procedures in Vietnam are governed by the Law on Customs.

Paperwork

Firms importing goods into Vietnam need to complete and submit a dossier of documents before the importation can be approved. This can in most cases be submitted online. It will include information on what the goods are, where they are from, their value, and a number of other details. The Vietnam National Trade Repository offers a detailed description of each item that is required.

Tariffs

In recent years, Vietnam has signed on to a number of free trade agreements that have reduced barriers and tariffs almost in their entirety for countries that are party to these agreements. Free trade agreements imports should be aware of include:

• ASEAN Free Trade Area
• ASEAN-China Comprehensive Economic Cooperation Agreement
• ASEAN-South Korea Comprehensive Economic Cooperation Agreement
• ASEAN-Japan Comprehensive Economic Partnership
• Japan-Vietnam Economic Partnership Agreement
• ASEAN-India Comprehensive Economic Cooperation Agreement
• ASEAN-Australia and New Zealand Free Trade Agreement
• Vietnam-Chile Free Trade Agreement
• South Korea-Vietnam Free Trade Agreement
• Eurasian Economic Union-Vietnam Free Trade Agreement
• Comprehensive and Progressive Agreement for Trans-Pacific Partnership
• ASEAN-Hong Kong, China Free Trade Agreement
• EU-Vietnam Free Trade Agreement
• United Kingdom – Vietnam Free Trade Agreement
• Regional Comprehensive Economic Partnership.

Import-export licenses

Most imports do not require an import licence, however there are a few areas where they do apply. These are detailed in the appendices of Decree 69. Generally, they cover sensitive materials like explosives or chemicals, publishing equipment and materials, and input materials for the agricultural sector–fertilizer and stock feed for example.

Priority customs treatment in Vietnam

Priority customs treatment is a way to fast track customs procedures for importing and exporting goods, out of and into Vietnam. Essentially this reduces the time goods spend in Vietnam’s ports and, depending on the volume of trade a business is doing through said ports, can be a significant time-saving measure. This incentive program is outlined in the Law on Customs 2014 but is implemented through a series of decrees and circulars.

For details see: Priority Customs Treatment in Vietnam for Foreign Firms 2024

Import taxes in Vietnam

Though there are no specific import taxes in Vietnam, most goods imported into the country will be subject to Vietnam’s Value-added Tax (VAT).

Value-added tax (VAT)

The specifics of the VAT are outlined in Law No. 13/2008/QH12. Broadly, this is a consumption-based tax on goods and services in Vietnam. It is generally charged at the point of sale, with regard to imports this is at the port of entry. VAT is generally charged at 10 percent of the sale price, though for select specialty items, it is only 5 percent, and some items are also exempt.

Generally, if imports attract the full VAT rate of 10 percent, they may be reimbursed if the goods are resold or used locally to make other goods for consumption or export. For accurate advice, firms looking to import goods into Vietnam should contact a Vietnamese tax professional.

Post-customs

After clearing customs, importers are free to distribute their goods or store them as they see fit. Logistics firms have built up vast networks of warehouses in recent years that can be an economical means of storing imported goods. Alternatively, depending on the size of the shipment, firms may find it easier to ship directly to their retail outlets.

What’s next?

Starting a business in Vietnam, of any kind, can be challenging, however, there are a broad range of tax agents, lawyers, market research firms, human resource professionals, and all-in-one consultancies that can make it a whole lot easier→let us connect you with an expert.

For up-to-date information on what is happening in Vietnam’s import and export sector at any given time, importers should make sure to subscribe to the-shiv.

Last updated

June 18 2024: Added section on priority customs treatment in Vietnam.