Launching Success: A Guide to Establishing a Small Business

In the dynamic landscape of Vietnamese business, understanding the regulatory framework for small enterprises is crucial for entrepreneurs seeking to establish and grow their ventures. In this comprehensive guide, we delve into the intricacies of small business regulations, shedding light on the criteria, establishment process, and government support, providing a roadmap for success. So, what doess dissolving a limited company mean? ACC Group will address your question.

I. What does it mean to establish a small business?

1. Understanding Small Business Classification in Accordance with Article 6 of Decree 39/2018/ND-CP

1.1. Criteria for Small Businesses in Agriculture, Forestry, Aquaculture, and Industry, Construction

In these sectors, businesses not considered micro-enterprises must meet specific criteria, including an average employee count not exceeding 100 people, and total annual revenue or capital not exceeding 50 billion VND or 20 billion VND, respectively.

1.2. Criteria for Small Businesses in Trade and Services

For businesses in trade and services, the conditions vary, with an average employee count capped at 50 people and total annual revenue or capital not surpassing 100 billion VND or 50 billion VND, respectively.

2. Navigating Regulations for Establishing Small Businesses

2.1. Conditions for Company Founders

Article 17 of the Law on Enterprises 2020 outlines the conditions for individuals to establish a company.

2.2. Types of Companies for Small Businesses

Choosing the right type of company is crucial. Optimal selections for small businesses include sole proprietorship, single-member limited liability company, and two-member limited liability company, depending on the intended development direction and business sector.

2.3. Guidelines for Business Names

Avoiding confusion with existing businesses is essential. The business name should not infringe on Vietnamese culture, traditions, or customs. A quick search on the national business registration portal helps verify name availability.

2.4. Government Support for Small and Medium-sized Enterprises (SMEs)

SMEs receive substantial support from the State and Government, ranging from credit access and tax benefits to support for land, production technology, and human resources development.

3. Documenting the Small Business Journey: What's Required?

To establish a small company in Vietnam, several documents are mandatory:

• Draft request for business registration
• Copy of ID card/citizen identification card or passport of the owner or representative
• Charter and list of members, shareholders contributing capital

4. Procedural Steps for Establishing a Small Company

4.1. Step 1: Document Preparation

Gather all necessary documents for business registration.

4.2. Step 2: Application Submission

Submit the application for company establishment to the competent authority.

4.3. Step 3: Await Approval

Wait for and receive the result from the competent authority.

4.4. Step 4: Publicize the Establishment

Publish the establishment of the new company.

4.5. Step 5: Financial Formalities

Open a bank account and purchase a digital signature.

4.6. Step 6: Tax Declaration and Payment

Declare and pay taxes as per regulations.

III. Conclusion

Establishing a small business in Vietnam involves navigating specific criteria, choosing the right business type, and adhering to stringent regulations. With substantial government support, small businesses can thrive in a conducive environment.

FAQs

1. Q: Are there additional benefits for small startup businesses in Vietnam?

A: Yes, the government provides extra support through the Small and Medium Enterprise Development Fund.

2. Q: Can a small business operate in any sector?

A: Small businesses must engage in activities permitted by law and specified in Article 6 of Decree 39/2018/ND-CP.

3. Q: How long does it take to establish a small company in Vietnam?

A: The timeline varies, but efficient preparation can expedite the process.

4. Q: What types of companies are recommended for easy management and operation?

A: Sole proprietorship, single-member limited liability company, and two-member limited liability company are advisable for small businesses.