Update

Economic Need Test for Second Retail Outlet for Foreign-Invested Companies

According to Decree 23/2007/ND-CP, a foreign-invested company wishes to open more than two retail outlets will need to pass an Economic Need Test (ENT) except in limited circumstances.  However, there are not specific  definitions on ENT, in which the investor could check it against their capility that could make foreign investors be hesitated on entering Vietnam market.

Under Circular No. 08/2013/TT-BCT issued by the Ministry of Industry and Trade, ENT is further clarified underwhich,

1. The ENT for setting up additional retail outlets by foreign invested companies is based on a) Number of the retail outlets, b) the maturity of the market, c) The population density and d) the area of the district where the proposed retail outlet is to be located.

2. A retail outlet with an area of less than 500m2 located in the place which has been designed for retailing business and which has complete infrastructure is not subject to ENT. This provision should allow foreign-invested companies to open small shops inside any complete shopping center without going through an ENT;

3. An ENT will be performed by a ENT Committee set up by the provincial People’s Committee. The decision of the ENT must be approved by the provincial People’s Committee.

Our lawyers of foreign investment practice at ANT Lawyers, a law firm in Vietnam are available to advise and provide client with service and representation for setting up a trading company in Vietnam.

In order to seek further advice or request service, please contact us at ant@antlawyers.vn or call +84 28 730 86 529

ANT Lawyers

Recent Posts

Decree No. 147/2024/NĐ-CP: A Comprehensive Framework for Internet and Information Management in Vietnam

With the rise of the digital age, Vietnam has experienced rapid growth in internet usage,…

7 days ago

The Employment in Vietnam Guide: 12 Key Legal Answers for Foreign Companies Entering the Market

Foreign companies entering Vietnam's thriving market face unique legal questions, especially around employing local talents.…

3 weeks ago

13 Critical Steps To Respond to Thailand’s Tough Anti-Dumping Investigation on Cold Rolled Stainless Steel

On October 3, 2024, Thailand’s Department of Foreign Trade (DFT) had officially launched an anti-dumping…

1 month ago

13 Essential Facts You Must Know About Setting Up a Vietnam Representative Office to Test the Market

Introduction For foreign businesses eyeing the fast-growing Vietnamese market, setting up a Vietnam Representative Office…

2 months ago

Anti-Dumping Investigation on Wood Fiber Boards from Thailand and China (AD21)

On September 25, 2024, the Ministry of Industry and Trade officially initiated an anti-dumping investigation…

2 months ago

Kick-Off Event of the 2024 International Mediation Writing Competition in Vietnam

The Weinstein International Foundation (WIF) has officially launched the 2024 International Mediation Writing Competition (IMWC2024).…

2 months ago