Conditions of applying for Retail Establishment License

1. Conditions of applying for a license for establishment of retail establishments

According to Article 5(2) of Decree 09/2018/ND-CP, a foreign-invested company wishing to establish a retail outlet will have to meet the conditions to be granted a license for establishment of retail outlet.

Therefore, according to Article 22 of Decree 09/2018/ND-CP, the conditions to be granted a license a license for establishment of retail outlet for a foreign-invested company are:

a) For the first retail outlet

Acquire a financial plan for setting up retail outlets.

Incur no overdue tax in a case where it has been established in Vietnam for at least 1 year.

The location where the retail outlet is set up is conformable with the relevant planning in the relevant geographic market. 

b) For retail outlet other than the first retail outlet

According to the law, when setting up a retail outlet other than the first one, investors must carry out an economic needs test (ENT), unless the retail outlet has an area of ​​less than 500m2, set up in a commercial center and not in the type of convenience store, mini supermarket. Thus, depending on each case, investors need to meet different conditions to be granted a license for establishment of retail outlet:

• In case the economic needs test is not required: Satisfy the conditions corresponding to the conditions for setting up the first retail outlet.

• In case the economic needs test is required:

Satisfying the same conditions as the first retail outlet and meeting the economic needs test:

• The scale of relevant geographic markets being affected by to-be-retail outlets.

• The number of existing retail outlets in the relevant geographic market.

• Impact of the retail outlet on the market stability and operating activities of other retail outlets and traditional markets in the relevant geographic market.

• Impact of retail outlets on traffic density, environment hygiene, fire safety in the relevant geographic market.

• Potential contribution of the retail outlet to the socio-economic development of the relevant geographic market.

2. Legal basis

• Commercial Law 2005.

• Enterprise Law 2020.

• Decree 09/2019/ND-CP detailing the Commercial Law and the Law on Foreign Trade Management on goods purchase and sale activities and activities directly related to the purchase and sale of goods by foreign investors, economic organizations with foreign investment capital in Vietnam.