Obligation to submit annual report on activities of Representative Office of foreign trader in Vietnam

According to the provisions of Decree 07/2016/ND-CP detailing the Commercial Law on Representative Offices and Branches of foreign traders in Vietnam; Circular 11/2016/TT-BCT stipulates the form for implementing Decree 07/2016/ND-CP; Decree No. 98/2020/ND-CP dated August 26, 2020 stipulating penalties for administrative violations in commercial activities, production and trading of counterfeit and banned goods and protecting consumer rights; Representative Office of foreign trader (“Representative Office”) is obliged to submit annual report on activity to the headquarters of the licensing agency, specifically as follows:

• Deadline for submitting annual report on activities: Before January 30th of the following year, Representative Office must submit annual report according to the prescribed form on the previous year's activities to the headquarters of the licensing authority.
• Report submission method: In person or by post.
• Recipient: Department of Industry and Trade.

The main content of the Representative Office's annual report on activities includes:

• Report on labor use situation: domestic employees, foreign employees, mandatory insurance compliances, personal income tax compliance, increasing and decreasing labor.
• Report on Representative Office’s activities: allowed commercial activities, manage and promote contracts, market research, product development, promote business opportunities – purchasing and selling goods, other activities.

Representative Office needs to pay attention to the risks when not fulfilling the obligation to report their annual activities as follows:

• Late submission of reports may result in a fine, the fine can be up to 40 million VND and affect the consideration of the renewal of Representative Office’s License and other procedures later, and additional report must also be submitted according to regulations.
• In case of detecting signs of violation, the State authorities can conduct an interdisciplinary inspection including the coordination of the Tax - Labor Department - Department of Industry and Trade to work directly at the Representative Office’s headquarter.

Above are some points related to the obligation to submit annual report on activities of Representative Offices of foreign traders in Vietnam. Should you have any questions or problems, please do not hesitate to contact Gia Luat for the best support.