The company form decides who can invest, who is liable for what, and how the business is run. Choosing early and well saves you from changing form later. This article helps you answer those questions yourself. It is general reference under Vietnam’s Law on Enterprises and does not replace advice on your particular case.
Common forms
- Single-member limited liability company: owned by one individual or one organisation. The owner is liable up to the capital contributed.
- Limited liability company with two or more members: has from two to fifty members. Each member is liable up to the capital contributed.
- Joint stock company: has three or more shareholders and its capital is divided into shares. It suits plans with many investors or further fundraising.
- Sole proprietorship: owned by one individual, who is liable with all of their personal assets.
- Partnership: has at least two general partners, often seen in some professional service trades.
A household business is a different arrangement, not a company, and has its own rules.
Questions to answer before choosing
- How many people are investing together? One person usually looks at a single-member limited liability company; several investors may choose a limited liability company with two or more members, or a joint stock company.
- How much liability are you willing to carry? If you want to keep personal assets apart from business risk, consider the limited liability forms.
- Do you plan to raise money or bring in partners? A joint stock company is more flexible for transferring stakes and welcoming new shareholders.
- Who will run the business and take decisions? Each form has its own structure and decision-making rules.
- Does your line of business have special conditions? Some sectors need extra conditions or licences.
Worth checking again
Rules on business registration, business lines and tax change over time. Before you file, check them against what is in force. We support this in the Understand step: we work with you to choose the form and registered business lines that fit your business plan.