10 Mistakes Chinese Investors in Vietnam

Thousands of Chinese investors have set up companies in Vietnam — and the same cluster of mistakes repeats. This article compiles the 10 most common, from paperwork to work culture, so newcomers don’t pay tuition twice.

Mistake 1: Chinese documents without consular legalisation

Problem: bringing “raw” passports, degrees, powers of attorney from China — Vietnamese authorities won’t accept them;
Cause: Vietnam is not in Apostille — every foreign document needs consular legalisation;
Cost: files returned, weeks lost sending papers back to China;
Avoid: legalise in China before travelling — don’t bring “raw” papers over.

Mistake 2: Confusing IRC and ERC

Problem: thinking one licence suffices — or applying in the wrong order;
Reality: FDI projects need the Investment Registration Certificate (IRC) first, then the Enterprise Registration Certificate (ERC);
Cost: ERC filed first gets rejected — time wasted redoing;
Avoid: remember “IRC first, ERC after” — Investment Law 143/2025.

Mistake 3: “Show-off” charter capital

Problem: registering huge charter capital to “look big” — then failing to contribute it;
Reality: capital must be fully contributed within the legal deadline — shortfalls draw fines and forced adjustment;
Cost: fines plus lost credibility with partners and banks;
Avoid: register real capital — enough for the business plan, contributable on time.

Mistake 4: Conditional business lines, unknowingly

Problem: registering conditional business lines (logistics, education, healthcare…) without preparing sub-licences;
Reality: an ERC is not enough — a sectoral licence is needed before operating;
Cost: the company sits idle awaiting licences — rent and payroll burning;
Avoid: check the conditional-sector list before registering — ask counsel.

Mistake 5: “Borrowed” head-office address

Problem: borrowing a friend’s address, using a virtual address to register fast;
Reality: tax authorities inspect head offices — no real activity means a closed tax code;
Cost: can’t issue invoices, operations frozen;
Avoid: rent a real office — small is fine, with a valid lease.

Mistake 6: No capital account opened

Problem: wiring investment money to a regular account — or carrying cash;
Reality: FDI capital must flow through a Direct Investment Capital Account (DICA) at a Vietnamese bank;
Cost: can’t prove capital contribution — trouble repatriating profits;
Avoid: open the DICA right after the ERC — route all capital through it.

Mistake 7: Forgetting initial tax duties

Problem: incorporating then “sleeping” — no tax filings, no business-licence fee;
Reality: new companies must file initial tax registration, choose a tax method, pay the licence fee;
Cost: late-filing fines — even with zero revenue;
Avoid: hire an accountant from month one — small cost, big fine avoided.

Mistake 8: Specialists working “under the radar”

Problem: Chinese specialists installing and training on tourist/e-visas;
Reality: working needs a work permit (or a reported exemption) — tourist visas don’t allow it;
Cost: inspections — specialists deported, company fined;
Avoid: get work permits before specialists arrive — see our work-permit article.

Mistake 9: Cultural mismatch with Vietnamese authorities

Problem: bringing Chinese authority-dealing habits over — “relationships solve everything”;
Reality: Vietnamese agencies work by written procedure — complete, correct files pass; incomplete ones return;
Cost: misunderstandings, delays, wasted “relationship” spending;
Avoid: prepare proper files — respect the process, skip the “shortcuts”.

Mistake 10: No local adviser from day one

Problem: DIY to save money — or relying on a non-specialist “acquaintance”;
Reality: all 9 mistakes above are avoidable with local counsel/accounting from the start;
Cost: fixing mistakes costs multiples of hiring advisers;
Avoid: hire Vietnamese counsel from step one — the project’s cheapest investment.

Appendix: standard FDI incorporation timeline

Weeks 1–2: legalise documents in China + hire Vietnamese counsel;
Weeks 3–4: policy approval (if required) and IRC file preparation;
Month 2: file IRC — await issuance (allow correction time);
Month 3: IRC in hand → file ERC → seal, open DICA, initial tax filing;
Month 4: company operating — lease space, hire, get specialists’ work permits.

Quick answers

Can I DIY everything? Yes — but 9 in 10 DIYers make at least one mistake above;
What does counsel cost? Far less than fixing mistakes — get a quote first;
How long start to operating? 3–4 months with a clean file — longer with errors.

Why Chinese investors repeat these mistakes

Information gap: Chinese-language guidance on Vietnamese procedures is thin — rumours fill the gap;
Assumption transfer: “it worked in China” doesn’t mean it works in Vietnam — different systems;
Speed pressure: headquarters demands fast setup — corners get cut;
Adviser gap: no trusted local adviser in the early days — mistakes compound;
Fix: this article plus one good local law firm — the complete solution.

Before you finish: the 5-minute self-check

Chinese papers: all consular-legalised?
IRC/ERC: right order, right type?
Capital: real, contributable on time?
Business lines: conditional ones — sub-licence plan ready?
Address: real, valid lease?
DICA: opened — capital flowing through it?
Tax: initial filing, licence fee — done?
Specialists: work permits before arrival?
Advisers: local counsel + accountant hired?

The cost of mistakes vs the cost of advice

Typical fix costs: re-legalisation, re-filing, fines, idle rent — each mistake costs weeks and millions of VND;
Typical advice costs: a setup package from a local firm — a fraction of one serious mistake;
The math: advice is insurance, not expense — budget it like insurance;
Timing: hire advisers before spending on offices and staff — sequence matters;
Selection: pick advisers with Chinese-client experience — language and culture bridge included.

Final advice: don’t pay tuition with your own money

Learn from predecessors: the 10 mistakes above are tuition others already paid — reading is free;
Hire right: local counsel + accountant — the two expenses never to skimp;
Right sequence: papers → IRC → ERC → DICA → tax → work permits — don’t skip steps;
Allow buffer: every procedure can run late — the business plan must absorb it;
Start now: prepare documents today — each idle week is a week of wasted rent;
One contact: a single law firm coordinating everything beats five separate advisers.

Setting up right: the investor’s mindset

Compliance is speed: clean files move faster through Vietnamese agencies than “clever” shortcuts;
Paper is power: in Vietnam’s system, the document decides — keep every original, every receipt;
Local partners matter: a good Vietnamese lawyer, accountant and HR contact — your three pillars;
Think in Vietnamese law: stop translating Chinese concepts — learn the Vietnamese categories;
Long game: setup is month one of a multi-year investment — build foundations, not facades.

Your first 90 days: the action plan

Days 1–30: hire counsel and accountant; legalise documents in China; secure office lease;
Days 31–60: file IRC; open bank relations; prepare ERC file;
Days 61–90: obtain ERC; carve the seal; open DICA; complete initial tax filings;
Day 90+: contribute capital; hire staff; file work permits for incoming specialists;
Throughout: document everything — the file you build now defends you later.

Remember: every mistake above was made by a real investor who thought “it won’t happen to me” — the cheapest insurance is a one-hour consultation before you start.

Contact us

FLAT Law Firm advises Chinese investors throughout the Vietnam investment cycle — from deal structuring and licensing to operations and compliance. Contact us for advice tailored to your project.

This article has been quality-reviewed by the FLAW AI Legal Council