One of the first questions foreign investors ask when coming to run a business in Vietnam is: “Do I need a work permit?” The answer depends on your role and capital contribution — and since 7 August 2025 it has been governed by Decree 219/2025/ND-CP, with a notable exemption threshold: capital contribution of VND 3 billion or more.
This article analyzes Article 7 of Decree 219/2025/ND-CP: who is exempt, how the VND 3 billion threshold is calculated, and which procedures still apply even when exempt.
1. The current legal framework
Decree 219/2025/ND-CP dated 7 August 2025 regulates foreign workers in Vietnam and took effect on its signing date (7 August 2025). It replaced all foreign-worker provisions of Decree 152/2020/ND-CP (as amended by Decree 70/2023/ND-CP).
In other words: every guidance document, form, and procedure under Decree 152/2020 — used by businesses for years — is no longer in force. FDI companies must update their HR processes to Decree 219.
2. The VND 3 billion threshold: who is exempt from work permits?
Article 7 of Decree 219/2025/ND-CP lists cases where foreign workers are not subject to work permit issuance. Two cases directly concern investors:
2.1. Limited liability companies — Article 7(2)
A foreign worker who is an “owner or capital-contributing member with a capital contribution value of VND 3 billion or more in a limited liability company” is not subject to work permit issuance.
This covers owners of single-member LLCs and contributing members of multi-member LLCs — provided the individual’s own contributed capital reaches VND 3 billion or more.
2.2. Joint stock companies — Article 7(3)
A foreign worker who is the “Chairman or a member of the Board of Directors with a capital contribution value of VND 3 billion or more in a joint stock company” is not subject to work permit issuance.
Note: for joint stock companies the rule attaches to the Chairman/Board member title — an ordinary shareholder without a Board seat does not qualify, however large the shareholding.
3. How is the VND 3 billion threshold calculated?
- Based on the individual’s contributed capital, not the company’s total charter capital. Example: an LLC with VND 10 billion charter capital where the foreign investor contributes VND 3 billion (30%) → qualifies for exemption.
- Supporting documents: the Enterprise Registration Certificate, company charter, member/shareholder register, and capital contribution records. The competent authority cross-checks these.
- Contribution below VND 3 billion: no exemption under Article 7(2)–(3). If the person holds a management position (Director, General Director, etc.), the company must apply for a work permit for them as a manager — with documents proving managerial status.
4. Exempt from the work permit — but notification is still required
A widespread misunderstanding: work permit exemption does not mean freedom from all procedures.
Under Article 9(4) of Decree 219/2025/ND-CP, cases under Article 7(2) and 7(3) need not apply for a confirmation of work permit exemption, but must notify the competent authority (where the foreign worker will work) at least 03 working days before the expected start date.
The notification covers: full name, date of birth, nationality, passport number, employer name, workplace, and working period.
Missing the notification deadline can expose the company to administrative penalties on labor — an entirely avoidable risk.
5. Investors who also serve as executives
In practice, foreign investors often double as executives (Director, General Director). Distinguish:
- Contribution of VND 3 billion or more: exempt under Article 7(2)/(3) — even while holding an executive title. Complete the 3-working-day notification.
- Contribution below VND 3 billion, serving as Director: not exempt — apply for a work permit as a manager or executive director, meeting Article 3 of Decree 219 (manager: an enterprise manager under the Enterprise Law; executive director: head of a branch/representative office/business location, or a person directly heading a field with at least 3 years of relevant experience).
- Investor not directly working in Vietnam (capital contribution only): no work permit obligation arises, as they are not “working in Vietnam”.
6. Common mistakes
- Assuming exemption means no paperwork: skipping the 3-working-day notification under Article 9(4).
- Miscalculating the threshold: using total charter capital instead of the individual’s contributed capital.
- A JSC shareholder without a Board seat assuming Article 7(3) applies.
- Still following Decree 152/2020 procedures (expired 7 August 2025) — wrong forms, wrong sequence.
- Not updating when capital changes: transferring capital so the stake falls below VND 3 billion ends the exemption — a work permit becomes required.
7. Frequently asked questions
Does committed but not yet fully contributed capital count?
Authorities rely on recorded contribution documents (charter, member register, capital contribution certificates). Investors should ensure contributions are fully documented on schedule and confirm with the local licensing authority for their specific case.
Where is the 3-working-day notification filed?
With the authority competent to issue work permit exemption confirmations where the foreign worker will work (under current decentralization — contact the local Department of Home Affairs / Public Administrative Service Center for guidance).
Does a work permit-exempt person still need a residence card?
Work permits and residence are separate procedures. Foreigners staying long-term in Vietnam must still complete residence procedures (temporary residence card/visa) under immigration law, in the appropriate category and duration.
Sources
- Decree 219/2025/ND-CP dated 7 August 2025 (effective from signing) — Article 7(2), 7(3); Article 9(4); Article 35.
- Labor Code 2019 — Article 154 (cases not subject to work permits).
- Ministry of Home Affairs’ reply on the Government e-Portal on work permit exemption for foreign business owners.
This article is for general information only. Foreign-worker regulations may receive further detailed guidance; companies should confirm with the local competent authority before acting.
Contact FLAT Law Firm: we help FDI companies review work permit exemption eligibility, complete notifications, and obtain work permits for experts and managers. See more articles on labour and employment at flaw.vn.
This article was prepared by the FLAW AI Legal Council, has passed internal QA review, and is pending owner approval. It is not the opinion of a licensed human lawyer and does not replace direct legal advice.