Vietnam updates foreign investment rules for trading and retail activities: Allen & Gledhill

6 November 2026

Vietnam Decree No. 342/2026/ND-CP, setting out requirements for the purchase and sale of goods and related commercial activities by foreign investors and foreign-invested enterprises (“FIEs”) in Vietnam, came into effect on 18 October 2026 (“Decree 342”). Decree 342 replaces Decree No. 09/2018/ND-CP (“Decree 09”) and repeals Article 36 of Decree No. 146/2025/ND-CP dated 12 June 2025 concerning the delegation and decentralisation of authority in the industry and trade sectors.

Decree 342 governs the trading rights, business licensing, establishment and operation of retail outlets, and ongoing compliance obligations of FIEs. It is particularly relevant to foreign investors establishing or expanding trading and distribution operations in Vietnam, acquiring existing Vietnamese retailers, or operating large retail networks and digital commerce platforms.

This article outlines the key requirements and their implications for businesses.

Trading activities and business licensing requirements

Decree 342 regulates export, import, and distribution rights, together with related commercial activities including commercial assessment, logistics, leasing of goods, trade promotion, commercial intermediary services, the operation of specified e-commerce platforms, and services for organising tenders for goods and services.

The Decree distinguishes between activities requiring a business licence and those that may be undertaken following the relevant investment and enterprise registrations. Business licences are required for specified activities, including:

retail distribution;
import and wholesale distribution of certain restricted categories of goods;
logistics services outside Vietnam’s applicable treaty-based market-opening commitments;
leasing of goods, excluding specified activities such as financial leasing;
trade promotion, excluding advertising services and commercial intermediary services; and
the management and operation of intermediary e-commerce platforms, social networks conducting e-commerce activities, and integrated commerce platforms.

Business licences are also required for specified services relating to the organisation of tenders for goods and services. Other goods trading activities that do not require a business licence may generally be undertaken once appropriately registered under the applicable investment and enterprise legislation.

Importantly, the right to import goods does not automatically confer the right to distribute them within Vietnam. An FIE holding import rights may import goods for sale to traders authorised to distribute them but must have the relevant distribution rights to participate directly in domestic wholesale or retail activities, unless otherwise permitted under Vietnamese law or an applicable international treaty. Businesses should therefore ensure that their registered activities and licences cover their intended commercial operations.

Conditions for obtaining a business licence

The applicable licensing conditions depend on the investor’s nationality, Vietnam’s international treaty commitments, and the proposed activities. Investors covered by relevant treaties must satisfy the applicable market access conditions throughout their operations. FIEs established in Vietnam for at least one year must also have no overdue tax debts when applying for a business licence. Additional criteria apply to investors and activities not covered by relevant market-opening commitments. Where an applicable international treaty provides otherwise than Decree 342, the treaty provisions prevail.

Additional restrictions apply to specified goods that are not yet covered by Vietnam’s applicable treaty-based market-opening commitments, including petroleum-derived lubricating oils and greases, rice, sugar, recorded items, books, newspapers, and magazines. For example, qualifying FIEs may be permitted to retail certain restricted goods through licensed convenience stores, mini supermarkets, or supermarkets subject to applicable conditions.

Provincial-level People’s Committees are responsible for issuing business licences, with the relevant authority determined by the FIE’s registered head office. Applications generally require information demonstrating compliance with the licensing conditions and a five-year business plan. The licensing authority ordinarily has 10 working days to assess a complete and valid application, although additional consultation requirements may extend the process. Depending on the licensing category, the authorised business period may be linked to the enterprise registration certificate or limited to five years.

FIEs wishing to establish retail outlets must obtain retail outlet establishment licences.

Economic needs tests for additional outlets

The establishment of retail outlets beyond the first may require an economic needs test (“ENT”), depending on the investor’s applicable treaty commitments and the characteristics of the proposed outlet. An ENT is not required where an applicable international treaty provides for its abolition. An exemption also applies to outlets with a selling area of less than 500 square metres located within shopping centres, provided they are not convenience stores, mini supermarkets, or supermarkets.

Where an ENT is required, the assessment considers the effect of the proposed outlet on existing retailers and traditional markets, local demand, its contribution to socio-economic development, and relevant security and public order considerations. The geographical market assessed depends on the size of the outlet: commune or ward level for outlets below 5,000 square metres, and provincial or centrally administered city level for larger outlets.

These requirements are particularly relevant to foreign retailers planning to expand their store networks. Businesses should assess whether proposed outlets qualify for an ENT exemption and factor any required assessment into their expansion timelines.

Foreign acquisitions of existing retailers

Decree 342 addresses circumstances in which an existing Vietnamese business becomes subject to foreign-invested licensing requirements following a foreign investor’s capital contribution, share purchase, or acquisition of an equity interest.

Where an existing retailer becomes an FIE or otherwise falls within the relevant foreign-invested licensing provisions of the Law on Investment, it must obtain the required business and retail outlet establishment licences. However, existing outlets may continue operating while the necessary licences are obtained, subject to a maximum period of 12 months from the date specified in the relevant legal document or confirmation of the foreign investor's eligibility to undertake the investment.

Applications for retail outlet establishment licences permitting existing outlets to continue operations must be submitted within 30 days of the relevant confirmation. The licensing authority generally has 14 working days to assess a complete and valid application, subject to additional consultation procedures where applicable.

For foreign investors acquiring Vietnam retailers, these provisions have implications for transaction structuring and completion planning. An acquisition may trigger additional licensing requirements even where the target business intends to continue its existing operations without expansion. Investors should therefore identify the relevant licensing requirements during due diligence, assess the continued operation of existing outlets and incorporate the applicable filing deadlines into transaction planning.

National security consultation for specified investments

Decree 342 requires licensing authorities to consult Vietnam’s Ministry of Public Security and Ministry of National Defence in certain cases involving foreign-invested commercial activities (“national security consultation”). These include specified applications involving investors or activities outside relevant treaty-based market-opening commitments, as well as foreign investors controlling businesses that operate major digital commerce platforms.

Additional consultation requirements apply to large retail networks. These include applications to permit existing outlets to continue operating where the application covers:

100 outlets with selling areas below 500 square metres each;
50 outlets with selling areas of 500 to less than 3,000 square metres each; and/or
30 outlets with selling areas of 3,000 square metres or more each.

A national security consultation is also required where a foreign investor applies for a licence to establish a new retail outlet and already owns or co-owns at least 100 outlets with a selling area of less than 500 square metres each, 50 outlets with a selling area of 500 to less than 3,000 square metres each, and/or 30 outlets with a selling area of 3,000 square metres or more each in Vietnam.

These requirements are particularly relevant to acquisitions involving established retail chains, large-scale retail expansion and investments in major e-commerce platforms. Investors should consider the possible impact of national security consultation on licensing timelines when planning such transactions or expansions.

Reporting and ongoing compliance

FIEs must submit periodic reports on their trading and related commercial activities before 15 January and 15 July each year, covering the preceding calendar year and the first six months of the current year respectively. They must also provide additional information or explanations when requested by competent authorities.

Decree 342 distinguishes between suspension of activities, termination of operations, and revocation of licences. An FIE that fails to maintain the applicable licensing conditions may be required to suspend its activities and take corrective measures within 12 months. Failure to remedy the non-compliance within that period results in termination of the relevant activities or retail outlet operations.

Licences may also be revoked on specified grounds including, inter alia, false information in licensing applications, cessation of operations for more than 12 months without reporting, failure to comply with periodic reporting requirements for 24 consecutive months, and repeated administrative violations. The grounds differ according to the type of licence.

Businesses should ensure that their compliance procedures cover continuing licensing conditions, periodic reporting, and changes to licensed activities, particularly where operations extend across multiple retail outlets or business lines.

Transitional arrangements for existing businesses

FIEs holding valid business licences or retail outlet establishment licences issued before 18 October 2026 may generally continue their licensed activities. However, subsequent amendments to specified licence particulars must comply with the procedures under Decree 342. Amendments are not required where changes to registered head office or retail outlet addresses arise solely from the reorganisation of provincial-level administrative units.

Special transitional provisions also apply to certain businesses holding pre-Decree 09 registrations that authorise trading activities or retail outlets but were not issued separate business or retail outlet establishment licences. Such businesses may be required to follow the new licensing procedures when seeking amendments to specified particulars.

Applications received before 18 October 2026 generally continue to be processed under the previous regime. Where an application is incomplete or invalid, however, the applicant must provide the requested supplementary explanations within six months of the licensing authority's request, failing which Decree 342 applies.

Implications for businesses

Decree 342 sets out the requirements applicable to foreign-invested trading and related commercial activities in Vietnam. Its provisions are particularly relevant to businesses considering market entry, acquisitions of Vietnam retailers, expansion of existing retail networks, and investments in major digital commerce platforms.

Foreign investors and FIEs should consider the following:

Review existing and proposed activities: Ensure that registered trading rights and business licences cover the full scope of intended operations, particularly where import, wholesale, and retail activities are combined.
Assess acquisitions early: Identify whether a proposed investment will trigger business or retail outlet licensing requirements and account for the 30-day application deadline and 12-month continuation period for existing outlets.
Plan retail expansion: Determine whether proposed outlets are subject to ENT requirements or qualify for exemptions, and assess whether a national security consultation is required.
Maintain ongoing compliance: Review existing licences and reporting procedures, and ensure that amendments, renewals and transitional requirements are addressed where applicable.

Businesses contemplating new investments or changes to existing operations should assess the applicable licensing conditions and approval requirements at an early stage to minimise regulatory delays and disruption to commercial activities.