Applying for a Retail Outlet Establishment Licence in Vietnam: Key changes and legal risks for FDI enterprises

Establishing retail outlets in Vietnam requires foreign-invested enterprises (FDI enterprises) not only to satisfy market access conditions and complete licensing procedures but also to comply with legal obligations throughout their operations.

Effective from 18 October 2026, Decree No. 342/2026/ND-CP will replace Decree No. 09/2018/ND-CP, introducing notable changes to the conditions for establishing retail outlets, the Economic Needs Test (ENT), reporting obligations, and the circumstances in which a Retail Outlet Establishment Licence may be revoked. These changes require FDI enterprises to proactively review licensing conditions and monitor compliance throughout their operations, particularly when expanding their retail networks, changing locations, or suspending operations.

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1. When must an FDI enterprise apply for a Retail Outlet Establishment Licence?

Pursuant to Clause 2, Article 5 and Clause 10, Article 3 of Decree No. 342/2026/ND-CP, a Retail Outlet Establishment Licence is issued to a foreign-invested economic organization to establish a retail outlet. A retail outlet is a location where retail activities are conducted, excluding vending machines and mobile sales vehicles.

Accordingly, an FDI enterprise must obtain a Retail Outlet Establishment Licence for each retail outlet subject to the licensing requirement before commencing operations. Registration of a business location or obtaining a Business Licence does not replace this obligation.

Regarding the licensing procedure, Clause 3, Article 5 of Decree No. 342/2026/ND-CP requires an enterprise to obtain a Business Licence and prepare the legal documents relating to the location before applying for a Retail Outlet Establishment Licence. However, where the enterprise establishes its first retail outlet in the same province or centrally governed city as its head office, it may apply for the Business Licence and the Retail Outlet Establishment Licence concurrently pursuant to Clause 4, Article 5 and Article 19 of the Decree.

A further issue to consider is how the first retail outlet is determined. Under Clause 11, Article 3 of Decree No. 342/2026/ND-CP, a retail outlet other than the first retail outlet also includes an outlet established under the same brand or trade name as an existing retail outlet. Therefore, an enterprise cannot establish a new legal entity and then open a retail outlet under the same brand or trade name to classify that outlet as its “first retail outlet” and avoid additional requirements, particularly the ENT requirement.

2. Conditions for obtaining a Retail Outlet Establishment Licence and the ENT requirement

2.1. General conditions

Under Clauses 1 and 2, Article 21 of Decree No. 342/2026/ND-CP, both the first retail outlet and any subsequent retail outlet must satisfy the following conditions:

a. Tax compliance: A foreign-invested enterprise established in Vietnam for at least one year as of the date of application must have no overdue tax debts.

b. Location requirements: The proposed retail location must satisfy the applicable requirements under the laws on land management, planning, investment, construction, fire prevention and fighting, traffic safety, and environmental sanitation for establishing a retail outlet in the relevant geographical market area.

Enterprises should review these conditions before entering into a lease agreement or investing in renovations to the proposed premises. A location that is commercially suitable does not necessarily satisfy all legal requirements for establishing a retail outlet.

2.2. Cases where the ENT is required or not required

Under Clause 1, Article 22 of Decree No. 342/2026/ND-CP, the ENT requirement is determined based on the type of retail outlet, its floor area and location, and Vietnam’s ENT commitments under the international treaties to which Vietnam is a party.

a. Cases exempt from the ENT

The following cases are exempt from the ENT:

(i) The first retail outlet;

(ii) A retail outlet other than the first retail outlet established by an investor from a country or territory whose commitments under an international treaty to which Vietnam is a party provide for the abolition of the ENT; and

(iii) A retail outlet other than the first retail outlet with an area of less than 500 m², located within a shopping mall, and not operating as a convenience store, mini-supermarket, or supermarket.

For the third case, all three conditions concerning floor area, location, and business format must be satisfied simultaneously. Accordingly, a convenience store, mini-supermarket, or supermarket with an area of less than 500 m² located within a shopping mall remains subject to the ENT.

b. Cases subject to the ENT

The ENT is required for a retail outlet other than the first retail outlet that does not fall within the cases specified in items (ii) and (iii) above.

As the ENT evaluates the potential impact of a proposed new retail outlet on the relevant market, enterprises should not determine whether the ENT applies solely by reference to the premises’ floor area. Instead, they should review all applicable legal conditions.

2.3. ENT criteria and assessment

a. ENT criteria

Under Clause 2, Article 22 of Decree No. 342/2026/ND-CP, the ENT assessment is based on the following principal criteria:

• Geographical market affected: For a retail outlet with an area of less than 5,000 m², the affected geographical market is assessed at the commune or ward level, or an equivalent administrative level. For a retail outlet with an area of 5,000 m² or more, the affected geographical market is assessed at the provincial or centrally governed city level.
• Market impact: The assessment considers the impact of the retail outlet on market stability and on the business operations of existing retail outlets and traditional markets within the affected geographical market. It also examines local demand and the proposed outlet’s capacity to meet that demand in order to establish the necessity of opening the outlet.
• Socio-economic contribution: The assessment considers the proposed outlet’s potential contribution to the socio-economic development of the affected geographical market, specifically: (i) contributing to the development and modernization of the retail sector in that market; and (ii) improving the living conditions of the local population.
• Security and public order: The assessment considers whether the proposed retail outlet is consistent with requirements for security, public order, and social safety in the affected geographical market, as well as requirements concerning border areas, islands, and military zones.

b. ENT assessment

Under Article 23 of Decree No. 342/2026/ND-CP, the provincial-level People’s Committee establishes an ENT Council to conduct the assessment. The Council may include, but is not limited to, the following members: a representative of the provincial-level People’s Committee, or a representative of an agency authorized by that Committee, serving as Chairperson; and representatives of the Department of Industry and Trade, Department of Finance, provincial-level police, and other relevant departments, agencies, and organizations serving as members.

Where the proposed retail location is situated in a commune, ward, or equivalent geographical area adjacent to another province or centrally governed city, the ENT Council must seek opinions from the People’s Committee, or its representative, of the adjacent province or centrally governed city in accordance with the applicable regulations.

Enterprises should also note that, under Clause 3, Article 21 of Decree No. 342/2026/ND-CP, when conducting the ENT assessment, the licensing authority must consider whether the enterprise satisfies the applicable conditions and criteria set out in Section 2.3(a), taking into account their consistency with local, regional, and national development plans and strategies. For investors from countries or territories that are not parties to international treaties to which Vietnam is a party, the licensing authority must also consider factors relating to the progress of negotiations, market-opening needs, diplomatic relations, and security.

Accordingly, submitting a formally complete application does not guarantee approval of the proposed retail outlet. Where the ENT applies, enterprises should prepare a well-supported explanatory report, backed by market data and a specific analysis of consumer demand, market capacity, and the proposed outlet’s socio-economic contribution.

3. Application dossier and key considerations for licensing

Under Article 25 of Decree No. 342/2026/ND-CP, an application for a Retail Outlet Establishment Licence comprises the following principal documents:

(i) Application form for a Retail Outlet Establishment Licence.

(ii) Explanatory report covering:

• Proposed retail location: The address of the retail outlet; a description of the general area, relevant surrounding areas, and the area to be used for the retail outlet; an explanation of compliance with the conditions and criteria set out in Section 2.3(a); and supporting documents relating to the proposed retail location.
• Five-year business plan: The business and market development plan for the retail outlet for the five years commencing in the year the application is submitted; staffing requirements; and an assessment of the plan’s socio-economic impact and effectiveness over the five-year period.

(iii) Tax authority document confirming that the enterprise has no overdue tax debts. The confirmation must have been issued no more than six months before the application is submitted to the licensing authority.

(iv) Copies of the following documents:

• For a retail outlet with an area of less than 500 m²: The Enterprise Registration Certificate, Business Licence, Certificate of Branch Registration, or Certificate of Business Location Registration corresponding to the location where the retail outlet is established.
• For a retail outlet with an area of 500 m² or more: The Enterprise Registration Certificate, Business Licence, Certificate of Branch Registration, and Investment Registration Certificate for the project establishing the retail outlet.

(v) ENT explanatory report, where the proposed retail outlet is subject to the ENT.

Notably, for a retail outlet with an area of 500 m² or more, the enterprise must also complete the procedure for obtaining an Investment Registration Certificate for the retail establishment project. The licensing dossier should therefore be prepared in coordination with the investment schedule and planned opening date to avoid a situation in which the enterprise has already invested in the premises but is not yet legally eligible to commence operations.

In addition, enterprises should distinguish the application for a Retail Outlet Establishment Licence from enterprise registration, business location registration, and investment procedures. These are separate procedures serving different purposes and subject to different legal requirements. Completion of one procedure does not automatically satisfy the others.

4. Reporting obligations: A key change enterprises should note

One notable change under Point (a), Article 38 of Decree No. 342/2026/ND-CP is that periodic reports on the implementation of goods trading activities and activities directly related to goods trading must be submitted twice a year:

a. First-half report: To be submitted before 15 July each year, covering data from 1 January through 30 June.

b. Annual report: To be submitted before 15 January each year, covering data from 1 January through 31 December of the reporting year.

Under Point (b), Clause 1, Article 38 of Decree No. 342/2026/ND-CP, foreign investors and foreign-invested economic organizations must also submit reports, provide documents, or provide explanations at the request of competent state authorities.

Reports may be submitted directly, through public postal services, or online via the relevant database, where the applicable conditions are satisfied.

Compared with the annual reporting regime under Decree No. 09/2018/ND-CP, the new regulations introduce a first-half reporting period and bring forward the annual reporting deadline from 31 January to 15 January. These changes require enterprises to take a more proactive approach to compiling business data, verifying its accuracy, and assigning responsibility for preparing, reviewing, and submitting reports. For enterprises operating multiple retail outlets, establishing a centralized reporting function can help reduce the risk of missed obligations or late submissions.

5. Administrative penalties and the risk of Retail Outlet Establishment Licence revocation

Non-compliance with licensing requirements, the permitted scope of operations, or reporting obligations may result in two separate categories of legal consequences: administrative penalties and licence revocation. These mechanisms must be considered independently, as paying an administrative fine does not automatically eliminate the risk of licence revocation where the enterprise falls within a statutory ground for revocation.

5.1. Administrative penalties

Under Article 70 of Decree No. 98/2020/ND-CP, the following violations warrant particular attention:

a. Illegally establishing a retail outlet or operating outside the scope specified in the licence: The enterprise may be fined from VND 30 million to VND 40 million. It may also have its right to use the Retail Outlet Establishment Licence suspended for one to three months or have its operations suspended for one to three months, and be required to surrender any unlawful gains obtained from the violation.

b. Failing to submit reports, provide documents, or explain matters relating to the enterprise’s operations to the competent state management authority as required: The enterprise may be fined from VND 10 million to VND 20 million.

c. Failing to apply for an amendment to the licence as required when any of the information stated in the licence changes: The enterprise may be fined from VND 20 million to VND 30 million.

d. Continuing operations after the licence has been revoked or expired without being renewed: The enterprise may be fined from VND 40 million to VND 50 million and required to surrender any unlawful gains obtained from the violation.

5.2. Cases in which the licence may be revoked

Under Clauses 1 and 2, Article 42 of Decree No. 342/2026/ND-CP, a Retail Outlet Establishment Licence may be revoked in the following circumstances:

• The Business Licence of the foreign-invested economic organization, the Investment Registration Certificate, or an equivalent legally valid document relating to the retail establishment project is revoked;
• Information declared in an application for the issuance, reissuance, amendment, or extension of the Retail Outlet Establishment Licence is falsified;
• Twelve months after the Retail Outlet Establishment Licence is issued, the foreign-invested economic organization has not obtained an Investment Registration Certificate in a case where such certificate is required and has not reported this matter to the licensing authority;
• Twenty-four months after the Retail Outlet Establishment Licence is issued, the foreign-invested economic organization has not obtained an Investment Registration Certificate in a case where such certificate is required;
• The retail outlet has ceased operations for more than 12 months without notifying the licensing authority;
• The enterprise has failed to comply with periodic reporting obligations for 24 consecutive months;
• The enterprise has failed to submit a report, provide documents, or provide an explanation within three months after the relevant deadline has expired; or
• The enterprise has been subject to administrative penalties up to three times within a 12-month period for violations of the goods trading activities specified in the Retail Outlet Establishment Licence.

In addition, under Article 37 of Decree No. 342/2026/ND-CP, an application for a Retail Outlet Establishment Licence will be rejected if it is submitted within two years from the date the licence was revoked. Accordingly, revocation may affect not only the operation of an existing retail outlet but also the enterprise’s ability to expand its retail activities in the future.

Where an enterprise needs to suspend operations temporarily, it should proactively complete the required procedures and ensure that its reporting obligations to the licensing authority are fulfilled. Under Article 40 of Decree No. 342/2026/ND-CP, a suspension requested by the enterprise may not exceed 12 months.

6. Recommendations and conclusion

To mitigate legal risks when establishing and operating a retail network in Vietnam, FDI enterprises should review market access conditions, the scope of goods they are permitted to trade, and the applicable licensing requirements before commencing operations at each retail outlet. After obtaining the relevant licences, enterprises should maintain compliance with the applicable conditions, monitor licence validity periods, and fulfil all reporting and notification obligations.

In particular, enterprises should pay attention to: (i) correctly identifying the first retail outlet and determining whether the ENT applies when expanding their retail networks; (ii) complying with periodic reporting deadlines, including the first-half and annual reporting requirements; and (iii) monitoring the operational status of each retail outlet to avoid grounds for licence revocation, especially where an outlet ceases operations for more than 12 months without notifying the licensing authority. Licence revocation may also result in the rejection of a new Retail Outlet Establishment Licence application for a period of two years.

Enterprises should therefore establish a centralized licence management and compliance control procedure for their entire retail network, clearly assigning responsibility for monitoring deadlines, submitting reports, and addressing changes as they arise. This approach enables enterprises to proactively prevent violations, reduce the risk of licence revocation, and maintain business continuity in Vietnam.

This article was prepared by Vy Le and reviewed by Lawyer Y Huynh.

This article is intended for general informational purposes only and does not constitute legal advice for any specific case. The legal provisions cited herein are those in effect as of the date of publication and may be amended, supplemented, or replaced thereafter. Readers are therefore advised to consult a lawyer before applying these provisions to their particular circumstances.