Are you a foreign investor planning to enter Vietnam’s rapidly growing advertising market? Wondering how WTO commitments affect your ability to set up an advertising joint-venture company—and what procedures you must follow to comply with Vietnamese law? This detailed guide explains all the steps, conditions, ownership rules, and regulatory requirements you need to know.

1. Understanding WTO Commitments and Vietnam’s Restrictions on Advertising Services

Vietnam’s accession to the World Trade Organization (WTO) significantly opened its service sectors to foreign investors. However, advertising remains a conditional business line, meaning market access is allowed—but only under specific structures and with strict compliance requirements.

1.1. WTO Commitments for Advertising Services (CPC 871)

Vietnam’s Schedule of Specific Commitments lists advertising services under CPC 871, and the commitments include:

• Foreign investors may provide advertising services in Vietnam.

• Market access is allowed only through joint ventures or business cooperation contracts (BCCs).

• 100% foreign-owned advertising companies are not permitted.

• There is no fixed maximum foreign ownership ratio as long as the company is not fully foreign-owned.

This framework ensures that foreign investment is welcomed, but domestic participation remains present in a sector that influences culture, media, and public messaging.

1.2. Ownership Requirements Under WTO Rules

While Vietnam prohibits 100% foreign ownership, it does not impose a specific cap such as 49% or 70%. Therefore:

➡️ Foreign investors may own up to 99.99% of the joint-venture advertising company.
➡️ A Vietnamese partner must hold at least one share or a nominal capital amount.

This structure satisfies both WTO commitments and Vietnam’s regulatory intentions.

1.3. Why Vietnam Maintains Joint-Venture Requirements

The joint-venture requirement exists for three key reasons:

1. Cultural and social protection: Advertising impacts public perception and national identity.

2. Regulatory transparency: Local partners help ensure compliance with advertising laws.

3. National communication security: The government retains oversight over content-based industries.

Understanding these principles helps foreign investors navigate approvals more efficiently.

2. Step-by-Step Procedures to Establish a Joint-Venture Advertising Company

Setting up an advertising joint venture requires more procedural steps than opening a regular foreign-invested enterprise. Below is the complete process aligned with WTO commitments and current Vietnamese laws.

2.1. Step 1 – Determine Joint-Venture Structure and Vietnamese Partner Eligibility

Before submitting any application, investors must identify a qualified Vietnamese partner. The partner should:

• Have a valid Enterprise Registration Certificate

• Engage in advertising or related industries

• Possess a clean compliance record

• Be legally eligible to contribute capital and participate in management (if applicable)

Choosing an unqualified partner is the #1 cause of licensing rejection for foreign-invested advertising projects.

DEDICA Law often assists foreign clients in screening and verifying eligible partners.

2.2. Step 2 – Prepare and Apply for the Investment Registration Certificate (IRC)

The IRC is the government’s approval allowing the foreign investor to participate in the advertising joint venture.

Required documents include:

• Legalized investor documents (passport or corporate records)

• Proof of financial capacity

• Joint-venture agreement or BCC draft

• Proposed ownership ratio

• Business plan and investment capital

• Office lease or intended location

• Description of advertising services in scope (CPC 871)

Application review typically takes 15–20 working days, though the advertising sector sometimes requires additional clarifications due to content-sensitivity concerns.

2.3. Step 3 – Obtain the Enterprise Registration Certificate (ERC)

After IRC approval, investors proceed to establish the company.

The ERC confirms:

• Company name and headquarters

• Joint-venture ownership structure

• Charter capital and capital contribution timeline

• Legal representative

• Registered business lines: VISC 7310 (Advertising Services)

This step officially creates the joint-venture legal entity under Vietnamese law.

2.4. Step 4 – Register Advertising Business Lines and Comply With Sector Regulations

Registering VISC 7310 allows the company to conduct advertising activities. However, operational compliance requires additional attention:

• Outdoor advertising may need permission from local authorities

• Digital advertising must comply with cybersecurity and data use laws

• TV, radio, and media advertising require content approvals

• Certain products/services (e.g., tobacco, strong alcohol, infant formula for babies under 24 months) cannot be advertised

• Foreign-language content must be translated or accompanied by Vietnamese

Violations can lead to fines, forced removal of content, or suspension of business activities.

2.5. Step 5 – Capital Contribution and Post-Licensing Compliance

After receiving the ERC, investors must:

• Contribute capital within the registered timeline

• Register tax declarations

• Open bank accounts

• Register employees with social insurance

• Comply with advertising laws while operating

Late or incomplete capital contribution may result in:

• Penalties

• Suspension of the investment project

• Forced amendment of charter capital

DEDICA Law provides ongoing compliance support to ensure smooth operation.

3. Strategic Considerations and How DEDICA Law Supports Foreign Investors

Beyond meeting legal requirements, foreign investors must analyze strategic and operational risks to ensure the long-term success of their advertising joint venture.

3.1. Key Risks When Establishing Advertising Joint Ventures

Foreign investors frequently encounter:

• Partner selection problems, leading to disputes or licensing rejection

• Misunderstanding WTO rules, resulting in incorrect ownership structure

• Improper documentation, especially involving legalization requirements

• Non-compliant advertising content, causing penalties later

• Slow licensing approval because of vague service descriptions

These mistakes are avoidable with the right legal guidance.

3.2. How DEDICA Law Supports the Entire Process

DEDICA Law provides end-to-end legal services for foreign investors entering Vietnam’s advertising sector:

• Identifying and assessing eligible Vietnamese partners

• Drafting joint-venture contracts aligned with investor control

• Preparing and submitting IRC & ERC applications

• Advising on WTO commitments and local advertising laws

• Structuring ownership in compliance with legal requirements

• Ensuring advertising content and operations meet regulatory standards

• Ongoing compliance and corporate advisory

Our team consists of lawyers experienced in international law firms and multinational environments, ensuring practical and reliable solutions.

3.3. Why Foreign Investors Trust DEDICA Law

• Deep understanding of WTO commitments and Vietnam’s investment regulations

• Strong experience in media, advertising, and digital services

• Business-oriented guidance, not just legal formalities

• Transparent communication and predictable timelines

• Strategic insights that help investors avoid long-term risks

DEDICA’s mission is to help investors enter the Vietnamese market with confidence, control, and legal certainty.

Contact DEDICA Law Firm for Professional Legal Support

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Contact us today for a free initial consultation with our experienced lawyers!