Can foreign investors own 100% of an advertising company in Vietnam? What is the maximum allowable ownership ratio, and how does it affect investment structures? This comprehensive guide explains Vietnam’s latest legal framework, ownership restrictions, licensing procedures, and strategic considerations for foreign investors entering the advertising sector.

1. Understanding Vietnam’s Ownership Restrictions in the Advertising Sector

Vietnam’s advertising market is expanding rapidly, driven by digital transformation, social media growth, and foreign brand investments. Despite this growth, the sector remains highly regulated—especially regarding foreign ownership.

1.1. Advertising as a Conditional Business Line Under Vietnamese Law

Advertising services fall under CPC 871, a category listed as a conditional business line for foreign investors according to Vietnam’s WTO Commitments and the Law on Advertising.

This classification has two key implications:

1. 100% foreign ownership is NOT permitted for advertising companies.

2. Foreign investors must invest through a joint venture or a Business Cooperation Contract (BCC) with a Vietnamese partner.

This requirement ensures domestic participation in an industry that directly influences culture, communications, and social norms.

1.2. What Is the Maximum Foreign Ownership Allowed?

Unlike other restricted sectors, Vietnam does not impose a fixed percentage cap (such as 49% or 70%). Instead, the rule is simple:

➡️ Foreign investors may hold up to 99.99% ownership—anything except full 100% ownership.

In other words, the joint venture must include at least one Vietnamese shareholder, but the Vietnamese stake can be as small as:

• 1%

• One share

• A symbolic nominal capital contribution

This structure ensures compliance while allowing foreign investors majority control in practice.

1.3. Why Vietnam Limits Foreign Ownership in Advertising

The ownership restriction is rooted in three policy objectives:

• Cultural protection: Advertising influences public opinion and cultural values.

• Domestic participation: The government seeks to maintain a responsible Vietnamese presence in content-driven industries.

• Regulatory oversight: Joint ventures allow better monitoring of compliance with advertising standards and banned content.

These principles remain consistent across all recent regulatory updates.

2. Legal Requirements and Procedures for Foreign Investors

To invest legally in Vietnam’s advertising sector—even with majority ownership—foreign investors must follow a structured licensing process.

2.1. Step 1 – Investment Registration Certificate (IRC)

The IRC is mandatory for all foreign-invested companies, especially those in conditional sectors.
The application requires:

• Investor profile and financial documents

• Investment capital structure and ownership ratio

• Joint venture agreement or BCC draft

• Business location and feasibility plan

• Detailed description of advertising services

Foreign documents must be notarized, legalized, and translated into Vietnamese.

Typical processing time: 15–20 working days.

2.2. Step 2 – Enterprise Registration Certificate (ERC)

Once the IRC is approved, the next step is establishing the company by obtaining an ERC.

The ERC will specify:

• Ownership structure (including foreign ownership percentage)

• Charter capital

• Legal representative

• Registered business lines (including VISC 7310 – Advertising Services)

Only after the ERC is issued can the company legally exist as a joint venture.

2.3. Step 3 – Registering Advertising Business Lines

To operate legally, the company must register:

➡️ VISC Code 7310 – Advertising Services
This corresponds to the international classification CPC 871, covering most types of advertising activities.

Depending on the services offered, additional compliance obligations may include:

• Outdoor billboard permits

• Online advertising compliance under cybersecurity laws

• Television, radio, or media advertising approvals

• IP and copyright compliance for digital assets

2.4. Step 4 – Capital Contribution and Ownership Documentation

Foreign ownership ratios must be accurately reflected in:

• The charter

• Joint venture contract

• Shareholder or member register

• Capital contribution receipts

Late capital contribution is a common mistake and may lead to:

• Administrative penalties

• Forced capital reduction

• Suspension of investment activities

DEDICA Law routinely assists clients in structuring timely contributions to avoid penalties.

3. Strategic Considerations for Foreign Investors

While the legal maximum for foreign ownership is clear, practical considerations often determine the success or failure of advertising joint ventures.

3.1. Control vs. Compliance Balance

Holding 99% ownership does not automatically guarantee full operational control. Vietnamese shareholders—even with a minority stake—may retain:

• Veto rights

• Approval authority for key decisions

• Legal representation roles

DEDICA Law regularly drafts customized joint venture agreements to ensure foreign investors maintain effective managerial control while staying compliant.

3.2. Choosing the Right Vietnamese Partner

Because advertising touches sensitive content, your Vietnamese partner must:

• Be licensed and qualified to engage in advertising

• Understand local regulations

• Maintain a good compliance record

• Have no history of advertising violations

Choosing a nominal or inexperienced partner may result in:

• Licensing rejection

• Compliance violations

• Internal disputes

• Inefficient operations or reputational risks

DEDICA Law conducts due diligence to ensure the Vietnamese partner meets legal and commercial standards.

3.3. Business Model Options Based on Ownership Needs

Foreign investors can choose between:

• Joint Venture Company (Majority Foreign-Owned)

  • Most common model

  • Foreign ownership up to 99.99%

  • Strong operational control if structured correctly

• Business Cooperation Contract (BCC)

  • No legal entity required

  • Vietnamese partner remains the legal owner

  • Profits shared by contract

  • Riskier but more flexible

DEDICA Law advises which model best suits the investor’s strategy, risk appetite, and timeline.

4. Conclusion

Vietnam offers significant opportunities for foreign investors in the advertising industry. However, because advertising is regulated as a conditional business line, foreign ownership is restricted—though not heavily. The maximum foreign ownership is effectively 99.99%, as long as a Vietnamese partner holds a minimal share.

Understanding ownership rules, licensing procedures, compliance standards, and partner selection is critical to a successful market entry.

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