Guide to Opening a Small Hotel in Vietnam for Foreign Investors
In recent years, Vietnam has risen to become a top tourist destination in Southeast Asia, experiencing a remarkable increase in both international and domestic arrivals. From major cities like Hanoi, Ho Chi Minh City, and Da Nang, to emerging hotspots such as Phu Quoc, Sapa, Quy Nhon, and Da Lat, the demand for accommodation and hotel services has surged.
Recognizing this trend, many foreign investors—especially small-scale or independent ones—view Vietnam as a “paradise” to open boutique or small hotels. However, the legal process of starting operations is far more complex and challenging than many expect.
Common Difficulties Faced by Foreign Investors
Client A of DEDICA, an Australian national, decided to invest in a 12-room boutique hotel in Da Lat after years of running Airbnb properties in Bali. However, upon arriving in Vietnam to scout locations, Client A encountered several obstacles:
Applying for an investment license in a conditional business sector.
Transferring land-use and residential-rights from Vietnamese individuals to an FDI enterprise.
Obtaining operating permits for lodging, along with fire safety and security certifications.
Besides the time and cost burdens, Client A faced cultural and procedural hurdles when liaising with government authorities.
How DEDICA Helped Overcome These Challenges
From the moment Client A engaged with us, DEDICA’s legal team conducted a comprehensive review of the investment site and relevant business conditions. We advised on the optimal investment structure to balance legal compliance and procedural efficiency.
Next, we drafted the investment registration dossier and represented the client at the Department of Planning and Investment and other relevant agencies to expedite approvals. Simultaneously, we negotiated and prepared a legally sound long-term lease that safeguarded the client’s usage rights.
Throughout the operational setup phase, DEDICA continued to assist with:
Obtaining fire safety and security permits
Registering lodging operations with the Department of Tourism and local police
Standardizing employment contracts and initial internal policies
With extensive experience supporting numerous foreign investors, our team proactively anticipates and addresses emerging issues, ensuring clients save time and cost while minimizing legal risks.
Legal Considerations When Operating a Small Hotel in Vietnam
After progressing through licensing and initial investment setup, the critical operational phase begins. This stage demands rigorous legal oversight and professional management to ensure stable, compliant operations. Below are essential legal considerations every investor should remember:
Regulatory Compliance for Lodging Operations
Maintain up-to-date documents and certificates for fire safety and security.
Accurately report guest registrations for both international and domestic tourists.
Adhere to regulations on room pricing, posted rates, and periodic reporting to relevant authorities.
Contract & Labor Management
In small hotels, HR processes are often informal, leading to potential issues such as:
Hiring without signed contracts or required insurance
Disputes over terminations, resignations, or workplace accidents
Tax & Invoice Management
Many investors struggle with Vietnamese tax rules, including:
Incomplete tax filings
Improper invoice issuance
Incorrect business classification, leading to VAT deduction limitations
Brand Protection & Online Content
In a competitive market, protecting your brand identity and website content is crucial:
Register trademarks to prevent copying or legal disputes
Address copyright infringements for image and content usage
How DEDICA Supports You Through Operations
DEDICA assists clients in reviewing and updating legal documentation, standardizing employment contracts, optimizing taxes, avoiding administrative penalties, and registering intellectual property both domestically and internationally. We also offer brand-defense strategies tailored to legal contingencies.
Opening a hotel in Vietnam is highly viable and full of potential for foreign investors. However, long-term, stable development requires skilled legal guidance. Seemingly minor issues, if overlooked or mismanaged, can seriously impact your hotel’s operations and brand reputation in the future.
DEDICA LAW FIRM proudly serves as a trusted legal partner for numerous FDI enterprises and individual investors in the Vietnamese hospitality industry. We are ready to advise and support you—from initial planning through full-scale operations.
📞 Hotline: (+84) 39 969 0012 (Available via WhatsApp, WeChat, and Zalo)
🏢 Head Office: 144 Vo Van Tan, Vo Thi Sau Ward, District 3, Ho Chi Minh City
🕒 Office Hours: Monday to Friday, 8:30 AM – 6:00 PM
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