Establishing a Labor Export Company in Vietnam in 2023

Establishing a Labor Export Company in Vietnam in 2023

The establishment of a labor export company involves a multi-step process due to the fact that labor export is a regulated business sector. Labor export involves sending Vietnamese workers abroad to meet the labor demands of foreign countries. This solution provides optimal labor resources for the third country and expands opportunities to improve the economic livelihoods of individuals, families, and communities in Vietnam.

The current high demand for labor supply and export has led to a growing trend of establishing labor export companies in various provinces and localities across the country.

However, the establishment of a labor export company is a multi-step and relatively complex process, as labor export falls under the category of regulated business sectors. This article by Warren B aims to provide valuable information and insights into the conditions for Establishing a Labor Export Company in Vietnam in 2023.

Things to Know Before Establishing a Labor Export Company in Vietnam

According to Article 8 of the Law on Sending Vietnamese Workers to Work Abroad under a Contract in 2020, the activities of sending Vietnamese workers abroad for employment are regulated as follows:

The service of sending Vietnamese workers abroad for employment under a contract is a conditional business sector.

Enterprises engaged in this service must obtain a License for sending Vietnamese workers abroad for employment under a contract, issued by the Minister of Labor, Invalids and Social Affairs.

In terms of the functions, tasks, and roles of establishing a labor export company, Article 9 of the same law outlines the following:

  • Enterprises must sign and execute contracts as agreed for sending Vietnamese workers abroad for employment.
  • Actively participate in seeking and developing the labor supply market abroad.
  • Provide direct training and consultation on the process of sending Vietnamese workers abroad for employment under a contract.
  • Prepare the labor force, select suitable workers, organize language and skills training, and provide educational orientation for Vietnamese workers going abroad for employment.
  • Manage the labor force, and actively protect the rights and legitimate interests of Vietnamese workers employed abroad.
  • Implement fully and accurately the policies and benefits for Vietnamese workers employed abroad.
  • Create conditions for the termination and liquidation of contracts for Vietnamese workers employed abroad. Support, introduce, and arrange workers’ jobs upon returning to the country.

--> Read more: Setting up a company in Vietnam – 6 regulations foreign investors must know

Conditions for Establishing a Labor Export Company

According to Article 10 of the Law on Sending Vietnamese Workers to Work Abroad under a Contract in 2020, Vietnamese enterprises must meet the following criteria to be eligible to establish a labor export company:

  • Have a minimum charter capital of VND 5 billion or more, where all owners, shareholders, and members must be domestic investors as regulated by the Investment Law.
  • Have participated in contributing to the fund as specified in Article 24 of the same law.
  • Have a representative who is a Vietnamese citizen, holds a university degree or higher, and has a minimum of 5 years of experience in the field of sending Vietnamese workers abroad for employment under a contract or general experience in employment services.
  • The representative must not be subject to criminal prosecution or have a criminal record for offenses such as compromising national security, endangering human life, property fraud, using trust to commit property fraud, false advertising, deceiving customers, brokering or assisting others in illegal entry or exit, assisting others in staying abroad illegally, forcing others to go abroad or stay abroad illegally.

In addition, to establish a labor export company, the enterprise must have sufficient personnel to fulfill and comply with the regulations outlined in Article 9 of this law. It must also have stable physical facilities or rented facilities that meet the standards for educational orientation for Vietnamese workers going abroad for employment.

Deposit Requirements When Establishing a Labor Export Company

Specific regulations regarding the deposit when establishing a labor export company are outlined in Article 24 of the Law on Sending Vietnamese Workers to Work Abroad under a Contract in 2020 as follows:

  • The deposit of a company engaged in the service of sending Vietnamese workers abroad for employment under a contract will be deposited in a bank and can only be used when the enterprise fails to comply with or fully comply with the regulations on providing services for sending Vietnamese workers abroad for employment under a contract, as stipulated by the competent authorities.
  • Within a maximum period of 30 days from the time the deposit is used, the enterprise is responsible for fully reimbursing the used deposit according to the regulations.
  • At point b, clause 3 of this article also specifies that the deposit will be used by the Ministry of Labor, Invalids and Social Affairs to make payments arising when the worker has not been liquidated to send Vietnamese workers abroad for employment under a contract and has returned to the country at the time of transfer.

--> Read more: Setting up a company in Vietnam – 6 regulations foreign investors must know

How Is the Deposit for Establishing a Labor Export Company Regulated?

After deducting all service fees with the bank, if there is any remaining deposit, the enterprise is allowed to use it to settle any remaining payments according to the provisions of the law on bankruptcy.

From this, it can be seen that the regulations of the state and the law regarding the conditions for establishing a labor export company, regulations on doing business in the service of sending Vietnamese workers abroad for employment under a contract, are relatively complex. The process involves multiple steps but is also comprehensive and detailed in terms of legal aspects.

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