Guide · Representative office
Representative office or EOR?
What a representative office in Vietnam can do, what it cannot, and when an employer of record is the better way to have people on the ground.
Updated 22 October 2026 · Written and checked by Nhân Kiệt's payroll and employment-law team (labour leasing licence 029/LĐTBXH-GP, employing people in Vietnam since 2009) · About 5 min read · General information, not legal or tax advice
Short answer
Should you open a representative office or use an EOR in Vietnam?
Open a representative office (RO) if you need a licensed presence in Vietnam for liaison, market research and promotion, and nothing more: under Decree 07/2016/ND-CP an RO may not earn revenue, sell, issue invoices or provide services. Use an employer of record (EOR) if you need people in Vietnam to do productive work — software development, customer support, operations or sales support for your company abroad — without opening an entity. An RO needs a licence from the provincial Department of Industry and Trade, valid for up to five years, an office, and its own payroll, social insurance and tax filings for its staff. An EOR needs no licence or office of your own: the EOR employs your staff and you pay salary, statutory contributions and a monthly fee, US$99–199 per employee plus VAT with Nhân Kiệt.
Key takeaways
- An RO is limited to liaison, market research and promotion; it cannot sell, invoice or provide services.
- The RO licence comes from the provincial Department of Industry and Trade and lasts up to five years.
- An RO employs its own staff and runs their payroll, insurance and tax filings itself.
- An EOR lets your staff do productive work for your company abroad with no licence or office of your own.
- Neither an RO nor an EOR can sell to Vietnamese customers with local invoices; that needs your own company.
Representative office
What a representative office may and may not do.
A representative office is a dependent unit of a foreign trader, set up under the Commercial Law and Decree 07/2016/ND-CP. It is not a company and has no profit-making activity of its own.
| Allowed | Not allowed |
|---|---|
| Acting as a liaison office for the parent company | Selling goods or services, or collecting revenue |
| Market research | Issuing invoices |
| Promoting investment and business opportunities for the parent | Providing services to the parent or to others for a fee |
| Employing staff for those activities | Subleasing its office |
The parent company normally needs to have operated for at least one year. The RO must keep an office address, report on its operations each year and renew its licence before it expires. Its staff may only carry out the RO’s permitted functions; work such as developing software or answering customers for the parent goes beyond them.
Sources: Commercial Law 2005; Decree 07/2016/ND-CP on representative offices and branches of foreign traders.
Employing people
Employing staff through an RO.
An RO is the employer of its staff. It signs their labour contracts, registers them for social, health and unemployment insurance, withholds personal income tax and files the returns. Recruiting Vietnamese employees follows the specific procedure for foreign organisations in Decree 219/2025/ND-CP. A foreign chief representative needs a work permit unless an exemption applies. All of this sits with you, usually with an outside accountant, from the first employee.
Side by side
RO, EOR and your own company compared.
| Representative office | EOR | Own company | |
|---|---|---|---|
| Licence | RO licence, up to five years | None for you | Investment and enterprise registration |
| What staff may do | Liaison, research, promotion | Work for your company abroad | Any registered business |
| Sell or invoice in Vietnam | No | No | Yes |
| Office | Required | Not required | Required |
| Payroll, insurance, tax | Run by the RO | Run by the EOR | Run by the company |
| Closing | Formal closure of the RO | End the service agreement | Dissolution takes months |
For the company route, see EOR or your own entity.
In practice
Which one fits your plan.
- You want to meet partners and study the market: an RO, or one person employed through an EOR to do the same research.
- You want engineers, designers or support staff working for you: an EOR, because an RO may not provide services.
- You want both a licensed presence and a working team: some companies keep a small RO for liaison and employ the working team through an EOR.
- You will sell to Vietnamese customers: your own company, with an EOR bridging the months of setup.
Example. A software company wants one country manager to build partnerships and four developers. The country manager’s work fits an RO, but the developers’ work does not. Employing all five through Nhân Kiệt costs US$495–995 a month in fees, plus VAT, with no licence or office to maintain.
Common mistakes
Mistakes with representative offices.
- Using the RO’s staff for productive work, such as software development or customer service, outside the RO’s permitted functions.
- Letting the RO sign sales contracts or collect payments in Vietnam.
- Missing the licence renewal before the five-year term ends.
- Forgetting the RO’s own employer filings: insurance, income tax and the annual operating report.
- Assuming an RO protects you from tax exposure when its staff in fact negotiate and close deals for the parent.
On tax exposure, see permanent establishment in Vietnam.
Questions
Representative office or EOR: FAQ
Can a representative office in Vietnam hire employees?
Yes. The RO is the employer of its staff and runs their contracts, insurance and income tax itself, but the staff may only carry out the RO’s permitted functions.
Can a representative office sign contracts or issue invoices?
It may not carry out revenue-generating activities: no selling, no invoicing and no providing services.
How long is a representative office licence valid?
Up to five years, and it can be renewed, under Decree 07/2016/ND-CP.
Can RO staff develop software for our head office?
That goes beyond liaison, market research and promotion. Staff doing productive work for the parent are usually employed through an EOR or your own company.
Is an EOR cheaper than a representative office?
For a few people, usually yes: an EOR has no office, licence or accounting of your own, only salary, contributions and US$99–199 per employee a month with Nhân Kiệt.
Can a representative office become a company later?
Not by conversion. You set up a company through investment and enterprise registration, then close the RO if you no longer need it.
Do I need an RO to get a work permit for a foreign hire?
No. An EOR such as Nhân Kiệt employs the foreign hire and applies for the work permit as the employer.
Hiring in Vietnam? We handle all of this as your employer.
Nhân Kiệt employs your team, runs payroll, insurance, tax and work permits. Fee: US$99–199 per employee a month, plus VAT.
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