VI In the strategy for the strong recovery and growth of the smokeless industry in Vietnam, the participation of foreign capital inflows is always expected to bring a fresh breeze of technology, management, and an abundant source of international tourists. However, travel services are one of the conditional market-access sectors, subject to strict supervision and regulation by the domestic investment and tourism legal systems. Foreign investors wishing to enter this market must confront stringent regulations regarding capital ownership ratios, the scope of business operations, as well as strict conditions concerning escrow deposits and the competence of executives. Let’s explore with Pham Consult the licensing conditions and the lawful scope of operations for foreign capital in this sector below.
I. Is travel service business a conditional business sector?
Tourism refers to activities related to trips taken by people outside their place of permanent residence for a continuous duration of not more than one (01) year to satisfy needs for sightseeing, leisure, entertainment, learning, exploring tourism resources, or combined with other lawful purposes.
Travel service business is the activity of building, selling, and organizing the implementation of a part or the whole of a tour program for tourists. Travel service business includes domestic travel service business and international travel service business.
According to the List of conditional business sectors and trades specified in Appendix IV issued concurrently with the Investment Law 2025, travel service business is a conditional business sector. Therefore, to participate in investing and operating a travel service business, foreign investors must satisfy the conditions prescribed by law.
II. Scope and conditions for travel service business of foreign investors
- Scope of travel service business for foreign investors
According to Article 38 of the Tourism Law 2017 and Vietnam’s WTO Schedule of Specific Commitments on Services, foreign service suppliers are permitted to provide services in the form of a joint venture with a Vietnamese partner to establish a travel service enterprise without any restriction on the foreign capital contribution ratio.
However, pursuant to Article 30 of the Tourism Law 2017 and the Schedule of Specific Commitments, foreign-invested enterprises providing services are only permitted to provide international travel services to bring tourists into Vietnam (inbound) and domestic travel services for inbound tourists as a part of the service of bringing tourists into Vietnam; they are strictly prohibited from operating outbound travel services (taking tourists from Vietnam abroad). In addition, tour guides employed within a foreign-invested enterprise must be Vietnamese citizens.
Foreign investors may choose one of the following two forms of investment to establish a joint venture company operating travel services in Vietnam:
– Investing in the establishment of an economic organization;
– Investing via capital contribution, purchase of shares, or purchase of contributed capital.
- Conditions for travel service business of foreign-invested enterprises
After a foreign investor establishes an economic organization to conduct travel services, such economic organization must apply for an International Travel Service Business License in accordance with regulations before commencing operations.
According to Clause 2, Article 31 of the Tourism Law 2017, to be granted an International Travel Service Business License, the economic organization conducting the travel service business must satisfy the following conditions:
– Maintain an international travel service business escrow deposit at a commercial bank, a cooperative bank, or a foreign bank branch established and operating in Vietnam;
– The person in charge of the travel service business must have graduated with a college degree or higher majoring in travel services; in case of graduation with a college degree or higher in other majors, such person must possess a certificate in international tour operation management.
III. Implementation process for travel service business investment in Vietnam by foreign investors
Step 1: Partner with a Vietnamese counterpart to carry out investment procedures at the investment registration authority. Investors may choose one of the two forms of investment: establishing an economic organization or contributing capital, purchasing shares, or purchasing contributed capital.
Step 2: Register the joint venture company conducting the travel service business at the business registration authority.
Step 3: Submit an application dossier for the issuance of an International Travel Service Business License to the Vietnam National Authority of Tourism. The application dossier comprises:
– An application form for the issuance of an International Travel Service Business License using the form prescribed by the Minister of Culture, Sports, and Tourism;
– A certified copy of the Enterprise Registration Certificate or the Investment Registration Certificate issued by the competent state authority;
– A certificate of the travel service business escrow deposit;
– Certified copies of qualifications and certificates of the person in charge of the travel service business as specified in Point c, Clause 2, Article 31 of the Tourism Law 2017;
– A certified copy of the appointment decision or the labor contract signed between the travel service enterprise and the person in charge of the travel service business.
Within ten (10) days from the date of receipt of a valid dossier, the Vietnam National Authority of Tourism shall appraise and issue the International Travel Service Business License to the enterprise, and simultaneously notify the specialized tourism authority at the provincial level where the enterprise’s head office is located. In case of refusal, a written notice clearly stating the reasons must be issued.
