Foreign investment in retail activity is subject to obtaining a trading license. The criteria for issuing a trading license for a foreign-invested enterprises (i.e. 51% or more foreign-owned), is discriminatory, including considerations related to their: (i) Compatibility with the competitive level of domestic enterprises in the same operational sector; (ii) Ability to create jobs for domestic workers; (iii) Ability to contribute and level of contribution to the State budget. The establishment of retail establishments (other than the first one) is also subject to an economic needs test. Pursuant to rules under Decree 09/2018/ND-CP, foreign investors wishing to establish additional retail outlets of less than 500m2 and located in a trading centre are exempted from the ENT, except in the case of mini-supermarket or convenience stores. Unlike under the previous regulation, the establishment of additional retail outlets are now subect to ENT regardless of the size and location of the outlet. The main criteria for economic needs testing are the number of service providers present in a geographic area, market stability, and geographic size.
"Article 3. Definitions
For the purposes of this Law, the terms below are construed as follows: [...]
10. “market access conditions applied to foreign investors” mean those which must be satisfied by foreign investors to make investment in the List of business lines with prohibited and restricted market access (hereinafter referred to as “the Negative List for Market Access”) specified in Clause 2 Article 9 of this Law.  [...]
19. “foreign investor” means an individual holding a foreign nationality or an organization established under foreign laws and carrying our business investment activities in Vietnam.
20. “domestic investor” means an individual holding Vietnamese nationality or a business organization whose members or shareholders are not foreign investors. 
[...]
Article 4. Application of the Law on Investment and relevant laws
1. Business investment activities in the territory of Vietnam [must] comply with the Law on investment [this Law] and other relevant laws.
2. If there is any discrepancy between the provisions of this Law and those of another law issued before the effective date of this Law in relation to the industries and trades in which business investment is prohibited, or industries and trades in which business investment is conditional, then the provisions of the Law on investment [this Law] shall prevail.
[...]
Article 9. Business lines with prohibited and restricted market access and market access conditions applied to foreign investors
1. Market access conditions applied to foreign investors are the same as those applied to domestic investors, except for the case specified in Clause 2 of this Article.
2. Pursuant to Laws and Resolutions of the National Assembly, Ordinances and Resolutions of the Standing Committee of the National Assembly, Decrees of the Government and international treaties to which the Socialist Republic of Vietnam is a signatory, the Government shall promulgate a Negative List for Market Access, including:
a/ Prohibited business lines; b/ Restricted business lines.
3. Market access conditions applied to foreign investors specified in the Negative List for Market Access include:
a/ Holding of charter capital by the foreign investor in a business organization; b/ Investment method; c/ Scope of investment; d/ Capacity of the investor; partners participating in the investment activities; dd) Other conditions specified in the Laws and Resolutions of the National Assembly, Ordinances and Resolutions of the Standing Committee of the National Assembly, Decrees of the Government and international treaties to which the Socialist Republic of Vietnam is a signatory.
[...]
Article 23. Implementation of investment activities by foreign-invested economic organizations
1. When making investment in establishment of other economic organizations; contribution of capital to, or purchase of shares or capital contributions at, other economic organizations; or investment in the form of BCC, economic organizations must meet the conditions and shall carry out investment procedures according to regulations applicable to foreign investors if falling into one of the following cases:
a/ Having over 50% of their charter capital held by a foreign investor/foreign investors, or having a majority of their general partners being foreign individuals, for partnerships;
b/ Having over 50% of their charter capital held by an economic organization/economic organizations specified at Point a of this Clause;
c/ Having over 50% of their charter capital held by a foreign investor/foreign investors and an economic organization/economic organizations specified at Point a of this Clause. [...]" (Law on Investment No. 61/2020/QH14 of 17 June 2020 [google translation])
------------------------------------
"Section 2. SECTORS, LINES AND MARKET ACCESS CONDITIONS FOR FOREIGN INVESTORS
Article 15. Sectors and trades restricted from market access for foreign investors
1. Sectors and trades with restrictions on market access for foreign investors and restrictions on market access for such industries and trades are prescribed in laws and resolutions of the National Assembly, ordinances and resolutions. of the National Assembly Standing Committee, Government decrees and international treaties on investment. The list of industries and trades with restrictions on market access for foreign investors is published in Appendix I of this Decree.
2. Market access conditions for foreign investors shall be applied in the forms specified in Clause 3, Article 9 of the Law on Investment and posted and updated according to the provisions of Article 18 of this Decree.
[...]
Article 16. Subjects of application of the List of industries and trades restricted from market access
1. The list of industries and trades with restricted market access applies to:
a) Foreign investors as prescribed in Clause 19, Article 3 of the Law on Investment ;
b) The economic organization specified at Points a, b and c, Clause 1, Article 23 of the Law on Investment when investing in the establishment of other economic organizations; make capital contribution, purchase shares, purchase capital contribution portion of other economic organizations; investment in the form of BCC contract.
(In this Section, the subjects specified at Points a and b of this Clause, hereinafter collectively referred to as foreign investors, unless otherwise provided for by this Decree).
[...]
Article 17. Principles of applying restrictions on market access for foreign investors
1. Except for the industries and trades on the List of industries and trades with restricted market access for foreign investors specified in Appendix I of this Decree, foreign investors are entitled to market access as prescribed for domestic investors.
2. Foreign investors are not allowed to invest in industries and trades that have not yet been able to access the market as prescribed in Section A, Appendix I of this Decree.
3. For industries and trades with conditional market access for foreign investors as prescribed in Section B, Appendix I of this Decree, foreign investors must satisfy the conditions for market access according to the provisions of Article 18 of this Decree.
4. Market access conditions for industries and trades that Vietnam has not yet committed to market access to for foreign investors are applied as follows:
a) Where laws and resolutions of the National Assembly, ordinances and resolutions of the National Assembly Standing Committee, decrees of the Government (hereinafter referred to as Vietnamese law) do not contain provisions restricting access to the market for that industry or trade, foreign investors may access the market as prescribed for domestic investors;
b) Where Vietnamese law already contains provisions on restricting foreign investors' market access for such industries or trades, the provisions of Vietnamese law shall apply. [...]
7. Foreign investors belonging to countries or territories that are not members of the WTO and conducting investment activities in Vietnam are entitled to the same market access conditions as those applicable to national investors. a territory that is a member of the WTO, unless otherwise provided for by Vietnamese law or an international treaty between Vietnam and that country or territory.
[...]
B. BUSINESS LINES WITH RESTRICTED MARKET ACCESS [...]
22. Goods trading activities and activities directly related to goods trading activities of foreign service suppliers in Vietnam [...]"(Government Decree on the Elaboration of Some Articles of the Law on Investment No. 31/2021/ND-CP of 26 March 2021 [google translation] (Decree 31), which provides guidance on the implementation of the new Law on Investment [google translation])
---------------------------
"INDUSTRY, SECTOR | CONDITIONS LIMITED MARKET ACCESS | LEGAL BASIS [not reproduced here] [...]
22. Goods trading activities and activities directly related to goods trading activities of foreign service suppliers in Vietnam
22.1 Distribution Services: Franchise Services |
1. Provisions in the Agreements:
Measures apply to all subsectors of distribution services: Tobacco and cigars, books, newspapers and magazines, videotaped articles, precious metals and gems, pharmaceuticals[1], drugs Explosives, crude and processed oils, rice, cane sugar and beet sugar are excluded from the scope of commitments.
1.1. Distribution services include:
i) Commission agency service (CPC 621, 61111, 6113, 6121)
ii) Wholesale services (CPC 622, 61111, 6113, 6121)
iii) Retail services (CPC 631 + 632, 61112, 6113, 6121).
The establishment of retail establishments (other than the first one) will be considered on the basis of an economic needs test (ENT)[2]. Particularly for CPTPP and EVFTA, 5 years after the Agreement comes into effect, the economic needs test will be abolished and this reservation will expire.
1.2. Franchise service (CPC 8929): unlimited. Allows establishment of branches. The head of the branch must be a permanent resident in Vietnam.
2. Vietnamese law:
Clause 1, Article 3 of Decree No. 09/2018/NDCP stipulates goods trading activities and activities directly related to goods trading, including the following activities:
a) Exercising the right to export;
b) Exercise the right to import;
c) Exercising the right to distribute;
d) Providing commercial assessment services;
dd) Provide logistics services;
e) Leasing of goods, excluding financial leasing;
g) Providing trade promotion services, excluding advertising services;
h) Providing commercial intermediary services;
i) Providing e-commerce services;
k) Providing services of organizing bidding for goods and services.
- Regarding pharmaceutical distribution: Establishments that have the right to import but are not allowed to exercise the right to distribute drugs and medicinal ingredients in Vietnam, are not allowed to carry out activities directly related to the distribution of drugs and raw materials making drugs in Vietnam, except for drugs and medicinal ingredients produced by the establishment itself (Clause 10, Article 91 of Decree No. 54/2017/ND-CP).
[1] In this schedule of commitments, “pharmaceuticals” does not include non-pharmaceutical nutritional products in the form of tablets, capsules or powders.
[2] The application for permission to establish more than one retail establishment must follow an established and publicly available process and the authorization must be based on objective criteria. The main criteria for economic needs testing are the number of service providers present in a geographic area, market stability, and geographic size.  [...]" (Government of Viet Nam, List B: List of occupations with conditional market access for foreign investors: Conditions (updated 2020), webpage [google translation])
---------------------------
"CHAPTER 1 - General Provisions [...]
Article 3 Definitions
In this Decree the following terms are defined as follows:
1. Activities of goods trading and directly related activities comprise the following activities:
(a) Exercising the right to export; (b) Exercising the right to import; (c) Exercising the right to distribute; (d) Provision of commercial assessment services; (dd) Provision of logistics services; (e) Goods leasing but excluding financial leasing; (g) Provision of trade promotion services excluding advertising services; (h) Provision of trade intermediation services; (i) Provision of e-commerce services; (k) Provision of services of arranging tendering/bidding for goods and services.
[...]
Article 5 Issuance of business licences and of licences to establish retail stores [retail store licences]
1. Business licenses are granted to foreign-invested economic organizations to carry out the following activities:
a) Exercise the right to retail distribution of goods, excluding goods specified at Point c, Clause 4, Article 9 of this Decree;
b) Exercise the right to import and wholesale distribution of goods specified at Point b, Clause 4, Article 9 of this Decree;
c) Exercise the right to retail distribution of goods specified at Point c, Clause 4, Article 9 of this Decree;
d) Provide logistics services; except for logistics service sub-sectors to which Vietnam has committed to open the market in international treaties to which Vietnam is a member;
dd) Leasing of goods, excluding financial leasing; except for rental of construction equipment with operators;
e) Providing trade promotion services, excluding advertising services;
g) Providing commercial intermediary services;
h) Providing e-commerce services;
i) Providing services of organizing bidding for goods and services. [...]
5. Economic organizations that fall into the cases specified at Points b and c, Clause 1, Article 23 of the Law on Investment must satisfy the following conditions and perform: Procedures for granting a business license when carrying out activities requiring a business license business; procedures for granting a license to establish a retail establishment when setting up a retail establishment, according to the provisions of this Decree.
[...]
Article 6 Cases not requiring a business licence
1. Apart from the activities for which a business licence is required as prescribed in article 5.1 of this Decree, any economic organization with FOC and any economic organization in the cases prescribed in sub-clauses (b) and (c) of article 23.1 of the Law on Investment has the right to conduct goods trading and directly related activities prescribed in article 3.1 of this Decree after registering such activities in relevant data in accordance with the provisions of the Law on Investment and the Law on Enterprises.
[...]
CHAPTER 2 - Business Licences
Article 9 Conditions for granting a business license
1. In case a foreign investor belonging to a country or territory that is a contracting party to an international treaty to which Vietnam is a contracting party commits to open the market for goods trading and activities directly related to sales of goods
a) Satisfy the conditions on market access in international treaties to which Vietnam is a contracting party; [...]
2. In case the foreign investor does not belong to a country or territory participating in an international treaty to which Vietnam is a contracting party
a) Conditions specified at Points b and c, Clause 1 of this Article;
b) Meet the following criteria:
- Comply with the provisions of specialized laws;
- Matching the level of competition of domestic enterprises in the same field of operation;
- Ability to create jobs for domestic workers;
- Ability and level of contribution to the state budget.
3. In case business services have not yet been committed to market opening in international treaties to which Vietnam is a contracting party: The conditions specified in Clause 2 of this Article.
4. If there is not yet a commitment to open the market for business in the following goods in international treaties of which Vietnam is a member, namely: oil and lubricants; rice; sugar, articles with recorded images; and books, newspapers and magazines:
a) Conditions specified in Clause 2 of this Article;
b) For goods being lubricating oil and grease: Consider granting a license to exercise the right to import or wholesale distribution to a foreign-invested economic organization that performs one of the following activities:
- Producing lubricating oil and grease in Vietnam;
- Producing or being allowed to distribute in Vietnam machinery, equipment and goods using special oils and greases.
c) For goods being rice; Street; recorded items; Books, newspapers and magazines: Consideration shall be given to licensing the exercise of retail distribution rights to foreign-invested economic organizations that already have retail establishments in the form of supermarkets, mini-marts, and convenience stores in order to conduct retail at those establishments.[...]" (Decree No. 09/2018/ND-CP dated January 15, 2018 of the Government detailing the Commercial Law and the Law on Foreign Trade Management on goods purchase and sale activities and activities directly related to the purchase and sale of goods by foreign investors and foreign-invested economic organizations in Vietnam. [google translation])
Law on Investment No. 61/2020/QH14 of 17 June 2020 [google translation]
Government Decree on the Elaboration of Some Articles of the Law on Investment No. 31/2021/ND-CP of 26 March 2021 [google translation]
Government of Viet Nam, List B: List of occupations with conditional market access for foreign investors: Conditions (updated 2020), webpage [google translation]
Decree No. 09/2018/ND-CP dated January 15, 2018 of the Government detailing the Commercial Law and the Law on Foreign Trade Management on goods purchase and sale activities and activities directly related to the purchase and sale of goods by foreign investors and foreign-invested economic organizations in Vietnam. [google translation]
[<a href="https://vbpl.vn/bokehoachvadautu/Pages/vbpqen-toanvan.aspx?dvid=312&ItemID=11133">Law</a>],[<a href="https://vbpl.vn/bokehoachvadautu/Pages/vbpq-toanvan.aspx?ItemID=147720&Keyword=31/2021/ND-CP">Decree</a>],[<a href="https://vietnaminvest.gov.vn/SitePages/News_Detail.aspx?ChuyenMuc=3&ItemId=16">Webpage</a>],[<a href="https://vbpl.vn/TW/Pages/vbpq-toanvan.aspx?ItemID=127637&Keyword=09/2018/ND-CP">Decree</a>]