We interviewed the founders of a group of retail companies that started in 1999 and now operate in three countries across Southeast Asia. We asked them what their greatest legal and tax challenges have been and how they have overcome them.
One of our first and biggest challenges was figuring out how to set up and operate our businesses in Vietnam. Although the law has changed since we first started out, at the time it wasn’t possible for a retail business to be owned by a foreigner. We had a production company there which we fully owned, but for the retail side we had to be creative. We followed a well-used route at the time that involved setting up an agreement with a trusted Vietnamese partner to establish the company, with written contracts to back it up. Although this route was legal, it wasn’t clear cut and wasn’t always easy to know how to navigate the situation.
Each time we have registered a new company in one of the countries we’ve hired a local law firm or business consulting firm to help us go through the business registration process. This has been essential because where we operate, this is not something you want to do on your own. We use a lawyer and we check with consultants locally about the process. We got our Vietnam registration completed in six months, whereas others have taken years. Getting that expert input is essential – if you don’t have everything right, it can really come back to bite you.
In Vietnam it is difficult to process anything without paying extra ‘fees’. We don’t pay bribes (i.e. offering money to receive a service we are not entitled to), but we do occasionally get extorted for money (i.e. being forced to pay extra for a service we are entitled to). Although we do try and resist being extorted, it does happen from time to time. Read more