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Decree 342/2026: what Vietnam's new retail rules mean for foreign franchise brands

A new decree on goods trading by foreign-invested companies takes effect on 18 Oct 2026. It removes the Economic Needs Test (ENT) for investors from many trade-treaty countries and moves licensing to the provinces. It does not change how a franchise is registered. Here is what it means if you plan to run stores in Vietnam yourself or through a master franchisee.

By the vietnamfranchise.net content team · Content lead: Nguyễn Phi Vân · Last reviewed 9 Oct 2026

The short version

Check your outlet with the ENT checker →

Key facts

Why franchise brands should care

A franchise system that only licenses its brand to Vietnamese operators deals with franchise registration, trademarks and tax on royalties. Decree 342 starts to matter when a foreign-invested company runs the stores. That happens when a brand opens company-owned flagships, when a master franchisee takes foreign capital, or when an area developer is a joint venture.

Under Decree 342 the province decides: the People's Committee of the head-office province issues the business licence and the People's Committee of each outlet's province issues that outlet's licence, with no routine MOIT consultation step. Treaty investors skip the ENT altogether.Source: Decree 342/2026/ND-CP, official signed text (Government of Vietnam) (3 Sept 2026) · Vietnam Briefing (Dezan Shira & Associates) (8 Oct 2026)

One rule is written with franchising in mind. Article 3(11) treats an outlet as “beyond the first” if another foreign-invested company already runs a licensed outlet under the same trademark or trade name. A brand that appoints several foreign-backed franchisees in Vietnam cannot give each of them a fresh first outlet.Source: Decree 342/2026/ND-CP, official signed text (Government of Vietnam) (3 Sept 2026)

Three franchise structures, three outcomes

  1. Pure master franchise to a Vietnamese-owned company. Decree 342 does not govern the operator. Your obligations are MOIT franchise registration, a trademark filed in Vietnam, and withholding tax on royalties.
  2. Master franchisee with foreign shareholders.The company is a foreign-invested enterprise. It needs a business licence and an outlet licence for each store. Whether an ENT applies to store two onwards depends on the investor's country and the outlet's size and location.
  3. Brand-owned subsidiary or joint venture. The same rules as above apply. Once the investor owns or co-owns 100 small, 50 mid-size or 30 large outlets, each new outlet licence also needs a national security review (Article 8(3)(c)).Source: Decree 342/2026/ND-CP, official signed text (Government of Vietnam) (3 Sept 2026) · VCCI (Vietnam Chamber of Commerce and Industry) (6 Oct 2026)

If a foreign investor buys into a local operator

Taking a Vietnamese franchisee above 50% foreign ownership brings it under the licensing rules. Its existing stores may keep trading for up to 12 months while it obtains licences (Article 5(6)). Plan the licensing work before closing the deal, not after.Source: Decree 342/2026/ND-CP, official signed text (Government of Vietnam) (3 Sept 2026) · Vietnam Briefing (Dezan Shira & Associates) (8 Oct 2026)

Checklist before 18 October 2026

  1. Map who owns each company that will operate stores, and from which country.
  2. Check whether another foreign-invested company already runs a licensed store under your brand in Vietnam.
  3. For each planned outlet beyond the first, record its size band, whether it is in a trade centre, and its format.
  4. Count outlets already owned or co-owned by size band against the 100 / 50 / 30 security-review thresholds.
  5. Diary the two reporting deadlines: 15 January and 15 July.
  6. Check that existing licences cover the activities you actually carry out.
  7. Separately confirm MOIT franchise registration and trademark filing — Decree 342 does not change them.

What we do not know yet

This page was checked against the official signed text of the decree on 9 October 2026, but not every article: Articles 11–18, 28–37, 40–43 and the annexes were not reviewed. We have not checked the ASEAN (ATISA) or Vietnam–Korea FTA schedules line by line, the UKVFTA schedule itself, or whether Decree 35/2006 on franchising was amended in 2025–26. The decree does not say how mixed-size networks count toward the security-review thresholds. We will update this page and log any correction on our corrections page.

Frequently asked questions

When does Decree 342/2026/ND-CP take effect?

18 October 2026. It was issued on 3 September 2026 and replaces Decree 09/2018/ND-CP (Article 45).

Is the Economic Needs Test (ENT) abolished?

Not for everyone. Under Article 22(1) the ENT applies only to investors from countries not party to a treaty in which Vietnam committed to abolish it. CPTPP (from January 2024), EVFTA (from 1 August 2025) and UKVFTA contain that commitment. Others still face an ENT for outlets beyond the first, unless the small-outlet exemption applies.

Does my first store need an ENT?

No — but check what counts as “first”. Under Article 3(11), if another foreign-invested company already runs a licensed store under the same brand in Vietnam, your store counts as beyond the first.

What is the small-outlet exemption?

An additional outlet needs no ENT if its selling area is under 500 m², it is inside a trade centre, and it is not a convenience store, mini-mart or supermarket (Article 22(1)).

Are Korean or US franchise brands exempt from the ENT?

South Korea, the United States, Thailand and China are not parties to CPTPP, EVFTA or UKVFTA, and Vietnam's RCEP services schedule keeps the ENT for outlets beyond the first. We found no ASEAN commitment that removes it. In May 2026 the head of the Korean business association in Vietnam said Korean retailers such as Olive Young, Emart and Lotte were still subject to the ENT (VCCI WTO Centre).

Who issues retail licences now?

The provincial People's Committee: where the company has its head office for the business licence, and where each outlet is located for that outlet's licence (Article 8).

When is a national security review needed?

When a foreign investor applies for a new outlet licence while it owns or co-owns 100+ outlets under 500 m², and/or 50+ outlets of 500 m² to under 3,000 m², and/or 30+ outlets of 3,000 m² or more. The two ministries have 14 working days (Article 8(3)(c)).

What reports must a foreign-invested retailer file?

Two a year: before 15 January for the previous calendar year and before 15 July for the first half (Article 38).

Does Decree 342 change franchise registration with MOIT?

No. Franchise registration still follows the Commercial Law 2005 and Decree 35/2006/ND-CP as amended. But Decree 342 does refer to franchising: Article 3(6) includes commercial franchising in the distribution sector, and Article 3(11) treats a same-brand outlet of another foreign-invested company as “beyond the first”.

Do restaurants and cafés need a retail outlet licence?

Not settled by the text we read. Article 3(9) defines retail as selling goods, so a dine-in food outlet may fall outside retail outlet licensing. Confirm with counsel for your format.

Sources

Tool

ENT eligibility checker

Answer six questions about your operator and outlet to see how the published rules read for you.

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