4 licenses that an alcohol trader should study before conducting this business in Vietnam

 Date: 26 August 2021

Writers: Linh Nguyen

Alcohol is a commodity on the list of conditional business goods for both domestic and foreign investors. Therefore, after completing the procedures for investment and business registration, foreign investors must also apply for alcohol business licenses. Through this article, BLawyers Vietnam would like to introduce the 4 alcohol license types required when trading alcohol with an alcohol content of 5.5 degrees or higher.

"Alcohol license"

1. What is an alcohol license?

An alcohol license is a type of license that a business must apply for before doing business in alcohol (it is a sub-license).

Alcohol licenses include the following types:

  1. Alcohol distribution license;
  2. Alcohol wholesale license;
  3. Alcohol retail license; and
  4. Selling alcohol on-the-spot consumption does not have to apply for a license but must register with the District-level competent authorities, thus we will describe underneath the process as a type of license.

2. Types of alcohol license

Investors must first determine the scope of their operations to determine what type of license they must apply for to comply with the laws. The following licenses are required when trading alcohol with an alcohol content of 5.5 degrees or higher:

2.1. Alcohol distribution license

Scope of business:

    • Importing alcohol, purchasing alcohol from domestic producers and other alcohol distributors;
    • Selling alcohol to alcohol distributors, wholesalers, retailers, and traders selling alcohol on-the-spot consumption within in the province and cities licensed;
    • Selling alcohol to traders purchasing it for export;
    • Directly retailing alcohol at the traders’ locations in the provinces and cities licensed;
    • Traders with this alcohol license type are allowed to import alcohol and are responsible for the quality and food safety of imported alcohol.

Conditions for license and operation:

    • Having an alcohol distribution system in at least 02 provinces or cities (including the area where the enterprise is headquartered);
    • In each province, there must be at least 01 business entity wholesaling the alcohol;
    • Having introduction letters from or principal contracts with alcohol producers, other alcohol distributors, or overseas alcohol suppliers.

Licensing Authority: Ministry

2.2. Alcohol wholesale license

Scope of business:

    • Purchasing alcohol from domestic producers, alcohol distributors, and other alcohol wholesalers;
    • Selling alcohol to alcohol distributors, wholesalers, retailers, and traders selling alcohol on-the-spot consumption within in the province and cities licensed;
    • Selling alcohol to traders purchasing it for export;
    • Directly retailing alcohol at the traders’ locations in the provinces and cities licensed.

Conditions for license and operation:

    • Having an alcohol distribution system in the province, where the enterprise is headquartered with at least 01 alcohol retailer.
    • Having introduction letters from or principal contracts with alcohol producers, other alcohol distributors, or overseas alcohol suppliers.

Licensing Authority: Local Department of Provincial People’s Committee

2.3. Alcohol retail license

Scope of business:

    • Purchasing alcohol from domestic producers, alcohol distributors, and other alcohol wholesalers;
    • Selling alcohol to traders selling alcohol on-the-spot consumption, or selling directly to buyers at the traders’ locations.

Conditions for license and operation:

    • Having the right to legally use fixed business premises with a clear address;
    • Having introduction letters from or principal contracts with alcohol producers, other alcohol distributors, or overseas alcohol suppliers.

Licensing Authority: Local Office of District-level People’s Committee

2.4. Selling alcohol on-the-spot consumption

Scope of business:

    • Purchasing alcohol from domestic producers, alcohol distributors, and alcohol wholesalers and alcohol retailers;
    • Selling alcohol directly to buyers for consumption at traders’ locations.

Conditions for license and operation:

    • Having the right to legally use fixed business premises with a clear address and registered for on-the-spot alcohol sale for consumption;
    • On-the-spot alcohol must be provided by traders with production, distribution, wholesale, or retail alcohol license;
    • In case the trader produces alcohol by itself for on-the-spot sale for consumption, it must obtain an industrial production license or a license for small-scale alcohol production for commercial purposes.

Licensing Authority: Local Office of District-level People’s Committee

Thus, determining the scope of operations and conditions will assist investors in thoroughly preparing and applying for the alcohol license type required before beginning operations. Since then, when making investments in Vietnam, investors should study legal compliance.

Should you have any questions about the above contents, please revert to BLawyers Vietnam at consult@blawyersvn.com. We are more than happy to hear from you!

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