1. Legal basis for regulation

The establishment of foreign-invested enterprises operating in the field of buying and selling airline tickets in Vietnam is regulated by the following legal documents and international commitments:

• Vietnam's commitments on trade in services in the World Trade Organization (WTO);
• Investment Law 2020;
• Law on Enterprises 2020;
• Commercial Law 2005, especially Article 166 on commercial agency;
• Specialized regulations of the Ministry of Transport and the Civil Aviation Authority of Vietnam related to airline ticket distribution activities.

2. Ability to establish a 100% foreign-owned enterprise in the field of airline ticket sales

According to Vietnam's WTO Commitments, airline ticket sales services are not included in the list of industries with limited market access for foreign investors. Specifically, in the distribution services sector, airline ticket sales services are classified into the group of commercial services that are allowed to access without any restrictions on the capital contribution ratio of foreign investors.

This means that foreign investors can establish businesses in Vietnam in the following forms:

• 100% foreign-owned enterprise;
• Joint Venture Company (JVC);
• Business Cooperation Contract (BCC).

The choice of business form depends on the needs, cooperation capabilities, investment scale and business strategy of the investor.

3. Conditions for operating as an airline ticket agent

Airline ticket agency activities are a form of commercial agency as prescribed in Article 166 of the 2005 Commercial Law, accordingly:

“Commercial agency is the activity of a trader receiving goods from the principal to sell or providing services of the principal to customers and receiving remuneration according to the agreement.”

In the aviation sector, businesses that want to become airline ticket agents must sign contracts with:

• Directly from airlines (such as Vietnam Airlines, Vietjet, Bamboo Airways...); or
• Level 1 agent authorized by the airline.

Note: The ticket supplier for the agent must be the airline or an agent officially authorized by the airline, to ensure legality and transparency in ticket distribution activities.

4. Recommendations for foreign investors

Although Vietnamese law and WTO commitments allow the establishment of 100% foreign-owned enterprises in the field of airline ticket trading, investors still need to pay attention to the following:

• Register suitable business lines such as: travel agency, airline ticket agency, air transport support services...
• Sign a valid agency contract with a partner in the aviation industry (airline or level 1 agent);
• Comply with specialized management regulations, especially on standards of facilities, personnel, and professional certificates if any;
• Fully carry out procedures for applying for an Investment Registration Certificate and registering for business establishment at a competent state agency.

5. Conclusion​

The establishment of a 100% foreign-invested airline ticket trading company in Vietnam is completely in accordance with domestic law and Vietnam's international commitments. However, to ensure that business activities run smoothly and legally, investors need to complete all legal procedures and establish an official cooperative relationship with a legal airline ticket supplier.

This article is for reference only, not intended as advice. If you need advice, please contact us via email: info@barrso.com