Representative Office vs. Company

A representative office is an entity that can be registered in Laos by a foreign company. Unlike companies, representative offices are not allowed to conduct any revenue-generating activities and are typically established to:

1. Collect information with respect to business, trade and investment in Laos; and
2. Coordinate with local businesses and the Government of Lao PDR.

In addition, there is a distinct category of representative offices registered to carry out concession activities under a memorandum of understanding (MOU) or an agreement with the Government of Lao PDR, e.g., to implement investments in energy projects.

Consequently, a representative office is not required to obtain an operating licence, whereas, a company generally needs one to conduct its intended business activities in Laos. Some foreign investors may consider the establishment of a representative office as a preparatory step before registering a company in Laos. A representative office in Laos is entitled to lease an office space, hire foreign and Lao employees and needs to pay personal income tax on behalf of its employees. Generally, the Representative Office Certificate is valid for one year and can be renewed for a one-year period twice. A foreign company wishing to establish a representative office in Laos needs to be registered in its domestic jurisdiction for no less than two years. In principle, the Representative Office Certificate in relation to a representative office carrying out concession activities is renewable until the approved project has been completed.

Key differences between a company and a representative office in Laos are pointed out in the table below:

‍

Application for Representative Office Certificate

Below, we outlined main steps of the representative office registration in Laos:

1. Apply for the Representative Office Certificate;
2. Apply for the Tax Identification Number;
3. Open a Bank Account in Laos;
4. Import Registered Capital and Apply for the Capital Importation Certificate;
5. Apply for Representative Office Seal and Representative Office Seal Approval.

The usual timeframe for obtaining the Representative Office Certificate is approximately two to four weeks from the date of filing a completed application with the Ministry of Planning and Investment (MPI).

The Representative Office Certificate is a document certifying that the representative office is properly registered in Laos. It outlines essential information including permitted activities and a name of the head of a representative office. The following documents will need to be prepared to support an application for the Representative Office Certificate:

1. Power of attorney to appoint a representative to submit the application to register the representative office on your behalf (in case you hire a legal adviser to assist);
2. Application form for the establishment of the representative office;
3. Articles of Association of the representative office;
4. Board of Directors’ or Shareholders’ Resolution of the parent company approving the proposed representative office registration and appointing the head of the representative office;
5. Business profile and latest financial statement of the parent company;
6. A copy of the parent company’s registration certificate;
7. Passport copy and CV of the proposed head of the representative office; and
8. Other documents as requested by authorities.

Other Steps

In addition to the Representative Office Certificate, a representative office will need to obtain the Representative Office Seal and the Representative Office Seal Approval from the Ministry of Public Security.

Within 30 days of the Representative Office Certificate has been obtained, the representative office is required to apply to the Ministry of Finance to obtain a tax identification number.

The representative office is also required to open a bank account in Laos and import its registered capital within 60 days of the Representative Office Certificate has been issued. In addition, the representative office needs to apply to the Bank of Lao PDR to obtain the Capital Importation Certificate.