New businesses that have just completed the company registration process will have many issues to pay attention to, one of the important but easily overlooked factors being the regulations regarding company signage.
Let Expertis help you explore these regulations to ensure your business operates efficiently and avoids legal issues.
Authorities discovered several businesses displaying company signs in violation of regulations.
Businesses without signage.
According to Article 31 of the 2020 Enterprise Law, one of the mandatory requirements for businesses is to display their name at important locations such as the head office, branches, and representative offices. Displaying company signage is an important part of showcasing identity. Furthermore, it demonstrates that each business is fulfilling its obligations and responsibilities, affirming its position and reputation in the minds of customers and partners.
Businesses display signage that does not meet regulations.
Firstly, according to Article 18 of the 2012 Advertising Law, the use of foreign languages in advertising is not a serious issue, but it must still comply with certain specific regulations.
Secondly, signs that are too small or located in obscured positions will be difficult to see. Additionally, signs that are too large can be overwhelming and pose a potential hazard if placed in crowded areas or in locations that obstruct public traffic.
Businesses display signage with missing company information.
Displaying company signage with the name and address, along with other required information, will help consumers easily identify, access, and distinguish the products and services offered by each business.
TIn summary, failure to comply with this requirement will result in administrative penalties as prescribed by law. The penalties can be quite severe and affect the business operations of enterprises, especially if the violation is detected and strictly dealt with.
Penalties for violating regulations regarding company signage.
According to Article 48 of Decree 38/2021/ND-CP, violations of regulations on signage will be subject to penalties depending on the severity and nature of the offense. Specifically:
The fine ranges from 5 million to 10 million VND: This applies to violations such as failing to display complete information on signage (name of the governing body, name of the production/business establishment, address, and telephone number) or using signage that does not comply with regulations.
The fine ranges from 10 million to 15 million VND: This applies to actions such as incorrectly or incompletely writing the name in Vietnamese on the sign; writing only in a foreign language without any Vietnamese text; displaying proper names, abbreviations, or international trade names in a foreign language above the name in Vietnamese; or the height of the vertical sign exceeding the height of the building floor where the sign is placed.
The fine ranges from 15 million to 20 million VND: This applies to actions such as hanging, erecting, placing, or attaching signs that obstruct escape routes or fire exits; encroaching on sidewalks or roadways, affecting public traffic; or detracting from the aesthetics of the area.
In addition to finesRemedial measures are also applied, including being forced to remove the offending sign or A more serious consequence is having your tax identification number blocked.
It is important to note that, according to Article 5 of Decree 38/2021/ND-CP, the maximum fine for an administrative violation can be up to 20 million VND for individuals and 40 million VND for organizations. The application of the fine also depends on the authority of the officials authorized to impose the penalty.
View more: Cases of tax identification number suspension and how to avoid tax identification number suspension.
Comply with company signage regulations.
Sign placement and size
The placement of signs must not obstruct emergency exits or fire escapes, nor must they encroach on sidewalks or roadways, or affect public traffic.
Signage may only be written and placed near the gate or front of the headquarters or business premises of organizations or individuals. Each agency or organization may only place one sign at the gate. At headquarters or business premises independent from other organizations or individuals, only one horizontal sign and no more than two vertical signs may be placed.
For horizontal signs, the maximum height is 2 meters and the length must not exceed the width of the building's facade.
For vertical signs, the maximum width is 1 meter and the maximum height is 4 meters, but it must not exceed the height of the building floor where the sign is placed.
Aesthetics and lettering of signage
Name of the direct supervisory agency (if any).
The full name in Vietnamese must match the establishment decision or business registration certificate issued by the competent authority.
Type of business or cooperative.
Main business activities and fields of operation (for establishments producing and trading goods and services).
Business address, phone number (if any).
The logo must be registered with the competent authority, its area must not exceed 20% of the signboard area, and it must not display any advertising information or images for any type of goods or services.
Using a foreign language to write signs.
According to Clause 1 of Article 18 of the 2012 Advertising Law, signs may use foreign languages in the following cases:
- Trademarks, slogans, brands, proper names in foreign languages, or internationally recognized terms cannot be replaced with Vietnamese words.
- Books, newspapers, websites, and publications permitted to be published in Vietnamese ethnic minority languages and foreign languages; radio and television programs in Vietnamese ethnic minority languages and foreign languages.
Although the 2012 Advertising Act provided a legal framework for the use of foreign languages in advertising, its implementation is not always easy. Controversies or mistranslations can arise, potentially leading to misunderstandings about products or services.
It is important to ensure that the message on the sign is understandable and accurately reflects the nature of the product or service being offered.
Therefore, managing and using language in advertising, especially when using foreign languages, requires careful consideration and a deep understanding of legal regulations.
Types of signage
The writing, placement, hanging, pasting, erection, and installation of signs at the headquarters or business premises of organizations and individuals in the form of boards, signs, light boxes, neon sign systems, or other forms to introduce the name and business address of Vietnamese organizations and individuals, or foreign organizations and individuals in Vietnam, does not require permission but must comply with the regulations in Article 23 – Decree 103/2009/ND-CP.
Write, put up signs
The name of the direct governing body written on the sign is the superior agency that directly decides on the organization, personnel, budget, or resolves issues related to the regulations and policies for the agency or organization that writes or displays the sign. For example, the Ministry of Culture, Sports and Tourism is the direct governing body of the Culture Newspaper; the People's Committee of Hanoi is the direct governing body of the Hanoi Department of Education and Training; Hanoi National University is the direct governing body of the University of Social Sciences and Humanities; and Corporation X is the direct governing body of Company Y.
The state management agency is not the direct supervisory body of law firms, private enterprises, or certain other types of companies.
Business name on the sign
The Vietnamese name of a business consists of two components in the following order: Business type and Proper name.
The type of business is written as "limited liability company" or "LLC" for limited liability companies; "joint-stock company" or "JSC" for joint-stock companies; "partnership company" or "HD company" for partnership companies; "private enterprise", "DNTN" or "TN enterprise" for private enterprises.
Proper names are written using letters from the Vietnamese alphabet, the letters F, J, Z, W, numbers, and symbols.
The business name must be displayed at the head office, branches, representative offices, and business locations of the enterprise. The business name must be printed or written on transaction documents, records, and publications issued by the enterprise.
Based on the provisions of this Article and Articles 38, 39, and 41 of this Law, the Business Registration Authority has the right to refuse to approve the proposed business name.
Expertis is always ready to answer any unclear questions or provide legal assistance. Please contact our consulting department for answers in accordance with the law.