Dossier for capital contribution of foreigners to companies in Vietnam

DangKhoi August 25, 2021

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Posts : Dossier for capital contribution of foreigners to companies in Vietnam In the section LSX Lawfirm

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The following article will provide you with information about the dossier for capital contribution of foreigners to a company in Vietnam.

Nowadays, the establishment of businesses is popular. Foreign investors have many ways to invest in Vietnam. Accordingly, the contribution of capital to companies in Vietnam has received more and more attention. So the question is, how does the law stipulate procedures and documents for registration of capital contribution to companies in Vietnam for foreigners? Let’s find out in this article with LSX Law firm.

Legal Ground

Enterprise Law 2020

What is capital contribution?

So, Capital contribution is the contribution of assets to form the charter capital of the company. This capital contribution is made when establishing a new enterprise, or when contributing additional charter capital to the established enterprise.

Also, Assets contributed as capital to the company in Vietnam are Vietnam Dong, freely convertible foreign currency, gold, land use rights, Intellectual property rights, technology, Technical know-how, other assets that can be valued in Vietnam Dong.

Additionally, Only individuals and organizations are lawful owners; or have the lawful use right of the property, can use such property to contribute capital in accordance with the provisions of law.

Conditions for capital contribution

Foreign investors’ capital contribution to companies in Vietnam must meet the following regulations and conditions:

a) Conditions on market access for foreign investors;

b) Ensuring national defense and security as prescribed by law;

c) Regulations of the law on land on the conditions for receiving; land use rights, land use conditions in islands, communes, wards, border towns, communes, wards, and coastal towns.

When meeting the above conditions, foreign investors can prepare a dossier of registration of capital contribution to a company in Vietnam. Or contact Law firm X for the most complete support and advice.

Forms of capital contribution

Article 23 of the Investment Law 2020 stipulates that an investor may contribute capital to a company in Vietnam in the following forms:

a) Buy shares issued for the first time or additionally issued shares of joint-stock companies;

b) Contributing capital to a limited liability company or a partnership;

c) Contributing capital to other economic organizations other than those specified at Points a and b of this Clause.

Why it is necessary to prepare a dossier for capital contribution to a company in Vietnam

In Clause 2, Article 26 of the Investment Law 2020 stipulates that Foreign investors need to carry out the procedures for capital contribution to a company in Vietnam. Therefore, it is necessary to prepare a dossier for capital contribution to a company in Vietnam; before changing members, shareholders if they fall into one of the following cases:

a) The capital contribution increases the foreign investors’ ownership ratio in the industry company; occupations with conditional market access for foreign investors;

b) Capital contribution leads to foreign investors; economic organizations specified at Points a, b and c, Clause 1, Article 23 of the Law on Investment 2020; holding more than 50% of the company’s charter capital in the following cases:

Increasing the percentage of foreign investors owning charter capital; from less than or equal to 50% to above 50%;
Increase the rate of ownership of charter capital of foreign investors; when foreign investors already own more than 50% of the charter capital in the company;

c) Foreign investors contribute capital to companies with certificates of land use rights in islands and communes; Ward; border town; coastal communes, wards, and towns; other areas affecting national defense and security.

Dossier for capital contribution to a company in Vietnam

The company that has a foreign investor making capital contribution to a company in Vietnam fall into the case specified in Clause 2, Article 26 of the Law on Investment. They must submit 01 application to the investment registration agency where the economic organization’s head office is located. A dossier includes:

a) A written registration of capital contribution, including the following contents:

Information on business registration of the economic organization to which the foreign investor intends to contribute capital
List of owners, members, founding shareholders, list of owners, members, shareholders being foreign investors (if any);
Rate of ownership of charter capital of foreign investors first; after contributing capital to the company;
Expected transaction value of capital contribution contract;
Information on investment projects of economic organizations (if any);

b) Copies of legal papers of individuals, organizations contributing capital and companies to which foreign investors contribute capital;

c) Written agreement on capital contribution; between foreign investors and companies in which foreign investors contribute capital; or between a foreign investor and a shareholder or member of that company;

d) A copy of the certificate of land use rights of the economic organization in which foreign investors contribute capital to the company in Vietnam.

Hope this article is useful for you, If you need any further information, please contact LSX Law Firm: 0833102102

Frequently Asked Questions

so, where is the application for registration of capital contribution to a company in Vietnam submitted?

A company with a foreign investor contributing capital to a company in Vietnam shall submit 01 application for registration of capital contribution to a company in Vietnam to the investment registration agency where the economic organization’s head office is located.

so, what forms of capital contribution are there in Vietnam?

So, According to the Investment Law 2020, there are 3 forms as follows:

a) Buying shares issued for the first time or additionally issued shares of a joint-stock company;

b) Contributing capital to limited liability companies or partnerships;

c) Contribute capital to other economic organizations that do not fall into the above two cases.

so, what is the procedure for changing members when contributing capital to the company?

After the foreign investor is approved to contribute capital, the procedures for changing members and shareholders will be carried out at the business registration office in accordance with the law on enterprises and other laws corresponding to the law on enterprises. each type of economic organization.