Procedures for investment capital contribution in Vietnam

by HaTrang

The State treats investors equally; adopt policies to encourage and create favorable conditions for investors to conduct business investment activities and to develop sustainably economic sectors. One of the most popular forms of investment in Vietnam for foreign investors is: Capital contribution; share purchase; purchase of capital contribution to an enterprise. Let’s find out procedures for investment capital contribution in Vietnam with LSX Law firm in the following article.

Legal grounds

Enterprise law 2020

Investment law 2020

Decree 31/2021/ND-CP guiding the Law on Investment

Decree No. 01/2021/ND-CP guiding the Enterprise Law

Procedures for foreign investors to register for capital contribution, purchase of shares or capital contribution to a company with 100% Vietnamese capital

Step 1: Investors submit dossier at the Investment Department – Department of Planning and Investment; and carry out procedures for registration of capital contribution; purchase of shares, capital contribution to the Company with 100% capital. Vietnam.
In case the capital contribution, share purchase, capital contribution portion of foreign investors meets the conditions, the Department of Planning and Investment will notify in writing within 15 days from the date of receipt of complete dossiers for public approval. The company carries out procedures for changing shareholders and members accordingly the law. In case the capital contribution, share purchase, capital contribution portion of foreign investors do not met conditions; the Department of Planning and Investment shall notify in writing the investor and clearly state the reason.

Step 2: After obtaining the approval of the Investment Department – Department of Planning and Investment on the approval of foreign investors to contribute capital; purchase shares; and contributed capital; investors carry out the following procedures: If buying from 51% capital of a Vietnamese company, open a direct investment capital account for a Vietnamese company; then the foreign investor makes a capital contribution and declares transfer income tax.

Step 3: Afterwards, the company in which the investor purchases contributed capital and shares will carry out the procedures for changing shareholders and members on the Business Registration Certificate (Certificate of Business Registration); accordingly regulations at the Business Registration Office – Department of Planning and Investment.

Procedures for foreign investors to register for capital contribution, purchase of shares or capital contribution to a foreign-invested company in Vietnam

Investors submit dossiers at the Department of Planning and Investment and carry out procedures for registration of capital contribution; purchase of shares; and capital contribution to the company with investment capital.

After obtaining the approval of the Investment Department – Department of Planning and Investment on the approval of foreign investors to contribute capital, buy shares, and contribute capital.

Afterwards obtaining the approval of the Investment Division – Department of Planning and Investment on the approval of foreign investors to contribute capital, purchase shares, and contributed capital; investors carry out the following procedures: If buying from 51% capital of a Vietnamese company; opening a direct investment capital account for a Vietnamese company; then the foreign investor makes a capital contribution and declares transfer income tax.

After or concurrently with the procedure for changing the business registration, the company changes the Investment Registration Certificate to recognize the new foreign investor.

The payment of capital contribution by foreign investors to Vietnamese companies

Pursuant to Circular No. 06/2019/TT-NHNN of the State Bank of Vietnam; the payment for investment capital transfer transactions; in foreign direct-invested enterprises must be made through financial accounts.

Therefore, when a foreign investor contributes capital, a Vietnamese company must open a foreign direct investment capital account at a bank in Vietnam in Vietnamese Dong or in a foreign currency depending on the currency used to contribute capital to the business.

Lastly, customers wish to learn the laws and regulations related to the Procedures for investment capital contribution in Vietnam, please contact LSX Law Firm for the fastest support: 0833102102

Related questions

Are there any restrictions for foreign investors when investing in Vietnam? 

Investors are required to meet the investment conditions of WTO commitment;, international treaties on investment that Vietnam has signed or acceded to and domestic laws.

What is the maximum ownership ratio of foreign investors in Vietnamese companies?

Restrictions on the percentage of capital contribution are set for some specific conditional occupations that investors intend to register. 
In addition, there are still popular industries with unlimited capital contribution to encourage investment.

Are foreign investors’ nationality restricted when contributing capital in Vietnamese companies?

Currently, investor nationality is no longer restricted from receiving investment; except for a few nationalities who are not allowed to receive investment because it affects national defense; security; politics and social order…

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