Procedure For A Foreign Investor To Contribute Capital Or Purchase Share In Vietnam

Phuoc Nguyen Huu

4 years ago

procedure-for-a-foreign-investor-to-contribute-capital-or-purchase-share-in-vietnam

Been together with the current open economy. It is not uncommon for foreign investors to contribute capital and buy shares in Vietnamese enterprises. But not all investors understand to prepare the necessary procedures for these projects. In order to solve the above problem. Phuoc & Partners publishes this article with the desire to answer questions as well as express clearly the necessary procedures for foreign investment who have capital contribution and share purchase in Vietnam.

1. Conditions for a foreign investor to contribute capital or purchase share

A foreign investor to contribute capital or purchase share in an economic institution established in Vietnam must satisfy requirements on equity capital ratio of such economic institution, investment form, scope of activity, Vietnamese partner in investment and other conditions as provided for in international treaties to which Vietnam is a member.

2. Procedure for a foreign investor to contribute capital or purchase share

A foreign investor to contribute capital or purchase share in an economic institution in one of following circumstances (1) a business line of the economic institution is conditional for a foreign investor; or (2) the charter capital held by a foreign investor is increased from less than 51% to 51% or more; or the charter capital held by a foreign investor is increased while such foreign investor is holding 51% charter capital or more of such business organization shall be required to carry out procedures of a foreign investor to contribute capital or purchase share as follow:

A foreign investor to contribute capital or purchase share shall submit 01 registration dossier for capital contribution or purchase of shares, capital contribution portion to the Department of Planning and Investment of the province where the economic institution’s headquarters is located, the dossier includes^[1]:
A registration form for capital contribution or purchase of shares, capital contributions portion, which specify information about the economic institution in which the investor to contribute capital or purchase share; the ratio of charter capital ownership of the investor to contribute capital or purchase share in the economic institution after investment;
A copy of the ID card or passport (if the foreign investor to contribute capital or purchase share is an individual); a copy of the Certificate of incorporation or other equivalent document certifying the legal status of the investor (if the foreign investor to contribute capital or purchase share is an organization).
Within 15 days from the date of receipt of a valid dossier, the local Department of Planning and Investment shall assess the satisfaction of investment condition by the foreign investor to contribute capital or purchase share and send a notification of approval or refusal to a foreign investor to contribute capital or purchase share;
After receiving the notification of approval, the economic institution invested by a foreign investor to contribute capital or purchase share shall conduct procedure for registration of change of member or shareholder at the Business Registration Authority in accordance with legal provisions on enterprises and other legal regulations corresponding to its type of economic institution.
The economic institution invested by a foreign investor to contribute capital or purchase share in the economic institution shall not be required to carry out procedures for issuance or amendment of an Investment Registration Certificate, or decision on investment policy for investment projects conducted prior to the time where the foreign investor to contribute capital or purchase share or capital contribution portion.

If a foreign investor to contribute capital or purchase share does not fall into cases above, it will just carry out procedure for registration of change of members/shareholders at the Business Registration Authority as stated at section 2.3.

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If you face difficulties with procedure for a foreign investor to contribute capital or purchase share, please contact us: Phuoc & Partners is a professional consulting firm established in Vietnam and currently has nearly 100 members working in three offices in Ho Chi Minh City, Hanoi and Danang. Phuoc & Partners is also rated as one of the leading consulting firms specializing in business law in Vietnam that has leading practice areas in the legal market such as Labour and Employment, Taxation, Merger and Acquisition, Litigation. We are confident in providing customers with optimal and effective legal service.

[1] Clause 2, Article 26, Law on Investment 2014

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