Law firm DHP sends its readers a summary of regulations on foreign investors contributing capital to purchase shares and capital contributions to enterprises in Vietnam as follows:
Forms of capital contribution, share purchase, purchase of capital contributions from foreign investors
- Buy shares issued for the first time or additionally issued shares of a joint-stock company;
- Contribute capital to limited liability companies, partnerships;
- Buying shares of a joint stock company from the company or shareholders;
- Purchase of capital contributions of members of a limited liability company to become a member of a limited liability company;
- Purchase capital contributions of capital-contributing members in a partnership to become a capital-contributing member of a partnership;
Cases of foreign investors contributing capital, buying shares, buying capital contributions of Vietnamese companies
Case 1: In case foreign investors contribute capital, purchase contributed capital, purchase shares of less than 51% in enterprises in Vietnam, invest in business lines without conditions.
Investors make capital contribution/transfer, declare income tax from transfer (if any)
Enterprises only need to carry out the procedure to change the Certificate of Business Registration
Dossier to prepare
- Notice of change of business registration contents;
- Decision on the change of the company;
- Minutes of the meeting on the change of the company;
- The transfer contract and documents certifying that the transfer has been completed, certified by the legal representative of the company;
- List of capital contributors or list of foreign shareholders;
- Notarized copy of passport/Certificate of business registration of the investor.
- Authorization letter (in case of authorizing another person to submit the application)
Procedure Foreign investors contribute capital, purchase shares, purchase capital contributions to Vietnamese companies with less than 51% of the charter capital of enterprises in Vietnam, invest in business lines without conditions.
Enterprises submit dossiers at the Business Registration Office
Within 03 working days from the date of receipt of a valid application, the business registration authority shall issue a new business registration certificate to the enterprise.
Case 2: In case foreign investors contribute capital, purchase contributed capital, purchase shares, invest in business in conditional lines or in case foreign investors contribute capital, purchase shares, purchase contributed capital to Vietnamese companies, leading to foreign investors holding more than 51% of charter capital.
Procedure steps:
Step 1: Register for capital contribution, purchase of contributed capital, and purchase of shares in a Vietnamese enterprise at the Investment Registration Authority
Procedures for registration of capital contribution, purchase of contributed capital, purchase of shares by foreign investors in Vietnamese enterprises
Prepared profile
- A written registration for capital contribution, share purchase or capital contribution, including the following contents: information about the economic organization to which the foreign investor intends to contribute capital, purchase shares or capital contribution; rate of ownership of charter capital of foreign investors after capital contribution, purchase of shares or capital contribution to economic organizations;
- A copy of the identity card, identity card or passport for the investor being an individual; copy of Certificate of Incorporation or other equivalent document certifying legal status for investor being an organization.
Implementation procedure:
Foreign investors submit documents at the Business Registration Office
Within 15 working days after receiving a valid application, the Business Registration Authority shall issue a Notice of satisfaction of conditions for capital contribution, share purchase, contributed capital and Vietnamese enterprises.
Step 2: Foreign investors make capital contribution, purchase shares, contributed capital and Vietnamese enterprises.
In case a foreign investor contributes more than 51% of capital, the Vietnamese company opens a direct investment capital account. Investors make capital contribution and transfer capital through direct investment capital account.
The members and shareholders transferring capital shall declare tax upon transfer in accordance with the law on personal income tax and corporate income tax (if any).
Step 3: Change the business registration certificate to add foreigners in the business registration file submitted at the Business Registration Office – Department of Planning and Investment (Sequence and procedures are similar to case 1 as above).
