For investment and doing business in Vietnam, investors can directly establish a business organization or making investment by contributing capital, purchasing shares or purchasing capital contributions in an existing local enterprise.

FORMS OF INVESTMENT IN VIETNAM

1. Investment in establishment of a business organization.
2. Investment in the form of capital contribution or purchase of shares or stakes.
3. Execution of an investment project.
4. Investment in the form of a business cooperation contract.

In which, establishment of a business organization and making investment by contributing capital, purchasing shares or purchasing capital contributions are the most common options of foreign investors.

INVESTMENT IN ESTABLISHMENT OF A BUSINESS ORGANIZATION IN VIETNAM

1. Every investor shall establish a business organization in accordance with the following regulations:

1. A domestic investor shall establish a business organization in accordance with regulations of law on enterprises and law corresponding to each type of business organization;
2. A foreign investor that establishes a business organization shall satisfy market access conditions applied to foreign investors specified by law;
3. Before establishing a business organization, the foreign investor must have an investment project and follow the procedures for issuance or adjustment of an investment registration certificate, except for establishment of a small and medium-sized start-up enterprise and a startup investment fund in accordance with regulations of the Law on Small and Medium-sized Enterprises.

2. From the date on which the enterprise registration certificate or an equivalent document is issued, the business organization established by a foreign investor shall be the investor that executes the investment project set out in the investment registration certificate.

3. When establishing a business organization, when making investment by contributing capital, purchasing shares or purchasing stakes of a business organization or when making investment under a business cooperation contract in one of the following cases, the foreign investor must satisfy the conditions and follow investment procedures applied to foreign investors:

1. Over 50% of its charter capital or more is held by a foreign investor(s) or the majority of the general partners are foreigners if the business organization is a partnership;
2. Over 50% of its charter capital or more is held by a business organization(s) mentioned in Point a above;
3. Over 50% of its charter capital or more is held by a foreign investor(s) and a business organization(s) mentioned in Point a above.

4.  Business organizations other than those mentioned in Points a, b and c above shall satisfy conditions and follow investment procedures applied to domestic investors when establishing a business organization, when making investment by contributing capital, purchasing shares or purchasing stakes of a business organization or when making investment under a business cooperation contract.

5.  If a foreign-invested business organization that is established in Vietnam has a new investment project, procedures for executing such investment project shall be followed without having to establish a new business organization.

INVESTMENT IN VIETNAM BY MAKING INVESTMENT BY CONTRIBUTING CAPITAL, PURCHASING SHARES OR PURCHASING CAPITAL CONTRIBUTIONS

1. Investors are entitled to contribute capital, purchase shares or purchase stakes of business organizations.

2. Foreign investors making investment by contributing capital, purchasing shares and purchasing stakes of business organizations must:

1. Satisfy market access conditions applied to foreign investors as prescribed by law;
2. Ensure national defense and security as prescribed by law;
3. Comply with regulations of the law on land and conditions for receipt of land use rights and conditions for use of land on islands or border or coastal communes.

FORMS OF CAPITAL CONTRIBUTION OR PURCHASE OF SHARES OR STAKES

1. A foreign investor may contribute capital to a business organization in the following forms:

1. Purchase of shares of joint-stock companies through the initial public or additional issuance;
2. Contribution of capital to limited liability companies and partnerships;
3. Contribution of capital to other business organizations.

2. A foreign investor may purchase shares or stakes of a business organization in the following forms:

1. Purchase of shares in a joint-stock company from such company or its shareholders;
2. Purchase of stakes of members of a limited liability company to become a member of such limited liability company;
3. Purchase of stakes of a capital contributing member of a partnership to become a capital contributing member of such partnership;
4. Purchase of stakes of members of other economic entities.

PROCEDURES FOR MAKING INVESTMENT BY CONTRIBUTING CAPITAL, PURCHASING SHARES OR PURCHASING STAKES

1. Upon contributing capital, purchasing shares or purchasing stakes of a business organization, the investor shall satisfy conditions and follow procedures for change of members or shareholders in accordance with regulations of law applicable to each type of business organization.

2. A foreign investor shall follow procedures for registration of capital contribution or purchase of shares or stakes of a business organization prior to change of members or shareholders in one of the following cases:

1. The capital contribution or purchase of shares or stakes increases the ownership ratio by foreign investors in a business organization conducting business in the restricted business lines;
2. The capital contribution or purchase of shares or stakes results in a foreign investor or business organization holding over 50% of the charter capital of the business organization in the following cases: The holding of charter capital by the foreign investor is increased from less than or equal to 50% to over 50%; the holding of charter capital by the foreign investor is increased while such foreign investor is holding over 50% of the charter capital of the business organization.
3. The foreign investor that contributes capital, purchases shares or stakes of a business organization has a certificate of rights to use land on an island or in a border or coastal commune; in a coastal commune; in another area that affects national defense and security.

3. Investors other than those mentioned above shall follow procedures for changing shareholders/members as prescribed by law when contributing capital, purchasing shares or stakes of business organizations. 

Read more:

• Guidelines on choosing of industrial parks in Vietnam
• Tax and investment incentives | Industrial parks and economic zones in Vietnam
• Doing business in Vietnam – register a company
• Business operation in Vietnam: manage the mandatory compliance procedures
• Doing business in Vietnam – how to name the company
• Trademark protection in Vietnam – frequently asked questions
• Company in Vietnam – lawful cash-flows and required compliances
• Legal documents review & completion for business in Vietnam
• Account for payment, withdrawals capital of foreigners who invest directly in Vietnam – what you need to know
• Re-purchase or transfer of stakes, increasing or decreasing charter capital – multi-member limited liability companies
• Capital contribution for establishment of a company – what you need to know
• How to remit profits from Vietnam to home country – what foreign investors need to know
• Profits remittance abroad – FDI company in Vietnam
• Value-added tax 0%
• Investment in Vietnam – market entry procedures
• Investment in Vietnam – restructuring – acquiring and selling a company
• Investment in Vietnam – how to buy or sell a company
• FDI companies in Vietnam – managing the required compliance procedures