I. What is a direct investment capital account? 

Pursuant to Clause 5, Article 3 of Circular 06/2019/TT-NHNN, direct investment capital account is a payment account in foreign currency or Vietnamese dong issued by foreign direct investment enterprises, investors. Foreign investments opened at licensed banks to carry out transactions related to foreign direct investment activities in Vietnam according to the provisions of Article 5, Article 6 and Article 7 of the Circular 06/2019/TT-NHNN.

II. What is a foreign direct investment enterprise? 

Pursuant to Clause 2, Article 3 of Circular 06/2019/TT-NHNN, enterprises with foreign direct investment include:

• Enterprises are established in the form of investment to establish economic organizations, in which foreign investors are members or shareholders and must carry out procedures for issuance of Investment Registration Certificates according to regulations. provisions of investment law.
• Enterprises other than those specified in Point a of this Clause that have foreign investors owning 51% or more of the enterprise’s charter capital, including:

• Enterprises with foreign investors contributing capital, buying shares, or capital contributions to the enterprise (operating in industries and business investment conditions with or without conditions applicable to foreign investors) leading to foreign investors owning 51% or more of the enterprise’s charter capital.
• The enterprise is established after a split, merger, or consolidation resulting in foreign investors owning 51% or more of the enterprise’s charter capital.
• Newly established enterprises according to specialized laws.

• Project enterprises established by foreign investors to implement PPP projects in accordance with investment laws

III. Can businesses receive foreign loans into their direct investment capital accounts in foreign currency?

Borrowing foreign capital is an activity where businesses borrow capital from foreign credit institutions to serve production and business activities. Pursuant to Point h, Clause 1, Article 6 of Circular 06/2019/TT-NHNN on revenue and expenditure transactions on direct investment capital account in foreign currency. Accordingly, enterprises are allowed to carry out transfer transactions related to foreign loans of enterprises with foreign direct investment capital according to the provisions of law on borrowing and repaying foreign debt of enterprises.

However, this must comply with the following conditions:

• Purpose of using loan capital: Loan capital must be used for the right purpose as registered in the investment project.
• Loan currency: The loan currency must correspond to the currency of opening the direct investment capital account. Exceptions: In some special cases, businesses may be allowed to open additional accounts to manage loans in another currency.

To know exactly whether a business can receive foreign loans into its direct investment capital account, and what procedures need to be followed, businesses should consult with legal or accounting experts.

IV. Procedures to be followed

• Post Sign a loan with the authorities: If a business wants to receive a loan from abroad into a direct investment capital account in foreign currency, it needs to carry out loan registration procedures with a state management agency, such as the State Bank of Vietnam. or the Ministry of Planning and Investment, depending on the type and purpose of the loan.
• Bank procedures: Enterprises must open an account at a commercial bank and carry out procedures to transfer foreign currency to that account. The bank will also check and ensure that transactions fully meet foreign exchange regulations.

In conclusion, businesses can receive loans from abroad into their direct investment capital accounts in foreign currency, but must fully comply with legal regulations on foreign loans, foreign exchange management and other procedures. registration with the authorities. Properly implementing these requirements will help businesses maintain the legality of transactions and avoid future legal problems.

V. About Us, Hankuk Law Firm

■ Hankuk Law Firm – Introduction

The goal of the legal services provided by HANKUK LAW FIRM is to support businesses, investors, and people. Our organization employs skilled Korean lawyers, partners, and professionals to provide legal services to businesses related to corporations and litigation.

To support the startup process, our lawyers and staff provide a wide range of services, including business law consulting, tax and immigration law consulting, real estate services, business consulting, marketing and communications, human resources, product distribution, franchise options, etc. We provide expert advice on every aspect of your business needs.

To protect the legitimate rights and interests of our clients and achieve the best results, we provide legal advice and participate in civil lawsuits related to business, labor, marriage, family, and inheritance.

■ Contact us now

For reliable and effective legal advice, please contact HANKUK LAW FIRM now. We are committed to providing you with the best possible answers and our team of experienced lawyers has extensive knowledge in many legal fields. We are always here to provide the most competent and dedicated support, whether you are dealing with contractual issues, commercial disputes or need guidance on foreign investment. HANKUK LAW FIRM is honored to have assisted hundreds of domestic and international clients in skillfully resolving complex legal issues as their trusted legal partner. Do not let legal issues hinder your success. Let us accompany you towards legal achievement and comfort. For prompt guidance and support to ensure your rights are always maintained at the highest standards, contact HANKUK LAW FIRM now.

■ Contact Hankuk Law Firm:

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