CAPITAL REQUIREMENTS FOR ESTABLISHING FOREIGN-INVESTED EDUCATIONAL INSTITUTIONS IN VIETNAM
Vietnam’s education market, with its young population and a growing demand for high-quality learning, presents attractive opportunities for foreign investors. However, for an educational project to be successfully licensed and operated, investment capital is not merely a figure on paper; it is the foundational element that determines the project’s feasibility and long-term sustainability.
This article, based on the updated regulations in Decree 86/2018/ND-CP, Decree 15/2019/ND-CP, the Law on Investment 2020, and notably Decree 124/2024/ND-CP, provides a detailed and professional legal guide to help investors master the capital requirements for effective project implementation.
Contents
- I. MINIMUM INVESTMENT CAPITAL LEVELS BY EDUCATIONAL SECTOR
- II. OTHER LEGAL REQUIREMENTS ON INVESTMENT CAPITAL FOR ESTABLISHING EDUCATIONAL INSTITUTIONS IN VIETNAM
- III. THE CAPITAL APPRAISAL PROCESS: KEY STEPS TO UNDERSTAND
- IV. COMPREHENSIVE LEGAL SOLUTIONS FOR EDUCATION INVESTORS
- V. About Us, Hankuk Law Firm
I. MINIMUM INVESTMENT CAPITAL LEVELS BY EDUCATIONAL SECTOR
Vietnamese law stipulates a minimum investment rate calculated per student, which excludes land use costs. This is a prerequisite that all investors must meet. The table below summarizes the capital requirements in a clear and comparable format:
| Type of Educational Institution | Minimum Investment Rate (per student) | Total Minimum Investment Capital | Capital Disbursement Schedule Requirements |
| Preschool Education | VND 30 million/child | Calculated based on the projected scale | Sufficient capital must be ensured for stable operation from the opening day (including classrooms, educational toys, health and safety facilities) |
| General Education (Primary, Lower & Upper Secondary) | VND 50 million/student | VND 50 billion | – Over 50% of total capital at the time of operational appraisal.
– 100% of capital within 5 years of the license date. |
| Short-term Training | VND 20 million/student | Calculated based on the projected scale | Must prove financial capacity and have an effective capital utilization plan. |
| Higher Education | VND 1,000 billion | Over VND 500 billion (i.e., >50%) at the time of the appraisal for establishment. | |
| University Branch Campus | VND 250 billion | – Over VND 150 billion at the time of operational appraisal.
– If no new construction is involved, the capital may be 70% of the above level, but >50% of the total capital must still be disbursed at the time of appraisal. |
Important Note: All minimum investment capital levels mentioned above are exclusive of land use costs. Investors must prepare a separate financial plan for this item, particularly when implementing projects in major cities.
II. OTHER LEGAL REQUIREMENTS ON INVESTMENT CAPITAL FOR ESTABLISHING EDUCATIONAL INSTITUTIONS IN VIETNAM
In addition to meeting the minimum capital levels, investors must pay close attention to the accompanying legal obligations to ensure the project is implemented in compliance with regulations.
- Commitment to Investment Schedule: Investors must provide a written commitment to invest the full registered capital within five years from the date the license is granted. This serves as a basis for regulatory authorities to monitor the project’s quality and progress.
- Proof of Financial Capacity: The investing organization’s financial statements for the last two years are a mandatory document to demonstrate actual financial capacity.
- Lawful Capital Sources: The capital may come from equity, loans, or other legally mobilized sources. If equity is insufficient, investors must clearly present a plan and the ability to raise additional funds to execute the project.
- Note on Land Costs: The cost of leasing or purchasing land is a significant budget item and is not included in the minimum investment capital requirements stated above. Investors must create a separate financial plan for this expenditure.
III. THE CAPITAL APPRAISAL PROCESS: KEY STEPS TO UNDERSTAND
The capital appraisal process is a decisive step for a project to be licensed. Thorough preparation will help facilitate a smooth process.
- Dossier Preparation: The application dossier must be detailed and clear, including the investment project proposal, a specific capital utilization plan, financial statements, and written commitments regarding capital.
- Appraisal and Approval: The competent authority will review and assess the project’s feasibility, the investor’s financial capacity, and the adequacy of the committed capital.
- Post-Licensing Supervision: After being licensed, the investor is obligated to submit periodic reports on capital utilization progress to ensure the capital is invested for its intended purpose and to avoid unnecessary legal risks.
IV. COMPREHENSIVE LEGAL SOLUTIONS FOR EDUCATION INVESTORS
Investment capital is a vital factor determining the success of a foreign-invested educational institution in Vietnam. Ensuring adequate capital not only helps the institution operate effectively but is also a mandatory legal requirement.
To ensure a successful project, investors should:
- Clearly understand the minimum capital levels and the disbursement schedule regulations for each type of educational institution.
- Prepare a complete and persuasive dossier to demonstrate financial capacity in a transparent manner.
- Develop a detailed investment plan and commit to executing it on schedule.
Experience shows that successful investors conduct meticulous preparation of capital and implementation plans, enabling them to build high-quality educational institutions in full compliance with Vietnamese law. To navigate complex legal procedures and optimize investment plans, obtaining professional legal counsel from the very beginning is critically important.
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Should you require more detailed advice on capital conditions or comprehensive legal support for your investment project in the education sector, please do not hesitate to contact us for assistance.
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.
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