I. Legal Basis

According to the 2020 Investment Law, foreign investors who meet the conditions specified by Vietnamese law have the right to contribute capital, purchase shares, or acquire capital contributions in Vietnamese companies.
When foreign investors contribute capital, purchase shares, or acquire capital contributions in economic organizations, they must meet the conditions and follow the procedures for changing members or shareholders according to the type of economic organization.
Foreign investors can contribute capital to businesses in the following forms:

• Purchase shares in an initial public offering or additional shares issued by a joint-stock company;
• Contribute capital to a limited liability company or a partnership;
• Contribute capital to other types of businesses not specified in points a and b above.
  Foreign investors purchasing shares or capital contributions in a business can do so in the following ways:
• Purchase shares from a joint-stock company, either from the company itself or from existing shareholders;
• Purchase capital contributions from members of a limited liability company to become a member of that company;
• Purchase capital contributions from members of a partnership to become a contributing member of that partnership;
• Purchase capital contributions from members of other businesses not covered by points a, b, and c above.

II. Cases Where Foreign Investors Must Register Capital Contribution, Share Purchase, or Capital Contribution Acquisition

Foreign investors must register their capital contribution, share purchase, or capital contribution acquisition before changing members or shareholders if any of the following cases apply:

The capital contribution, share purchase, or capital contribution acquisition increases the foreign investors’ ownership ratio in an economic organization engaged in a market-access industry or activity subject to conditions for foreign investors.

The capital contribution, share purchase, or capital contribution acquisition results in the foreign investor, economic organization with foreign investors, or partnership with a majority of foreign members holding more than 50% of the charter capital of the economic organization in the following cases:

• Increasing the foreign investor’s ownership ratio from 50% or less to more than 50%;
• Increasing the foreign investor’s ownership ratio when the foreign investor already holds more than 50% of the charter capital in the economic organization.

Foreign investors contribute capital, purchase shares, or acquire capital contributions in an economic organization with land use rights certificates in islands, border communes, wards, or towns; coastal communes, wards, towns; or areas affecting national defense and security.

III. Procedures for Capital Contribution, Share Purchase, or Capital Contribution Acquisition

Step 1: Register Capital Contribution, Share Purchase, or Capital Contribution Acquisition with the Investment Registration Authority

• Documents required:

A registration document for capital contribution, share purchase, or capital contribution acquisition, including: information on the target company (name, business registration number), business sectors, the list of owners, founding members, and foreign investors (if any); the foreign investors’ ownership ratios before and after the capital contribution, share purchase, or capital contribution acquisition; estimated transaction value of the contract; information about the investment project of the company (if applicable);

A copy of legal documents of the individuals or organizations contributing capital, purchasing shares, or acquiring capital contributions, and of the company receiving foreign investment;

A letter of agreement regarding the capital contribution, share purchase, or capital contribution acquisition between the foreign investor and the company or between the foreign investor and the company’s shareholders or members;

• Procedure:

Foreign-invested companies in the situations outlined above must submit one set of documents for registration to the investment registration authority where the company is headquartered.

Within 15 days from the date of receiving valid documents, the investment registration authority will assess whether the capital contribution, share purchase, or capital contribution acquisition meets the required conditions and notify the investor. The notification will be sent to both the foreign investor and the foreign-invested company.

After receiving the notification, the foreign-invested company must complete the procedure to change members or shareholders with the business registration authority.

Step 2: Register or Notify Changes in Members or Shareholders at the Business Registration Office

Therefore, for foreign investors contributing capital, purchasing shares, or acquiring capital contributions in a Vietnamese economic organization, they must follow the registration procedure if any of the above conditions apply. If the investor is not subject to these conditions, they only need to complete the procedure to register changes in members or shareholders at the business registration authority.

IV. 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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