Does profit overseas from outward investment have to repatriate to Vietnam?

1. Does profit overseas from outward investment have to repatriate to Vietnam?

Pursuant to Clause 1, Article 68 of the Investment Law 2020 has the following provisions:

1. Within 06 months from the date on which the tax declaration or an equivalent document is available as prescribed by the host country’s law, the investor shall repatriate the entire profit and other incomes derived from outward investment unless the profit is retained as prescribed in Article 67 of this Law.

According to Clause 1, Article 67 of the Investment Law 2020, the investor is entitled to retain profit derived from outward investment for reinvestment in the following cases:

a) Continuing to contribute outward investment capital if capital has not yet been fully contributed as registered;

b) Increasing outward investment capital;

c) Executing a new investment project overseas.

Thus, according to the above regulations, your business profits from outward investment are not required to be repatriated to Vietnam but can be used for reinvestment.

2. What are regulations on transfer of investment capital overseas in Vietnam? 

In Article 66 of the Investment Law 2020, transfer of investment capital overseas is regulated as follows:

1. An investor is allowed to transfer investment capital overseas in order to conduct investment activities if the following conditions are met:

a) The outward investment registration certificate has been granted, except for the case prescribed in Clause 3 of this Article;

b) The investment activities have been approved or licensed by a competent authority of the host country. If the host country’s law does not cover investment licensing or approval, the investor must provide documents proving their right to carry out investment activities in that country;

c) There is a capital account as prescribed in Article 65 of this Law.

2. The transfer of investment capital overseas must comply with regulations of law on foreign exchange management, export and technology transfer and relevant regulations of law.

3. Investors are entitled to transfer foreign currencies, goods, machinery and equipment overseas to serve market survey, research and market exploration and to carry out investment preparatory activities as prescribed by the Government.

According to this Article, transfer of investment capital overseas shall comply with the above provisions in Vietnam.

Best Regards!