Is it Allowed to Contribute Capital in Cash?

Thu Ky Luat would like to address your query as follows:

Not only individuals but also organizations are permitted by law to contribute capital, purchase shares, and invest in capital contributions in joint-stock companies, limited liability companies, and partnerships as regulated by the Law on Enterprises 2014, except for the following cases:

- State agencies and people's armed forces units using state assets to contribute capital to enterprises for their own profit.- Entities not allowed to contribute capital to enterprises as prescribed by the law on officials.- General partners are not permitted to contribute capital to establish a private enterprise unless agreed upon by all remaining members.- Private enterprises are not entitled to contribute capital to establish or purchase shares, or invest in capital contributions in partnerships, limited liability companies, or joint-stock companies.

Therefore, enterprises are entirely allowed to contribute capital to other enterprises if they do not fall into the prohibited cases. However, the law strictly prohibits enterprises from using cash (paper money, coins issued by the State Bank) to settle transactions when contributing capital, buying, or transferring capital contributions into other enterprises (based on Clause 1, Article 3 of Circular 09/2015/TT-BTC).

The current law only permits capital contribution between enterprises through the following methods:

- Payment by cheque;- Payment by authorization for credit transfer;- Other lawful non-cash payment methods in accordance with current regulations.

Thus, should your enterprise wish to contribute capital to another enterprise, it cannot use cash but must employ the aforementioned methods. Additionally, the participating enterprise must not fall into any of the prohibited cases mentioned above.

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