Vietnam: Investment conditions applied to foreign investors from December 27, 2015

According to Vietnam’s regulations, investment conditions applied to foreign investors are conditions that foreign investors must satisfy before making investment in the business lines subject to conditions applied to foreign investors specified in relevant Laws, Ordinances, Decrees, and international agreements on investment.

Investment conditions applied to foreign investors are applied in the following cases: Investment in establishment of a business organization; Investment in the form of capital contribution, purchase of shares/stakes in a business organization; Investment in the form of a business cooperation contract; Receipt of an investment project; Change or addition of business lines of a foreign-invested business organization.

According to Article 10 of Decree No. 118/2015/NĐ-CP of Vietnam’s Government, investment conditions applied to foreign investors include:

a) Ratio of the foreign investor’s charter capital in a business organization;

b) Investment method;

d) Scope of investment;

d) Vietnamese partners participating in the investment;

dd) Other conditions specified in Laws, Ordinances, Decree, and international agreements on investment.

Rules for applying investment conditions to foreign investors are specified as follows:

- A foreign investor that makes investment in various business lines must fulfill all conditions applied to these business lines;

- A foreign investor that is regulated by international agreements on investment that provide for different investment conditions may apply the investment conditions provided for in one of such international agreements and must fulfill the foreign investor’s rights and obligations under the selected international agreement;

- With regard to sectors and sub-sectors excluded from commitments or not specified in Vietnam’s WTO Schedule of commitments and other international agreements on investment, if investment conditions applied to foreign investors are already provided for in Vietnam’s law, such Vietnam’s law shall apply;

- Where a foreign investor in a territory that is not a WTO member makes investment in Vietnam, such investor shall apply the same investment conditions as investors in WTO members, unless otherwise prescribed by law and international agreements between Vietnam and such WTO members;

- With regard to sectors and sub-sectors excluded from commitments or not specified in Vietnam’s WTO Schedule of commitments and other international agreements on investment, if investment conditions applied to foreign investors are also not provided for in Vietnam’s law, the investment registration authority shall consult with the Ministry of Planning and Investment and relevant Ministries;

- Where a foreign investor permitted to make investment in the service sectors and sub-sectors specified in Point dd of this Clause and they have been posted on National Foreign Investment Web Portal specified in Article 13 of Decree No. 118/2015/NĐ-CP, the investment registration authority shall consider deciding foreign investors’ investment in the same business lines without consulting with Ministries.

View more details at Decree No. 118/2015/NĐ-CP of Vietnam’s Government, effective from December 27, 2015.

Thu Ba

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