Enterprise Law 2020: Regulations on transfer of ownership of contributed assets in Vietnam

Enterprise Law 2020: Regulations on transfer of ownership of contributed assets in Vietnam (Internet image)

Clause 1, Article 35 of the Law on Enterprises 2020 stipulates that transfer of contributed assets by members of a limited liability company, partners of a partnership, shareholders of a joint stock company in Vietnam shall comply with the following regulations:

- For assets whose ownership have been registered and LURs, the capital contributor shall follow procedures for transfer the ownership of such assets or the LUR to the company as prescribed by law. This transfer is exempt from registration fee;

- Contribution of assets whose ownership is not registered shall be recorded in writing unless the contribution is made by wire transfer.

Note that according to Clause 1, Article 34 of the Law on Enterprises 2020, contributed assets include VND, convertible foreign currencies, gold, land use right (LUR), intellectual property rights, technologies, technical secrets, other assets that can be converted into VND.

The contribution is considered complete once the lawful ownership of the assets has been transferred to the company.

Procedures for ownership transfer are exempt for assets serving business operation of the sole proprietorship’s owner.

In addition, Clause 5, Article 35 of the Law on Enterprises 2020 also regulates that payment for transfer of shares/stakes, receipt of dividends of remittance of profits by foreign investors shall be carried out through accounts in accordance with foreign exchange laws, except for payment in assets and cashless payment.

More details can be found in the Law on Enterprises 2020 of Vietnam, which comes into force from January 1, 2021.

Le Vy

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