Vietnam: 07 Contents of a business cooperation contract (BCC)

Vietnam: 07 Contents of a business cooperation contract (BCC) (Internet image)

1. What is a business cooperation contract (BCC)?

According to Clause 14, Article 3 of the Law on Investment 2020, business cooperation contract (BCC) means a contract between investors for business cooperation and distribution of profits or products without establishment of a business organization.

2. 07 Contents of a business cooperation contract

- A business cooperation contract shall contain at least:

+ Names, addresses and authorized representatives of parties to the contract; business address or project address;

+ Objectives and scope of business;

+ Contributions by the parties to the contract, and distribution of business investment results between the parties;

+ Schedule and duration of the contract;

+ Rights and obligations of parties to the contract;

+ Adjustment, transfer and termination of the contract;

+ Responsibilities for breaches of the contract; method of dispute settlement.

- During the execution of a business cooperation contract, parties may reach an agreement on using assets derived from the business cooperation to establish an enterprise in accordance with regulations of law on enterprises.

- The parties to a business cooperation contract are entitled to agree upon other items which are not contrary to law.

(Article 28 of the Law on Investment 2020)

3. Investment under business cooperation contracts in Vietnam

- Business cooperation contracts signed between domestic investors shall be executed in accordance with the civil law.

- Procedures for issuance of investment registration certificates in Article 38 of Law on Investment 2020 shall apply to business cooperation contracts signed between a domestic investor and a foreign investor, or between foreign investors.

- Parties to a business cooperation contract shall establish a coordinating board to execute the BBC. Functions, tasks and powers of the coordinating board shall be agreed upon by the parties.

(Article 27 of the Law on Investment 2020)

4. Establishment of operating office of foreign investor to business cooperation contract in Vietnam

- A foreign investor to a business cooperation contract may establish an operating office in Vietnam to execute the contract. The location of the operating office shall be decided by the foreign investor depending on the requirements for contract execution.

- The operating office of a foreign investor to a business cooperation contract has its own seal; the foreign investor may open an account, hire employees, sign contracts and carry out business activities under the business cooperation contract and Certificate of registration of operating office.

- The foreign investor to the business cooperation contract shall submit the application for registration of operating office to the investment registration authority of the area where the operating office is intended to be located.

- An application for establishment of an operating office consists of:

+ An application form which specifies the name and address of the representative office in Vietnam (if any) of the foreign investor to the business cooperation contract; name and address of the operating office; contents, duration, and operating scope of the operating office; full name, residence, ID Card or Citizen ID Card number or passport number of the head of the operating office;

+ The decision of the foreign investor to the business cooperation contract for establishment of an operating office;

+ A copy of the decision to appoint the head of the operating office;

+ A copy of the business cooperation contract.

- Within 15 days from the receipt of the application prescribed in Clause 4 of this Article, the investment registration authority shall issue the Certificate of registration of operating office to the foreign investor to the business cooperation contract.

(Article 49 of the Law on Investment 2020)

Diem My

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