Sequence and procedures for capital contribution and purchase of shares or stakes

The capital contribution and purchase of shares or stakes by a foreign investor in a Vietnamese economic organization/ enterprise shall, in fact, follow the steps below:
(i) Assess the current status of the enterprise where the foreign investor plans to contribute capital to or purchase shares or stakes from for consideration and decision; negotiate and sign a framework agreement on capital contribution or purchase of shares or stakes;
(ii) Open a capital account at a commercial bank in Vietnam to carry out the capital contribution or purchase of shares or stakes.
(iii) Register the capital contribution or purchase of shares or stakes at the Department of Planning and Investment, in one of the following cases:
a) The contribution of capital or purchase of shares or stakes results in the increase of the ownership ratio by foreign investors in an economic organization with business lines which are conditional for foreign investors;
b) The contribution of capital or purchase of shares or stakes results in the facts that:
- a foreign investor holds over 50% of the charter capital or a majority of partnership members are foreign individuals in case of a partnership;
- an economic organization (where foreign investors hold more than 50% of its charter capital or a majority of partnership members are foreign individuals in case of a partnership) holds over 50% of the charter capital;
- a foreign investor and an economic organization (where foreign investors hold more than 50% of its charter capital or a majority of partnership members are foreign individuals in case of a partnership) hold more than 50% of the charter capital in the following cases: The holding of charter capital by the foreign investor is increased from less than or equal to 50% to over 50%; the holding of charter capital by the foreign investor is increased while such foreign investor is holding over 50% of the charter capital of the business organization..
c) The foreign investor that contributes capital, purchases shares or stakes of a business organization has a certificate of rights to use land on an island or in a border or coastal commune, ward or town or in another area that affects the national defense and security;
(iv) Follow procedures for changing shareholders/ members at the Business Registration Office.

Cre: VIETBID LAW CO., LTD
Vietnam maps showing administrative units, sources of critical raw materials and industrial zones locations.