Capital Contribution to a Limited Liability Company in Vietnam for Foreign Investors

Posted 4.01. 2021 by Cekindo

An increasing number of foreign investors are forming limited liability companies in Vietnam, or LLC, as they see the benefits that this type of legal entity can provide. These benefits of establishing a limited liability company in Vietnam include the protection of members against lawsuits, reduction of process paperwork, high potential for expansion, permanent existence even the depart/deceased of shareholders, prevention of double taxing, and enhanced credibility.

Ways for Foreign Investors to Contribute Capital to an LLC in Vietnam

Foreign investors can choose one of the three major ways to contribute capital to a limited liability company in Vietnam:

  1. Becoming the owner of a one-member LLC by purchasing all the contributed capital
  2. Converting a one-member LLC into a multi-member LLC by buying the owner’s partial equity
  3. Purchasing contributed capital that causes the increased number of members in a multi-member LLC

Becoming the owner of a one-member LLC by purchasing all the contributed capital

Here is the procedure on how to do this:

a. Prepare the following required documents to register for the purchase of capital contribution:

  • A written document of capital contribution
  • A copy of the passport or identity card
  • A copy of the establishment certificate

b. Submit the complete and valid documents to the investment registration agency.

c. The agency will issue an approval notice to investors within 15 working days upon the receipt of the submission. If the application is rejected, investors will receive a written explanation from the agency.

Once the purchase registration of capital contribution is done, the foreign investor must amend the company’s business registration certificate.

e. Amending a business registration certificate requires the submission of the following dossier to the Department of Planning and Investment:

  • A notification of the amendment of the business registration certificate
  • A certified transferee’s identity document or business registration certificate
  • A notarised copy of the company’s revised charter
  • An authorisation letter
  • A contract or document concerning the capital transfer

f. The authority will issue the business registration certificate within three working days upon the receipt of complete and valid submission.

Converting a one-member LLC into a multi-member LLC by buying the owner’s partial equity

a. When purchase leads to foreign investors owning more than 51% of the charter capital

  • Prepare required documents. All documents and certificates must be in Vietnamese languages and notarised.
  • Complete the application at the National Business Registration Portal and submit documents to the Department of Planning and investment.
  • The agency will issue the business registration certificate in three working days upon the receipt of the application.
  • Register a new company seal.

b. When purchase leads to foreign investors owning less than 51% of the charter capital

  • Investors only have to carry out an enterprise change procedure.

Purchasing contributed capital that causes the increased number of members in a multi-member LLC

a. When purchase leads to foreign investors owning more than 51% of the charter capital

  • Prepare required documents. All documents and certificates must be in Vietnamese languages and notarised.
  • Complete the application at the National Business Registration Portal and submit documents to the Department of Planning and investment.
  • The agency will issue the business registration certificate in three working days upon the receipt of the application.

b. When purchase leads to foreign investors owning less than 51% of the charter capital

  • Investors only have to carry out an enterprise change procedure.

How Cekindo can Assist

As a foreign company expanding to Vietnam, it is more advantageous to look for a professional business consultant who can guide you in setting up a limited liability company in Vietnam.

With Cekindo’s specialist support, you can form your limited liability company in Vietnam with full compliance per the Vietnamese Law on Enterprises and other related regulations.

Through Cekindo, you can get started faster and stronger in a competitive but stable economy with minimum liability. Our expert team of local and foreign professionals has deep experience and knowledge to help entrepreneurs and investors via our full range of business setup, market-entry, and other necessary back-office services including visa application, recruitment and hiring, due diligence, and other outsourcing solutions.

Let us know your business plan by completing the form below. One of our business incorporation specialists will guide you through.