Legal basis

• Law on Investment 2020;
• Decree No. 31/2021/ND-CP dated 26/03/2021 elaboration of some articles of the law on investment
• Official Letter 8909/BKHĐT-PC 31/12/2020 on the implementation of the Law on Investment.

1. Market access conditions applied to foreign investors in business organizations

According to Article 9.3 on the Law on Investment 2020, foreign investors must meet the following conditions

1.1. Foreign investors have the following restrictions on the percentage of charter capital ownership

• In case more than two foreign investors contribute capital, purchase shares, or purchase capital contributions to a business organization and are subject to FTAs, the total ownership ratio of all foreign investors in the organization such business must not exceed the highest ratio prescribed by an international treaty that stipulates the percentage of foreign investors’ ownership in a particular industry or profession;
• Where many foreign investors from the same country or territory contribute capital, purchase shares, or purchase capital contributions to an economic organization, the total ownership ratio of all such investors must not exceed the ownership rate specified in an international treaty on investment applicable to such investors;
• For public companies, securities companies, securities investment fund management companies, or securities investment funds securities investment companies under the law on securities, in case the Law on Securities If Securities has other regulations on foreign investors’ ownership ratio, the provisions of the Law on Securities shall apply;
• If an economic organization has many lines of business and the international treaty on investment contains different provisions on the percentage of foreign investors’ ownership, the foreign investor’s ownership ratio in the organization shall be the same. Such business organizations must not exceed the limit on the foreign ownership ratio for the industry or profession with the lowest foreign ownership limit.

1.2 Forms of investment

According to Article 9.3 on the Law on Investment 2020, there are 5 forms of investment:

• Investment in establishment of a business organization.
• Investment in the form of capital contribution or purchase of shares or stakes.
• Execution of an investment project.
• Investment in the form of a business cooperation contract.
• New forms of investment and types of business organizations prescribed by the Government’s regulations.

1.3. Conditions on scope of investment 

• For industries and sub-sectors to which Vietnam has committed, and foreign investors satisfy the investment conditions of that industry, the Investment Registration Authority shall consider and decide to grant and adjust the Investment Registration Certificate or register for capital contribution, share purchase, or capital contribution from foreign investors under the Law on Investment.
• Vietnam’s law already has provisions on investment conditions for service sectors and sub-sectors that have yet to commit or are not specified in Vietnam’s Schedule of Commitments in international treaties on investment. Foreign investment shall apply according to the provisions of Vietnamese law.

1.4. Conditions on the investor’s capacity; partners participating in investment 

For some business lines, foreign investors are required to enter into joint ventures with Vietnamese enterprises licensed to operate in that field when planning to invest.

1.5. Other conditions as prescribed in laws and resolutions of the National Assembly, ordinances and resolutions of the National Assembly Standing Committee, Government decrees and international treaties to which the Socialist Republic of Vietnam is a signatory

2. Conditions for granting an investment registration certificate in Vietnam

Foreign investors need to meet the following conditions to be granted an Investment Registration Certificate:

• Have nationality (individual) or head office address (organization) in a country that is in the WTO with Vietnam.
• The business lines registered for investment do not belong to the industries banned from operating. That is, it must be in the schedule of WTO commitments.