100% FOREIGN CAPITAL COMPANY ESTABLISHMENT IN VIETNAM

Currently, Vietnam's economy is growing, making more and more foreign investors want to invest in our country. The procedure for establishing a company with 100% foreign capital is quite complicated, involving many competent state agencies. In order to save time, money, and prevent all legal risks, through this article, Doanh Tri Law Firm will guide you through the full procedure for setting up a 100% foreign-owned company.

Mục lục

I. Legal basis

- Law on Investment 2020.

II. Definition

A company with 100% foreign capital is a type of enterprise established in Vietnam with 100% capital contributed by foreign investors to establish a company, a company with 100% foreign investment capital has the following legal status: when it is granted an investment registration certificate or a business registration certificate by the registration authority.

III. Procedures for establishing a company with 100% foreign capital

Step 1: Register the investment policy at the competent authority to establish a company with 100% foreign capital

When a foreign investor enters Vietnam to invest in a project, he/she must carry out procedures to apply for an Investment Registration Certificate. However, before carrying out the procedures to apply for an Investment Registration Certificate, in some cases, the investor must register the investment policy under the authority of the Prime Minister or the provincial People's Committee.

In case of a decision on investment policy, the agency of the People's Committee of the province.

Provincial-level People's Committees shall decide on investment policies for the following projects:

- The project is allocated or leased land by the State without auction, bidding, or transfer; projects requiring a change of land use purpose;

- The project uses technology on the list of technologies restricted from transfer in accordance with the law on technology transfer.

Dossier of application for approval of investment policy of the provincial People's Committee includes:

- A written request for the implementation of an investment project;

- For individual investors: Copy of identity card, identity card, or passport

- For institutional investors: copy of Certificate of Establishment or other equivalent document certifying legal status;

- The investment project proposal includes the following contents: investor implementing the project, investment objectives, investment scale, investment capital and capital mobilization plan, location, duration, and investment schedule, demand labor, a proposal for investment incentives, assessment of the project's socio-economic impact and efficiency;

- A copy of one of the following documents: Financial statements of the last 2 years of the investor; Commitment to the financial support of the parent company; Commitment to the financial support of financial institutions; Guarantee of investors' financial capacity; Documents explaining the investor's financial capacity;

- Proposing land use needs; In case the project does not request the State to allocate or lease land or permit the change of land use purpose, a copy of the location lease agreement or other document certifying that the investor has the right to use the site for implementation. current investment project;

- The explanation on the use of technology includes the following contents: technology name, technology origin, technological process diagram; Main technical parameters, usage status of the main machinery, equipment, and technological lines for projects using technologies on the List of technologies restricted from transfer;

- BBC contract (BBC contract also known as business cooperation contract is a contract signed between investors to cooperate in investment and business in Vietnam.)

The case of the Prime Minister's decision on investment policy

In case, projects of foreign investors in the fields of the shipping business, business of telecommunications services with network infrastructure, afforestation, publishing, press, establishment of scientific and public organizations, etc. technology, science and technology enterprises with 100% foreign capital. Accordingly, in case a company with 100% foreign capital is established and related to the above issues, it must register the investment policy with the Prime Minister according to the provisions of the Investment Law 2020.

Dossier of application for approval of investment policy of the Prime Minister includes:

- The documents are the same as the investment policy registration of the Provincial People's Committee Agency

- Plan on-site clearance, migration, and resettlement (if any);

- Preliminary assessment of environmental impact, environmental protection solutions;

- Assessment of economic and social impacts and efficiency of investment projects.

The case of the National Assembly's decision on investment policy:

- Nuclear power plants;

- Investment projects requiring conversion of land use purposes of special-use forests, watershed protection forests or border protection forests of 50 hectares or more; protective forests against the wind, flying sand and protection forests against waves and sea encroachment of 500 ha or more; production forests of 1,000 ha or more;

- Investment projects requiring migration and resettlement of 20,000 people or more in mountainous areas, and 50,000 or more people in other areas;

- Investment projects that require the resettlement of 20,000 people or more in mountainous areas, and 50,000 or more people in other areas.

Dossier of application for approval of investment policy of the National Assembly includes:

- Plan on-site clearance, migration, and resettlement (if any);

- Preliminary assessment of the impact on the environment and solutions to protect the environment;

- Assess the economic, social, and affective impacts of the project;

- Propose specific mechanisms and policies (if any).

Step 02: Apply for an Investment Registration Certificate for a company with 100% foreign capital

In the following cases, the investor must carry out the procedures for applying for an Investment Registration Certificate:

- Investment projects of foreign investors;

Investment projects of the following economic organizations:

- Having a foreign investor holding 51% or more of the charter capital or having the majority of general partners being foreign individuals, for economic organizations being a partnership;

- Having the above-said economic organizations holding 51% or more of charter capital;

- There are foreign investors and economic organizations specified as above holding 51% or more of charter capital.

Dossier for issuance of Investment Registration Certificate for 100% foreign-owned company:

- A written request for the implementation of an investment project;

- For individual investors: Copy of identity card, identity card, or passport

- For institutional investors: copy of Certificate of Establishment or other equivalent document certifying legal status;

- The investment project proposal includes the following contents: investor implementing the project, investment objectives, investment scale, investment capital and capital mobilization plan, location, duration, and investment schedule. , demand for labor, the proposal for investment incentives, assessment of the project's socio-economic impact and efficiency;

- Copy of one of the following documents:

- Financial statements for the last 2 years of the investor;

- Commitment to the financial support of the parent company;

- Commitment to the financial support of financial institutions;

- Guarantee of investors' financial capacity;

- Documents explaining the investor's financial capacity;

- The explanation on the use of technology includes the following contents: technology name, technology origin, technological process diagram; Main technical parameters, usage status of main machinery, equipment, and technological lines for projects using technologies on the List of technologies restricted from transfer

- BCC contract for investment projects in the form of a BCC contract.

The agency that submits the application for the Investment Registration Certificate to the 100% foreign-owned company at the investment registration agency:

- If the company is located in an industrial park, the management board of industrial zones

- If the company is located outside the industrial zone, it is the Department of External Economic Relations - Department of Planning and Investment at the provincial level.

Time to issue Investment Registration Certificate for 100% foreign-owned company:

- For investment projects not subject to a decision on investment policies: 15-20 working days from the date of receipt of complete dossiers.

- For investment projects subject to an investment policy decision: 05 - 10 working days from the date of receipt of the decision on investment policy.

Step 03: Establish an enterprise and issue a business registration certificate to a company with 100% foreign capital

After obtaining the investment registration certificate, investors need to prepare documents to set up a business.

Dossier to establish a limited liability company with 100% foreign capital:

- Business registration application form;

- Company rules;

- Members list;

- Copies of the following papers: Citizen identification cards, People's identity cards, Passports, or other lawful personal identification of members being individuals;

- Establishment decision, business registration certificate or other equivalent documents of the organization and power of attorney; Citizen's identity card, people's identity card, passport or other lawful personal identification of the authorized representative of the member being an organization;

- For a member being a foreign organization, a copy of the Certificate of Business Registration or an equivalent document must be consular legalized;

- Investment registration certificate for foreign investors in accordance with the Law on Investment.

Dossier of the establishment of a joint-stock company with 100% foreign capital:

- Business registration application form;

- Company rules;

- List of founding shareholders and shareholders being foreign investors (list of authorized representatives if any);

- Copies of the following papers: Citizen identification cards, People's identity cards, Passports, or other lawful personal identification of members being individuals;

- For a member being a foreign organization, a copy of the Certificate of Business Registration or an equivalent document must be consular legalized;

- Investment registration certificate for foreign investors in accordance with the Law on Investment.

The agency that submits the application for an enterprise registration certificate to a company with 100% foreign capital

Business registration agency – Provincial Department of Planning and Investment.

Time to issue business registration certificates for companies with 100% foreign capital

05 working days from the date of receipt of complete and valid documents.

Step 04: Posting the establishment statement of a company with 100% foreign capital

After an enterprise is granted an enterprise registration certificate, it must make a public announcement on the national business registration portal according to the order and procedures and pay fees as prescribed.

The content to be announced includes the contents of the Business Registration Certificate and the following information:

- Line of Business;

- List of founding shareholders and shareholders being foreign investors for joint-stock companies.

- Implementing agency: Reporting division of the Business Registration Authority – Provincial Department of Planning and Investment.

The above information is about the ‘100% Foreign Capital Company Establishment In Vietnam.' For more information and advice on this issue, please contact Doanh Tri Law Firm directly via:

Hotline: (+84) 911.233.955 - (024) 6293 8326