Vietnam investment regulations – Definition of “Foreign investors”
There are more than one definition of foreign investors (nhà đầu tư nước ngoài) under Vietnamese law:
- Foreign investors are defined under the Investment Law to mean … “foreign organization or individual using capital in order to carry out an investment activity in Vietnam”. The definition under the Investment Law seems to suggest that only companies incorporated outside Vietnam can be regarded as foreign investors.
- However, in subsequent decisions of the Prime Minister (Decision 88/2009 and Decision 55/2009), foreign investors also include enterprises established in Vietnam with more than 49% of capital contributed by “foreign parties” (bên nước ngoài). It is not clear if the term “foreign parties” are the same as “foreign investors” in the Prime Minister’s decision.
- The Ministry of Finance on the other hand consider foreign investors to include “enterprises established in Vietnam with 100% foreign contributed capital”.
- The latest document (Decree 102/2001) does not provide a definition of foreign investors but provides that companies incorporated in Vietnam of which foreign investors own more than 49% will be subject to the same investment and business conditions as those applicable to foreign investors.
In summary, there are overlapping and confusing definitions of “foreign investors” under Vietnamese law. However, it is reasonable to conclude that such term will cover, among others, companies incorporated outside of Vietnam and companies incorporated in Vietnam of which foreign investors own more than 49%.
The Vietnamese Government has recently issued Decree 168/2025 on enterprise registration, which replaces the previous Decree 1/2021. This blog post highlights several significant changes and clarifications to enterprise registration procedures under Decree 168/2025.
1) Additional forms of documents evidencing the completion of capital contribution and transfer
Decree 168/2025 introduces new options for documenting the completion of capital contributions or capital transfers in the enterprise registration application dossiers as follows:
For evidence of the completion of a transfer, one of the following documents is now accepted:
• A copy or extract of the member register or shareholder register.
• A copy or original of the liquidation minutes of the transfer contract.
• Bank confirmation of completed payment.
• Other documents validly proving the completion of share or capital contribution transfer as prescribed by law.
Decree 153/2020 (as amended), which governs private corporate bond offerings, creates ambiguity concerning the permissible use of bond proceeds, especially when parent companies aim to finance their subsidiaries.
Decree 153/2020 stipulates that bond proceeds can be used for implementing investment programmes and projects, restructuring debts of the issuing enterprise itself, or for other purposes sanctioned by specialised laws. The ambiguity stems specifically from how the qualifier “of the issuing enterprise itself” applies to these permissible uses. This leads to two primary interpretations:
The recently enacted law amending the Investment Law 2020 (Amendment Law 2025), effective 1 July 2025, introduces the following key changes:
1. Major Decentralization of Approval Authority
1.1. Under the Amendment Law 2025, the Provincial People's Committees, rather than the Prime Minister under the previous law, have the authority to grant investment policy approval for the following projects:
A pdf version of this post can be downloaded here.
In June 2025, the National Assembly passed a new Law on Management of State Capital (Law on State Capital 2025) replacing the same law issued in 2014 and amended in 2018 (Law on State Capital 2014). The Law on State Capital 2025 have given the individuals managing State-owned (or controlled) enterprises (i.e., the Members’ Council or the Chairman) substantial flexibility to run their businesses. In this post, we discussed some key changes introduced by the Law on State Capital 2025. A comparison between the Law on State Capital 2025 and Law on State Capital 2014 by Deep Research of Gemini 2.5 Pro can be found here.
Clearer scope of application
Law on State Capital 2025 clearly provides that enterprises which more than 50% charter capital or voting shares of which is held by the State are also subject to this law. This point is not clear under the Law on State Capital 2014.
Definition of State Capital
Under Law on State Capital 2025, State capital in a State-owned enterprise only includes the contributed capital portion held by the State out of the total owner's equity of the enterprise. In addition, the Law on State Capital 2025 defines State capital by reference to the holding percentage of the State. This new approach is a significant change from the Law on State Capital 2014 because:
The Law on State Capital 2025 excludes other funding sources such as the state budget, public assets, and development investment funds from the definition of "State capital" within an enterprise. Instead, the Law on State Capital 2025 classifies these as sources of capital and assets to be used for investing state capital in enterprises; and
in many scenarios, the holding percentage is more important than the absolute amount
The 9th working session of the National Assembly of Vietnam, which lasted 35 days and ends on 27 June 2025, is probably the most productive working session of the National Assembly for several decades. In this one working session, the National Assembly has passed a number of laws equal to all laws passed by the National Assembly in 17 previous working sessions.
Immediately after the conclusion of the National Assembly’s working sessions in late June 2025, newspapers and social media in Vietnam were flooded with information about these new laws and regulations. Information about these new laws was important since many of those laws would take effect on 1 July 2025 – only one week after the National Assembly concluded its working session.
As part of our marketing efforts, we also set out to review those laws and resolutions for our legal updates. However, when we first started, our lawyers struggled to locate the final text of many of these laws. For us, a “final text” of a law would be a scanned PDF of these laws bearing the seal of the National Assembly and signatures of the Chairman of the National Assembly or an official publication on official websites such as the Official Gazette or the National Database of Legal Documents.