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Posted in: Inward Investment
On 26 June 2015, the Ministry of Planning and Investment (MPI) issued Official Letter 4211 providing temporary guidance for the implementation of the Enterprise Law 2014. Under OL 4211,
The Investment Law 2014 and the Enterprise Law 2014 will take effect very soon on 1 July 2015. However, the Government has not issued any implementing Decrees or Circulars which are necessary for the actual implementation of the Investment Law 2014 and the Enterprise Law 2014. This is unfortunate as the lack of proper implementing Decrees and Circulars may affect the operations of many companies and investors.
Under the Investment Law 2014, the investors of an investment project whose land is leased, allocated or adjusted by the Government must make a security deposit to ensure that the project will be implemented in accordance with registered investment schedule. The amount of deposit is from 1% to 3% of the total investment capital. It is certain that the security deposit requirement will apply to investment projects licensed on or after 1 July 2015. However, it is not certain if this requirement will apply to investment projects licensed before 1 July 2015 since there is no security deposit requirement under the Investment Law 2005.
The Investment Law 2014 introduces entirely new procedures “acquisition registration” for investment by foreign investors in the form of capital contribution or acquisition of equity interests in existing companies in Vietnam. However, due to its novelty, the new procedures may raise various unexpected consequences: