Vietnam Business Law is a website managed by lawyers of Venture North Law Limited (VNLaw). Venture North Law Limited (VNLaw) is a Vietnamese commercial law firm. We won the Rising Law Firm of the Year Award at the Southeast Asia Law Awards for the years 2020 and 2021 held by The Legal 500. Very few Vietnamese law firms have achieved a similar regional recognition.
Posted in: Inward Investment
Under the Bilateral Investment Treaty between Vietnam and Japan (VJ BIT) and the Agreement for an Economic Partnership between Vietnam and Japan (VJ Partnership), a subsidiary incorporated outside Japan by a Japanese investor has certain legal grounds to claim for enjoying the rights preserved for Japanese investors when investing into Vietnam under these treaties. This is because:
Under Decree 58/2012, if an international treaty has provisions regarding foreign ownership limit (FOL) in a public joint stock company then the provisions of the international treaty will apply. Under Decree 118/2015, if a foreign investor is subject to multiple international treaties on the same industry or business line then the foreign investor is entitled to select one of the applicable international treaty. And if the foreign investor has selected to follow one international treaty then the investor will need to comply the provisions of such international treaty as a whole.
The Ministry of Planning and Investment (MPI) published a consolidated list of investment conditions applicable to foreign investors in Vietnam (FDI Condition List) as of 27 December 2015 in its website. For easy reference, is a consolidated list based on the information published on MPI’s website can be downloaded from here. The FDI Condition List represents a major effort of the MPI to help foreign investors to navigate a mirage of domestic laws and investment treaties which may apply to a foreign investor in Vietnam. That said, when relying on the FDI Condition List, one should take note of the following:
To mitigate or avoid the risks of investor claims, the Government of Vietnam has introduced various measures under various new laws issued in 2014 and 2015. These measures certainly make it more difficult for foreign investors to use Vietnamese law against the Government of Vietnam in case of an investment dispute. Below are some of these measures: