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.
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:
The Investment Law 2014 introduces major changes to the ability to choose foreign arbitration as the dispute resolution forum for transactions involving a foreign-invested enterprise in Vietnam. In particular, from 1 July 2015, only transactions with a foreign-invested enterprise (or more correctly a foreign economic organisation) 51% or more of which is directly or indirectly owned by foreign investors could be referred to foreign arbitration for dispute settlement. Under the Investment Law 2005, transactions with any company with any level of foreign ownership (not necessarily more than 51%) could be referred to foreign arbitration for dispute settlement.
Decree 51/2015 issued in May 2015 is an entire new decree on legal opinions issued by the Ministry of Justice (MOJ) of Vietnam. The MOJ has been issuing legal opinions covering various Vietnamese legal issues to support for financing various large scale infrastructure projects for many years. For the first time, Decree 51/2015 sheds some lights on MOJ’s legal opinion practice. In particular,
In April 2015, the General Department of Tax (GDT) instructs a provincial tax department to consider imposing corporate income tax (CIT) on a capital transfer transaction whereby a Vietnamese buyer acquires the entire equity interest of a Hong Kong company (Offshore Target Co) from a foreign seller. The Offshore Target Co holds shares in a joint venture company in Vietnam. The GDT considers the purchase price that the foreign seller receives from the Vietnamese buyer for sale of shares in the Offshore Target Co as “taxable income arising in Vietnam” (thu nhập chịu thuế phát sinh tại Việt Nam) of the foreign seller under Decree 12/2015. The GDT’s view could raise a tax concern over capital transfer in an offshore company which in turn have shares in a Vietnamese company, at least in case the buyer is a Vietnamese company.