Vietnam investment regulations – Direct investment v.s. indirect investment
Under the Investment Law, direct investment means a form of investment whereby the investor invests its invested capital and participates in the management of the investment activity. On the other hand, indirect investment means a form of investment through the purchase of shares, share certificates, other valuable papers or a securities investment fund and through other intermediary financial institutions and whereby the investor does not participate directly in the management of the investment activity.
The confusing point here is what “participating in the management” of investment activity. If having purchased shares of a listed company in Vietnam, a foreign investor attends the shareholders meeting of such company and exercises its voting rights then arguably the investor has “participated in the management” of the company in Vietnam. A more relevant example is a foreign investor purchases a minority stake in a domestic joint stock company and nominates its personnel to hold position in the Board of Directors of such company. In such case, it is not clear if the investor could be deemed to have “participated in the management” of the company in Vietnam.
The consequences of being treated as a direct investment and an indirect investment may be material. If an investment is an indirect investment then the parties may not need to obtain an Investment Certificate and must settle the transaction in Vietnamese Dong through a VND capital contribution account. If an investment is a direct investment then the parties may need to obtain an Investment Certificate and could settle the transaction in foreign currency.
It would have been clearer if the Investment Law replaces the concept of “participating in the management” with “control”. In such case, an investor will be deemed to make a direct investment if it has “control” of the investment activity. In other cases, the investor will be deemed to make an indirect investment.
On 16 March 2026, the Ministry of Public Security (MPS) issued the draft decree on administrative sanctions in the fields of cybersecurity and personal data protection (the Draft Decree) for public consultation. It is the first step to put concrete penalties behind the PDPL 2025, which took effect on 1 January 2026 but left the enforcement details to the Government. The Draft covers a wide range of sectors, such as cybersecurity, personal data, AI, telecommunications, and digital signatures. This post focuses on the personal data provisions (Articles 57 to 69 of the Draft Decree), which raise potential concerns for businesses.
On 5 June 2026, the Government issued Decree 200 on private placement and trading of corporate bonds on domestic market and offering of corporate bonds on international market (Decree 200/2026). Decree 200/2026 will replace Decree 153/2020 (as amended) on the same subject. We have discussed certain contents of Decree 200/2026 in New Decree on private bonds (Part 1) — Vietnam Business Law.
The Government officially issued Decree 102/2026/NĐ-CP (Decree 102/2026), which introduces critical amendments and supplements to Decree 75/2019/NĐ-CP (Decree 75/2019) regarding administrative penalties for violations in the competition sector. Effective from 20 May 2026, Decree 102/2026 provides clearer enforcement guidelines and adjusts penalty frameworks, particularly for economic concentrations.
Below is a summary of the key changes introduced by Decree 102 that will directly affect M&A transactions subject to merger control (economic concentration notification) requirements in Vietnam.
In March 2026, Vietnam’s Ministry of Finance (MOF) released a draft decree (Draft Decree) implementing the Law on Personal Income Tax 2025 (PIT Law 2025) for public consultation. One proposal drew strong feedback from businesses and investors: a change to how individuals are taxed on the transfer of shares in non-public/unlisted joint-stock companies (JSCs). Following the consultation, the MOF now appears poised to step back from that change – welcome news for investors and companies engaged in M&A and private share transactions.
On 5 June 2026, the Government issued Decree 200 on private placement and trading of corporate bonds on domestic market and offering of corporate bonds on international market (Decree 200/2026). Decree 200/2026 will replace Decree 153/2020 on the same subject. In the past, Decree 153/2020 has been amended by Decree 65/2022 and Decree 8/2023. Decree 200/2026 introduces more conditions for private bond issuance.
5x debt/equity ratio
1.1. Decree 200/2026 reflects the 5x debt/equity requirement established under the 2025 amendment to the Enterprise Law. In particular, the debt of a bond issuer (including the value of the bonds to be issued) must not exceed 5 times of the equity of such issuer as recorded in the audited financial statements of the year preceding the issuance.
On 15 May 2026, the Government issued Resolution No. 66.17/2026/NQ-CP (the Resolution 66.17 or the new), slimming down the list of conditional business sectors currently set out in Appendix IV of Investment Law 2025 (the old).
Resolution 66.17 will take effect on 1 July 2026 and is set to expire on 28 February 2027, by which time the Government expects the National Assembly to formalise these adjustments through an amendment to Appendix IV. Although there would be a question about the effectiveness of the Resolution 66.17 over the Appendix 4 of Investment Law 2025 and how the investment authority will apply in practice, the investor may, in the meantime, treat the Resolution 66.17 as the working text for the next 9–10 months while following up on the law amendments.