Foreign investors, according to the provisions of the Investment Law 2020, are defined as individuals with foreign nationality or organizations established under the jurisdiction of foreign law conducting business and investment activities in Vietnam. Before planning to invest in Vietnam, investors need to know their rights and obligations in Vietnam – one of the most dynamic markets in the world.
Rights of investors
By investing in Vietnam, investors acquire the following basic rights:
- Carrying out business activities in industries and sectors not prohibited by the investment law. For conditional business lines, investors must meet the conditions for business investment as prescribed by law.
- To decide and take self-responsibility for business investment activities in accordance with the provisions of the investment law and other relevant laws. To have access to and use credit capital, support funds, and use of land and other resources as prescribed by law.
- The State of Vietnam recognizes and protects investors’ ownership of assets, investment capital, income and other lawful rights and interests.
- The State of Vietnam treats investors equally and adopts policies to encourage and create favorable conditions for investors to conduct business and develop sustainably in Vietnam.
- Right to contribute capital, buy shares, and buy capital contributions of economic organizations in Vietnam.
- Right to transfer all or part of an investment project to another investor when all conditions are met.
- During the implementation of an investment project, the investor has the right to adjust the target, transfer part or the whole of the investment project, merge projects, or split a project into multiple projects, use land and assets on land of the investment project to contribute capital to establish an enterprise, and to carry out other business activities and must comply with the provisions of law.
- Termination of investment activities and investment projects.
- Establishing/terminating operations of an executive office in Vietnam for business cooperation.
- Remittance of assets to a foreign country after fulfilling financial obligations to the State of Vietnam as prescribed by law.
- Enjoying investment incentives by investing in sectors encouraged by the government.
- Being granted a temporary residence card with a term of three to ten years depending on the amount of money invested in Vietnam. This temporary residence card helps investors live, work and travel in Vietnam without having to apply for a visa.
Obligations of investors
- Complying with Vietnamese laws during business investment.
- Ensuring financial capacity and contributing investment capital according to the registered project schedule.
- Depositing or guaranteeing from a credit institution or foreign bank’s branch established under Vietnamese law to secure the implementation of the investment project for which land is allocated or leased or permitted to be transferred by the state for conducting business.
- Satisfying the conditions laid down for industries that require business investment conditions throughout the investment process.
- Declaring and fully paying all kinds of financial and tax obligations as prescribed.
- Reporting on investment projects according to regulations.
- Must open a direct investment capital account at an authorized bank to conduct revenue and expenditure transactions related to all FDI activities in Vietnam lawfully.
Writing period: 20/09/2021
The article is based on applicable law at the time noted above and may no longer be relevant at the time the reader approaches this article due to the change in applicable law and the specific case in which the reader wishes to apply. Therefore, the article has only reference values.