Buying and selling FDI enterprises: Process and important notes

Buying and selling FDI enterprises is an important process, helping businesses expand their scale, increase market share or change their investment strategy in Vietnam. This process not only helps you access new business opportunities but also ensures compliance with strict legal regulations. Understanding the process and important notes will help the transaction go smoothly and optimize benefits for the business.

Conditions for buying and selling FDI enterprises

Conditions for transferring capital contributions in FDI enterprises in Vietnam include the following factors:

1. Market access conditions for foreign investors: Foreign investors when making capital contributions, purchasing shares, or purchasing capital contributions in economic organizations established in Vietnam must comply with Comply with market access conditions as prescribed in Article 9 of the Law on Investment 2020 and regulations in Decree 31/2021/ND-CP.
2. Conditions for ensuring national defense and security: The transfer of capital contributions to foreign investors must ensure the requirements for protecting Vietnam’s national defense and security according to current regulations. This is especially important for economic organizations with foreign investors contributing capital in areas affecting national defense and security.
3. Conditions on land use rights in special areas: If an economic organization with foreign investors owns Land Use Rights Certificates in the following areas, capital transfer must also comply Special regulations:

• Islands, communes, wards, border towns and coastal communes, wards and towns;
• Other areas that affect national defense and security. However, economic organizations implementing investment projects in industrial parks, export processing zones, high-tech zones, and economic zones established according to Government regulations do not have to apply this regulation.

4. Comply with the provisions of the Law on Enterprise 2020 and related guiding documents: In addition to the above conditions, FDI enterprises also need to meet specific capital transfer conditions depending on the type of enterprise as prescribed in the Law on Enterprise 2020 and related guiding documents.

Procedures for buying and selling FDI enterprises according to regulations in 2024

Prepared documents

According to Clause 2, Article 66 of Decree 31/2021/ND-CP regulating documents for implementing procedures for buying and selling FDI enterprises according to 2024 regulations, including:

• Document to register capital contribution, share purchase, purchase of capital contribution.
• Copies of legal documents of individuals, organizations contributing capital, purchasing shares, purchasing capital contributions and economic organizations with foreign investors contributing capital, purchasing shares, purchasing capital contributions;
• Document of principle agreement on capital contribution, share purchase, capital contribution purchase between foreign investors and economic organizations to which foreign investors contribute capital, share purchases, capital contributions, or between investors foreign investment with shareholders or members of that economic organization;
• Copy of Land Use Rights Certificate of the economic organization with foreign investors contributing capital, purchasing shares, purchasing capital contributions (if necessary).

Implementation steps

Pursuant to Clause 2, Article 26 of the Law on Investment 2020, Article 66 of Decree 31/2021/ND-CP, steps for buying and selling FDI enterprises according to regulations in 2024 include:

Case 1: Capital transfer falls under Points a and b, Clause 2, Article 26 of the Law on Investment 2020:

• Step 1: FDI enterprises that need to transfer capital submit transfer registration documents to the investment registration agency where the enterprise is headquartered.
• Step 2: Within 15 days from the date of receipt of valid documents, the investment registration agency will consider meeting the capital transfer conditions and notify the investor.
• Step 3: After receiving the approval notice, the economic organization with foreign investors will carry out procedures to change members and shareholders at the business registration agency in accordance with the provisions of the law on enterprises for each type of economic organization.

Case 2: Capital transfer falls under Point c, Clause 2, Article 26 of the Law on Investment 2020:

• Step 1: FDI enterprises that need to transfer capital submit transfer registration documents to the investment registration agency where the enterprise is headquartered.
• Step 2: Within 03 working days from the date of receipt of valid documents, the investment registration agency will seek opinions from the Ministry of National Defense and the Ministry of Public Security on meeting the legal conditions.
• Step 3: Within 07 working days from the date of receipt of the request from the investment registration agency, the Ministry of National Defense and the Ministry of Public Security will provide comments on the fulfillment of the conditions for ensuring national defense and security for the capital transfer. If the request deadline is exceeded without any comments, the transfer is considered to have been agreed.
• Step 4: Within 15 days from the date of receipt of valid documents, the investment registration agency will consider meeting the capital transfer conditions and, based on the opinions of the Ministry of National Defense and the Ministry of Public Security, notify investors.
• Step 5: After receiving the approval notice, the economic organization with foreign investors will carry out procedures to change members and shareholders at the business registration agency in accordance with the provisions of the law on enterprises for each type of economic organization.

Some things to note when buying and selling FDI enterprises

When buying and selling FDI enterprises, the following points should be noted:

• Legal check: Ensure the business complies with legal regulations, there are no disputes or tax debts.
• Ownership structure: Consider foreign ownership ratio, ensuring not violating ownership limits in specific industries.
• Financial analysis: Check financial statements, evaluate business value and debt.
• Sales contract: Clear agreement on value, payment, and rights of both parties.
• Licenses and approvals: Obtain permission from state agencies when necessary, adjust investment licenses if ownership structure changes.
• Human resources: Review labor benefits and change personnel if necessary.
• Tax: Understand transfer tax obligations and related taxes.
• Development strategy: Planning long-term strategic integration to optimize business value.
• Follow the correct process and consult experts to minimize risks and protect rights.

Consulting and support services for buying and selling FDI enterprises quickly and effectively

Understanding important notes when buying and selling FDI enterprises will help you clearly understand the steps and factors to keep in mind during the transaction process, thereby optimizing opportunities and limiting risks. When using Long Phan’s services, you will receive support from us:

• Appraisal of business value;
• Prepare and draft sales contracts;
• Negotiation support;
• Check and resolve risks;
• Support for ownership transfer procedures;
• Consulting on business restructuring after purchase and sale;
• Resolve disputes after transactions.

Long Phan will accompany you throughout the process of buying and selling FDI enterprises, from consulting, negotiating to completing procedures, helping you save time and effort, while ensuring the highest legality and efficiency in the transaction. To receive the most professional and effective support, please contact Long Phan via the hotline 0906735386.