How to Acquire a Company in Vietnam for Foreigners (2026): Capital Contribution Registration, Ownership Limits, Approvals

Understanding how to acquire a company in Vietnam for foreigners is the single most important compliance step before any cross-border deal closes in the country. Vietnam’s regulatory framework draws a sharp line between transactions that merely require registration and those that trigger full investment approval, and getting that distinction wrong can invalidate a deal, freeze capital in transit, or expose the buyer to administrative penalties. This guide delivers a practitioner-led, step-by-step acquisition workflow current to mid-2026, covering the regulatory trigger test, capital contribution registration procedures, foreign-ownership caps by sector, and the banking mechanics that routinely catch first-time acquirers off guard.

TL;DR, The Primary Compliance Decision Every Foreign Buyer Must Make

Before engaging advisers or signing a letter of intent, foreign acquirers should internalise four decision points that shape every Vietnam M&A timeline:

• Approval vs registration. If the target operates in a conditional business line, or if the acquisition introduces or increases foreign ownership in the company, the transaction is treated as a foreign-invested project requiring an Investment Registration Certificate (IRC) or its amendment, issued by the provincial Department of Planning and Investment (DPI). If the target already holds an IRC and foreign ownership is merely being transferred between foreign parties with no change in the registered sector, a simpler registration procedure at the Business Registration Office typically suffices.
• Capital contribution registration. A foreign investor injecting new capital into an existing domestic company (rather than buying shares from a current shareholder) must complete a capital contribution registration with the DPI before the capital is remitted. This is a distinct filing from a share purchase and carries its own document set and timeline.
• Timeline differences. Simple Enterprise Registration Certificate (ERC) updates can be processed in as few as three business days. IRC issuance or amendment typically takes 15–30 days, but conditional-sector approvals involving line ministries can extend the process to 60–90 days or longer.
• Bank and FX traps. Purchase funds must flow through a properly established direct investment capital account (DICA) at a licensed Vietnamese bank, using correct SWIFT purpose codes. Missteps here, particularly remitting funds before the IRC is issued, are the single most common cause of deal delay.

The practical decision rule: if the transaction will result in a foreign investor holding any equity in a company that was previously 100 % domestically owned, or if it changes the foreign-ownership ratio in a conditional sector, treat the deal as requiring full M&A approval from the outset. Detailed guidance on each step follows below.

Quick Compliance Decision: M&A Approval vs Registration in Vietnam

The question of whether a foreign buyer needs formal investment approval or only a registration update is governed primarily by the Law on Investment (as amended) and its implementing decrees. In practice, the analysis follows a short decision tree with four nodes.

Regulatory Triggers Under the Law on Investment

A foreign investor’s acquisition of shares or capital contribution in a Vietnamese company is treated as a foreign-invested economic organisation, and therefore subject to the investment registration regime, when any of the following conditions are met:

• Conditional sector. The target’s registered business lines include one or more activities on Vietnam’s list of conditional sectors for foreign investment (Appendix IV of the Law on Investment). Key examples include telecommunications, banking and finance, advertising, logistics, education, and real-estate trading.
• Foreign-ownership change. The transaction increases foreign ownership from below 50 % to 50 % or above, or it introduces foreign ownership into a previously fully domestic enterprise.
• Target already holds an IRC. If the target is already classified as a foreign-invested enterprise (FIE) and the deal involves a change in the investor, registered capital, or business lines on the IRC, an IRC amendment is required.
• Merger control thresholds. Regardless of the above, if the combined market share, total assets, or turnover of the parties exceeds the thresholds set out under Vietnam’s competition legislation, a separate merger control notification to the National Competition Commission (NCC) may be required before closing.

When to Treat the Transaction as FDI vs a Domestic Transfer

A share transfer between two domestic shareholders that does not alter any foreign-ownership ratio is a purely domestic corporate transaction. It requires only an ERC update at the Business Registration Office and a personal income tax (PIT) filing by the seller. No DPI involvement is needed. However, the moment a foreign entity or individual appears on either side of the transfer, even if the target is already partly foreign-owned, the deal enters the investment-registration framework. Industry observers expect provincial DPI offices to continue applying this bright-line test strictly through the remainder of 2026.

Step-by-Step Workflow: How to Buy a Company in Vietnam

Once the compliance trigger test is clear, the acquisition follows a structured workflow that experienced practitioners typically divide into three phases: pre-deal due diligence, transaction documentation, and closing mechanics. Each phase carries Vietnam-specific requirements that differ materially from common-law M&A practice.

Pre-Deal Due Diligence: Legal, Regulatory and Foreign-Ownership Screening

Due diligence on a Vietnamese target must address regulatory fitness as aggressively as it addresses financial performance. The following checklist captures the documents and investigations that are essential before a foreign buyer can confidently sign a share purchase agreement (SPA):

• Enterprise Registration Certificate and IRC (if any). Confirm the target’s current legal status, registered capital, and business lines. Cross-check against the National Business Registration Portal.
• Foreign-ownership register. Determine the current foreign-ownership ratio and whether the proposed acquisition will cross any threshold that triggers an IRC requirement.
• Conditional-sector screening. Map every registered business line against the current conditional-sector list. Even a single conditional line on an otherwise unrestricted ERC will pull the entire transaction into the approval regime.
• Land-use rights and leases. Verify the target’s land-use right certificates (if any), lease terms, and whether those rights are transferable to a foreign-invested entity. Certain categories of land use are restricted for FIEs.
• Tax compliance. Request tax clearance or confirmation from the target’s managing tax authority. Outstanding tax liabilities can delay post-closing ERC amendments.
• Employment and social insurance. Confirm current headcount, review material employment contracts, and verify that compulsory social, health, and unemployment insurance contributions are up to date.
• Capital contribution records. For existing FIEs, confirm that all previously registered capital contributions have been made within the statutory timeframes. Unfulfilled capital contribution obligations are a common red flag.
• Litigation and regulatory proceedings. Search for pending disputes, administrative sanctions, and environmental compliance orders.

This due diligence phase typically requires 20–40 business days, depending on the target’s size and the responsiveness of Vietnamese government portals. Engaging local counsel early, particularly for the consular legalisation of foreign documents for use in Vietnam, avoids downstream delays.

Transaction Documents: SPA, Warranties and Escrow

The share purchase agreement for a Vietnamese M&A deal should be drafted bilingually (English and Vietnamese), with the Vietnamese version governing for regulatory filings. Key provisions that require Vietnam-specific tailoring include:

• Purchase price and payment mechanics. The SPA should specify whether payment is in VND or a foreign currency, the escrow arrangement (typically held at a Vietnamese bank branch), and the conditions for release. A typical clause might read: “The Purchase Price shall be deposited into an escrow account at [Bank] within five business days of signing and released to the Seller upon confirmation of the ERC/IRC amendment reflecting the Buyer as shareholder.”
• Warranties and indemnities. Standard commercial warranties (title, authority, compliance, tax) should be supplemented with Vietnam-specific representations covering capital contribution compliance, land-use right status, and foreign-ownership ratio accuracy.
• Conditions precedent. Include regulatory approvals (IRC issuance/amendment, sector-licence updates, merger-control clearance if applicable) as explicit conditions to closing.

Procedures of Purchasing Company Shares in Vietnam: Closing and Share Transfer

Closing a Vietnamese share acquisition involves several simultaneous workstreams:

• Shareholder and board approvals. The target’s members’ council (for an LLC) or general meeting of shareholders (for a joint-stock company) must approve the share transfer. The required approval threshold depends on the company’s charter, but the Enterprise Law sets default supermajority requirements for certain structural changes.
• Notarisation and authentication. Share transfer contracts involving foreign parties generally require notarisation. Foreign-language documents must be legalised or apostilled and accompanied by certified Vietnamese translations.
• Share transfer registration. The completed transfer must be registered with the Business Registration Office to update the ERC. For FDI transactions, the DPI must first issue or amend the IRC before the ERC update can proceed.
• Tax clearance for the seller. The seller is liable for PIT (for individuals) or CIT (for corporate sellers) on any gain. In practice, many DPIs will not process the ERC update until evidence of tax payment or withholding is provided.

Capital Contribution Registration Vietnam: Forms, Authorities and Timelines

Foreign investors who choose to enter a Vietnamese company by subscribing to newly issued capital, rather than purchasing existing shares, must complete a distinct capital contribution registration process. This distinction is critical: the two pathways involve different filing authorities, different document sets, and different timelines.

Under the Vietnam investment law framework, a capital contribution by a foreign investor into an existing domestic enterprise is treated as the formation of a new foreign-invested economic organisation. The investor must register with the provincial DPI before making the capital contribution.

Key Filings Compared

In 2026 practice, the most common delay occurs when the DPI requests supplementary documents, often additional proof of the foreign investor’s legal status, audited financials, or a bank reference letter. Preparing a complete dossier from the outset, including legalised and translated constituent documents, significantly reduces processing times.

The practical difference between a capital contribution and a share purchase also has tax implications. A capital contribution does not trigger a taxable event for the existing shareholders (no gain is realised), whereas a share sale generates a capital-gains tax liability for the seller. Buyers should model both structures during the letter-of-intent stage to determine which is more efficient for the specific transaction.

Ownership Limits, Conditional Sectors and Exemptions

Vietnam permits 100 % foreign ownership in most sectors. However, the conditional-sector list, maintained under the Law on Investment and updated periodically, imposes caps, additional licensing requirements, or outright prohibitions on foreign participation in specific industries. Understanding these restrictions is essential for any foreign buyer evaluating how to acquire a company in Vietnam for foreigners.

Key conditional sectors and their typical foreign-ownership limits include:

• Banking and finance. Foreign ownership in a Vietnamese commercial bank is generally capped at 30 % in aggregate, with a single foreign investor limited to 20 % (or 15 % for a single institutional investor without a strategic-partner designation).
• Telecommunications. Foreign ownership is capped at 49 % for network infrastructure services and certain value-added telecom services. Higher caps may apply to specific sub-sectors under Vietnam’s WTO commitments.
• Real-estate trading. Foreign investors may own up to 100 % of a real-estate enterprise, but the scope of permissible activities (particularly residential development for sale) is subject to conditions and may require project-specific investment approval.
• Advertising, logistics and distribution. Various caps (typically 49–51 %) apply depending on the specific activity and the applicable international trade commitment.
• Education and healthcare. Foreign ownership is permitted, often up to 100 %, but sector-specific licensing from line ministries (Ministry of Education and Training, Ministry of Health) adds 30–90 days to the approval timeline.

Where a sector cap prevents outright acquisition, foreign buyers sometimes consider structural alternatives such as joint ventures, nominee arrangements, or management contracts. Industry observers consistently caution that nominee structures carry significant legal risk in Vietnam and are actively scrutinised by authorities. Any structural workaround should be thoroughly vetted by qualified Vietnamese M&A counsel before implementation.

Banking, Capital Account and Remittance Checklist

The banking leg of a Vietnamese acquisition is where many otherwise well-prepared deals stall. Foreign investors must open a Direct Investment Capital Account (DICA) at a licensed Vietnamese commercial bank before remitting purchase funds into the country. The State Bank of Vietnam’s regulations on foreign-exchange management for FDI activities govern this process.

The following checklist captures the essential steps and common rejection points:

The likely practical effect of these requirements is that buyers should budget 7–21 days for bank processing after the IRC is in hand. Engaging the Vietnamese bank early, ideally during the due-diligence phase, with a preliminary KYC submission, can compress this timeline. For guidance on broader tax obligations for cross-border income in Vietnam, buyers should review Vietnam’s personal and corporate tax frameworks in parallel.

Post-Closing Filings, Tax, Employment and Compliance

Closing the share transfer or capital contribution is not the end of the compliance workflow. Foreign acquirers must complete several post-closing filings within prescribed deadlines to avoid penalties and ensure the target can continue operating without interruption.

• IRC / ERC amendment (if not already completed as a condition precedent). Must be filed promptly after closing, most practitioners target completion within 10 business days.
• Tax registration update. Notify the managing tax authority of changes in ownership, legal representative, or registered capital within 10 business days of the ERC amendment.
• PIT / CIT on capital gains. The seller must declare and pay tax on any gain within the statutory filing period. In share-purchase transactions, the buyer often withholds and remits the tax on the seller’s behalf as a contractual obligation under the SPA.
• Social insurance transfer. If the acquisition involves a change of employer entity (uncommon in a simple share purchase, but relevant in asset deals or mergers), the target must notify the social insurance authority and ensure continuity of employee coverage.
• Beneficial ownership disclosure. Depending on the target’s structure and sector, updated beneficial-ownership information may need to be filed with the Business Registration Office or the State Bank.

For buyers who will need to bring foreign personnel into Vietnam to manage the acquired business, understanding Vietnam business visa requirements should be part of the post-closing integration plan.

Conclusion

Knowing how to acquire a company in Vietnam for foreigners is ultimately a matter of sequencing: identifying the correct regulatory pathway before signing, assembling a complete filing dossier before approaching the DPI, and engaging the Vietnamese bank before the IRC lands. Each of these steps has a defined legal basis, a predictable timeline, and a set of common pitfalls that experienced practitioners can help buyers avoid. With conditional-sector enforcement and capital-contribution scrutiny remaining tight through 2026, foreign acquirers who invest in proper structuring and early regulatory engagement will close faster and with significantly less risk than those who treat Vietnam M&A as a simple share-transfer exercise.

Sources

1. Ministry of Planning and Investment (MPI), Law on Investment (official text and amendments)
2. Vietnamese Government Portal, Enterprise Law and Decree on Enterprise Registration
3. State Bank of Vietnam, Foreign-exchange and capital-account circulars
4. Vietnam Briefing, Setting Up a Business in Vietnam
5. Viet An Law Firm, Company Registration in Vietnam (2026 Guide)
6. Nova Law Vietnam, Open a Company in Vietnam
7. Acclime Vietnam, Registration and banking procedural guides
8. InCorp Vietnam, Foreign investment procedural guides