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Foreign investors transfer contributed capital in limited liability companies
Transfer of contributed capital in a limited liability company is an act of a foreign member transferring all or part of the rights and obligations equivalent to the capital invested in their company to another individual, member organization or non-member. This is also a fairly common activity when foreign investors transfer contributed capital in a limited company in Vietnam. To learn more about this issue, please refer to the article below with Siglaw:
Conditions for foreign investors to transfer contributed capital in a limited liability company
Foreigners need to carefully study the regulations on the percentage of contributed capital that foreign investors are allowed to contribute as well as the industry in which the company is operating. Because, Vietnamese law restricts some industries and the proportion of foreign investors’ capital in the company. For example, the tourism industry requires dispatch companies to have at least 10% Vietnamese capital; Freight forwarding business: Maximum foreign ownership of 49%.
Therefore, when transferring contributed capital in a limited liability company to meet the conditions on industries and capital ownership ratio of foreigners and Vietnamese in the company.
At that time, if the foreign member/shareholder wants to transfer the contributed capital or shares to another foreigner, the company must carry out procedures for changing investors stated in the investment registration certificate (IRC). At that time, the change of new members/shareholders is carried out on the basis of the enterprise registration certificate.
Foreign investors transfer contributed capital in limited liability companies
Foreign investors transfer contributed capital in limited liability companies
Dossiers of procedures for foreign investors to transfer contributed capital in limited liability companies
The transfer of contributed capital in a limited liability company by a foreign investor has three different ways, and the procedure will also vary depending on the purpose of the parties and the limitations allowed by law.
Note, documents from abroad, issued by foreign agencies need to be consular legalized, then notarized. Except for personal documents issued by foreign agencies such as driver’s licenses, passports, identity cards, temporary residence cards, permanent resident cards, diplomas, certificates and transcripts accompanied by diplomas and certificates, consular legalization is not required before authentication. Therefore, the procedures for transferring contributed capital in a limited liability company of a foreign investor are carried out in the following ways:
Option 1: Get back all contributed capital and become the owner (1-member limited liability company)
Step 1: Prepare dossiers for registration of capital contribution and purchase of contributed capital
01 certificate of registration of capital contribution/capital contribution. Contents include: Enterprise information (name, tax code, address,…) and capital ratio of foreign investors after contributing;
01 certified copy of ID card/CCCD/passport (if the investor is an individual) or 01 certified copy of the company’s establishment license or other equivalent document proving legal status (if the investor is an organization)
Step 2: Submit the application for registration of capital contribution and share purchase Place of submission: Investment registration agency where the company is located. Example:
Hanoi Department of Planning and Investment: No. 258 Vo Chi Cong Street – Xuan La Ward – Tay Ho District – Hanoi City (Vo Chi Cong Complex Area). Contact number: 024.38256637.
Management Board of industrial parks, export processing zones, high-tech parks and economic zones in Hanoi: 7-storey building, CC02, Mo Lao urban area, Mo Lao ward, Ha Dong. Contact number: +84 4 3356 0426.
Time to receive results: 15 days from the date of submission of valid documents. If the result is not received within the time limit, it is possible to ask the agency where the application is submitted to settle.
Step 3: Prepare the application Change of business registration
01 VB announces the change of enterprise registration contents;
01 certified copy of ID card/CCCD/passport of the transferor and recipient of the transferred capital
01 certified copy of the Establishment License or other equivalent document proving legal status;
01 certified copy of ID card/CCCD/passport of the authorized representative; and 01 copy of Power of Attorney
01 certified copy of the amended and supplemented charter of the company;
01 copy of the transfer/donation contract or a written confirmation of completion of the transfer/capital contribution;
01 copy of the Certificate of approval for contribution, purchase of shares and capital contribution of foreign investors from the Ministry of Planning and Investment
Step 4: Submit the application Change of business registration Place of submission: The business registration office where the company is located. Example:
Business Registration Office – Department of Planning and Investment in Hanoi: 6th Floor, 27-storey building, No. 258 Vo Chi Cong Street – Xuan La Ward – Tay Ho District – Hanoi City (Vo Chi Cong Complex Area). Contact number: 024.38256637.
Time to return results: 03 working days from the date of receipt of valid documents
Option 2: Receive back part of the capital from the investment owner to convert from a 01-member limited liability company into a 02-member limited liability company.
Case 1: Capital transfer leads to foreign investors holding more than 51% of the total charter capital
Step 1: Prepare and submit the application for capital contribution and share purchase Similar to Method 1
Step 2: Prepare documents Change of business registration
01 Application for Business Transformation
01 copy of the converted company’s charter
For individual members: 01 copy of the Member List. Enclosed: 01 certified copy of ID card/CCCD/passport (if an individual of Vietnamese nationality); and Passport and Temporary Residence Registration Certificate of the legal representative (if an individual of foreign nationality)
For members being organizations: 01 copy of the establishment decision; 01 copy of the IRC (or IRC and tax IRC; or IRC and tax registration); and 01 certified copy of ID/CCCD/passport of the authorized representative and 01 copy of the corresponding Power of Attorney.
01 copy of the Transfer Contract or 01 document proving the gift of a part of the company’s assets (in case the company owner transfers a part of the company’s assets to one or more other people).
01 copy of the decision to mobilize capital contribution of the company owner (in case the company mobilizes additional capital contribution of one or more other people).
Step 3: Apply Place of submission:
Directly the Business Registration Office
Online at the National Business Registration Portal at: dangkykinhdoanh.gov.vn
Time to receive results: 03 days from the date of receipt of valid documents
Case 2: Capital transfer leads to foreign investors holding less than 51% of total charter capital (Similar to above)
Option 3: Get back the contributed capital to increase more members (02-member limited liability company)
Case 1: Capital transfer leads to foreign investors holding more than 51% of the total charter capital
Step 1: Prepare and submit the application for capital contribution and share purchase Similar to Method 1
Step 2: Prepare documents Change of business registration
01 VB announces the change of enterprise registration contents;
01 copy of the Transfer Contract or 01 document proving the gift of a part of the company’s assets (in case the company owner transfers a part of the company’s assets to one or more other people).
For individual members: 01 copy of the Member List. Enclosed: 01 certified copy of ID card/CCCD/passport
For members being organizations: 01 copy of the establishment decision; or 01 copy of the IRC (or IRC and tax IRC; or IRC and tax registration); and 01 certified copy of ID/CCCD/passport of the authorized representative and 01 copy of the corresponding Power of Attorney.
01 copy of the Certificate of approval for contribution, purchase of shares and capital contribution of foreign investors from the Ministry of Planning and Investment
Step 3: Apply Place of submission:
Directly the Business Registration Office
Online at the National Business Registration Portal at: dangkykinhdoanh.gov.vn
Time to receive results: 03 days from the date of receipt of valid documents
Case 2: Capital transfer leads to foreign investors holding less than 51% of total charter capital
Step 1: Prepare and submit the application for capital contribution and share purchase Similar to Method 1
Step 2: Prepare the application Change of business registration Similar to the above
The above is the advice of Siglaw Law Firm on the transfer of contributed capital in a limited liability company of a foreign investor. If you have any questions about the above, please contact the information below for a 24/7 direct consultation:
Phone: (+84) 961 366 238
Email:
- vphn@siglaw.com.vn
- vphcm@siglaw.com.vn
Headquarters: Floor 12A Sao Mai Building, 19 Le Van Luong Street, Nhan Chinh Ward, Thanh Xuan District, Hanoi City.
Southern branch: No. 99 Cong Hoa, Ward 04, Tan Binh District, Ho Chi Minh City.
Central branch: 177 Trung Nu Vuong, Hai Chau District, Da Nang City
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