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Forms of investment in tourism with foreign capital
Although the real estate market in general is difficult, foreign investors are still interested in resort real estate. The Vietnamese market has a young population, a rapidly growing middle class, and a high urbanization rate, creating favorable conditions for socio-economic development and opening up the potential for many types of real estate development. In particular, the resort real estate segment is still the investors’ choice, especially investors in regions such as Korea, Japan, Singapore, and Hong Kong. So what forms of investment are there in the tourism sector with foreign capital in Vietnam? Let’s find out with Siglaw Law Firm through the article below!
What is the field of foreign capital tourism in Vietnam?
Foreign-invested tourism in Vietnam means individuals and organizations of a country investing capital to carry out business activities in the tourism sector through investment forms according to the provisions of investment law in Vietnam to invest in Vietnam’s tourism sector for business purposes to seek profits.
In recent years, Vietnamese tourism has been on the rise, with the number of international visitors as well as domestic tourists increasing. Vietnam tourism is increasingly known around the world, and many domestic destinations are voted as favorite addresses of international tourists. Tourism is increasingly receiving the attention of the entire society. Currently, tourism is considered one of three major economic sectors that are focused on investment and constantly developing in Vietnam.
Vietnam is among the countries with the fastest tourist growth in the world. Tourism is considered a key economic sector of Vietnam, the country has diverse and rich tourism potential with many strengths:
- Vietnamese Heritage: Our country has 8 heritage sites recognized by UNESCO: Thang Long Imperial Citadel, Hoi An Ancient Town, Trang An Scenic Complex, Hue Ancient Capital, Ho Dynasty Citadel, My Son Sanctuary, garden Phong Nha – Ke Bang country, Ha Long Bay.
- Scenic landscapes: The potential for tourism development is not only in the plains but also in the mountainous and midland regions of our country, which also have countless memorable landscapes: Moc Chau plum and mustard flower season, Northwest ripe rice season,…
- Culinary culture: Vietnamese cuisine is very famous in the world, international friends are fascinated with Vietnamese dishes such as Pho, bread, Hue beef noodle soup,… In addition, intangible cultures such as Quan Ho, Hue royal court music, Central Highlands gong cultural space,… are also very attractive to tourists.
Forms of investment in the tourism sector with foreign capital
Tourism is a service industry that is being developed in Vietnam, therefore, investing in establishing a travel company is targeted by many investors, including businessmen from abroad. However, because tourism services are a conditional business, so if foreign investors want to invest in the tourism sector in Vietnam, they need to meet some conditions in the form of investment according to the regulations of Vietnamese law. Currently, Vietnamese law stipulates that there are four forms of investment as follows:
Investing in establishing economic organizations in the field of tourism in Vietnam
Forms of establishing economic organizations investing in the field of tourism with foreign capital include two methods:
+ Established a 100% foreign-invested tourism company
+ Establishing a travel company between domestic investors or the domestic Government and foreign investors.
Before establishing an economic organization in the field of tourism, foreign investors must have an investment project, procedures for granting an investment registration certificate in the field of tourism, and must meet the conditions of the exchange rate, charter capital ownership according to the provisions of the law on securities, equitization, and conversion of state-owned enterprises and other conditions according to the provisions of international treaties to which the Socialist Republic of Vietnam is a member;
Investing in capital contributions, buying shares, purchasing capital contributions of tourism companies in Vietnam
Contributing capital, buying shares, or contributing capital to economic organizations in the tourism sector is a form of indirect investment for foreign investors who want to invest in tourism in Vietnam. This form of indirect investment is through the purchase of stocks, bonds, and other valuable papers at tourism companies in Vietnam without the investor directly participating in managing investment activities. When implementing this form of investment, investors need to comply with the forms and procedures for capital contribution, share purchase, and capital contribution according to the provisions of Vietnamese law governing these activities.
Implement investment projects in the field of tourism
Foreign investors can sign investment contracts in the tourism sector in the form of public-private partnerships (PPP contract). This is an investment method implemented based on the terms of cooperation between the State and the Government and private investors through signing PPP contract to attract private investors to participate in implementing PPP investment projects.
Investment in the form of BCC contract
BCC is a form of investment signed between investors for business cooperation, profit sharing, and product division without establishing a new legal entity. This form of investment helps investors conduct investment activities quickly without wasting time or money to establish and manage a newly established legal entity. BCC contracts are signed between domestic investors under the provisions of civil law. For BCC contracts with at least one party being a foreign investor, procedures for granting an investment registration certificate must be carried out.
Above are the forms of investment in the tourism sector with foreign capital in Vietnam. If you have any questions related to forms of investment in the field of foreign capital tourism, you can contact Siglaw Law Firm directly for support!
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