DOCUMENTS REQUIRED TO BE PREPARED BEFORE APPLYING FOR INVESTMENT CERTIFICATE

Investment is one of the indispensable business activities in the context of globalisation. In recent years, attracting foreign direct investment (FDI) has increased sharply, leading to the need to apply for foreign investment certificates in Vietnam. Although there are many intrusting legal documents, documents preparation for investment certificate application procedure still faces many difficulties and obstacles in practice. Through this article, Phuoc & Partners will list the documents required to be prepared before applying for investment certificate and the points needed to pay attention to when preparing documents based on popular investment methods in Vietnam.

1. Documents required to be prepared before investing in the form of establishing economic organisations

1.1 For domestic investors:

For domestic investors include (i) individuals of Vietnamese nationality and (ii) economic organisations established and operating under the law of Vietnam without foreign investors being members or shareholders[1], the establishment of economic organisations must comply with the provisions of enterprise law[2]. The components of dossier for establishing an economic organisation are varied based on the type of enterprise established. Dossiers and documents to be prepared before invesment as specified in Decree 01/2021/ND-CP on enterprise registration are as follows:

• The application form for enterprise registration;
• The company’s charter;
• List of members (for limited liability company with two or more members/partnership) or list of founding shareholders and list of shareholders who are foreign investors (for joint-stock company);
• Copies of the following documents:
• Legal documents of the enterprise’s legal representative;
• Legal documents of company’s members, founding shareholders, shareholders who are foreign investors; legal documents of authorised representative of members, founding shareholders, shareholders that are foreign investment organisations and documents appointing an authorised representative to manage shares, capital contributions.

1.2 For foreign investors

Foreign investors are individuals with foreign nationality, organisations established under the foreign laws conducting investment and business activities in Vietnam[3]. According to the provisions of Article 22 Law on Investment 2020, foreign investors must have an investment project and must conduct the procedure for obtaining the Investment registration certificate before establishing economic organisation in Vietnam.

Please note that according to Article 23.1 Law on Investment 2020, foreign invested economic organisation belonging to the following cases must conduct the procedure for obtaining the Investment registration certificate when establishing other economic organisation:

• Having foreign investors holding more than 50% of the charter capital or the majority of partners are foreign individuals for the partnership companies;
• Having economic organisation specified in sub-clause a of this clause holding more than 50% of the charter capital;
• Having foreign investors and economic organisation specified in sub-clause a of this clause holding more than 50% of the charter capital.

Documents required to be prepared in conducting the procedure on obtaining the Investment registration certificate according to Article 33 Law on Investment 2020 and Article 36 Decree 31/2021/ND-CP guiding Law on Investment are as follows:

• An application form for implementation of investment project, including commitment bearing all costs and risks if the investment project is not approved;
• Documents on legal status of the investors;
• Documents proving financial capacity of the investors including at least one of the following documents: financial statements of the investors for the last 02 years; financial support commitment of parent company; financial support commitment of financial institutions; guarantee for financial capacity of the investors; other documents proving financial capacity of the investors;
• Proposal for the investment project;
• In case the investment project does not request the State to allocate or lease out land, or to permit land repurposing, documents on land use rights and other documents identifying location use rights to implement the investment project are required to submitted;
• Explanation contents on technology used in the investment project regarding projects subject to appraisal and consultation on technology according to legal regulations on technology transfer;
• Other documents related to the investment project, requirements on the eligibility and capacity of the investor according to the law (if any).

After being granted the Investment Registration Certificate, the foreign investor will conduct the enterprise establishment procedure in accordance with enterprise law. Dossiers and documents to be prepared are similar to those for domestic investors as mentioned in Section 1.1 and are additionally required an Investment Registration Certificate.

2. Documents required to be prepared before investing in the investment form of contributing capital, purchasing shares, capital contributions.

Domestic investors contributing capital to or purchasing shares or capital contribution proportion of economic organisations must meet the conditions and conduct procedures for changing members or shareholders according to the provisions of law corresponding to each type of economic organisation.

For foreign investors, they must conduct the procedure on registration for contributing capital, purchasing shares or capital contribution proportion before changing members or shareholders if falling into one of the cases specified in Article 26.2 Law on Investment 2020. In case this procedure is required, documents that the foreign investor must prepared are as follows:

• Application form for contributing capital, purchasing shares orcapital contribution proportion;
• Copies of legal documents of individuals, organisations contributing capital, purchasing shares or capital contribution proportion and of economic organisations with foreign investors contributing capital, purchasing shares or capital contribution proportion;
• Principal agreement on contributing capital, purchasing shares or capital contribution proportion between foreign investors and economic organisations to which foreign investors contribute capital or purchase shares or capital contribution proportion, or between foreign investors and shareholders or members of that economic organisation;
• Copy of Land use right certificate of the economic organisation with foreign investors contributing capital, purchasing shares or capital contribution proportion (in case that economic organisation has land use right certificate on islands, in border communes, wards, towns and coastal communes, wards, towns; other area that affects national defense and security)

3. Documents required to be prepared before investing in the form of business cooperation contract (BCC)

Business cooperation contract (also known as BCC) is a contract signed between investors for business cooperation, profit distribution, products distribution in accordance with legal regulations without establishment of an economic organisation[4]. Accordingly, investors need to prepare and sign the BCC. The content of BCC must be ensured to have all the contents as prescribed in Article 28 Law on Investment 2020.

In case the parties to BCC are domestic investors, the parties prepare, sign the contract and implement investment project in accordance with provisions of civil law.

In case that BCC is signed between domestic and foreign investors or between foreign investors, after signing the BCC, investors must conduct the procedure for obtaining Investment Registration Certificate[5]. Regarding the documents to be prepared for the procedure on application for Investment Registration Certificate, in addition to documents mentioned in Section 1.2 above, investors need to prepare BCC signed between parties to submit to competent state authority.

In case foreign investors to BCC demand to establish a project management office to perform the contract, the investors need to prepare documents for the procedure of establishment of the project management office, including:

• Application form for establishment of the project management office;
• Decision of foreign investors to BCC on establishment of the project management office;
• Copy of decision on appointment the head of the office;
• Copy of BCC contract.

4. Factors assisting the documents required to be prepared before investing be accurate and effective during the process of implementing investment procedures

Preparation of necessary documents before applying for investment registration certificate is a complex process that requires careful, thoughtful, and meticulous preparation. Below are some methods can be applied by enterprises for effective preparation of these documents:

Identifying and establishing strategic investment plan:

• Identifying requirements: Firsly, based on the investment needs, enterprises should clearly understand legal regulations and specific requirements of licensing authority or local legal regulations regarding the type of documents required to be prepared.
• Establishing detailed plan: Creating detailed schedule for collecting, handling and preparing each document. Dividing tasks into small phases and identifying the person who is responsible for each part.

Collecting information about investment project:

• Communicating with departments within enterprise to assign information collection task to relevant departments such as accounting, legal, human resources and managing board to ensure that all necessary information for project registration and implementation is sufficient.
• Checking information: comparing information, requirements, recommendations of internal departments to ensure that all information collected is accurate and thoroughly checked to avoid errors. This process should be consulted with local lawyers to avoid errors in the actual project registration process.

Checking, assessing and preparing completed dossiers

• Assessment on accuracy and validity: Ensuring that each document is thoroughly checked for accuracy and validity by qualified personnel.
• Creating completed dossiers: Ensuring that all necessary documents have been fully prepared, arranging documents into completed dossiers with attached lists of documents to help competent state authority search

Ensuring the form of documents

• Ensuring the form of documents: Ensuring that all documents are presented in the correct form as prescribed by law, originals must have full signatures and stamps, copies must be notarised and duly authenticated. Documents issued by foreign agencies must be legalised before submission to the competent state authority.
• Secured archive: Archiving copies and original documents securely and easily accessible for supplementing documents when necessary.

Legal consulting

• Investors should seek advice from lawyers or legal experts to ensure that all documents are complied with legal regulations and standards, as well as receive support to carry out the necessary procedures in investing in Vietnam.

The above is an overview of Documents required to be prepared before applying for investment certificate that Phuoc & Partners share with readers. If you have any difficulties related to the legal field, please contact us. Phuoc & Partners is a law firm established in Vietnam and currently has nearly 100 members working in three offices in Ho Chi Minh City, Hanoi and Da Nang. Phuoc & Partners is also considered one of the law firms with a team of staff specialising in the leading legal field in Vietnam and whose practice areas are rated top in the legal market such as Labor and Employment, Taxation, Mergers and Acquisitions, Litigation. We are confident that we are one of the Law Firms providing the best legal services to our customers.

[1] Article 3.20 Law on Investment 2020

[2] Article 22.1(a) Law on Investment 2020

[3] Article 3.19 Law on Investment 2020

[4] Article 3.14 Law on Investment 2020

[5] Article 27.2 Law on Investment 2020