Summary: One of the most common assumptions in a Vietnamese factory acquisition is that the target’s existing licences and approvals simply continue after closing. In practice, transferability varies by licence type, by deal structure, and by whether the change involves ownership, legal representative, or both — and getting this wrong can leave a newly acquired facility unable to operate on day one after closing. This article sets out how General Counsel should approach licence transferability as a structured diligence and closing-plan item.
By ECOVIS Vietnam Law | Last reviewed: 17 July 2026
“I have seen a closing go smoothly on the corporate side and then stall for weeks because nobody mapped which licences needed re-registration after the change of legal representative. Licence transferability is not a single yes-or-no question — it has to be answered licence by licence, and built into the closing timeline from the start.” — Attorney Vu Manh Quynh, Founder & Managing Partner, ECOVIS Vietnam Law
Why This Matters for Foreign Investors / Foreign Companies
A manufacturing facility typically operates under a stack of licences and approvals — investment registration, enterprise registration, environmental approval, fire-safety certification, and often sector-specific permits — each issued by a different process and, in some cases, a different authority. A change of ownership does not automatically carry every one of these forward in the same way. Some update through a straightforward notification process; others require a substantive re-application or amendment that can take weeks or months. Treating this as a single “licence transfer” line item in a closing checklist, rather than a licence-by-licence review, is a common source of post-closing operational disruption.
Key Legal and Compliance Issues
- Deal structure changes what needs to move. In a share acquisition, the legal entity holding the licences generally continues to exist, so many approvals may not require formal transfer — though a change of legal representative or ultimate ownership can still trigger notification or amendment obligations for some approvals. In an asset acquisition, licences generally do not follow the assets automatically and may require the buyer to obtain new approvals in its own name.
- Licence transferability is licence-specific, not a single rule. The trigger for updating each approval depends on what changed and what that specific licence tracks — treat this as a table to build, not a general assumption:
- Enterprise Registration Certificate (ERC): changes to charter capital, ownership, or legal representative generally require notification or registration of the change with the business registration authority, typically within a short statutory window (commonly around 10 days) of the change taking effect.
- Investment Registration Certificate (IRC): generally only needs amendment where the change affects content recorded on the certificate itself — such as the named investor, project scope, or where the deal structure triggers a formal M&A approval procedure under investment law — not for every internal ownership change at a holding level.
- Environmental permit (GPMT) and sector-specific permits (PCCC, hazardous materials, food processing, etc.): whether amendment is required depends on what is recorded in that specific permit file and whether the change affects the entity or facts the permit is tied to — see items 3 and 4 below for environmental and fire-safety specifics.
- Environmental approvals. An environmental permit is tied to the project or facility and the entity named as project or facility operator in the permit file, not to share ownership as such. A change of the named owner/operator on the permit is generally handled as a straightforward re-issuance in the operator’s updated name, while a change to production capacity, technology, waste streams, or treatment works is more likely to require substantive amendment or re-issuance on the merits. Whether a given transaction triggers either kind of update depends on what changes at the operating level, not solely on whether shares changed hands — and while the procedure is legally independent from business registration, permit files in practice need the entity’s current registration details, so the two are practically linked even if not formally the same filing.
- Fire safety (PCCC) approvals. PCCC approval is tied to the building, its design, and its approved use and fire-safety systems — not to the corporate owner. A share transfer alone does not automatically trigger a re-approval requirement, unless the change also affects the approved fire-safety basis (for example, a change in layout, use, occupancy, or fire-protection systems). This should be confirmed against the facility’s specific approval rather than assumed either way.
- Sector-specific permits. Certain activities (e.g. specific manufacturing processes, hazardous materials handling, food processing) carry additional licences that may have their own change-of-control notification or re-application requirements, separate from the general corporate registrations — each should be checked against its own issuing basis.
- Timing and sequencing. Corporate-level preparation (documentation, internal approvals, due diligence on each licence) can generally proceed in parallel with planning the licence updates. But several licence filings are legally sequenced — they can only be completed, not merely started, after the underlying corporate or investment registration change is itself recorded. This sequencing dependency, rather than a strict prohibition on parallel work, is what should be built into the closing plan.
- Interim operating risk. Where a licence update is pending, the facility’s ability to continue normal operations during the transition period should be confirmed — this is a practical continuity question, not just a paperwork one.
Practical Risks for Management
- General Counsel risk a facility unable to operate normally immediately after closing if licence-by-licence transferability was not mapped before signing.
- M&A/Corporate Development leads risk an inaccurate closing timeline if licence updates are assumed to run in parallel with corporate closing steps rather than sequentially.
- Boards risk reputational and operational exposure if a post-closing licensing gap becomes visible to customers, regulators, or the workforce.
- CFOs risk underestimating post-closing transition costs if licence re-application fees, delays, or interim compliance measures are not budgeted.
Practical Action — Licence Transferability Checklist
- Build a licence-by-licence inventory of the target’s approvals before signing, and confirm the transfer or amendment requirement for each — do not treat “licence transfer” as a single line item.
- Confirm whether the chosen deal structure (share vs. asset) changes the transferability analysis for each licence category.
- Map which licence filings can be prepared in parallel with corporate closing and which can only be completed after the corporate or investment registration change is recorded, and build this sequencing into the overall closing timeline.
- Confirm the facility’s ability to continue operating during any pending licence update, and identify any interim risk.
- Assign clear responsibility (buyer, seller, or joint) for each licence update in the transaction documents, with a realistic timeline for each.
- Budget for licence re-application fees, professional support, and any interim compliance measures as part of the transaction cost, not as an afterthought.
How Ecovis Vietnam Law Can Support
Ecovis Vietnam Law maps licence and approval transferability for Vietnamese manufacturing acquisitions before signing, and helps build a realistic closing plan that sequences corporate and licensing steps correctly — so operations continue without disruption after closing.
FAQ
Do all licences automatically transfer in a share acquisition since the company itself does not change?
Not necessarily. While the legal entity continues, changes in legal representative or ultimate ownership can still trigger notification or amendment obligations for specific licences — this should be checked licence by licence.
Is licence transfer easier in a share deal than an asset deal?
Generally a share deal involves fewer licence transfers since the same entity continues to hold them, but some updates are still required; an asset deal typically requires the buyer to obtain new approvals in its own name, which is a more extensive process.
Can licence updates be processed in parallel with the corporate closing?
Preparation can — but completion of several licence filings is legally sequenced and cannot happen before the corporate or investment registration change is itself recorded. This dependency should be planned for rather than assumed away.
What happens if a required licence update is still pending after closing?
This depends on the specific licence and situation; the facility’s ability to continue normal operations during the transition should be confirmed as part of pre-closing planning, not left to be discovered after the fact.
Who should be responsible for managing licence updates after closing — the buyer or the seller?
This should be explicitly assigned in the transaction documents on a licence-by-licence basis, since responsibility can reasonably sit with either party depending on the specific approval and deal structure.
Call to Action
Request a Licence Transferability Review. Ecovis Vietnam Law maps licence and approval transferability for Vietnamese manufacturing acquisitions and builds a realistic closing plan. Contact us before finalizing your transaction timeline.
Disclaimer
This article is for general information only and should not be treated as legal advice. Specific licence transferability should be confirmed for each transaction and licence type.