FDI Law in Vietnam

Summary

Vietnam's FDI legal framework changed materially in 2026. Foreign investors should assess market access, investment registration, enterprise registration, beneficial ownership disclosure, capital contribution, land use, tax, labour and post-licensing compliance under the Law on Investment 2025, Decree 96/2026/ND-CP and the amended enterprise registration rules.

Investor context

Vietnam remains one of Southeast Asia's most active destinations for foreign direct investment, particularly in manufacturing, technology, logistics, renewable energy, business services and export-oriented production. For many investors Vietnam is no longer only a low-cost production base; it is part of a China+1, ASEAN supply-chain and regional market-entry strategy.

The legal issue is not simply whether a foreign investor may enter Vietnam. The more important question is whether the investment structure can be licensed, funded, governed, operated and expanded predictably.

Treat Vietnam FDI law as an implementation framework, not an incorporation procedure. A market-entry project normally involves investment licensing, enterprise registration, foreign exchange control, tax registration, land or lease arrangements, labour planning, sector approvals and post-licensing reporting.

Current legal framework

As of 2026, Vietnam's foreign investment framework is governed primarily by the following instruments. Investment planning should be anchored in the 2025 Investment Law and Decree 96/2026/ND-CP; the 2020 framework should no longer be treated as the lead legal basis for new FDI analysis.

Market access for foreign investors

Before entering Vietnam, confirm whether the intended activity is open to foreign investors; subject to market-access conditions; restricted by foreign ownership limits; subject to special licensing or sub-licensing; or sensitive because of land location, national defence, security, data, technology, environment or sector regulation.

Vietnam uses a market-access approach based on negative lists and conditional sectors. Company incorporation alone does not give the right to conduct every intended activity.

For manufacturers, the market-access review should be connected with industrial land, factory lease terms, environmental requirements, fire safety, construction, machinery import, labour recruitment and tax planning.

IRC and ERC: the two licensing documents

Foreign investors encounter two key documents: the Investment Registration Certificate (IRC), which records the investment project, and the Enterprise Registration Certificate (ERC), which establishes the Vietnamese legal entity.

Many foreign-invested projects still require an IRC before the investor can implement the project. The 2025 Investment Law and Decree 96/2026/ND-CP introduce more flexible sequencing in certain cases — a foreign investor may be able to establish an economic organisation before completing investment registration, provided market-access conditions are satisfied and investment registration is completed within the statutory timeline.

That flexibility is useful, but licensing, banking, charter capital, foreign exchange control, tax registration, business lines and operational permits still have to be coordinated. A fast ERC without a compliance roadmap creates problems when the company opens bank accounts, contributes capital, leases land, imports machinery or applies for sector approvals.

Competent licensing authorities

Depending on location and nature, licensing may involve the provincial Department of Finance for many projects outside industrial zones — the former Department of Planning and Investment function, following the 2025–2026 merger of the Ministry of Planning and Investment into the Ministry of Finance; the relevant Industrial Zone, Export Processing Zone, High-Tech Zone or Economic Zone Management Board for projects inside such zones; the provincial People's Committee or higher authorities where investment policy approval is required; and sector regulators for conditional activities.

The exact licensing route should be checked at project level, especially for industrial, real estate, energy, education, healthcare and technology projects. Processing has been reported as inconsistent during the institutional transition, so confirm current practice and IRC project-code mapping before relying on a published timeline.

Investment policy approval

Some projects require investment policy approval before the IRC is issued — typically where the project involves large-scale land use, sensitive locations, residential or real estate development, industrial infrastructure, energy or natural resources, major environmental impact, sectors under special state management, or approval by the National Assembly, Prime Minister or provincial People's Committee.

The practical point is sequencing: do not sign binding land, factory, construction, financing or equipment commitments before confirming the required approvals and a realistic licensing timeline.

Capital contribution and foreign exchange compliance

After licensing, foreign investors must contribute capital in accordance with the registered charter capital and the investment capital schedule. Contribution is normally made through a Direct Investment Capital Account (DICA) at a Vietnamese commercial bank.

Key issues include correct use of the DICA, currency and remittance procedures, timing of charter capital contribution, supporting documents for inbound capital, shareholder loan registration where applicable, profit repatriation after tax and financial obligations, and consistency between the IRC, ERC, charter, bank documents and accounting records.

Capital contribution errors create banking, tax and accounting problems and affect future M&A, profit repatriation, capital increase, restructuring or dissolution. For a CFO the question is whether the entity's capital history is clean enough to support audit, financing, dividend distribution, group reporting and exit.

Beneficial ownership disclosure

From 1 July 2025 the enterprise registration framework includes beneficial ownership disclosure obligations under amendments to the Law on Enterprises and the implementing registration rules. Companies should collect, update and retain beneficial owner information where required.

For investors using holding companies, nominee layers, funds, trusts, SPVs or offshore group structures, beneficial ownership compliance should be reviewed before incorporation, M&A, restructuring or capital transfer — banks, licensing authorities, tax authorities, auditors and counterparties all check it.

M&A and share acquisition

A foreign investor may enter Vietnam by setting up a new company or by acquiring shares or contributed capital in an existing company. M&A registration may be required where the transaction increases foreign ownership in a conditional sector, results in controlling or significant foreign ownership, involves land-use rights in sensitive locations, or triggers competition, securities, real estate, banking, insurance or other sector approvals.

Conduct legal due diligence before signing or closing: corporate authority, land and lease rights, tax exposure, labour compliance, environmental permits, business lines, foreign ownership conditions, related-party transactions, debts, litigation, contracts and hidden licensing issues.

Land, factory and real estate issues

Vietnam's land framework governs how foreign-invested enterprises lease land, sublease industrial land, use ready-built factories, acquire real estate projects or take part in property business. The relevant laws include the Land Law 2024, Housing Law 2023 and Real Estate Business Law 2023, all effective 1 August 2024.

For manufacturing projects, check whether the industrial park is properly licensed; whether the landlord may lease or sublease; the permitted land-use purpose; lease term and renewal risk; infrastructure commitments; environmental conditions; construction and fire-safety obligations; handover conditions for ready-built factories; and whether the intended activity matches the project approvals.

Land due diligence is one of the highest-risk areas in Vietnamese FDI projects, because a licensing defect becomes an operational delay rather than a legal technicality.

Tax, accounting and post-licensing compliance

After incorporation, foreign-invested companies must meet tax, accounting, labour, reporting and governance obligations: tax registration and e-tax setup; VAT, corporate income tax and withholding compliance; labour contracts and internal labour rules; social insurance registration; work permits or exemptions for foreign employees; investment project reporting; annual corporate compliance; beneficial ownership recordkeeping; and registration of changes to business lines, capital, address, legal representative or project scope.

A common mistake is to treat company setup as complete once the IRC and ERC are issued. In practice the first 90 to 180 days after licensing decide whether the entity can operate cleanly.

Practical implementation steps

Where projects go wrong

Frequently asked questions

Implementation checklist

How we support investors

ECOVIS Vietnam Law supports international investors with market-entry structuring, investment registration, enterprise establishment, M&A approval, industrial project setup, corporate governance, tax coordination and post-licensing compliance.

The objective is not only to obtain incorporation documents. It is to build a Vietnam structure that can be licensed, funded, governed and operated predictably.