What steps to be taken
to transfer an Investment Project in Vietnam?
Under the current Law on Investment,
investors are entitled to transfer part or all of the project to another
investor when satisfied the specific conditions and conducting to procedure of
project adjustment under the regulation of law.
The conditions of project transfer
· The project is not terminated in the cases as
prescribed in Clause 1 Article 48 of Law on investment;
· Investment conditions applied to foreign
investors are satisfied in case the foreign investor receives a project
of investment in conditional
business lines;
· Regulations of law on law, real estate trading
is complied with if the project transfer is associated with transfer of land;
· Conditions in the Certificate of investment
registration or relevant regulations of law are complied with.
Preparation of dossier
· A written request for permission for project
adjustments;
· A report on the project’s progress up to the
time of transfer;
· The project transfer contractor an other
document with equivalent legal value;
· Copies of the ID card or passport (if the
investor is an individual) or Certificate of Enterprise Registration or another
document with equivalent legal value (if the investor is an organization);
· Copies of the Investment Registration Certificateor decision on investment guidelines (if any);
· Copies of the BCC contract (for BCC projects);
· Copies of one of the following documents of the
transferee: financial statements of the last 02 years; commitment to provide
financial support by the parent company, commitment to provide financial
support by a financial institution, the guarantee of transferee’s financial
capacity, documents describing the transferee’s financial capacity;
Order and procedure
· Investors submit the dossier at Department of
Planning and Investment (or Management of Economic Zone or High-tech Zone);
· Within a period of 10 working days from the date
of receipt the complete and valid dossier for an investment project operating
under an investment license and not subject to decision of investment policy
(or 28 working days from the date of receipt the complete and valid dossier for
an investment project which is subject to investment decision of the provincial
People’s Committee; 47 working days from the date of receipt the complete and
valid dossier for the investment project subject to the decision of the Prime
Minister), the competent authorities consider and decide to adjust the
investment registration certificate to the investor transferring the project.
Before transferring an investment project, investors need to
evaluate the legal situation, apart from the financial, personnel, and other
key issues of the project, which are subject of the transfer. Therefore, to
ensure effective transfer, investors often engage law firms with highly
qualified lawyers in Vietnam to
conduct M&A legal due
diligence related to the
legal documentation of the owner, capital contribution of the shareholder or
member, tangible assets (land use rights, plant and machinery, equipment, etc.)
and invisible assets (including industrial property rights),
licenses, contracts or transactions of great value, taxes and other legal risks
such as litigation or disputes which could significantly impact the project..
The transfer of an investment project is an administrative
procedure with a state agencies that is only smooth when the parties reached
agreements. In fact, the transfer of the investment project’s timeline depends
on the appraisal and evaluation process of the parties involved in the project.
Source: ANTLawyers.vn
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