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Vietnamese investors looking to expand their operations internationally must navigate a defined legal framework to obtain the necessary approvals for outward investment.
This article outlines the procedure for obtaining a Certificate of Registration for outward investment under the Investment Law 2014 and details the circumstances under which an outward investment project may be terminated.
Procedure for Issuance of Certificate of Registration for Outward Investment
The process for obtaining a Certificate of Registration for outward investment is detailed in Article 59 of the Investment Law 2014. It varies depending on whether the investment project requires a decision on investment policy.
For Projects Requiring a Decision on Investment Policy:
- The Ministry of Planning and Investment is responsible for issuing the Certificate of Registration for outward investment. This must be done within 5 working days from the date the decision on the investment policy is received.
For Projects Not Requiring a Decision on Investment Policy:
- The investor must submit an application to the Ministry of Planning and Investment. The application must include:
- A written registration for outward investment.
- A copy of the investor’s ID card, citizen ID, or passport (for individual investors); or a copy of the Certificate of Establishment or equivalent document confirming the legal status (for institutional investors).
- A decision on outward investment as specified in Clauses 1 and 2, Article 57 of the Investment Law 2014.
- A written commitment to self-balance foreign currency sources, or a document from an authorized credit institution committing to arrange foreign currency for the investor as specified in Clause 3, Article 58 of the Investment Law 2014.
- For investment projects in banking, securities, insurance, science, and technology, the investor must provide an approval document from the competent state authority regarding the conditions for outward investment according to the relevant laws.
- The Ministry of Planning and Investment must issue the Certificate of Registration within 15 days of receiving a complete application. If the certificate is denied, the Ministry must notify the investor in writing, stating the reasons for the denial.
Termination of Outward Investment Projects
The government further details the procedures for appraising outward investment projects, including issuing, adjusting, and terminating the validity of the Certificate of Registration for outward investment.
According to Clause 1, Article 62 of the Investment Law 2014, an outward investment project can be terminated in the following nine cases:
- Investor Decision: The investor decides to terminate the project.
- Expiration of Project Duration: The project’s operational period expires.
- Contractual Conditions: Termination conditions specified in the contract or enterprise charter are met.
- Transfer of Investment: The investor transfers all investment capital abroad to a foreign investor.
- Lack of Approval: More than 12 months pass from the issuance of the Certificate of Registration for outward investment without the project being approved by the host country, or from the host country’s approval without the project being implemented.
- Non-Implementation: More than 12 months pass from the issuance of the Certificate of Registration without the investor implementing the project or without the ability to implement the project as per the registered schedule, and without adjusting the investment schedule.
- Lack of Reporting: More than 12 months pass from the date of the tax finalization report or an equivalent legal document in the host country without the investor submitting a report on the project’s operational status.
- Dissolution or Bankruptcy: The foreign economic organization is dissolved or bankrupt according to the laws of the host country.
- Legal Judgment or Decision: Termination as per the judgment or decision of a court or arbitration.
Understanding and complying with these legal requirements is essential for Vietnamese investors seeking to pursue outward investment. By following the outlined procedures and being aware of the potential grounds for termination, investors can better navigate the complexities of international investment and ensure their ventures are legally sound and strategically viable.
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