Investors play an important role in promoting economic development and building a sustainable economy of each country. In Vietnam, investors contribute significantly to the prosperity of this rapidly growing economy. In order to ensure fairness, transparency and protect the interests of both investors and the country, the legal system has paid great attention to protecting the basic rights of investors.
Discover the 8 essential rights and protections safeguarding investors in Vietnam with this comprehensive article. According to the Law on Investment 2020, investors in Vietnam, including both domestic and foreigners, have the following basic rights guaranteed by Vietnam:
1. Equal treatment
Investors (domestic and foreign) are treated fairly and equally by the Law. All are entitled to the same rights and benefits in the process of investment and business.
2. Autonomy in investment and business activities
- Select investment fields, investment forms, capital mobilization methods, geographical areas, investment scale, investment partners, and operation duration of the project in accordance with current regulations and local planning. For conditional investment fields, investors have the right to be autonomous if they fully meet the legal conditions;
- Register for business lines; business establishment; capital contribution, purchase of shares, purchase of capital contributions of economic organizations; investment in the form of business cooperation contract (BCC); can decide for themselves on registered investment and business activities.
3. Property ownership and investment-related assets
Investors have the right to own and manage assets formed from investment activities, including assets directly and indirectly related to investment activities.
The State recognizes and protects investors’ ownership of assets, investment capital, income, and other lawful rights and interests.
The investor’s legal assets are not nationalized or administratively sanctioned. In case the State appropriating property for reasons of national defence and security or in the name of national interest, in a state of emergency, and for natural disaster prevention and control; then the investor shall be compensated in accordance with the legal provisions.
Find out other articles relating to Property ownership:
- Vietnamese franchise business: Legal overview and intellectual property considerations
- Who owns employee innovations according to the Law on Intellectual Property?
- 6 key points when valuing Intellectual Property in M&A deals
4. Access to and utilization of capital
- Equality in accessing to and using credit capital, land, and support funds;
- Hire and purchase equipment and machinery domestically and internationally.
5. Employment and labor utilization rights
- Hire domestic workers; hire foreign workers to do management work, technical workers, experts according to their needs in accordance with the legal provisions;
- Regulations on workers’ wages are consistent with the minimum wage according to the labour laws.
Find out other articles relating to Labor matters:
- Labor management in foreign companies in Vietnam
- 8 key clauses in employment contracts in Vietnam
- Welfare provisions for female employees in Vietnam
Contact us today to receive a free 30-minute consultation about Labor matters in your company.
7. Asset transfer rights for foreign investors abroad
After completely fulfilling financial obligations to the State of Vietnam, foreign investors may legally remit the following assets abroad:
- Investment capital, investment liquidations;
- Income from business investment activities;
- Money and other assets legally owned by the investor.
Read more: Which assets are contributed as capital to an enterprise?
8. Self-determination in investment and business activities
Investors have the right to adjust investment projects, transfer investment projects or stop/terminate investment projects, however, investors must satisfy all conditions in some cases prescribed by Law.
9. Other rights
- Enjoy investment incentives as prescribed by Law;
- Access and use public services on the principle of non-discrimination;
- Access to legal documents and policies related to investment; the national economy data of each economic sector and socio-economic information related to investment activities; advice on laws and policies related to investment;
- Complaint, denounce or sue organizations and individuals that commit violations of the investment Law.
In summary, these rights play an important role in creating favourable conditions for investors when participating in the business market in Vietnam. This is a clear demonstration of the Government’s commitment to creating an open, transparent investment environment and protecting common interests. When the basic rights of investors are effectively guaranteed and enforced, the investment market in Vietnam will become more attractive with the participation of many domestic and foreign investors. This will promote economic development and bring significant benefits to both the country and investors.
At PLF Law Firm, we stand out for providing tailored solutions on Doing business in Vietnam, Mergers & Acquisitions and Tax & Accounting fields for foreign investors and business owners, helping them build a solid business foundation and minimize legal risks.
Contact us today to receive a free 30-minute consultation.
