Corporate - M&A

Globalization is happening at a very fast pace, forcing businesses to adapt in order to survive and develop. One of the fastest way to change is to undergo a merger and acquisition (“M&A”) process. However, M&A deals always contain many risks due to hidden internal problems of each party and of the degree of rapid integration between the parties once the M&A deal is closed, especially for cross-border M&A, where enterprises face different business practices and legal systems. The difference of legal systems is one of the main reason of post-deal failure and enterprises should consider it carefully.

We understand the difficulties and can assist in all stages of M&A deals; from preparation to restructuring; to transferring or assessing the legal and financial capacity of the seller; or even negotiating the deal between the enterprises, local or foreign alike.

Through many years of practice in many business areas such as services, retail, manufacturing, food & beverage, hospitality or technology, we understand the core needs of each of the parties in the transaction. When needed, we know how to maintain harmonious benefits between the parties to quickly bring new businesses into operations.

Registering a 100% foreign-owned company in Vietnam is possible. However, foreign investment is subject to regulatory limitations applied on each specific business sector.

In most cases, investors shall implement the following steps to establish a company:

Step 1: Obtaining an Investment Registration Certificate, abbreviated IRC (if any non-Vietnamese investors).

Step 2: Obtaining an Enterprise Registration Certificate, abbreviated ERC or BRC for Business Registration Certificate.

The company is established but the following steps are required for regulatory compliance:

Step 3: Post establishment procedures.

Step 4: Obtaining sub-licenses (if any).

IRC stands for Investment Registration Certificate which shall be obtained (in most cases) when a foreign investor wants to set up a project (such as establishing a company) in Vietnam at the beginning.

ERC stands for the Enterprise Registration Certificate which every company in Vietnam must have. In other jurisdiction it is sometimes referred to as the “Incorporation Certificate” or “Company Certificate”.

Joint Stock Company (“JSC”) and Limited Liability Company (“LLC”) are the most common types of company in Vietnam since they offer the following advantages:

  • Limitation in liabilities of their shareholders/ members/ proportionate to their capital contribution;
  • Flexible management structure;
  • Conversion from JSC to LLC and conversely is possible.

In general, there is no minimum capital required by law when registering a company in Vietnam. Only some conditional business sectors such as real estate trading, banking or education have specific capital requirements.

However, the capital shall be sufficient in light of the intended business sectors and scale of operation.

For non-conditional business sectors, we usually need from 6 to 8 weeks to setup a foreign-invested company and 1 week for a Vietnamese-invested one.

However, especially for foreign-owned companies, the time can be extended due to various reasons such as additional requirements from the licensing authorities.

We would be delighted to schedule a meeting to provide you with an effective solution.