Subsidiary company establishment An investor could invest in Viet Nam through many different methods. In fact, one of the methods that foreign companies often choose is establishing an subsidiary company. HNLaw & Partners would like to guide Customers contents as follows:
I. Legal basis
- Law on Investment 2014;
- Law on Enterprises 2014;
- WTO Commitment
II. Procedures of the establishment of subsidiary company in Viet Nam
Foreign companies when establishing subsidiary companies often contribute investment capital to establish a economic organization in Viet Nam. The procedures of establishing a subsidiary company in Viet Nam are carried out in 2 steps:
Step 1: Procedure on the grant Investment Registration Certificate
Foreign companies which establish subsidiary company in Viet Nam must execute the procedure on the grant of Investment Registration Certificate.
Step 2: Procedure on the grant of Enterprise Registration Certificate
Foreign companies (parent company) submit dossiers on the request of establishing the subsidiary company to Department of Planning and Investment of the province where the head office of the company is placed.
Notes on the parent company, subsidiary company (Article 189 Law on Enterprises)
- One company which is considered as a parent company if falling into one of the following cases:
- Owning more than 50% of the charter capital or the total of common shares of such company;
- Has a right to directly or indirectly decide on the appointment of mostly or total of members of board of directors
- Has a right to decide on the adjustments and suppliments of the Charter of such company.
- The subsidiary company must not invest capital, buy shares from the parent company. Subsidiary companies in a same parent company must not together invest capital, buy shares to own each others.
- Subsidiary companies in a same parent company which owns at least 65% of the state capital must not together invest capital to establish an enterprise according to Law on Enterprises.
Above is the consult on “Foreign company establishing subsidiary company in Viet Nam” of HNLaw & Partners. Customers who have any question or demand to use legal services please contact Company directly for detailed consults and best support.
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