Common questions on investment issues and helpful answers
Question 1: Can the company within the same group as an investor provide financial support for project in Vietnam?
Answer: It is advised that, when contributing capital, capital should be directly contributed from investors, not from other companies in the same group as investors.
Question 2: What happens if the actual amount of the investment is different from the amount stated in the file?
Answer: Total investment capital (TIC) includes contributed capital (charter capital) and loan capital (if any).
In principle, real investment capital must be equal to the Total investment capital described in the Investment Certificate (IC).
In case of reduction or increase of investment capital, the investor must register with the provincial departments to adjust the investment certificate. However, state agencies still expect a rise in investment capital.
In case an investment company is a one-member limited liability company (1 investor) and requests to reduce its charter capital (not investment capital), it is not allowed.
Question 3: Do Government projects improve Hai Phong infrastructure? What are specific plans and results from those projects?
Answer: Hai Phong plays an important role in Vietnam’s economy and society, so the Government decided to invest in developing large infrastructure of Hai Phong such as:
Hanoi – Hai Phong expressway: reducing travel time between two cities from 2 hours to 1 hour.
Expected completion: Year 2015
Lach Huyen Deep Sea Port Project: improve the productivity of vessel tonnage from 20,000 DWT (maximum) to 100,000 DWT (phase 1: 45,000 DWT).
Completion objectives: Harbor No. 1 (Q1-2016) and Harbor No. 2 (Q1-2016)
Upgrade Cat Bi domestic airport to become an international reserve airport for Noi Bai International Airport.
Expected to be completed in 2015
Question 4: What is the minimum wage for workers to apply to foreign enterprises?
Answer: The minimum wage for local workers in foreign enterprise is: (applicable from January 1, 2013)
- US $ 135/ month (VND 2.7 million) for Region 1
- US $ 120/ month (VND 2.4 million) for Region 2
- US $ 105/ month (VND 2.1 million) for Region 3
- US $ 95/ month (VND 1.9 million) for Region 4
Question 5: What is the tax form for export processing enterprises?
Answer: Factories in the form of export processing enterprises will be exempt from import and export taxes
Question 6: What licenses do (production) investors need before they operate the Company in Vietnam?
Answer: Investment Certificate
Tax registration certificate
Seal certificate
Construction Permit
Environmental certificate
Fire protection certificate
Waste disposal license (> 1000m3/ day: Ministry of Agriculture and Rural Development; <1000 m3/ day: Department of Agriculture and Rural Development
Work permit (for foreign workers in Vietnam)
Visas (for foreign workers in Vietnam)
Question 7: Human resources for workers in Hai Phong?
Answer: With a workforce of about 1.2 million people, Hai Phong has a large workforce.
Moreover, abundant labor resources from neighboring localities such as Hai Duong, Nam Dinh, Quang Ninh and Thai Binh can also be provided to the locality.
Question 8: Time frame for capital contribution?
Answer: Based on the approval of the Investment Certificate, the company is required to contribute its charter capital within 36 months from the effective date of the Investment Certificate.
Capital contribution can be in the form of cash or machines in mortgages.
The remaining capital can be invested during operation in the form of loans from the parent company or local banks.
Question 9: Are profits or dividends allowed to flow backward from Vietnam?
Answer: It is possible that foreign investors may freely return their profits or dividends back to their home countries after fulfilling their tax obligations. As of January 1, 2004, the profit transfer tax is canceled.
Question 10: What is the highest valid limit for workers’ overtime?
Answer: 200 hours in a year is the workers’ maximum overtime as defined by the Labor Code. The company must comply with this regulation.
Question 11: Can the investor write the address of the Corporation as the legal representative of the company established in Vietnam in the application file for the Investment Certificate?
Answer: In fact, the company address in Investment Certificate application dossier should be in Vietnam. However, because this is the first registration, investors can use the address of the Corporation instead.
Question 12: Which foreign banks are operating in Vietnam?
Answer: The majority of foreign banks are operating widely in Vietnam.
Banks such as UnitedOverseas Bank, May Bank, HSBCandCitibank.
Question 13: Can the investor write the address of the Corporation as the legal representative of the company established in Vietnam in the application file for the Investment Certificate?
Answer: In fact, the company address in Investment Certificate application dossier should be in Vietnam. However, because this is the first registration, investors can use the address of the Corporation instead.
Question 14: Can foreign individuals own or buy land in Vietnam?
Answer: Foreign individuals cannot own or buy land in Vietnam. They can lease land for up to 50 years, where they will be given land use rights.
Question 15: For implementation of the capital contribution plan, we would like to contribute capital several times within 36 months from the date of business establishment. Is this process possible?
Answer:
- By law, the time limit for deploying capital contribution is 36 months from the date of issuance of the Investment Certificate. The number of capital contributions will be decided by the company, issued within 36 months.
- For loans, the company only needs to pay attention to the total invested capital.
Question 16: Can investors transfer to the owner of the company?
Answer: The investor may transfer the company to another shareholder without any change in tax incentives (except for the case of changing the type of business: for example from Export Processing Enterprise to Non-Export Processing Enterprise)