Increase capital of foreign capital company in Vietnam

Capital increase dossiers are necessary documents that must be submitted to competent state agencies when foreign company make changes in investment capital on the Investment Registration Certificate.

Investors wishing to increase investment capital to expand or develop business activities should submit an application for adjustment of the Investment Registration Certificate at the investment registration agency. This article Viet An Law Firm guides the dossier of capital increase of foreign capital company in accordance with the Law on Investment 2020.

Legal bases

• Investment Law 2020;
• Decree 31/2021/ND-CP guiding the Law on Investment;
• Circular 03/2021/TT-BKHDT;

Dossier of capital increase of foreign capital company in Vietnam

A dossier of capital increase of a foreign capital company for adjustment of an Investment Registration Certificate includes:

• A written request for adjustment of the investment project;
• Report on the implementation of investment projects up to the time of adjustment;
• Investor’s decision on increasing investment capital;
• Explain the reasons for increasing investment capital;
• A copy of the Investment Registration Certificate;
• Documents proving the investor’s ability to contribute additional capital.

Notes on the application for increasing investment capital:

• Financial proof documents only need to prove the additional capital contribution, including one of the following:
• Translation and notarization of the financial statements of the last 02 years of the investor with profit corresponding to the increased capital (if the investor contributing additional capital is an organization);
• Translation, notarized confirmation of the balance of the bank account with the balance corresponding to the increased capital (if the investor contributing additional capital is an individual or organization);
• In case of only increasing mobilized capital (borrowed capital) without increasing the investor’s contributed capital: Commitment of financial support from investors or from credit institutions or guarantees on financial capacity of investors.
• In case of increase in investment capital due to conversion from a loan: A copy of the confirmation of foreign loan registration; a copy of the statement of the foreign direct investment account on receipt of the loan; Notarized translation of the minutes of the agreement to convert the loan into investment capital.
• In case investors contribute capital with assets: confirmation of balance proving financial capacity, statement of assets contributed as investment capital.
• In case the Investment Registration Certificate has not recognized the sufficient contribution of investment capital, when submitting the dossier of adjustment of capital increase, it is necessary to enclose: The latest audited financial statements at the time of adjustment or Confirmation of the direct investment capital account showing that the investment capital has been fully contributed.
• In case of a change in investment capital accompanied by a change in charter capital, the investor, after submitting the application for increasing investment capital and fully contributing the increased charter capital, needs to submit a dossier of increase in charter capital.
• Investors enclose the confirmation of submitting investment reports online on the national information system on foreign investment to facilitate the inspection of investment reports in accordance with the law.

Some questions related to the capital increase dossier of a foreign capital company in Vietnam

Does the capital increase dossier of the foreign company need to prove the financial capacity of the investor?

A dossier of capital increase of a foreign company needs documents proving the financial capacity of the investor. Usually supporting documents can be: Financial statements of the last 02 years of the investor / confirmation of the investor’s bank account balance / commitment of financial support of the investor / …

Does the capital increase dossier need to be included with the audited financial statements of the company?

In case the Investment Registration Certificate does not recognize the sufficient investment capital contribution, when submitting the dossier for adjustment of the investment project, it is necessary to enclose: The latest audited financial statements at the time of adjustment or Confirmation of the direct investment capital account showing that the investment capital has been fully contributed.

What documents are needed to increase capital of a foreign company with borrowed money to prove the financial capacity of the investor?

Dossiers of capital increase due to conversion from loans and documents proving financial capacity include: A copy of the confirmation of foreign loan registration; a copy of the statement of the foreign direct investment account on receipt of the loan; Notarized translation of the minutes of the agreement to convert the loan into investment capital

Customers who are interested in the service of drafting dossiers to increase capital of foreign capital company, please contact Viet An Law Firm directly for detailed advice.