Buying shares in a Vietnamese company — especially when the buyer is a foreign investor — needs a checklist covering legal, financial and administrative procedures: legal due diligence of the target company (legal standing, land, labor, licenses, disputes, tax obligations); determining whether capital contribution/share purchase registration applies; negotiating the share purchase agreement (SPA) with protection mechanisms (representations & warranties, price adjustment, conditions precedent); payment through the capital account per foreign exchange rules; the seller’s transfer tax declaration; and completing the enterprise registration change. Missing any link can stall the deal at the final stage.
For FLAT LAW FIRM’s clients, a good legal analysis must answer three questions: whether the dossier has sufficient basis, which authority is competent at the time of implementation, and which option reduces risk while fitting the client’s commercial or family objectives.
This article is written practically, makes no commitment to outcomes, and does not replace individual advice. The analyses are built on current legal sources, using cautious authority naming following changes to state machinery, administrative boundaries and the court system.
Quick summary
| Topic | Checklist for share purchases in Vietnamese companies |
|---|---|
| Suitable for | FDI companies, foreign investors and in-house legal teams. |
| Points to check | Party standing, supporting documents, competent authority, implementation timelines and risks arising at filing time. |
| Desired outcome | A clear action plan, standardized documents, quantified risks, and business/family decisions made on a cautious legal basis. |
Main legal issues: checklist for share purchases in Vietnamese companies
Buying shares in a Vietnamese company — especially when the buyer is a foreign investor — needs a checklist covering legal, financial and administrative procedures. The first group is legal due diligence of the target company: legal standing and business registration change history; land use rights and on-land assets (whether the company uses land in sensitive areas — the decisive factor for the capital contribution registration obligation); valid specialized licenses; labor and social insurance status; tax obligations (tax debts, ongoing inspections); and existing disputes and lawsuits.
The second group is determining the transaction’s own administrative obligations: whether the foreign investor must register the capital contribution/share purchase with the investment registration authority; whether the transaction exceeds economic concentration notification thresholds; the payment method (through the capital account for foreign investors). Missing this group is a common reason deals end up “money paid but paperwork unfinished”.
The third group is the share purchase agreement (SPA): price and price adjustment mechanisms; the seller’s representations & warranties on the company’s legal and financial status; conditions precedent (registration approval, no material adverse change); post-closing indemnification for discovered misstatements; and governing law and dispute resolution. The more detailed the SPA, the lower the “overpay” risk.
Legal basis and verification sources
- Law on Investment 2025 (No. 143/2025/QH15)
- Law No. 76/2025/QH15 amending the Law on Enterprises 2020
- Decree 168/2025/ND-CP on enterprise registration
- Decree 29/2025/ND-CP on the functions and tasks of the Ministry of Finance
- Resolution on the 2025 provincial-level administrative unit rearrangement
- Resolution 203/2025/QH15 amending the Constitution on administrative units
Handling process or dossier checklist
The 8-group due diligence framework
1. Legal standing and ownership structure: the enterprise registration certificate, charter, shareholder/member registers, General Meeting of Shareholders resolutions; compare against the Law on Enterprises 2020 (No. 59/2020/QH14, amended by Law No. 76/2025/QH15) — particularly the beneficial owner information update obligation effective 01/7/2025.
2. Land and on-land assets: land use right certificates, use purposes, terms, land financial obligations; note restrictions for foreign-invested economic organizations after the transaction.
3. Licenses and business conditions: sub-licenses, conditional sector conditions — against the list of conditional investment business sectors (applied per the Law on Investment 2025’s effectiveness roadmap).
4. Labor and social insurance: labor contracts, internal rules, collective labor agreements, SI/HI/UI contribution status — see Social insurance and salary compliance for FDI companies.
5. Tax: tax finalization status, enjoyed tax incentives and maintenance conditions, reassessment risks — see M&A approval for foreign investors on capital transfer tax obligations.
6. Material contracts: change of control clauses, non-compete commitments, the target company’s guarantees for third-party obligations.
7. Disputes and compliance: ongoing lawsuits, administrative sanction decisions, employee complaints.
8. Intellectual property and data: trademarks, copyrights, technology transfer; personal data protection law compliance for customer and employee data.
Due diligence findings must be quantified into: (i) conditions precedent, (ii) representations, warranties & indemnities, (iii) price adjustments — and attached directly to the share purchase agreement. See also Registering foreign investors’ capital contributions and Protecting minority shareholders in M&A transactions.
Step 1 — Legal due diligence: comprehensively review the target company across the 8 groups: legal standing, land, licenses, labor, tax, finance, material contracts, disputes; prepare a findings report and remediation costs.
Step 2 — Determine registration obligations: match against the capital contribution/share purchase registration cases under the Law on Investment; assess economic concentration thresholds under Decree 35/2020/ND-CP.
Step 3 — Negotiate and sign the SPA: agree on price, price adjustment mechanisms, representations & warranties, conditions precedent, indemnification, deposits/escrow; sign the share purchase agreement.
Step 4 — Complete approval procedures: file the capital contribution/share purchase registration (if required); notify economic concentration (if above thresholds); await approval before full payment.
Step 5 — Pay, tax and update: pay through the capital account (buyer is a foreign investor); the seller declares transfer tax; update the shareholder register; change enterprise registration if founding shareholders or certificate information changed.
Common risks
Risk 1 — No or superficial due diligence: discovering large tax debts, land disputes or expired licenses only after purchase — the company’s true value far below the purchase price.
Risk 2 — Skipping capital contribution/share purchase registration: a registrable transaction not registered; shareholders cannot be updated, the deal hangs.
Risk 3 — Bare-bones SPA: no representations & warranties, no indemnification mechanism; post-closing misstatements discovered but no basis to claim compensation.
Risk 4 — Paying before conditions are met: paying in full while approval procedures are pending; if denied, recovering the money is complex and costly.
Risk 5 — Land issues: the target company uses land in sensitive areas (border, islands, coastal) — increased foreign ownership may face national defense and security conditions; needs separate assessment.
Competent authority and filing agency
Foreign investors’ capital contribution/share purchase registration (if required) is done at the investment registration authority where the target company is headquartered. The economic concentration notification (if above thresholds) is filed with the National Competition Commission. Shareholder register updates are done at the company; enterprise registration changes (when needed) at the business registration authority (the Department of Finance).
Capital transfer tax declarations go to the tax authority directly managing the target company. Foreign investors’ payments go through the capital account at a permitted bank. Where the target company uses land, additionally review land regulations for foreign organizations and individuals.
When to contact a lawyer
A lawyer should be involved in every share purchase deal with a foreign element. Three signs to engage a lawyer early: (1) before signing any document, even a memorandum — to design the due diligence checklist and deal structure; (2) when it is unclear whether the transaction is subject to capital contribution/share purchase registration or exceeds economic concentration thresholds; (3) when findings emerge during due diligence — a lawyer is needed to quantify risks and negotiate protective terms and appropriate price mechanisms.
What FLAT LAW FIRM supports
FLAT LAW FIRM supports document review, legal issue identification, source-of-law verification, evidence assessment and building handling roadmaps in Vietnamese, Chinese and English.
For foreign clients or Chinese-speaking investors, we help translate business or family requirements into specific legal checklists, avoiding crude machine translation and ensuring key terms are understood consistently among the parties.
The support scope may include initial advice, document drafting, contract review, dossier standardization, working with related parties, preparing dispute materials and coordinating with lead counsel when representation in formal procedures is needed.
See also related pages: Foreign investment in Vietnam | Ongoing legal advisory | Contact | Legal insights
FAQ
What should a share purchase diligence cover?
Legal standing and ownership structure, assets and land use rights, material contracts, labor, licenses, ongoing disputes, and potential tax obligations.
What terms does a share purchase agreement need?
Subject matter and purchase price (with price adjustment mechanisms), the seller’s representations & warranties, conditions precedent (state approval if needed), and indemnification for post-deal discovered misstatements.
How does a foreign buyer pay?
Through the investment capital account under foreign exchange management rules; the payment currency must match the parties’ residence status.
Must the seller pay transfer tax?
Yes. Income from share/capital contribution transfers is taxable; the parties should agree in the contract on who handles declaration and payment.
When must registration with the investment authority be done?
When the foreign investor’s capital contribution/share purchase registration case under the Law on Investment applies (increased ownership in companies using sensitive land, conditional sectors…).
When is a lawyer needed?
From the due diligence stage — DD costs are always cheaper than fixing risks discovered after money is paid.
