When a single-member LLC wants to bring in new capital contributors — whether by transferring part of its charter capital or raising fresh capital — it must convert into a multi-member LLC. This is a change of enterprise type driven by a change in capital ownership, not the establishment of a new company; the converted company inherits all rights and obligations. The law provides two conversion paths with different legal bases and dossiers — this article presents both, matching the right article to the right scenario.
1. Path (a): capital increase — Article 87.2 of the Law on Enterprises
Under Article 87 (“Increase and decrease of charter capital” of single-member LLCs), the company owner may increase charter capital by contributing additional capital or raising additional capital contributions from others (Clause 1). When raising capital from others, the company must organize management as a multi-member LLC or a joint stock company (Clause 2).
- Deadline: notify the change of enterprise registration contents within 10 days from completing the capital increase (Point a, Clause 2, Article 87). Note: the law does not say “working days” — read cautiously as 10 calendar days.
- Converting into a joint stock company: follows the conversion registration procedure under Article 202 of the Law on Enterprises (distinct from the 1-member to multi-member case below).
2. Path (b): transfer, donation, or admission of new members — Article 78.1
Under Article 75.1, the owner of a single-member LLC may transfer part or all of the charter capital. Under Article 78.1 (“Exercise of owner rights in certain special cases”), when transferring or donating part of the charter capital, or admitting new members, the company organizes management under the corresponding enterprise type and registers the change within 10 days.
Confirmed point: the correct basis is Article 78 — some sources (including dichvucong.gov.vn) citing “Article 77” are incorrect (Article 77 governs owner obligations).
3. Four paths and their respective dossiers
Conversion dossiers follow Clause 2, Article 26 of Decree 168/2025/ND-CP (effective 01/7/2025, replacing Decree 01/2021/ND-CP): documents under Clause 3, Article 24 (the dossier of a multi-member LLC, excluding a copy of the Investment Registration Certificate) plus one case-specific document:
- (a) Partial capital transfer → basis Article 78.1 + transfer contract or proof of completed transfer;
- (b) Capital contribution donation → basis Article 78.1 + donation contract;
- (c) Raising/admitting new members (capital increase) → basis Article 87.2 + owner resolution/decision on raising additional capital and proof of new members capital contributions;
- (d) Company merger → merger contract.
Other cases: written confirmation of lawful inheritance rights (capital inheritance). If a new member is a foreign investor subject to capital-contribution registration, prior approval from the investment registration authority is required before filing.
4. “Change notification” vs “conversion registration”
- Single-member → multi-member LLC: a notification/registration of change of enterprise registration contents within 10 days — not a “conversion registration” in the Article 202 sense.
- Single-member LLC → joint stock company: a true conversion registration under Article 202.
Many articles conflate the two. (Technical note: the statute says “notify the change of enterprise registration contents” at Point a, Clause 2, Article 87, while Decree 168/2025 groups the procedure under “type-conversion registration” — cite each instrument own wording.)
Conversion may be registered simultaneously with the change notification/registration (Clause 6, Article 26 of Decree 168/2025). If the legal representative changes at the same time, the dossier is signed by the Chair of the Members Council of the post-conversion company.
5. Common mistakes
- Assuming dissolution and re-establishment is required — wrong: conversion inherits all rights and obligations; it is not a new establishment.
- Forgetting to register the type change after completing the capital transfer — registration within 10 days is still required.
- Mixing up Articles 77 and 78 — the transfer/donation/admission path rests on Article 78, not 77.
- Citing expired instruments: Decree 01/2021/ND-CP was replaced by Decree 168/2025 from 01/7/2025; use current forms under Circular 68/2025/TT-BTC.
6. Post-conversion checklist
- Adopt a new charter (Members Council replacing the single owner);
- Prepare the member list and member register;
- Update tax authorities, banks and counterparties (contracts, invoices, accounts).
Frequently asked questions
Is tax finalization required for conversion? Enterprise registration law does not require tax finalization as a conversion condition (unlike dissolution/termination). The company must still ensure tax obligations are fulfilled continuously.
Does the former owner remain liable for pre-conversion debts? The converted company inherits all rights and obligations of the pre-conversion company; member liability is determined under the new enterprise type and the company charter.
When does the 10-day period start? From completion of the change (completed transfer/donation/admission or capital raising). The law does not say “working days”, so treat it cautiously as 10 calendar days.
Conclusion
Remember the two paths with the right article each: capital increase / raising new capital → Article 87.2; transfer/donation of partial capital or admitting new members → Article 78.1. Dossiers differ by path (Clause 2, Article 26 of Decree 168/2025), the common deadline is 10 days, and this is a type change — not a new establishment. Preparing the correct dossier upfront keeps the process smooth.
Legal basis
- Law on Enterprises 59/2020/QH14 (effective 01/01/2021) — Articles 75, 78, 87, 202
- Decree 168/2025/ND-CP on enterprise registration (effective 01/7/2025, replacing Decree 01/2021/ND-CP) — Articles 24, 26
This article is for general reference only and does not constitute legal advice for any specific case.
Transparency note: This content was prepared with AI assistance and will undergo quality review by the FLAW AI Legal Council before publication approval; it is not legal advice from a human lawyer.
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