A commercial legal entity in Vietnam can face criminal liability only from 1 January 2018 — the date the 2015 Penal Code officially took effect under Resolution 41/2017/QH14. This was a landmark change: the 1999 Penal Code recognized only individuals as subjects of criminal liability.
Short answer
- Key date: 1 January 2018. Only conduct by a commercial legal entity from 00:00 on 1 January 2018 may trigger corporate criminal liability under this regime.
- Legal basis: Article 2(2) of the Penal Code — "Only a commercial legal entity that commits an offence defined in Article 76 of this Code shall bear criminal liability."
- Applicable text: the Penal Code as consolidated in 135/VBHN-VPQH (5 September 2025) — the latest version, in force at the time of writing (14 October 2026).
Why 1 January 2018 and not 2015?
The 2015 Penal Code was passed in 2015, but Article 1 of Resolution 41/2017/QH14 set its effective date at 1 January 2018. From that date, the provisions on criminal liability of commercial legal entities (Articles 2, 75 and 76) became applicable. Before then, Vietnamese criminal law prosecuted individuals only; corporate wrongdoing was handled through administrative sanctions or by prosecuting managers and representatives personally.
The four mandatory conditions (Article 75(1))
A commercial legal entity bears criminal liability only when all four conditions are met:
1. The criminal act was committed in the name of the commercial legal entity — the perpetrator acted on behalf of the company, not in a purely personal capacity. 2. The criminal act was committed for the benefit of the commercial legal entity — the company stood to gain (for example, tax evasion boosting corporate profits). 3. The criminal act was committed under the direction, management, or approval of the commercial legal entity — the conduct reflects the organization's will, expressed through authorized persons. 4. The statute of limitations for criminal prosecution has not expired — under Article 27(2) and (3) of the Penal Code.
In addition, the offence must fall within the list in Article 76 — a commercial legal entity is criminally liable only for offences enumerated there.
Two principles often misunderstood
1. Corporate liability does not exclude individual liability
Article 75(2) is explicit: a commercial legal entity's criminal liability does not exclude the criminal liability of individuals. In practice, when a company commits an offence, both the entity and the individuals involved (those who directed it or personally carried it out) may be prosecuted — each independently under the rules applicable to them.
2. Temporal application (Article 7)
Article 7 of the Penal Code requires applying the law in force at the time the offence was committed. The direct consequence: conduct by a legal entity before 1 January 2018 cannot trigger criminal liability under this regime, because the law did not yet recognize commercial legal entities as subjects of criminal liability.
What is a "commercial legal entity"?
Not every legal entity qualifies. Under Article 75 of the 2015 Civil Code, a commercial legal entity is one whose primary purpose is profit-seeking (for example: limited liability companies, joint-stock companies, partnerships). Non-commercial legal entities fall outside this regime.
What businesses should do
- Review internal compliance: tax, invoicing, social insurance, environment, and intellectual property are the highest-risk areas for corporate prosecution.
- Strengthen internal controls: since "direction, management, or approval of the legal entity" is a basis for liability, companies need clear approval workflows and delegation rules — both to prevent offences and to demonstrate good-faith compliance.
- Track legal changes: under the law in force at the time of writing (14 October 2026), the above framework applies. Note: a comprehensive draft amendment to the Penal Code (expected at the National Assembly's 2nd session, opening 17 October 2026, effective 1 March 2027) may expand the scope of corporate criminal liability — monitor it once officially adopted.
FAQs
If a company is prosecuted, can its director also be punished? Yes. Article 75(2) provides that corporate criminal liability does not exclude individual liability — directors or individuals involved may be prosecuted independently if the elements of an offence are met.
Are non-commercial entities (associations, charities) covered? No. Only commercial legal entities — organizations whose primary purpose is profit-seeking — are subject to criminal liability under the Penal Code.
Can a 2017 corporate offence be prosecuted under this regime? No. The regime applies only to conduct from 00:00 on 1 January 2018 (Article 7 and Resolution 41/2017/QH14).
Sources cited
- Penal Code — consolidated text 135/VBHN-VPQH (5 September 2025): Article 2(2), Article 7, Article 75, Article 76; in force.
- Law 86/2025/QH15 amending the Penal Code (25 June 2025), effective 1 July 2025 — does not amend Articles 2, 7 or 75.
- Resolution 41/2017/QH14, Article 1 — the 2015 Penal Code took effect on 1 January 2018.
Need a criminal-risk assessment for your business in Vietnam? The FLAT Law Firm team advises companies on criminal-law compliance, reviews operational risks, and stands by clients when issues arise. Contact us at contact us.
For reference only, based on the law in force at the time of writing (14 October 2026) — not legal advice for a specific matter.
Transparency notice: This article was drafted by FLAT Law Firm's AI content production system and is undergoing internal review (AI Legal Council QA and owner approval before publication). It has not been reviewed by a human lawyer.