Scenario: Group A (Japan) is the 100% investor of an FDI project manufacturing medical devices in Binh Duong (the project is already operational). In 2027, Group A merges into Group B (Japan), and legal entity A ceases to exist. What procedures must the FDI project in Vietnam complete? This situation is increasingly common as multinational groups restructure.
Foundational principle: a foreign merger follows foreign law
A merger of the foreign parent company follows the law of the jurisdiction where the merger takes place — Article 200 of the 2020 Enterprise Law does not apply, as it only governs mergers among Vietnamese enterprises. Vietnamese law is concerned solely with the consequences of the merger for the FDI project in Vietnam.
The reassuring point: the project in Vietnam is not terminated because the parent merges. The Vietnamese subsidiary is an independent legal person; the new legal person inherits all rights and obligations under the foreign law.
The mandatory task in Vietnam: amend the IRC
Although the project is not terminated, the company must amend the IRC because the investor information recorded on the IRC has changed (clause 2, Article 33 of the 2025 Investment Law). Procedures follow Article 56 of Decree 96/2026/ND-CP: processing time of 07 working days, reduced to 03 working days if only the investor name changes.
The notion that “the merger happened abroad, so nothing is needed in Vietnam” is wrong — an IRC recording investor information inconsistent with reality may attract administrative penalties (under Decree 122/2021/ND-CP; specific amounts to be checked against the original text).
Two merger classifications
Case 1 — Old legal person ceases to exist; new person inherits everything: as in the Group A into Group B scenario. In substance this is a change of investor → the mechanism of Article 34 of the 2025 Investment Law applies (conditions: the project is not subject to termination; the new legal person satisfies clause 2, Article 21; compliance with conditions in the IRC/approval document), combined with the adjustment procedure under Article 33.
Case 2 — The investor legal person essentially survives (e.g., it merely acquires another company without ceasing to exist): only an update of investor information is needed, through a lighter procedure.
Which case applies depends on the merger form under the foreign law and the registration authority’s interpretation — the law has no dedicated clause for this, so consult the authority in advance.
Is policy adjustment approval needed?
If the project was subject to investment policy approval granted together with investor approval and has not yet been put into exploitation or operation, then the investor change falls under point dd, clause 3, Article 33 of the 2025 Investment Law → a policy adjustment approval procedure is required. In the example scenario (project already operational), this step is unnecessary.
Five-step checklist in Vietnam
- Amend the IRC with the competent investment registration authority (in the example: the Binh Duong industrial zone Management Board) — updating the new investor information.
- Determine whether policy adjustment approval is needed — not required if the project is already operational.
- Review the new legal person’s conditions: market access conditions (clause 2, Article 21 and Article 8 of the 2025 Investment Law; Article 17 of Decree 96/2026/ND-CP and Appendix I) — especially important where the merger changes the legal person’s nationality (e.g., from Japan to the United States) or where business lines are subject to foreign ownership ratio limits.
- Update owner/member information of the Vietnamese subsidiary with the business registration office (2020 Enterprise Law, Decree 168/2025/ND-CP).
- Consular legalization of merger documents: proof that the merger has been completed under the foreign law (consular legalization or Apostille plus notarized translation), the project adjustment request, and the original IRC.
Distinguishing three easily confused regimes
| Regime | Nature | Basis |
|---|---|---|
| Foreign parent merger (this topic) | Merger takes place outside Vietnam under foreign law; no project transfer transaction | IRC amendment (Art. 33.2); investor-change cases apply the Art. 34 mechanism |
| Investment project transfer | Investor transfers all or part of the project to another investor | Art. 34 of the 2025 Investment Law + Art. 57 of Decree 96/2026/ND-CP |
| Investment project merger | Merging investment projects of the same investor into one project | Art. 59 of Decree 96/2026/ND-CP |
There is also the regime of reorganization of economic organizations in Vietnam (Article 60 of Decree 96/2026/ND-CP) — applicable when the Vietnamese subsidiary itself undergoes division, separation, merger, or type conversion; different from a foreign parent merger.
Open questions to watch
- The law has no dedicated clause for “foreign parent merger” — the “information update” vs “investor change” classification depends on the merger form and the registration authority’s interpretation.
- No statutory deadline exists for completing the IRC amendment after the merger; in practice do it immediately to avoid IRC information inconsistent with reality.
- Where the new legal person fails to meet market access conditions, the law provides no specific handling mechanism — seek the registration authority’s opinion case by case.
FAQ
Does a foreign parent merger terminate the Vietnamese project?
No. The subsidiary is an independent legal person; the new legal person inherits all rights and obligations under the foreign law.
Does Article 200 of the 2020 Enterprise Law apply to the foreign merger?
No. Article 200 only governs mergers among Vietnamese enterprises. A foreign parent merger follows the foreign jurisdiction’s law.
How long does the Vietnamese procedure take?
IRC amendment: 07 working days (03 days if only the investor name changes) under Article 56 of Decree 96/2026/ND-CP.
Is a parent merger the same as a project transfer?
No. A foreign parent merger involves no project transfer transaction; project transfer (Art. 34 + Art. 57 of Decree 96) and merger of projects of the same investor (Art. 59 of Decree 96) are distinct regimes.
Legal sources cited
- 2025 Investment Law: Art. 8, Art. 21.2, Art. 33.2, Art. 33.3(dd), Art. 34
- Decree 96/2026/ND-CP: Art. 17, Art. 56, Art. 57, Art. 59, Art. 60, Appendix I
- 2020 Enterprise Law (Art. 200 applies only to mergers among Vietnamese enterprises)
- Decree 168/2025/ND-CP on enterprise registration
Note: This article is for general reference only and does not constitute legal advice. Each merger has a different legal structure under its home jurisdiction’s law; seek professional advice before completing procedures in Vietnam.
Transparency note: Content reviewed by the FLAW AI Legal Council; it does not replace advice from a licensed lawyer.
Need advice on post-merger procedures? Contact FLAT Law Firm: Contact us.
