Short answer: YES. Foreigners who commit crimes on Vietnamese territory are subject to Vietnam’s Penal Code just like Vietnamese nationals (Article 5). A foreigner holding a position or power at a company in Vietnam — including private or FDI enterprises — who abuses that position to appropriate property under their management commits embezzlement under Article 353. The statute does not distinguish by nationality.
1. Territorial principle: a crime in Vietnam is punished under Vietnamese criminal law
Article 5(1) of the Penal Code (Consolidated Document 135/VBHN-VPQH dated 5 September 2025):
“This Code applies to all criminal acts committed on the territory of the Socialist Republic of Vietnam.”
The sole exception: persons enjoying diplomatic or consular immunity — handled under international treaties, international custom or diplomatic channels. A foreign expert, director or accountant working for a company in Vietnam does not fall under this exception.
Interpretation note: the statute does not name “foreigners” in the embezzlement provision. This conclusion follows from the territorial principle (Article 5) combined with the embezzlement subject provision (Article 353(6)) — the law makes no distinction by nationality.
2. The subject of embezzlement: state and non-state enterprises alike
Article 353(6) of the Penal Code:
“A person holding a position or power in non-state enterprises or organizations who embezzles property shall be dealt with under this Article.”
This means:
- A foreigner holding a position at a company in Vietnam is a potential subject of embezzlement — whether a CEO, branch director, chief accountant, cashier or warehouse manager at an FDI enterprise, private company or other non-state organization.
- The appropriated property must be property the person is responsible for managing by virtue of their position (company funds, goods, supplies…).
- The act must be abusing the position or power to appropriate — using the position as the means to take the property.
3. Thresholds and current penalty frames (no more death penalty)
| Clause | Appropriated amount / damage | Penalty |
|---|---|---|
| Clause 1 | VND 2,000,000 to under VND 100,000,000 (below VND 2 million still a crime if already disciplined or convicted of a corruption offence and re-offending) | 2–7 years’ imprisonment |
| Clause 2 | (aggravating circumstances as prescribed) | 7–15 years’ imprisonment |
| Clause 3 | (aggravating circumstances as prescribed) | 15–20 years’ imprisonment |
| Clause 4 | Appropriation of VND 1 billion or more, or damage of VND 5 billion or more | 20 years’ imprisonment or life imprisonment |
The death penalty for embezzlement was abolished effective 1 July 2025 (Law No. 86/2025/QH15, Clause 22 of Article 1). Death sentences imposed before 1 July 2025 that have not been executed shall not be executed; the Chief Justice of the Supreme People’s Court shall decide to commute the death penalty to life imprisonment (Article 4 of Law 86/2025).
4. Supplementary penalties (Clause 5)
An embezzlement convict may also be: banned from holding certain positions for 1 to 5 years, fined VND 60–200 million, and have part or all of their property confiscated.
5. Can the company itself face criminal liability for embezzlement?
No. Article 76 of the Penal Code lists a closed set of 33 articles under which commercial legal entities bear criminal liability (188, 189, 190, 191, 192, 193, 194, 195, 196, 200, 203, 209, 210, 211, 213, 216, 217, 225, 226, 227, 232, 234, 235, 237, 238, 239, 242, 243, 244, 245, 246, 300, 324) — Article 353 is not on the list. Only the individual who committed the act (including a foreigner) is prosecuted; the company as a legal entity bears no criminal liability for this offence.
Note: thuvienphapluat.vn currently hosts a “Draft amended Penal Code (draft dated 22 September 2026)” — this is only a draft, not current law, and does not affect the conclusions above.
FAQ
Q: A foreign director of an FDI company misappropriated VND 50 million of company funds — can he be jailed?
A: He may be prosecuted for embezzlement under Article 353 (Clause 1 threshold: VND 2 million to under VND 100 million) with a 2–7-year prison frame, because he is a person holding a position or power who abused it to appropriate property under his management — nationality does not change this conclusion.
Q: Do foreigners enjoy any leniency policies different from Vietnamese nationals?
A: In the application of criminal law, foreigners are treated like Vietnamese nationals when committing crimes on Vietnamese territory (except diplomatic/consular immunity cases). Leniency policies in the Penal Code apply generally, without nationality distinction.
Q: What can a company do when harmed by a foreign employee’s embezzlement?
A: The company may report the matter to investigative authorities for criminal prosecution of the individual, and claim compensation for damages through court proceedings.
Legal sources
- Penal Code — Consolidated Document 135/VBHN-VPQH dated 5 September 2025 (Articles 5, 76, 353) — thuvienphapluat.vn
- Law No. 86/2025/QH15 dated 25 June 2025, effective 1 July 2025 (Clause 22 of Article 1; Article 4 on commuting declared death sentences to life imprisonment)
This article is for general information only and does not constitute legal advice. Content is pending review by FLAT Law Firm lawyers before publication.
For reference only, not legal advice. Content quality-checked by the AI Legal Council; not yet reviewed by a human lawyer.
