Buying a Company in Vietnam 2026 for US and Foreign Buyers: The Article 21 M&A Registration, the 50% Line, the 2% Seller Tax and 12 Due Diligence Items
Ta Thi Nhu Quynh Lawyer 
Key takeaways
- Three structures. The share deal is the usual one. An asset deal is for a buyer who wants the plant and equipment without the history. A merger is rare in practice.
- Three cases need registration with the investment authority before the shareholder change. They are a target in a sector with market access conditions for foreign investors, foreign ownership that crosses 50 per cent or rises when already above it, and a target holding land on an island, at the border or on the coast. Every other deal goes straight to the business registration authority.
- The review takes 10 working days from a valid dossier. Where the land is in a defence or security area, the provincial military command and police are consulted inside that period. The buyer's rights as a shareholder arise only when the change of members or shareholders is completed.
- Merger control thresholds doubled on 1 July 2026. A filing with the National Competition Commission is needed where assets or turnover in Vietnam reach VND 6 trillion (about USD 220 million), the transaction value reaches VND 2 trillion (about USD 73 million), or the combined market share reaches 20 per cent.
- A foreign corporate seller pays 2 per cent of the transfer price. Decree 320/2025 replaced the old 20 per cent tax on the gain from 15 December 2025. No US-Vietnam income tax treaty is in force to reduce it.
- Beneficial owners must be declared and kept current. The test is 25 per cent or effective control, and a change is notified within 10 days.
- A US buyer inherits the target's past conduct. Under the US Department of Justice's policy on acquisitions, disclosure within 180 days of closing and remediation within a year support a presumption against prosecution.
Foreign investors used to enter Vietnam by leasing land, building a plant and applying for an investment licence. In our Ho Chi Minh City office, more of the files are now purchases of an existing company: a long-standing supplier, the plant of an investor who is leaving, or a stake in a local business that already has licences and customers.
Buying is faster, but Vietnamese share deals have their own rules, and most of them changed recently. The new Investment Law (No. 143/2025/QH15) took effect on 1 March 2026 and redrew the line between deals that need prior registration and deals that do not. Its implementing Decree 96/2026 of 31 March 2026 set out the procedure. The tax on foreign sellers changed on 15 December 2025, beneficial owner declarations began in July 2025, and the merger control thresholds doubled in July 2026. This article goes through structure, approvals, filings, tax, payment and due diligence from the side of a US or other foreign buyer.
1. Three structures: decide what you are buying
| Point | Share deal | Asset deal | Merger |
|---|---|---|---|
| What you get | The shares or capital contribution of the target | Specific assets: buildings, equipment, land use rights, contracts | The target is absorbed into the buyer's Vietnamese company |
| Does the legal entity continue | Yes | No. The buyer sets up a company or uses an existing one | The absorbed company ceases to exist |
| Licences, contracts, employees | Continue in principle, but the investment certificate and some sector licences must be amended | Re-applied for or transferred one by one | Succeeded to as a whole, but licences still need amending |
| Historical liabilities | All taken on | Not taken on in principle | Taken on |
| Approvals | Article 21 registration where it applies, then the change of members or shareholders | Transfer of land use rights and fresh licences | Investment registration and the merger procedure under the Law on Enterprises |
| Typical use | Taking a stake in a supplier, taking over a plant from an exiting investor | Wanting the plant without the old company's tax and labour risk | Reorganisation inside a group |
Most foreign buyers choose the share deal, because the licences, the customer contracts and the workforce stay in place and the plant ships the day after closing. The price is that every historical liability comes with it, so the depth of the due diligence decides the risk of the deal.
An asset deal makes sense where the target has tax problems nobody can explain, land that was held through a nominee, or unresolved labour disputes, or where the seller will sell the plant but not the company. Whether a land use right inside an industrial park can be transferred, and how, depends on whether the original company paid its land rent in one lump sum or annually. That point is explained in Leasing a Factory in Vietnam 2026 for US and Foreign Manufacturers .
2. The first gate: market access and foreign ownership limits
Vietnam uses a negative list. A foreign investor may own 100 per cent of a business in any sector that is neither prohibited nor subject to market access conditions. The difficulty is that a target usually has several registered business lines, and one conditional line affects the whole transaction.
Sectors that commonly carry conditions include logistics and transport, advertising, education, real estate business, distribution of certain goods, travel services, and finance and insurance. Check every business line on the target's enterprise registration certificate, not only what the company actually does.
For buyers coming in through the stock market, Decree 245/2025, in force since 11 September 2025, removed the power of a public company's shareholders or charter to set a foreign ownership cap lower than the legal maximum. The cap is now whatever the law and the sector rules say.
3. The second gate: registration under Article 21 of the Investment Law
This is the core procedure for a 2026 acquisition. Under Article 21(3) of the Investment Law, a foreign investor who contributes capital or buys shares or a capital contribution must register before the change of members or shareholders in three cases.
| Case | What the law says | Example |
|---|---|---|
| Conditional sector | The transaction increases foreign ownership in a company doing business in a sector with market access conditions for foreign investors, whatever the percentage | Taking a stake in a company that also has logistics or advertising among its business lines |
| Crossing 50 per cent | Foreign ownership goes from 50 per cent or below to above 50 per cent, or increases when it is already above 50 per cent | From 40 to 60 per cent; from 70 to 100 per cent |
| Sensitive land | The target holds a land use right certificate on an island, in a border commune, ward or special zone, in a coastal commune or ward, or in another area that affects national defence and security | A plant in a coastal ward |
A deal outside these three cases, for example a move from 10 to 30 per cent in an ordinary manufacturer on inland land, does not go to the investment authority. The company files the change of members or shareholders directly with the business registration authority. Decree 96/2026 also lets an investor register voluntarily, which some buyers do when a bank or a counterparty wants the comfort of a written notice.
Procedure and timing
| Step | What happens | Time |
|---|---|---|
| 1. Prepare the dossier | A registration form giving the target's registration details, business lines, owners and foreign owners, foreign ownership before and after, the expected transaction value and any investment project; legal status documents of the buyer and the target; an agreement in principle; land use right information where relevant | Depends on apostilles and translation |
| 2. File | One set, filed by the target with the investment registration authority where it has its head office | Day 0 |
| 3. Defence and security opinion, sensitive land only | The authority asks the provincial military command and the provincial police within 2 working days. They answer within 5 working days, and silence counts as agreement | Inside the 10 working days |
| 4. Review and notice | The authority checks the conditions and sends a written notice to the investor and the target | Within 10 working days of a valid dossier |
| 5. Change of members or shareholders | The target files with the business registration authority. The foreign investor's rights and obligations as a member or shareholder arise when this is completed | After the notice |
| 6. Follow-up | Register of members or shareholders, beneficial owner information, the investment registration certificate and sector licences | After closing |
The statutory 10 working days run from a complete dossier. With corrections, document formalities and translation, we advise clients to allow one to two months for an ordinary deal and two to three months where coastal or border land is involved.
US documents. The Apostille Convention has been in force for Vietnam since 11 September 2026. A certificate issued by a US state, such as a certificate of good standing, takes an apostille from that state's Secretary of State. A board resolution or a power of attorney is notarised first, and the notarial act is then apostilled. Every document still needs a notarised Vietnamese translation.
Does the investment registration certificate change by itself?
No. A share deal does not amend the investment registration certificate (IRC). If the target holds one, the investor details have to be amended after closing. If the target was a purely domestic company with no IRC, whether it needs one after becoming foreign-owned depends on whether it later takes on a new investment project. Buyers often overlook this and discover after closing that the certificate still names the seller.
4. The third gate: merger control
Under the Law on Competition and Decree 35/2020, a transaction that meets a threshold must be notified to the National Competition Commission before it is carried out. Government Resolution 66.18/2026/NQ-CP of 18 May 2026 doubled three of the four thresholds from 1 July 2026.
| Threshold | From 1 July 2026 | Before |
|---|---|---|
| Assets | Total assets in Vietnam of a party, or of its group of affiliated enterprises, of VND 6 trillion in the previous financial year | VND 3 trillion |
| Turnover | Total sales or purchases in Vietnam of a party, or of its group, of VND 6 trillion | VND 3 trillion |
| Transaction value | A transaction value of VND 2 trillion | VND 1 trillion |
| Market share | A combined share of 20 per cent in the relevant market | Unchanged |
Meeting any one threshold is enough. The increases do not apply to credit institutions, insurers and securities companies, which have their own thresholds. The preliminary appraisal takes 30 days, and if no notice has been issued by then the transaction may proceed. An official appraisal takes 90 days and can be extended by up to 60 days in a complex case. Closing without a required filing exposes the parties to penalties.
Most mid-sized acquisitions stay below the thresholds. The asset and turnover tests, however, count the whole group of affiliated enterprises, so a large foreign group buying a small company may still have to file. The resolution is a temporary measure, reported to run until 28 February 2027 while Decree 35/2020 is amended, so recheck the figures for a deal that will sign later.
5. Tax and payment
| Item | Rule |
|---|---|
| Foreign corporate seller | Under Decree 320/2025, from 15 December 2025 the tax is 2 per cent of the transfer price, for direct and indirect transfers, in place of the earlier 20 per cent on the gain. An intra-group restructuring that leaves the ultimate parent unchanged and meets the decree's conditions is outside the rule |
| Vietnamese corporate seller | Corporate income tax on the gain, at the standard rate of 20 per cent |
| Individual seller | Taxed under the personal income tax rules |
| Asset deal | Value added tax and the taxes and fees on a transfer of land use rights, item by item |
| Filing | The Vietnamese company whose capital is transferred may have to declare and pay on the foreign seller's behalf, transaction by transaction, on Form 05/TNDN, within 10 days after the liability arises |
Two points for a US party. First, the United States has no income tax treaty in force with Vietnam, so a US seller cannot claim treaty relief from the 2 per cent. Second, a US buyer purchasing from a foreign seller should treat the 2 per cent as a closing item, because the target is the one the tax office will look to. The contract should say who bears the tax, make the tax receipt a completion deliverable and give an indemnity if it is not paid. US tax consequences for the buyer are outside this article.
Payment. A foreign investor has to pay through the correct capital account. The State Bank's Circular 38/2026/TT-NHNN replaced the 2019 rules in August 2026. A company in which foreign investors hold more than 50 per cent of the charter capital must open an investment capital account. Below that level the foreign investor uses its own indirect investment account. Money sent through the wrong account causes trouble later, when profits are remitted or capital is repatriated, so confirm the route with the bank before signing.
6. Beneficial owners: update within 10 days of closing
Since 1 July 2025 a Vietnamese company must declare its beneficial owners. The criteria are in Article 17 of the enterprise registration Decree 168/2025, as rewritten by Decree 296/2026 from 23 July 2026: an individual who holds 25 per cent or more of the charter capital or voting shares, directly, indirectly or together with a family or contractual group, or who has effective control, with the most senior manager designated where nobody else qualifies. A change in the beneficial owner or the holding is notified to the provincial registration authority within 10 days.
This cuts two ways. The buyer's own group structure has to be disclosed down to individuals. In due diligence, the buyer should compare what the seller declared with the real ownership. A mismatch often means a nominee arrangement, the risks of which are set out in Nominee Investment in Vietnam 2026: Why Holding Land or Shares Through a Vietnamese Name Fails, What Precedent 02/2016/AL Really Decided, and the 25% Beneficial Owner Rules .
7. Due diligence: twelve items
| No. | Item | What to check |
|---|---|---|
| 1 | Registration and equity | Enterprise registration certificate, register of members or shareholders, evidence that each capital contribution was paid in, beneficial owner declaration |
| 2 | Investment licence | Whether the investor, project scope and capital on the IRC match reality |
| 3 | Market access | Whether any business line is conditional and whether foreign ownership is already at a cap |
| 4 | Land and buildings | Land use right certificate, one-off or annual payment, remaining term, location in a sensitive area, mortgages |
| 5 | Construction, fire safety and environment | Construction permit and completion acceptance, fire-safety compliance under the 2024 law, environmental permit |
| 6 | Tax | Corporate income tax, value added tax, transfer pricing filings, audit history, tax incentives and their conditions |
| 7 | Labour | Employment contracts, social insurance payments, trade union, collective agreement, work permits of foreign staff |
| 8 | Material contracts | Change of control clauses in customer and supplier contracts, related party transactions |
| 9 | Disputes and penalties | Pending litigation and arbitration, customs and tax decisions |
| 10 | Personal data | Impact assessment files, cross-border transfer filings and the data protection officer under the personal data law in force since 2026 |
| 11 | Customs and origin | Certificates of origin and transshipment risk for an exporter |
| 12 | Anti-corruption and sanctions | Dealings with public bodies, payments through agents, sanctions screening |
The three items buyers most often miss are the second, the fourth and the tenth. Capital shown on the IRC but never paid in puts the company's legal standing in question, because Vietnam enforces contribution deadlines. Land on which rent is paid annually cannot be transferred as a land use right, which decides whether an asset deal is possible at all. Personal data compliance is new, and most targets have not done it.
Items 11 and 12 carry extra weight for a US buyer. A target that exports to the United States with origin documents that do not hold up exposes its new owner to duties and penalties on goods found to be transshipped. On corruption, the buyer inherits the target's past. The US Department of Justice's Justice Manual provides that an acquirer which voluntarily discloses misconduct found at the target, generally within 180 days of closing, remediates within one year and pays any disgorgement can expect a presumption that it will not be prosecuted. That makes anti-corruption diligence before signing, and an audit plan for the first months after closing, part of the deal timetable. In Vietnam the records to pull are dealings with customs, tax, land and licensing officials.
8. Transaction documents and closing
Clauses specific to Vietnam in the share purchase agreement
- Conditions precedent: the Article 21 notice, the merger control result where a filing is needed, and third-party consents from banks and key customers.
- Price and payment: denomination, payment through the correct capital account, and who carries the exchange rate risk.
- Transfer tax: who files and pays, with the seller's tax receipt as a completion deliverable.
- Representations and warranties: paid-in capital, land rights, tax, labour and the accuracy of the beneficial owner declaration.
- Post-closing covenants: the seller's cooperation with the change of members or shareholders, the IRC amendment and licence changes.
- Dispute resolution: we generally recommend arbitration at VIAC, for the reasons in Arbitration in Vietnam 2026: VIAC's New Rules, Enforcement and Clause Drafting for Foreign Investors .
Closing steps
- Sign, and have the buyer's corporate documents apostilled and translated.
- File the Article 21 registration where it applies and obtain the notice.
- Pay through the capital account.
- Complete the change of members or shareholders and obtain the amended enterprise registration certificate.
- File and pay the seller's transfer tax.
- Update the beneficial owner information, the IRC, sector licences, bank mandates and, where it changes, the legal representative.
A buyer who installs its own executive as legal representative at closing takes on the personal duties described in Legal Representative of a Vietnamese Company 2026 for US and Foreign Owners from the first day.
How Louis Group can help
Our Ho Chi Minh City and Hanoi offices carry out the due diligence, the Article 21 registration and the merger control filing, draft and negotiate the share purchase agreement, and run the closing and the post-closing changes. For setting up from scratch instead of buying, see The Complete Guide to Establishing Your Business in Vietnam for Taiwanese Companies 2026 . For the same questions in Thailand, see Buying a Company in Thailand 2026 .
This article reflects Vietnamese law as of November 2026. The National Assembly passed an amendment to the Investment Law on 24 August 2026 (No. 24/2026/QH16) that takes effect on 1 March 2027 and replaces the list of conditional business lines, so check the transitional rules for a deal that straddles that date. It is general information, not legal advice.
Sources
- Government of Vietnam, official text: Luật Đầu tư số 143/2025/QH15 (PDF)
- Ministry of Industry and Trade of Vietnam, 8 June 2026: Thay đổi ngưỡng thông báo tập trung kinh tế
- Tạp chí Kinh tế - Tài chính (Ministry of Finance), 17 September 2026: Chính sách thuế đối với giao dịch chuyển nhượng vốn của nhà đầu tư nước ngoài
- US Internal Revenue Service: United States income tax treaties - A to Z
- US Department of Justice, Justice Manual: 9-28.000 Principles of Federal Prosecution of Business Organizations
Related reading
- The Complete Guide to Establishing Your Business in Vietnam for Taiwanese Companies 2026: Understanding Investment Licenses, Environmental Impact Assessment, and Fire Safety at a Glance
- Nominee Investment in Vietnam 2026: Why Holding Land or Shares Through a Vietnamese Name Fails, What Precedent 02/2016/AL Really Decided, and the 25% Beneficial Owner Rules
- Leasing a Factory in Vietnam 2026 for US and Foreign Manufacturers: Why You Cannot Buy Land, Four Ways to Get a Site, and One-Off vs Annual Rent
Frequently asked questions (FAQ)
When does a foreign buyer have to register with the investment authority before buying shares in a Vietnamese company?
In three cases under Article 21(3) of the Investment Law: the target does business in a sector with market access conditions for foreign investors, foreign ownership crosses 50 per cent or rises when already above 50 per cent, or the target holds a land use right certificate on an island, in a border or coastal commune or ward, or in another area affecting defence and security. Otherwise the company files the change of members or shareholders directly.
How long does the registration take?
The authority has 10 working days from a valid dossier. Where the land is in a defence or security area, the provincial military command and police are consulted within that period and have 5 working days to answer. With document preparation, apostilles and translation, allow one to two months for an ordinary deal.
What changes when foreign ownership passes 50 per cent?
The transaction that takes foreign ownership above 50 per cent must be registered first, and so must any later increase. A company in which foreign investors hold more than 50 per cent is in principle treated like a foreign investor when it invests further, and it must open an investment capital account for the payment.
What tax does a foreign seller pay on a share transfer, and does a US treaty reduce it?
A foreign corporate seller pays 2 per cent of the transfer price under Decree 320/2025, for transfers from 15 December 2025, with an exception for qualifying intra-group restructurings. The United States has no income tax treaty in force with Vietnam, so there is no treaty relief for a US seller.
Does every acquisition have to be notified to the National Competition Commission?
No, only one that meets a threshold. From 1 July 2026 the thresholds are assets or turnover in Vietnam of VND 6 trillion, a transaction value of VND 2 trillion, or a combined market share of 20 per cent. Large groups must test the asset and turnover figures on a group basis.
Does the investment registration certificate update automatically after the purchase?
No. The IRC has to be amended separately after closing. A domestic company with no IRC that becomes foreign-owned needs one only if it later takes on a new investment project.