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

Key takeaways

• Vietnamese law does not recognise nominee investment. A foreigner's money and a Vietnamese national's name is common practice, but the nominee agreement is only evidence of the funding relationship; it does not replace ownership, membership or the statutory investment procedure.
• Land and houses are different. A foreign individual cannot be a land user under the Land Law, but can own a commercial house in a qualifying housing project under the Housing Law (30% of a building, 250 houses per ward, 50 years). What you can hold yourself, do not hold through a nominee.
• A nominee agreement whose purpose is to get around foreign ownership limits or market access conditions can be void under Articles 123 and 124 of the Civil Code, with each party restoring what it received.
• Precedent 02/2016/AL is not a route to land use rights for a foreigner. The party was an overseas Vietnamese, the case did not involve shares, and the court only returned the original capital; the increase in value was split by contribution, and equally only where contribution could not be determined.
• Beneficial owner reporting has applied since 1 July 2025: anyone holding or controlling 25% or more must be declared, and Decree 296/2026, in force from 23 July 2026, adds that no one may contribute capital in another person's name and aggregates family holdings.
• Declaring a beneficial owner does not legalise a nominee structure. It is a transparency duty, and it can be the starting point for questions about source of funds and market access.

In Vietnamese investment practice it is not unusual for a foreign national to pay, while a Vietnamese individual appears on the register as the owner of the property, the capital contribution or the shares. The motives are usually speed, convenience, or getting around the restrictions that apply to foreign investors acquiring certain assets or entering certain sectors. To "protect" the real investor, the parties sign a nominee agreement, an undertaking, a power of attorney or an asset management agreement.

The problem is that Vietnamese law has never recognised nominee investment as a form of investment. In a dispute, the real investor may be able to prove the funding relationship with the nominee, but will not necessarily be recognised as the owner of the asset, a member of the company or a shareholder. And since 1 July 2025, when beneficial owner reporting for enterprises came into force, structures that exist only on paper and do not reflect the real owner or controller face transparency pressure they have never faced before.

This guide sets out the legal risk of nominee investment in Vietnam, the real scope of the precedent that is so often cited, the beneficial owner regime of 2025 and 2026, and how to regularise an existing structure. If you are evaluating a factory or a company in Vietnam, read it with our complete guide to establishing a business in Vietnam .

1. The two common forms: property held in a Vietnamese name, and shares held in a Vietnamese name

Property. A foreign individual pays all or most of the price, but the transfer contract and the certificate of land use rights and ownership of assets attached to land name a Vietnamese individual. Between the parties there may be a nominee agreement, a confirmation of source of funds, a loan agreement, an asset management power of attorney, or an undertaking to return the asset on demand. None of these internal documents replaces the registration of ownership or use rights under Vietnamese law.

Capital contribution or shares. A foreign investor funds the establishment or purchase of a Vietnamese company, and a Vietnamese individual is registered as the member or shareholder. On the enterprise registration certificate and in the register of members or shareholders, the Vietnamese individual owns the capital; a private agreement says the foreign investor keeps the right to profits, votes, appointment of management and transfer of the capital on demand. The gap between the registered holder and the real controller is the source of every legal risk that follows.

2. Can a foreigner hold the asset directly? Land use rights and houses are different questions

Many nominee arrangements are unnecessary. Under Article 4 of the Land Law No. 31/2024/QH15, a foreign individual who does not hold Vietnamese nationality is not a "land user" and cannot receive a transfer of land use rights as a Vietnamese citizen can.

But land use rights and house ownership must be separated. Under Articles 16 to 18 of the Housing Law No. 27/2023/QH15, a foreign individual permitted to enter Vietnam, and not entitled to diplomatic or consular immunity, may own a commercial house in a housing development project outside areas of national defence and security. Articles 19 and 20 set the limits: no more than 30% of the apartments in one building, no more than 250 houses in an area equivalent to one ward, and ownership for no more than 50 years from the certificate, extendable once.

A note for readers of Vietnamese origin. The 2024 Land Law treats three groups differently. A Vietnamese citizen living abroad, who has kept Vietnamese nationality, is a land user on the same footing as a citizen in Vietnam (Article 4, clause 3). A person of Vietnamese origin living abroad who no longer holds Vietnamese nationality is also a land user, but with narrower rights (Article 4, clause 6 and Article 28): they may buy or lease-purchase houses attached to land use rights, acquire rights in housing development projects, and inherit or receive land use rights by gift. A foreign national with no Vietnamese origin has only the Housing Law route above. Many Vietnamese-American families put property in a relative's name under the old law; under the 2024 law that is often no longer necessary, and the first step is to establish which of the three groups you fall into.

Before deciding on a nominee, establish whether what you are buying is a land use right, a commercial house in a project, or another building. If it is an asset a foreigner may hold, registering it in your own name as a foreign buyer is far safer than handing every legal right to another person.

3. Is a nominee agreement valid in Vietnam? Civil Code Articles 117, 123, 124 and 131

Vietnamese law does not say that every nominee agreement is void. Each transaction is assessed on its parties, consent, content, purpose and the specific rules for that asset or investment activity. Under Article 117 of the Civil Code No. 91/2015/QH13, a civil transaction is valid only if the parties have capacity, consent is genuine, the purpose and content do not breach a prohibition of law or social ethics, and the required form is observed.

A nominee agreement can serve as evidence of the source of funds and of the parties' rights and obligations. But where its real purpose is to help a foreigner own an asset the law does not permit, to conceal the foreign ownership ratio, or to avoid mandatory investment conditions and procedures, the transaction may be declared void under Article 123 (purpose or content in breach of a prohibition) or Article 124 (a sham transaction to conceal another transaction or to evade an obligation to a third party).

Once void, under Article 131 the transaction creates no rights or obligations from the outset; the parties restore the original position and return what they received, and a party at fault may have to compensate. The key point: proving that you sent the money does not mean the court will recognise your land use rights or your shareholding on that basis. If the specific law does not allow the real investor to own that asset, or the mandatory investment procedure has not been completed, the court will not use a judgment to "legalise" a right that the law restricts.

4. The risk is not only that the nominee changes their mind: debt, divorce, death, foreign exchange and tax

Most investors assume the risk arises only if the nominee is dishonest. In reality, even where the relationship is good, an asset registered in another person's name is exposed to events beyond either party's control. If the nominee owes money and faces enforcement, divorces, or dies, the property and capital contribution in their name can be seized, divided as marital property or distributed as an estate, and the real investor is left proving the source of funds and the terms of the agreement from the outside.

The quality of the evidence decides everything. If funds were paid in cash, routed through several accounts, or remitted with a description such as "loan", "deposit" or "support", the position is worse; a handwritten undertaking rarely clarifies the whole transaction. At company level, the registered shareholder can vote, take profits and dispose of the capital under the company's own documents; if they refuse to cooperate, the real investor cannot even inspect the accounts, replace management, control the bank account or recover the investment. A power of attorney does not solve this: agency is not a transfer of ownership and cannot replace a transfer that the law requires to be registered.

Beyond civil disputes, a nominee structure creates investment, foreign exchange and tax exposure. If money that is in substance foreign investment capital is paid into an individual's account or dressed up as another transaction, the authorities may ask for an explanation of the source of funds, the purpose of the payment, and compliance with investment, banking, tax and anti-money-laundering rules. Where a dispute does arise, the forum matters: our guide to arbitration in Vietnam explains why a nominee dispute over land or shares often cannot be arbitrated at all and ends up in the Vietnamese courts.

5. Does Precedent 02/2016/AL get the land back? Scope and limits

In land nominee disputes, Precedent No. 02/2016/AL of the Judicial Council of the Supreme People's Court is cited constantly, and its scope is constantly overstated.

The case concerned a Vietnamese national settled abroad who paid for a transfer of land use rights and had a person in Vietnam register the land. The court weighed the source of funds, the nominee's labour in managing and maintaining the asset, and the increase in land value. It held that the real investor was entitled to recover the original purchase price; as to the increase in value, the nominee's contribution in keeping, maintaining and improving the land was to be assessed first, and only where that contribution could not be determined were the parties treated as having contributed equally and the increase split in half.

For a foreign investor three things must be clear. First, the precedent established a method for settling the financial interests between funder and nominee; it did not establish that proving the source of funds gives you land use rights. Second, the party was an overseas Vietnamese, not a foreign national, and under the 2024 Land Law that group now has land rights of its own. Third, the precedent did not deal with capital contributions or shares at all. It is useful as a reference for assessing source of funds, labour and the division of appreciation; it should not be cited to argue that a foreign individual can acquire land use rights in Vietnam. On the published precedents and judgments, the outcome of a nominee case depends heavily on the type of asset, the funder's status, the purpose of the transaction and the quality of the evidence. No precedent has established that a foreigner who produces a nominee agreement and remittance records will be recognised as owner or shareholder.

6. The beneficial owner regime since 1 July 2025: definition, the 25% threshold and the three changes in Decree 296/2026

Law No. 76/2025/QH15 of 17 June 2025 amended the Law on Enterprises (No. 59/2020/QH14) with effect from 1 July 2025 and introduced the concept of the beneficial owner of an enterprise with legal personality: the individual who actually owns the charter capital or has controlling power over the enterprise (excluding persons representing state capital). The identification criteria are in Article 17 of the enterprise registration Decree No. 168/2025/ND-CP, as amended by Decree No. 296/2026/ND-CP of 23 July 2026, in force from the date of issue. Under the current criteria, a person meeting any of the following may be identified as a beneficial owner:

• Ownership test: holding, directly, indirectly or in aggregate, 25% or more of the charter capital or of the total voting shares; indirect holding includes holding through another organisation or a legal arrangement such as a trust or an investment agreement.
• Effective control test: even below the threshold, a person with the actual power to appoint or remove a majority of the board or members' council, appoint or remove the general director, amend the charter, or reorganise or dissolve the enterprise; Decree 296/2026 adds the power to decide financial and investment policy.
• Senior manager fallback (added by Decree 296/2026): if nobody can be identified under the first two tests, the enterprise must designate the manager with the widest authority as beneficial owner. The field cannot be left blank.

Decree 296/2026 makes two further changes that bear directly on nominee structures. First, a group of individuals related by family, or bound together by contract, whose combined holding reaches 25% must be aggregated and declared together. Second, it writes into Article 4 of the enterprise registration decree that the owners, shareholders and members of an enterprise "must not stand in another person's name to contribute capital to the enterprise" (in the original, không đứng tên thay người khác để góp vốn vào doanh nghiệp). The prohibition on nominees is now a basic requirement of enterprise registration itself.

For a nominee structure the "indirect holding" and "effective control" tests are the critical ones. Suppose a Vietnamese individual is registered as holding all of the charter capital, but under a private agreement must vote as the foreign investor directs, pass on the profits, and not change the management structure. The enterprise registration certificate then no longer reflects the person who actually owns or controls the enterprise. The regime no longer looks only at who is listed as shareholder, but at the person behind the ownership structure and the control relationships. Readers familiar with beneficial ownership registers in the United States or the European Union will recognise the concept; Vietnam's version is stricter in one respect, because the effective control test and family aggregation are applied at registration rather than only in an investigation.

7. When must an existing company declare? Authority, register and the 10-day notice

Under Article 3.1 of Law No. 76/2025/QH15, an enterprise registered before 1 July 2025 does not in principle have to file a separate declaration simply because the law took effect. It supplements the beneficial owner information, and the basis of identification, with the provincial enterprise registration authority where its head office is located (under Decree 168/2025, usually the enterprise registration office of the provincial or municipal Department of Finance; for enterprises in high-tech zones, the zone management board) the first time it registers or notifies a change of registered particulars after the law took effect. An enterprise may also declare voluntarily before then.

Besides the declaration, the enterprise must keep a register of beneficial owners in paper or electronic form under the Law on Enterprises and Decree 168/2025. Any later change in the beneficial owner or their holding must be notified to the provincial registration authority within 10 days of the change; a change of corporate shareholder in a joint stock company is in principle subject to the same 10-day limit (listed companies and companies registered for trading excepted).

8. Declaring a beneficial owner is not the same as legalising the nominee

This is the commonest misunderstanding. Some assume that once the foreign investor is declared as beneficial owner, the nominee structure has "received legal recognition". That is wrong.

Declaring a beneficial owner is a transparency duty to disclose who really owns or controls the enterprise. It does not give the declared person the status of a member or shareholder; it does not replace the registration of a purchase of capital contribution or shares; it does not replace the update of the register of members or shareholders; and it does not remove the market access conditions that apply to foreign investors. A person may be identified as beneficial owner on the basis of effective control and still not be recognised as a shareholder under the Law on Enterprises. That inconsistency is precisely why the enterprise has to revisit its investment structure.

An honest declaration also does not excuse breaches that already occurred in the contribution, remittance or investment process. On the contrary, the declared information may become the starting point for the authorities to ask about source of funds, market access, investment procedure, tax and foreign exchange compliance.

9. What to do with an existing structure: regularising property and shares

There is no one-size-fits-all solution; the answer starts from the nature of the asset and the purpose of the investment.

Property. First establish whether the foreign investor can register the asset in their own name. If it is a commercial house in a project that a foreign individual may own, consider a transfer in a form the law permits, so that the registration matches reality. If it is a land use right a foreigner may not receive, do not try to "reinforce" the structure with an irrevocable power of attorney, a sham loan agreement or a promise of future transfer. Those documents cannot override the restriction on who may hold the right.

Capital contribution or shares. Review the business lines, market access conditions, foreign ownership ratio, source of funds and the procedures already completed. If the foreign investor qualifies to be a shareholder, the correct course is usually a formal transfer of the capital contribution, completion of the required investment procedures (foreign investors' investment and purchase of capital contributions are now reviewed under the Investment Law No. 143/2025/QH15, in force since 1 March 2026, and its implementing documents, with the list of conditional business lines applying from 1 July 2026), an update of the corporate documents, and payment through the proper accounts. If the sector has a foreign ownership cap or special conditions, the restructured holding must comply with them; a Vietnamese nominee cannot continue to be used to disguise a holding above the cap. The investment procedures and the capital account are explained in our complete guide to establishing a business in Vietnam .

While regularising, the enterprise must identify its beneficial owner correctly, looking not only at the ownership ratio in the corporate documents but at voting agreements, the power to appoint and remove management, who receives the economic benefit, and who decides major matters. The transition also has to deal with the source of the funds already invested, profits already distributed, tax obligations, and the handover of documents, seals, accounts and management control. If there are signs that the nominee is transferring, mortgaging or dissipating the asset, preserve evidence at once and consider applying to the court for provisional emergency measures under the procedural law.

Frequently asked questions (FAQ)

Is a nominee agreement for property or shares valid in Vietnam?

Not necessarily. Vietnamese law does not say that nominee agreements are automatically void, but it has never recognised nominee holding as a form of investment. The agreement can be evidence of the source of funds and of the parties' rights and obligations; but if its purpose is to help a foreigner own an asset the law does not permit, to conceal the foreign ownership ratio or to avoid mandatory investment procedures, it may be declared void under Article 123 or 124 of the Civil Code, and the parties must restore the original position. Even if the agreement is valid, it cannot replace registered ownership, shareholder status or the investment procedure.

Can a foreigner buy land or a house in Vietnam directly?

Land and houses are separate questions. Under Article 4 of the Land Law, a foreign individual without Vietnamese nationality is not a land user and cannot receive a transfer of land use rights. Under Articles 16 to 20 of the Housing Law, a foreign individual may own a commercial house in a qualifying housing development project, limited to 30% of the apartments in one building, 250 houses in one ward, and 50 years of ownership, extendable once. A person of Vietnamese origin living abroad has wider rights under the 2024 Land Law, and a Vietnamese citizen living abroad has the same rights as a citizen at home. Whatever you may hold directly, register it in your own name rather than through a nominee.

Can Precedent 02/2016/AL be used to recover land held through a nominee?

Not as a basis for acquiring land use rights. The party in that case was a Vietnamese national settled abroad, not a foreign national, and the case did not deal with shares. The court recognised only the recovery of the original purchase price; the increase in value was assessed first by the nominee's contribution and split equally only where the contribution could not be determined. The precedent offers a method for assessing source of funds, labour and the division of appreciation; it does not establish that proving the funding gives you land use rights.

What is a beneficial owner, and when must one be declared?

A beneficial owner is the individual who actually owns or ultimately controls the enterprise. Under Article 17 of Decree 168/2025, as amended by Decree 296/2026 in force from 23 July 2026, that is anyone holding 25% or more of the charter capital or voting shares, directly, indirectly or in aggregate, or anyone below that threshold who has actual control, such as the power to appoint a majority of the board, decide financial and investment policy or amend the charter. If nobody can be identified, the manager with the widest authority must be designated; the field cannot be left blank. Family members whose combined holding reaches 25% are aggregated. Indirect holding through a trust, investment agreement or other legal arrangement counts.

When must a company registered before 1 July 2025 declare its beneficial owner?

Under Article 3.1 of Law No. 76/2025/QH15, an existing enterprise does not have to file a separate declaration immediately; it supplements the information with the provincial enterprise registration authority the first time it registers or notifies a change of particulars after 1 July 2025, and may declare voluntarily before then. After declaring, it must keep a register of beneficial owners and notify the authority within 10 days of any change in the beneficial owner or their holding.

If I declare myself as beneficial owner, is the nominee structure now legal?

No. The declaration is a transparency duty; it does not make you a shareholder, does not replace the registration of a purchase of capital contribution or shares, and does not remove the market access conditions for foreign investors. Decree 296/2026 has also written into Article 4 of the enterprise registration decree that a contributor may not stand in another person's name. An honest declaration may instead prompt the authorities to ask about source of funds, investment procedure, tax and foreign exchange compliance. The correct course is a formal transfer and registration under the Investment Law, so that ownership, control and the flow of funds sit in a transparent and enforceable structure.

Nominee registration may buy convenience at the start of an investment; the price is a real investor who holds a legally unprotected position for years. Since 2025, beneficial owner reporting means that "whose name is on the register" is no longer the end of the enquiry; "who really owns and controls" is what the authorities want answered. And the declaration itself does not make a non-compliant structure compliant.

How Louis Group can help

Louis Group has offices in Hanoi and Ho Chi Minh City , with Vietnamese-qualified lawyers working alongside colleagues in Taipei in English. We help foreign investors review existing nominee structures, assess the route to regularising property and shares, carry out transfers of capital contribution and the related investment procedures, identify and declare beneficial owners, and preserve evidence and litigate nominee disputes. If you currently hold assets in Vietnam through a nominee, or are deciding how to hold a new investment, contact our Vietnam team.

Author: Chun-Hung Yeh , Attorney at Law, Louis Group. Co-author: Ta Thi Nhu Quynh , Vietnamese lawyer, Louis Group Ho Chi Minh City office.

*This article is general legal information, not advice on a specific case. The right course depends on the type of asset, the business lines, the investor's status, the remittance documents and the parties' agreements; Vietnamese regulations change frequently, so take advice from a qualified lawyer and rely on the latest announcements of the Vietnamese authorities.*

Related reading

• The Complete Guide to Establishing Your Business in Vietnam for Taiwanese Companies 2026
• Arbitration in Vietnam 2026: VIAC's New Rules, Enforcement and Clause Drafting for Foreign Investors
• Collecting Unpaid Invoices from a Vietnamese Buyer 2026: The Two-Year Limitation, Regional Courts, Account Freezes and Why a US Judgment Is the Hardest Route