Investor: We have a two 100% owned foreign companies in Hanoi and HCMC.
Currently these 2 companies are ‘dormant’ in their activities. We have a local Vietnam individual who intend to buy over the companies and intend to convert it to a local entity.
We require lawyers in hcmc and Hanoi to assist us with the procedures.
Please advise if your company is interested to take up this work, what are the procedures, and fees involve.
Lawyer of SBLAW: This is with regards to your email from which you requested us to advise for your company (hereinafter referred to as “Client”) to transfer 100% its equity.
Thus, we are pleased to present herewith our Legal Service Proposal for your kind reference.
1. OUR PRELIMINARY COMMENTS
At present, Client wishes to transfer 100% equity in International Training Centers to a Vietnamese Citizen and convert the same in to pure local companies.
Under Vietnam Law, during the operation term of foreign invested company, foreign investor is entitled to transfer a part of or whole of its equity to either local investors or foreign investors.
Therefore, in case related Parties completed obligations regarding to capital transfer under Vietnam Law, the acquisition by above said Vietnamese Citizen shall be approved by the Competent Authority.
However, until now, there is still no legal instrument guiding in detail the administrative procedure for converting foreign invested company into pure local company.
Regarding to this matter, in the Dispatch No. 3938/BKH-DTNN dated 14 June 2010 of the Ministry of Planning and Investment responding the letter of Hanoi Department of Planning Hanoi Office and Investment guiding on administrative procedure for converting Opera Hotel Company Limited from foreign invested company into pure local company, the following licensing process should be temporarily applied:
Step 1: The Licensing Authority shall issue Decision approving capital transfer and terminate validity of the Investment Certificate granted to Foreign Invested Company;
Step 2: The Local Investor shall register to obtain Certificate of Business Registration;
Step 3: The Licensing Authority shall grant new Investment Certificate for the current Investment Project.
We also would like to note that, procedure for acquiring 100% equity from International Training Center by the above said Vietnamese Citizen shall be subjected to the evaluation process.
The total process can be lasted within 45 working days from submission date of application dossier, exclusive of required time duration for supplementation of required document. In fact, the time duration can be longer due to that the Competent Authority need to consult relevant Ministries.
2. SCOPE OF WORKS
With regards to the above targets, our scope of work shall be as follows:
2.1. Preparation of Capital Transfer Agreement
Preparation of Capital Transfer Agreement under Vietnam Law to protect the legal rights and interests of Client;
Explaining, clarifying if Client have any questions/ comments regarding the above Agreement;
Update the Capital Transfer Agreement according to negotiation process between two parties and giving advice/ suggestion on amendment, supplement where needed to protect the legal rights and interests of Client under mutually agreement by the related Parties and applicable laws.
2.2. Preparation of the application documents:
Notifying application documents required in accordance with Vietnamese law;
Drafting application documents required for submission purpose including board resolution, application etc;
Liaising with Client to discuss the draft application documents;
Amending the application documents based on your comments;
Obtaining preliminary comments from the licensing authority on the draft application documents;
Finalizing the application documents following comments from the licensing authority; and
Translating the final version of the application documents into Vietnamese for execution.
2.3. Licensing procedures:
Submitting the application dossier to the licensing authority on your behalf;
Monitoring and following up with the relevant authorities on the approval process;
Keeping you updated on the developments and additional requirements, if any; and
Assisting you in obtaining the Decision on approving Capital Transfer, Investment
Certificate and Certificate of Business Registration.
2.4. Post-licensing procedures:
Upon the issuance of the investment certificate, the Vietnamese Citizen shall be required to carry out immediate administrative procedures.
3. Our services include:
Obtaining the new seal for International Centers; and Placing an announcement in the newspaper.
4. The roadmap for the case can be described in following steps as follows:
Preparing the application dossier: We shall collect necessary information and documents from you. Upon receipt of necessary information and documents from you, we shall translate documents from English into Vietnamese and prepare the application dossier under the standard forms. The initial drafted application dossier and Capital Transfer Agreement shall be sent to you for your comments. Then, after updating the application dossier based on your comments, we shall obtain the preliminary comments from the competent authority and send the finalized application dossiers for you to sign and seal. We anticipate that this phase shall be completed within 10 working days.
Submission of application dossier: Within 02 working days from receipt of duly signed and sealed application dossier, we shall submit the application dossier to the competent authority. It shall take about 45 working days from submission of application dossier to the competent authority for the provincial licensing authority to approve the Capital
Transfer and converting International Centers into pure local companies. The process can be longer as it takes time to consult relevant Ministries such as Ministry of Industry and Trade, Ministry of Planning and Investment, and the Ministry of Finance.
Post licensing: Within 13 working days we shall complete the post licensing procedures
