What is an FDI company? Establishment forms and procedures

Doanh nghiệp FDI là gì? Hình thức và Thủ tục thành lập

is currently a popular type of business around the world and in Vietnam. However, this is not actually a type of business.

So business What is IDE?? Let’s follow the following article by Ms. Uptalent to better understand these companies!

CONTENTS:
1- What is an FDI company?
2- FDI business form

2.1- Company with 100% FDI capital
2.2- FDI companies under joint venture contracts
2.3- Investment in the form of BOT
2.4- Creation of a branch of a foreign company

3- Procedures for creating FDI companies
3.1- Direct investment
3.2- Indirect investment through capital contribution and purchase of shares in Vietnamese companies

4- Top 10 largest FDI companies in Vietnam

Headhunting service - Headhunting

1- What is an FDI company?

FDI means “foreign direct investment”, understood as direct investment from abroad. You may come across this term commonly used in the field of international economics.

Currently, Vietnamese law does not provide specific regulations on FDI business types. However, according to the Investment Law of 2020, it can basically be understood that an FDI enterprise is an economic organization benefiting from direct capital from foreign investors, regardless of the percentage of foreign capital inflow.

The emergence of FDI companies has brought many considerable benefits. The first is to promote trade capabilities, improve technology and increase the competitiveness of domestic enterprises. It is then a question of creating more employment opportunities for workers, by promoting economic growth and the country’s export turnover.

2- Forms of FDI companies

Currently, the sources of FDI capital flowing into Vietnam are very diverse. FDI businesses can be organized in many different forms. Specifically:

2.1- Company with 100% FDI capital

Companies in this form are owned by foreign investors and established in the host country. Foreign investors will be responsible for the management and operation of the company.

In Vietnam, this form of business is not popular. The most common form is to invest in a joint venture with a Vietnamese organization.

Attractive jobs

With this form of business, the investor will be the manager and operator of the business. However, they must still comply with economic, political, legal, cultural, etc. regulations. of this country and this region.

FDI companies

2.2- FDI companies under joint venture contracts

This is a popular form of FDI business in Vietnam. A joint venture will be established by two or more parties in the host country. All terms and commitments of cooperation will be clearly stated in the joint venture contract.

In some cases, the form of joint venture contract may be based on agreements signed between countries to carry out investments and business.

See also  Predicting future recruitment trends in the C&B sector

2.3- Investment in the form of BOT

BOT stands for Build, Operate, Transfer. This is the abbreviation of Build – Operate – Transfer.

This form of FDI investment is very popular in the field of infrastructure construction. In this form, the state will call on foreign investors to invest capital to build the project, then they will have the right to operate it for a certain time and finally return it to the state.

In addition to the BOT, there are also BT and BTO forms. The State will choose the appropriate type of investment based on each project and objective.

2.4- Creation of a branch of a foreign company

This form is similar to a company with 100% foreign investment because the entire capital of the branch comes from abroad.

According to this form, foreign companies will establish branches in Vietnam. This branch will be managed by Vietnamese or foreigners working there.

3- Procedures for creating FDI companies

In order to help foreign investors easily make investments, the Vietnamese government has significantly simplified the procedures for setting up FDI businesses.

To set up an FDI business in Vietnam, investors can take the steps in the following two ways:

Foreign-invested enterprises

3.1- Direct investment

Investors will follow the procedure including the following steps:

Step 1: Report investment project information on the online system

First, investors will need to report project information in the national foreign investment information system. After submitting the paper application, you will receive a system access account to track your application.

The mission of the investment registration agency is to receive, process, return results, update and issue codes for investment projects through the system.

2nd step: Submit the application for investment registration certificate

After submitting the declaration online, within 15 days, the investor must submit the application (hard copy) for investment registration certificate to the investment registration authority.

The investment registration certificate will be issued within 15 days from the date the investment registration authority receives the complete documents. In the event of refusal to issue a certificate, this agency must inform the investor in writing and clearly state the reason.

The file to request an investment registration certificate includes:

– Document requesting the implementation of the project.

– Document verifying the account balance.

– Proposal for the implementation of investment projects.

– Office or house rental contract for projects.

– Notarized copy of the identity card or CCCD or passport of the Vietnamese person contributing to the capital (if applicable).

– Notarized copy of the foreign investor’s passport.

– Audited financial statements for the last 2 years of the foreign organization.

Note that depending on whether the investor is an individual or an organization, the detailed records will undergo certain changes.

Step 3: Submit the application for business registration certificate

Once you receive the investment registration certificate, you will need to continue submitting documents to the Business Registration Office – Department of Planning and Investment to obtain a business registration certificate.

See also  What qualifications help you become a supply chain manager?

Then you will proceed to engrave the seal, display the seal and publish the business information on the national business registration portal.

Step 4: Submit the business license application to the Ministry of Industry and Commerce

You only complete this step if your business needs authorization to sell products at retail.

Step 5: Open a capital investment transfer account

After receiving the business registration certificate, foreign investors will need to contribute their capital within 90 days.

Step 6: Complete the procedures after the creation of the company

You will need to take steps such as purchasing digital signatures, paying license fee, issuing invoices, registering accounts, etc.

IDE

3.2- Indirect investment through capital contribution and purchase of shares in Vietnamese companies

With this form of investment, the procedure will be as follows:

Step 1: Register to buy capital contributions and shares of Vietnamese companies

Investors will submit registration documents for capital contribution, share purchase and capital contribution to the Department of Investment – Department of Planning and Investment where the headquarters of the organization is located economic.

The processing time is 15 days. If the request is not accepted, the investor will receive a notice clearly stating the reason from the processing agency.

2nd step: Change of business registration certificate

After receiving approval from the Department of Investment – Department of Planning and Investment to allow foreign investors to contribute capital, purchase shares or contribute capital, the investor will carry out the procedures of change of shareholders. , member on the business registration certificate in accordance with the provisions of the Act at the Business Registration Office.

4- Top 10 largest FDI companies in Vietnam

Many FDI companies are currently operating in Vietnam. Among them are companies with huge investment capital.

Below are the top 10 large FDI companies in Vietnam:

STT

Company Name

Fields of activity

Total investment capital (USD)

Investment country

1

Hung Nghiep Formosa Ha Tinh Company Limited

Metallurgy, production, import and export of iron and steel; port affairs; make products from furnace slag; cement, pressed products.

7,879,060,000

Taiwan

2

New City Vietnam Company Limited

Real estate business, tourism services, resorts, hotels, restaurants, offices, houses, villas for rent

4,345,870,000

Brunei

3

Ho Tram Project Company Limited

Construction and operation of resorts, entertainment, hotels and amusement parks with prices.

4,230,000,000

Canada

4

Dragon Beach Group Company Limited (Dragon Beach Ecotourism Area)

Construction and activity of ecotourism, entertainment complexes, hotels, restaurants, video games CT.

4,150,000,000

UNITED STATES

5

Winvest Investment Company Limited (Vietnam)

Construction of resorts, 5-star hotels and entertainment areas.

4,100,000,000

UNITED STATES

6

Berjaya International University of Vietnam Urban Company Limited

International university urban planning (educational zone, residential zone, commercial zone, entertainment – medical – TT).

3,500,000,000

Malaysia

7

Guang Lian Vietnam Co., Ltd.

Construction of a steel rolling plant with a capacity of 5 million tonnes per year.

3,000,000,000

Cayman Islands

8

Berjaya Nhon Trach New City Company Limited

Construction and activity of the new urban area of ​​Nhon Trach.

2,000,000,000

Cayman Islands

9

Vung Ro Oil Company Limited

Production-VC, containing oil and gas, petroleum products, 4 million tons/year.

1,700,000,000

British Virgin Islands

ten

Phu Long Thang Design and Construction Company Limited

Real estate business

1,700,000,000

Samoa

Above is some information about FDI companies that Ms. Uptalent would like to share with you. I hope this article helped you understand What is an FDI company? as well as forms and procedures for setting up FDI businesses in Vietnam. Good luck!

HRchannels – Headhunter – Premium recruitment service

Back To Top