PROCEDURES FOR CHANGING INVESTORS IN CASE OF INVESTMENT PROJECT TRANSFER

PROCEDURES FOR CHANGING INVESTORS IN CASE OF INVESTMENT PROJECT TRANSFER

When implementing investment projects, a great deal of investors have to transfer an investment project to another investor for further execution for various objective reasons. The investor must then go through the steps to change investors. Thus, how does the law govern over these procedures? HTC Vietnam Law firm will assist investors in answering this matter in the article below.

I. Legal basis

- Investment Law 2014

- Decree 118/2015 / ND - CP

II. Scope of consultation

An investor (the transferor) may transfer part of or the whole investment project to another investor (the transferee) in accordance with the requirements for changing investors. If the project transfer generates income, the transferor shall fulfill his/her tax liability as prescribed by law.

* The application consists of:

- A written request for permission for project adjustments;

- A report on the project’s progress up to the time of transfer;

- The project transfer contract or another document with equivalent legal value;

- Copies of the ID card or passport (if the investor is an individual) or Certificate of Enterprise Registration or another document with equivalent legal value (if the investor is an organization);

- Copies of the Investment Registration Certificate or decision on investment guidelines (if any);

- Copies of the BCC contract (for BCC projects);

- Copies of one of the following documents of the transferee: financial statements of the last 02 years; commitment to provide financial support by the parent company, commitment to provide financial support by a financial institution, the guarantee of transferee’s financial capacity, documents describing the transferee’s financial capacity;

* Procedures for changing the investor of a project operating under an Investment Registration Certificate which is not required to have a decision on investment guidelines:

- The transferor shall submit a set of application to the investment registration authority.

- The investment registration authority shall consider the fulfillment of conditions for project transfer specified in the Law on Investment to adjust the Investment Registration Certificate within 10 working days from the day on which the valid application specified in Point a of this Clause is received.

* Procedures for changing the investor of a project operating under an Investment Registration Certificate whose decision on investment guidelines is issued by the People’s Committee of the province:

- The investor shall submit 04 sets of application specified in the Law on Investment to the investment registration authority;

- Within 03 working days from the receipt of the valid application as set out in the Law on Investment, the investment registration authority shall send 02 it to competent authorities to receive comments about the conditions for project transfer;

- Within 10 working days from the day on which the request of the investment registration authority is received, the authorities shall make comments about the issues under their management;

- Within 20 days from the receipt of the valid application, the investment registration authority shall make a report on fulfillment of conditions for project transfer according to the Law on Investment and submit it to the People’s Committee of the province;

- Within 05 working days from the receipt of the report from the investment registration authority, the People’s Committee of the province shall consider issuing a decision on adjustments to investment guidelines;

- Within 03 working days from the receipt of the decision on adjustments to investment guidelines, the investment registration authority shall adjust the Investment Registration Certificate of the transferee.

* Procedures for changing the investor of a project operating under an Investment Registration Certificate whose decision on investment guidelines is issued by the Prime Minister:

- The investor shall submit 08 sets of application specified in the Law on Investment to the investment registration authority;

- Within 03 working days from the receipt of the valid application as set out the Law on Investment, the investment registration authority shall send 02 it to competent authorities to receive comments about the conditions for project transfer;

- Within 10 working days from the day on which the request of the investment registration authority is received, the authorities mentioned in the Law on Investment shall make comments about the issues under their management;

- Within 25 days from the receipt of the valid application as set out in the Law on Investment, the investment registration authority shall request the People’s Committee of the province to consider and send comments about the issues (if any) to the Ministry of Planning and Investment;

- Within 10 working days from the receipt of comments from the People’s Committee of the province, the Ministry of Planning and Investment shall make a report on fulfillment of conditions for project transfer;

- Within 07 working days of receipt of the report, the Ministry of Planning and Investment and the Prime Minister shall consider issuing a decision on adjustments to investment guidelines. The decision on adjustments to investment guidelines shall be sent to the Ministry of Planning and Investment, the People’s Committee of the province, and the investment registration authority;

- Within 05 working days from the receipt of the decision on adjustments to investment guidelines, the investment registration authority shall adjust the Investment Registration Certificate of the transferee.

With regard to a project having a decision on investment guidelines issued by the management board of an industrial park, export-processing zone, hi-tech zone, or economic zone (hereinafter referred to as management board), the management board shall decide the adjustments to investment guidelines when the conditions specified in the Law on Investment are fulfilled.

With regard to a project having a decision on investment guidelines, if the investor in which has finished contributing and/or raising capital, and the project has been put into operation, it is not required to follow the procedures for adjusting investment guidelines. Where a project is executed under an Investment Registration Certificate, the investor shall follow procedures for adjusting the Investment Registration Certificate.

Where a foreign investor receives a project and establishes a business organization to execute it, such foreign investor shall follow procedures for issuing or adjusting the Investment Registration Certificate, then follow procedures for establishing a business organization in accordance with regulations of law on establishment of the corresponding type of business organization.

The above HTC’s are our consultation on the investment procedures for investment in the form of capital contribution or purchase of shares or stakes. HTC Vietnam Law Firm is honored to accompany clients in resolving all legal issues. Please contact us for the best consulting services.

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For more details, please contact:

HTC Vietnam Law Firm

Address: 15th Floor, Multipurpose Building, 169 Nguyen Ngoc Vu, Trung Hoa Ward, Cau Giay District, Hanoi.

Tel: 0989.386.729; Email: [email protected]

Website: https://htc-law.com; https://luatsuchoban.vn

Translator: Pham Nguyen Nhat Linh