New Circular Allows Foreign Investors to Open Direct Investment Capital Accounts in Vietnam

Posted by Reading Time: 3 minutes

HANOI – On August 11, the State Bank of Vietnam issued Circular 19/2014/TT-NHNN to provide detailed instructions on the management of foreign currency FDI operations in the country. This Circular serves as explanation to Decree 70/2014/ND-CP, which will go into effect from September 25th 2014.

According to the new regulations, foreign investors can open direct investment capital accounts in Vietnam Dong in addition to their foreign currencies accounts. Before, they were only allowed to open direct investment capital accounts in foreign currencies.

This change will provide huge support to foreign investors, especially those who want to reinvest in Vietnam using their own revenue in the country.

Professional Service_CB icons_2015RELATED: Dezan Shira & Associates’ Corporate Establishment Services

Another regulation of note is that, before obtaining an investment license, foreign investors can transfer part of their capital money to Vietnam for expenditures on pre-investment activities, such as business registration, market research and strategy consulting, etc. This cost will be counted as an operating expense when enterprises get their investment permit.

All transactions and cash payments for import and export activities of goods and services must be conducted by bank transfers with authorized credit institutions.

Foreign investors can also buy foreign currencies from local authorized banks and can transfer the money abroad from their own investment capital accounts within 30 days from the day of purchase.

RELATED: State Bank of Vietnam Issues New Circular on Foreign Investment

The circular aims to improve the management of FDI flows through the banking system in Vietnam and, at the same time, provide foreign investors with better conditions to make investments in the country.

Asia Briefing Ltd. is a subsidiary of Dezan Shira & Associates. Dezan Shira is a specialist foreign direct investment practice, providing corporate establishment, business advisory, tax advisory and compliance, accounting, payroll, due diligence and financial review services to multinationals investing in China, Hong Kong, India, Vietnam, Singapore and the rest of ASEAN. For further information, please email vietnam@dezshira.com or visit www.dezshira.com.

Stay up to date with the latest business and investment trends in Asia by subscribing to our complimentary update service featuring news, commentary and regulatory insight.

Related Reading

Tax, Accounting, and Audit in Vietnam 2014-2015
The first edition of Tax, Accounting, and Audit in Vietnam, published in 2014, offers a comprehensive overview of the major taxes foreign investors are likely to encounter when establishing or operating a business in Vietnam, as well as other tax-relevant obligations. This concise, detailed, yet pragmatic guide is ideal for CFOs, compliance officers and heads of accounting who need to be able to navigate the complex tax and accounting landscape in Vietnam in order to effectively manage and strategically plan their Vietnam operations.

An Introduction to Doing Business in Vietnam 2014 (Second Edition)
An Introduction to Doing Business in Vietnam 2014 (Second Edition) provides readers with an overview of the fundamentals of investing and conducting business in Vietnam. Compiled by Dezan Shira & Associates, a specialist foreign direct investment practice, this guide explains the basics of company establishment, annual compliance, taxation, human resources, payroll, and social insurance in the country.

Leave a Reply

Your email address will not be published. Required fields are marked *