Vietnam’s Circular 38: What Foreign Investors Need to Know About Investment Capital Accounts

Circular 38 changes Vietnam investment capital account rules. Review the implications for capital contributions, M&A payments and profit remittances.

Vietnam’s Circular No. 38/2026/TT-NHNN, issued by the State Bank of Vietnam on 31 July 2026, took effect on 18 August 2026 and replaced Circular No. 06/2019/TT-NHNN. It sets the foreign exchange rules for covered investment flows, including capital contributions, acquisitions, project transfers and the movement of profits and other lawful proceeds.

The circular uses the term foreign investment capital account in Vietnam, referred to here as an investment capital account (ICA). It also covers qualifying investment by member enterprises of Vietnam’s International Financial Centre (IFC) into the rest of Vietnam. For businesses and investors, the practical questions are who must hold an ICA, which transactions must pass through it and which currency and account route apply.

Who must open an investment capital account in Vietnam?

Circular 38 requires investment capital accounts for economic organisations established by foreign investors or IFC member enterprises, and for foreign-invested organisations in which those investors hold more than 50 percent of charter capital following a contribution or acquisition. It also covers public-private partnership (PPP) project enterprises established by foreign investors; foreign investors and IFC member enterprises participating in business cooperation contracts (BCCs); foreign investors carrying out PPP projects without a project enterprise; and specified foreign petroleum contractors. The 50 percent threshold applies to the contribution or acquisition category, rather than every foreign-invested organisation.

The account classification should be reviewed when ownership or company status changes. An ICA opened under the contribution or acquisition category must generally be closed if, after a transfer or charter capital change, the relevant holding falls to 50 percent or less. Closure is also required if the organisation becomes a public company whose shares are listed or registered for trading. An ICA being used for foreign borrowing, debt repayment or another lawful payment obligation is excepted from these closure requirements. Investors who retain a holding after closure use the applicable indirect investment account route for transactions relating to it.

Foreign exchange matters relating to listed or registered-for-trading public companies, and specified securities-market investments and transactions, fall outside Circular 38’s scope. Teams should check the applicable securities and indirect investment rules when either exclusion applies.

How can an ICA be opened and used?

An eligible account holder may open one foreign currency ICA and/or one Vietnamese dong ICA at the same authorised bank. Where capital contributions are made in several foreign currencies, it may open one ICA for each currency at that bank. A foreign investor or IFC member enterprise carrying out multiple business cooperation contracts (BCCs), petroleum contracts or public–private partnership (PPP) projects must maintain a separate ICA for each contract or project.

To change banks, the account holder must open a new ICA, transfer the entire balance from the old ICA and then close the old account. Until those steps are complete, the new ICA may receive the transferred balance but cannot be used for its other permitted transactions. Bank changes should therefore be scheduled around planned capital contributions and transaction payments.

An organisation established by a foreign investor before its investment registration certificate (IRC) is issued or adjusted may open a foreign currency and/or Vietnamese dong ICA in advance. Until the IRC is issued or adjusted, the account may be used only to receive charter capital and interest on its balance, pay lawful pre-investment costs, and refund capital to investors or IFC member enterprises if the IRC is not issued or adjusted. After the IRC step, the organisation may use the existing ICA for the transactions permitted under Articles 8 and 9 and, where needed, open ICAs in additional foreign currencies.

What changes for capital contributions and preparation costs?

Investors and IFC member enterprises may contribute in Vietnamese dong or foreign currency as supported by the relevant investment, corporate, sectoral or contractual documents. Monetary contributions must be transferred into the appropriate ICA. Where several currencies are used, the contributor selects one documented contribution currency as the consistent basis for calculating the total. The bank’s exchange rate at the time each amount is credited to the ICA is used, and the converted total must not exceed the documented contribution amount. This calls for a running reconciliation of commitments, exchange rates and receipts.

Investors and IFC member enterprises may transfer funds into an ICA for a capital contribution, or a change in its amount or ratio, before the foreign-invested organisation registers the relevant increase or change. This clarifies the banking sequence, while applicable registration requirements still need to be completed. Finance and legal teams should agree to the contribution timetable and supporting documents before funds arrive.

Before the specified investment approvals or documents are obtained, foreign investors may fund lawful preparation costs from abroad or from a payment account at an authorised bank in Vietnam. IFC member enterprises may use payment accounts at authorised banks in Vietnam. Where an organisation has already been established and opened an ICA before its IRC is issued or adjusted, these transfers must instead pass through that ICA. Once the relevant approval or document is obtained, the transferred funds may, with valid supporting records, be converted wholly or partly into a capital contribution or foreign loan, or returned after lawful preparation costs are deducted. Conversion into a loan remains subject to Vietnam’s foreign borrowing rules.

How do the rules affect capital returns and profit remittances?

Articles 8 and 9 specify the permitted receipts and payments for foreign currency and Vietnamese dong ICAs. Depending on the transaction, these include capital contributions, payments for transfers of capital or investment projects, refunds, capital returns, profits, other lawful proceeds and transactions relating to permitted foreign loans. The route depends on the transaction and currency; the ICA is used for specified investment flows, while the company also uses payment accounts for other permitted transactions.

A foreign investor’s transfer abroad of capital, profits or other lawful investment proceeds generally passes through the ICA. For an IFC member enterprise, the corresponding transfer into the IFC generally passes through the ICA to its capital account at an IFC member bank. Where the proceeds remain in Vietnam for a project or other investment activity, they are transferred from the ICA to the investor’s or member enterprise’s payment account at an authorised bank. The Circular specifies exceptions, including certain transfers after an ICA has been closed. These account routes do not remove applicable tax, corporate or investment requirements, and the authorised bank may require documents supporting the transaction.

Which account and currency apply to an M&A payment?

For a transfer of shares or contributed capital in a foreign-invested organisation covered by Article 6(1), payment between a resident investor and either a non-resident investor or an IFC member enterprise must pass through the ICA. Payment between two non-resident investors, two resident investors, two IFC member enterprises, or a non-resident investor and an IFC member enterprise do not pass through the ICA under this rule. Project transfers under business cooperation contracts, PPP projects and petroleum contracts have separate account-routing requirements.

The currency depends on the parties and transaction. Transfers of capital or investment projects between non-resident investors, between a non-resident investor and an IFC member enterprise, or between IFC member enterprises may be valued and settled in foreign currency. Transfers involving a resident investor and a non-resident investor or IFC member enterprise, or two resident investors, must be valued and settled in Vietnamese dong, except for the specified petroleum transactions for which foreign currency is permitted. Deal teams should confirm the parties’ residency, transaction type, account route and currency before finalising the purchase agreement and payment instructions.

What should existing investors check now?

Authorised banks must publish their ICA documentation and transfer procedures, examine supporting records and comply with anti-money laundering requirements. Investors must accurately describe each transfer and provide the documents their bank requires. Banks submit periodic statistical reports; covered account holders and banks may also be asked to report to the State Bank of Vietnam in specific cases.

Investors should map each entity, contract and project to the appropriate ICA, confirm the applicable ownership category and contribution currencies, and align transaction documents with bank instructions. For a pending acquisition or capital increase, establish who will open or close an account, whether an indirect investment account will be needed, and what documents the bank requires.

Article 19 sets targeted transition rules, rather than a 12-month deadline for all existing ICAs. Charter capital received into a company payment account before 18 August 2026 may be transferred to its ICA. Foreign investors conducting petroleum activities before that date have 12 months to complete the opening of an ICA. The same period applies to previously unclosed ICAs where no foreign investor or IFC member enterprise retains a holding, or where an investment registration certificate was not issued or adjusted and the contributed funds have been refunded.