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Vietnam: New rules for foreign exchange control, foreign direct investments

Vietnam: New rules for foreign exchange control

Guidance issued by Vietnam’s state bank concerning foreign direct investment is effective 6 September 2019.

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The guidance (Circular 06/2019/TT-NHNN) reflects changes that:

  • Expand the definition of foreign direct investment enterprises that are subject to direct investment capital account requirements
  • Provide clearer guidelines on opening and use of direct investment capital accounts
  • Set out circumstances when foreign direct investment enterprises are no longer required to maintain direct investment capital accounts and their foreign members or non-resident shareholders are required to open indirect investment capital accounts
  • Clarify the currency and payment for capital transfer transactions (for instance, mergers and acquisitions) in foreign direct investment enterprises
  • Relax the requirement on inward remittance of funds for the payment of pre-investment expenditures

There is a 12-month transition period to complete the conversion to the appropriate capital accounts (that is, by 6 September 2020).

Read an August 2019 report [PDF 498 KB] prepared by the KPMG member firm in Vietnam

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