VIETNAM BUSINESS READINESS
Pre-Incorporation Due Diligence for a Vietnam Business
A practical evidence test for deciding whether a proposed Vietnam company is ready to file, needs repair, or should stop.
Do not file a Vietnam company merely because the name, shareholders and capital figure are available. Pre-incorporation due diligence should first prove that the proposed activities are open to the investors, the legal and investment pathways match the project, the address can support the intended use, and every ownership, funding and authority statement is evidenced.
The review should end with one of three recorded outcomes: clear to draft, repair a defined gap, or stop and redesign. It is formation-readiness diligence—not due diligence on an existing acquisition target—and it does not replace any approval by a Business Registration Agency, investment registration authority, sector regulator or bank.
Key takeaways
- Market access comes before document drafting because ownership limits, partner requirements or sector conditions can invalidate the proposed structure.
- A foreign investor’s company-establishment step and its project-level investment procedure are connected but no longer fit a universal “IRC first, ERC second” slogan.
- The address, activity scope, capital logic and investor evidence must tell one consistent commercial story across registration, licensing and bank review.
- Each diligence finding needs an owner, supporting document, expiry or validity date, and a stop condition—not a generic green tick.
- An Enterprise Registration Certificate proves registration; it does not by itself prove that a conditional activity is licensed, capital is paid, banking is active or the business may trade.
What the review must decide before filing
The useful question is not “Do we have the forms?” It is whether the facts that will appear in those forms can survive four later tests: registration review, a sector-licensing check, the bank’s KYC and source-of-funds review, and the company’s own ability to operate as described. A filing-ready dossier is not the same as an operation-ready business.
Start with a one-page fact pattern: each investor’s nationality and legal form; direct and indirect owners; proposed products and revenue flows; customers and suppliers; delivery location; staff and foreign personnel; premises; funding sources; and any regulated touchpoint. Then test the same facts against law, the proposed charter, supporting records and the commercial model. A contradiction is a diligence finding even when every document is authentic.
Keep this task separate from acquisition diligence. If the plan is to buy shares or an operating business, you must also examine the target’s licences, tax, employment, litigation, land, contracts, data, debt and historical compliance. The greenfield review here asks whether a new entity can be formed on the proposed facts. For a foreign-owned proposal, the related foreign-investor feasibility test is the appropriate deeper check on investor-specific eligibility before the dossier is drafted.
Test the facts before paying for filings
Have the proposed activities, owners and location screened as one fact pattern so a structural problem is found before documents are legalised or translated.
The six evidence gates
A due-diligence checklist becomes useful only when each gate produces evidence and a consequence. The matrix below is designed as a hand-off record between founders, counsel, translators, filing staff and the future finance team. It prevents a reassuring but meaningless “checked” status.
| Gate | Evidence to retain | Clear condition | Stop or repair trigger |
|---|---|---|---|
| 1. Activity and access | Product, customer, revenue and delivery map; legal classification; treaty basis where used | Every activity has an ownership and licensing conclusion | Prohibited activity, unresolved foreign-access condition or missing permit route |
| 2. Entity and pathway | Structure memo identifying enterprise and project procedures | Company type, ownership and filing order fit current law | A legacy filing sequence is being used without a current legal test |
| 3. Ownership and authority | Ownership chain, control persons, resolutions, signatory powers and identity records | The natural-person control map reconciles with every declaration | Nominee inconsistency, unexplained controller or defective corporate authority |
| 4. Place and premises | Lease or consent, landlord/title evidence, permitted use and operational approvals | Address supports both registration and the intended activity | Address is only nominal or cannot support licensing, staff or equipment |
| 5. Capital and funding | Use-of-funds budget, contribution schedule, source evidence and banking assumptions | Amount, timing and source support the project and can be evidenced | Arbitrary capital, circular funding or a schedule investors cannot meet |
| 6. Filing and launch evidence | Current forms, translated records, data reconciliation and post-registration owner list | One controlled data set can populate filing, bank and compliance work | Names, dates, addresses, activities or ownership percentages conflict |
The matrix is not a substitute for a legal opinion. Its value is operational: it shows exactly which assumption is cleared, which evidence supports it, and which unresolved issue prevents the team from treating the company as ready.
Control the evidence by version as well as by document name. Record who supplied each item, the date it was checked, the transaction or filing it supports, and whether a later change to the activity, shareholder, capital or location invalidates it. The final pack should contain the evidence actually relied on—not every draft received. This creates an audit trail for a filing correction, licence query or bank follow-up without forcing the team to reconstruct why an assumption was accepted months earlier.
Market access and the correct filing path
Classify what the business will actually do before selecting activity wording. Article 8 of the Law on Investment 2025 , effective March 1, 2026, gives foreign investors domestic-investor access unless an activity is on the restricted-market-access list; listed conditions may concern foreign ownership, investment method, scope, investor capacity or a participating partner. A broad phrase such as “consulting,” “trading” or “technology” is therefore not a conclusion. Break it into products, contractual deliverables, money flows and place of performance.
The filing sequence must also be tested under current law. Article 19 now permits a foreign investor to establish an economic entity for an investment project before completing issuance or amendment of an investment certificate, while requiring market-access compliance at enterprise establishment. Article 26 still identifies foreign-investor projects and certain foreign-invested entities’ projects as subject to an Investment Registration Certificate. The correct diligence conclusion is a project-specific dependency map, not a universal certificate order.
Record whether investment-policy approval is triggered, whether the project requires an IRC, which authority has jurisdiction over the location, and which sector conditions must be satisfied before trading. The law assigns IRC functions differently for projects inside relevant zones and projects outside them. A project spanning locations can change the responsible authority, so “province to be confirmed” is not a harmless placeholder.
For the enterprise filing itself, the Government’s explanation of Decree 168/2025 on business registration confirms that the provincial Business Registration Agency issues enterprise registration certificates and that the business code also serves as the tax code. Because the decree was amended in 2026, freeze the form set, authentication method and declaration fields only on the actual filing date. Before building the dossier, align the base facts with the current Vietnam company registration requirements ; project approval, sector licensing and bank acceptance remain separate workstreams.
Ownership, location, capital and evidence
Reconstruct ownership from natural person to Vietnam company
Draw the full chain rather than copying the immediate shareholder list. For every entity in the chain, retain a current registry extract, constitutional document, ownership evidence and the resolution authorising the investment and signatory. Identify the people who ultimately own or control the structure under the filing-date enterprise-registration rules. The same chain should reconcile with the charter, declarations, legalised or apostilled documents where applicable, translations, bank KYC pack and tax onboarding.
Test authority separately from identity. A director shown on a foreign registry may not automatically have power to approve an overseas investment or delegate the Vietnam filing. Record the governing clause, approving body, resolution date, signatory and any expiry. An authentic document signed by the wrong corporate organ is still defective evidence.
Prove that the address works for the business
A usable registered address and an operational site are not always the same. Match the address to permitted use, lease rights, landlord or title evidence, signage, staff presence, equipment, warehouse needs and the location conditions of any sector approval. If the project sits inside an industrial or other managed zone, confirm the relevant management board and the project’s geographical boundaries before assuming the authority or sequence.
Do not accept “virtual office available” as the diligence conclusion. The record should state what the address proves, what activity may occur there, what must occur elsewhere, and which lease or approval condition remains outstanding. A later relocation can require changes across enterprise, investment, tax, licence and bank records.
Make capital a documented operating assumption
Build a use-of-funds schedule covering setup, deposits, payroll, inventory, equipment, licensing, tax and working capital until expected cash generation. Then reconcile the proposed charter capital and investment capital with the investors’ evidence of financial capacity, contribution timetable, funding currency and expected bank route. Capital is not a professional fee or a government charge; it is part of the company or project funding plan.
The amount should be commercially credible without being inflated to signal strength. Choose a contribution schedule the investors can actually evidence and meet. If the model depends on shareholder loans, customer advances or staged investment, document their legal and banking treatment rather than treating them as interchangeable with charter capital.
Reconcile the evidence pack
Use one controlled ownership, address and funding data set across corporate approvals, translations, the registration dossier and the bank-facing file.
Build a Stop, Repair or Clear record
Close each finding with a dated decision. “Clear” means the proposition is supported, the evidence is current for its intended use, and no conflicting fact remains. “Repair” means there is a defined cure—such as narrowing an activity, changing the premises, obtaining a resolution, correcting a translation or producing source-of-funds evidence—with a named owner and deadline. “Stop” means filing would misstate the plan, breach an access rule, rely on defective authority, or create an entity that cannot perform the intended business.
For every conclusion, record five fields: proposition tested, source or document, applicable date, decision owner and next action. Add an expiry or refresh trigger where the evidence can become stale. Registry extracts, bank letters, leases and powers of attorney may all be genuine yet unsuitable if they are outdated, incomplete or inconsistent with the final structure.
End with a data-reconciliation meeting, not a document-count meeting. Read the name, address, activities, capital, ownership percentages, legal representative, project location and funding dates across every final draft. No unresolved red finding should be converted into a caveat after submission. If the regulator, bank or sector authority retains discretion, say so explicitly and identify the evidence prepared for that decision.
Decide whether the Vietnam business is ready to incorporate
Proceed to drafting only when the activity classification, market-access result, entity and project pathway, ownership/control map, signing authority, address, capital plan and filing evidence are mutually consistent. Conditional licences may remain for a later stage, but their route, premises and responsible party must already be known; otherwise the company could be registered into an unusable operating model.
Escalate rather than file if an activity has no defensible classification, a foreign-access condition is unresolved, the chosen premises cannot support the business, an investor cannot prove authority or funding, or the same fact appears differently across documents. The proper result of diligence is sometimes a redesigned scope, different location, different ownership route or a decision not to incorporate yet.
Turn the findings into a filing decision
HSJGlobal can map the unresolved gates, define the evidence still required and prepare a scope for the appropriate enterprise, investment and launch workstreams.
Frequently asked questions
Is pre-incorporation due diligence legally required for every Vietnam company?
There is no single document universally called a pre-incorporation due-diligence report. The underlying checks are still necessary because enterprise, investment, sector, premises, ownership and evidence rules apply to the facts submitted. The review is a control process for reaching accurate filing and operating decisions.
Does the 2025 Law on Investment mean a foreign investor never needs an IRC before company registration?
No. Article 19 changed the establishment sequence, but Article 26 continues to identify projects requiring an IRC. The correct order depends on the investor, project, market-access conditions, any investment-policy approval and implementing procedures at the filing date.
Can a leased office clear the address gate?
Yes, when the lease and underlying rights are valid and the site can support the intended registered and operational use. A service address may be insufficient for activities requiring production space, storage, customer facilities, technical conditions or premises-based licences.
Should founders choose the lowest possible charter capital?
Not as a default. The capital plan should satisfy any applicable legal threshold and credibly fund the business until expected cash generation. It must also match the investors’ capacity and contribution schedule. An unrealistically low amount can undermine licensing, project or bank review.
What proves that the diligence is complete?
A dated decision record should show every proposition tested, the supporting evidence, applicable law or policy, decision owner and action. All stop findings must be resolved or accepted as a decision not to file; repair findings need a completed cure and recheck.
