“Vietnam M&A Strategy: Legal Perspectives on Market Entry and Exit via Equity Transfer”: Vietnam Team

Vietnam M&A Strategy: Legal Perspectives on Market Entry and Exit via Equity Transfer

1. Introduction
Equity transfer is regarded as a highly practical means both for entering into and withdrawing from the Vietnamese market. For instance, when establishing a new legal entity in Vietnam, obtaining the requisite licenses may take considerable time depending on the industry. By contrast, by acquiring equity from a company already operating locally, an investor can bypass the licensing process and thereby enter the market in a relatively smooth manner. In addition, the use of equity transfers allows investors to gradually increase their ownership ratios, thereby diversifying risks through phased investment.
Equity transfer also serves as a useful mechanism for market exit. In general, the dissolution of a company in Vietnam requires significant time and effort. However, by utilizing equity transfers, an investor can achieve withdrawal from the Vietnamese market in a comparatively simple and efficient manner.
In this article, drawing on our experience from actual cases we have handled and taking into account the latest legislative developments , we will focus specifically on Vietnam-specific legal issues relating to the equity transfers in limited liability companies with two or more members .

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【Contents】

1. Introduction

2. Regulations specific to Vietnam

3. Key Considerations When Preparing an Equity Transfer Agreement

4. Key Tax Considerations

5. Proposed Schedule

6. Conclusion

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