{"id":12545,"date":"2025-08-01T12:47:40","date_gmt":"2025-08-01T05:47:40","guid":{"rendered":"https:\/\/cdlaf.vn\/?p=12545"},"modified":"2025-08-01T12:52:16","modified_gmt":"2025-08-01T05:52:16","slug":"foreign-invested-enterprises-how-to-properly-identify-the-beneficial-owner","status":"publish","type":"post","link":"https:\/\/cdlaf.vn\/en\/foreign-invested-enterprises-how-to-properly-identify-the-beneficial-owner\/","title":{"rendered":"Foreign-Invested Enterprises: How to properly identify the Beneficial Owner?"},"content":{"rendered":"<p>The term <strong>\u201cbeneficial owner\u201d<\/strong> is no longer unfamiliar to enterprises, as it has been explicitly defined under the <strong>Law on Anti-Money Laundering 2022<\/strong>. However, prior to the adoption of this law, there were no mandatory requirements for enterprises to declare beneficial ownership, nor were there any official guidelines regarding the forms, methods of identification, or procedures for such declaration. These regulatory gaps have, to some extent, placed Vietnam\u2019s financial system in a <strong>grey area<\/strong> due to a lack of transparency in financial matters, raising concerns among certain investors regarding the safety and integrity of the investment environment. In response to these concerns, from <strong>July 1, 2025<\/strong>, the amended <strong>Enterprises Law<\/strong> introduces a mandatory requirement for all enterprises to declare their <strong>beneficial owners<\/strong>, including <strong>foreign-invested enterprises<\/strong> conducting business in Vietnam. The following article will provide comprehensive information that investors and foreign enterprises need to know about beneficial ownership.<\/p>\n<p>For FDI enterprises \u2013 which often have multi-layered ownership structures involving multiple intermediary legal entities and foreign investors \u2013 the <strong>accurate identification of the beneficial owner<\/strong> is no longer optional but a mandatory obligation. Failure to comply fully and in a timely manner may expose the enterprise to legal risks, administrative sanctions, and serious impacts on its reputation in the eyes of investors, regulatory authorities, and financial partners. In this context, the following article by CDLAF will provide further clarification on beneficial ownership and the actions that enterprises must take.<\/p>\n<figure id=\"attachment_12533\" aria-describedby=\"caption-attachment-12533\" style=\"width: 600px\" class=\"wp-caption aligncenter\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-12533 size-medium\" src=\"http:\/\/cdlaf.vn\/wp-content\/uploads\/2025\/07\/pexels-rdne-7414218-1-600x400.jpg\" alt=\"\" width=\"600\" height=\"400\" srcset=\"https:\/\/cdlaf.vn\/wp-content\/uploads\/2025\/07\/pexels-rdne-7414218-1-600x400.jpg 600w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2025\/07\/pexels-rdne-7414218-1-1200x800.jpg 1200w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2025\/07\/pexels-rdne-7414218-1-768x512.jpg 768w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2025\/07\/pexels-rdne-7414218-1-1536x1024.jpg 1536w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2025\/07\/pexels-rdne-7414218-1.jpg 1662w\" sizes=\"auto, (max-width: 600px) 100vw, 600px\" \/><figcaption id=\"caption-attachment-12533\" class=\"wp-caption-text\">Source: pexels-rdne-7414218<\/figcaption><\/figure>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of contents:<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #a32411;color:#a32411\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #a32411;color:#a32411\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/cdlaf.vn\/en\/foreign-invested-enterprises-how-to-properly-identify-the-beneficial-owner\/#1_Declaring_beneficial_owners_based_on_the_capital_structure_of_foreign-invested_enterprises\" >1. Declaring beneficial owners based on the capital structure of foreign-invested enterprises<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/cdlaf.vn\/en\/foreign-invested-enterprises-how-to-properly-identify-the-beneficial-owner\/#2_What_is_the_legal_framework_governing_beneficial_ownership_in_foreign-invested_enterprises_in_Vietnam\" >2. What is the legal framework governing beneficial ownership in foreign-invested enterprises in Vietnam?<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/cdlaf.vn\/en\/foreign-invested-enterprises-how-to-properly-identify-the-beneficial-owner\/#3_Guidelines_for_identifying_the_beneficial_owner_in_the_capital_structure_of_an_FDI_enterprise\" >3. Guidelines for identifying the beneficial owner in the capital structure of an FDI enterprise<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/cdlaf.vn\/en\/foreign-invested-enterprises-how-to-properly-identify-the-beneficial-owner\/#SEND_CONSULTATION_REQUEST\" >SEND CONSULTATION REQUEST<\/a><\/li><\/ul><\/nav><\/div>\n<h2><span class=\"ez-toc-section\" id=\"1_Declaring_beneficial_owners_based_on_the_capital_structure_of_foreign-invested_enterprises\"><\/span>1. Declaring beneficial owners based on the capital structure of foreign-invested enterprises<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Combating transfer pricing and base erosion has consistently been a pressing issue, not only for the Vietnamese Government but also as one of the criteria used by international organizations to assess the transparency of Vietnam\u2019s financial market. As a result, new regulations have imposed mandatory obligations on foreign enterprises conducting business in Vietnam.<\/p>\n<p>One prominent characteristic of foreign-invested enterprises is their multi-tiered capital ownership structure, particularly in multinational companies, companies established through investment funds, or those present in Vietnam through nominee agreements established in a third country \u2014 where nominee relationships or outsourced capital ownership are legally recognized. Under the previous regulations, the layering of such ownership structures was only reflected in enterprise records. Under the new provisions, however, enterprises must rely on this structure to accurately identify which individual investor is the beneficial owner, and this information must be submitted and retained at the company.<\/p>\n<p>Therefore, for FDI enterprises, the declaration of beneficial owners must take into account the capital structure of the foreign investors. The assessment must be based on the legal documents of the investors as established in their country of origin. It should be noted that this applies to foreign institutional investors operating in Vietnam. In the case of individual investors, the individual is deemed the beneficial owner, unless that individual is engaged in a capital ownership agreement with another individual or organization.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"2_What_is_the_legal_framework_governing_beneficial_ownership_in_foreign-invested_enterprises_in_Vietnam\"><\/span>2. What is the legal framework governing beneficial ownership in foreign-invested enterprises in Vietnam?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Regulations on beneficial ownership, as mentioned above, are provided under the Anti-Money Laundering Law 2022. However, these regulations currently focus on specific entities engaging in particular types of transactions and do not impose a declaration obligation on all enterprises. Accordingly, the Anti-Money Laundering Law sets out obligations to collect, verify, update, and retain information on beneficial owners during the course of operations by enterprises involved in financial and banking transactions. This also reflects Vietnam\u2019s commitment to international financial standards.<\/p>\n<p>From July 1, 2025, the amended Enterprises Law officially introduces a mandatory requirement for all enterprises to declare their beneficial owners, with the timing of the declaration depending on each specific case. The law provides that:<em>&#8220;<\/em><em>Beneficial owner of an enterprise having<\/em><em>\u00a0juridical person status (hereinafter referred to as \u201cbeneficial owner\u201d)\u00a0means an individual who has actual ownership of charter capital of or has controlling interest in that enterprise, except a direct representative of owner in a wholly state-owned enterprise or a representative for the State\u2019s portion of capital at a joint-stock company or a multi-member limited liability company in accordance with regulations of law on management and use of state capital in enterprises.\u201d<\/em><\/p>\n<p><strong>What are the criteria for determining the beneficial owner of an enterprise?<\/strong> To determine which individual is the beneficial owner, the FDI enterprise must rely on criteria related to capital ownership and the right to control decisions of that enterprise, specifically:<\/p>\n<ul>\n<li>An individual who directly or indirectly owns 25% of the charter capital or 25% of the total voting shares or more of the enterprise;<\/li>\n<li>An individual who has the right to control the decision-making over at least one of the following matters: appointment, dismissal, or removal of the majority or all members of the Board of Directors, Chairperson of the Board of Directors, Chairperson of the Members\u2019 Council; the legal representative, Director or General Director of the enterprise; amendment or supplementation of the charter of the enterprise; change of the organizational management structure of the company; reorganization or dissolution of the company;<\/li>\n<li>An individual who indirectly owns as stipulated at point a of this Clause 1 is an individual who owns 25% of the charter capital or 25% of the total voting shares or more of the enterprise through another organization.<\/li>\n<\/ul>\n<p>Thus, the person who establishes the enterprise, the enterprise itself shall declare and notify the Business Registration Authority of information on the beneficial owner of the enterprise as follows: An individual who is a shareholder owning 25% or more of the total voting shares; an individual who is a member owning 25% or more of the charter capital in a partnership or a multi-member limited liability company; an individual who is the owner of a single-member limited liability company. At the same time, the enterprise shall retain the list of beneficial owners of the enterprise as declared and notified to the provincial-level Business Registration Authority in accordance with regulations, in the form of either hard copy or electronic document.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"3_Guidelines_for_identifying_the_beneficial_owner_in_the_capital_structure_of_an_FDI_enterprise\"><\/span>3. Guidelines for identifying the beneficial owner in the capital structure of an FDI enterprise<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>As previously mentioned, due to the multi-layered structure and the involvement of foreign legal systems, the identification of the beneficial owner is not as straightforward as in Vietnamese enterprises. Accordingly, the enterprise must:<\/p>\n<ul>\n<li>Collect all legal documents related to all intermediary legal entities in the investment chain, such as: business licenses, charters, appointment decisions, shareholder agreements, or any other documents in accordance with foreign law;<\/li>\n<li>Trace back the original ownership chain from the investor\u2019s base in Vietnam in order to identify the actual owner and thereby determine which individual is the beneficial owner;<\/li>\n<li>Determine the actual controlling rights, as in some cases individuals manage or own capital based on agreements established in countries whose legal systems recognize nominee arrangements.<\/li>\n<\/ul>\n<p>The identification and disclosure of information regarding the beneficial owner is not only a legal obligation but also a matter of strategic governance for each FDI enterprise. Enterprises must be fully aware of their role in compliance: accurately and fully declaring information on the beneficial owner from the time of establishment and throughout the course of operations. Regularly updating such information in case of any changes in ownership structure, share transfers, changes to intermediary legal entities, or actual governance structure.<\/p>\n<p><strong><em>Time of writing:<\/em><\/strong> 28\/07\/2025<\/p>\n<p><em>The article contains general information which is of reference value, in case you want to receive legal opinions on issues you need clarification on, please get in touch with our Lawyer \u00a0at\u00a0 <a href=\"https:\/\/mail.google.com\/mail\" target=\"_blank\" rel=\"noopener\"><strong>info@cdlaf.vn<\/strong><\/a><\/em><\/p>\n<div class=\"content-post-nd\">\n<div style=\"text-align: center;\"><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-5519 size-full aligncenter\" src=\"http:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG.png\" alt=\"\" width=\"1080\" height=\"600\" srcset=\"https:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG.png 1080w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG-720x400.png 720w, https:\/\/cdlaf.vn\/wp-content\/uploads\/2023\/05\/CHUONG-TRINH-THANG-768x427.png 768w\" sizes=\"auto, (max-width: 1080px) 100vw, 1080px\" \/><\/div>\n<\/div>\n<div class=\"content-post-nd\">\n<p><strong>Why choose CDLAF\u2019s service?<\/strong><\/p>\n<ul class=\"li-content\">\n<li>We provide effective and comprehensive legal solutions that help you save money and maintain compliance in your business;<\/li>\n<li>We continue to monitor your legal matters even after the service is completed and update you when there are any changes in the Vietnamese legal system;<\/li>\n<li>Our system of forms and processes related to labor and personnel is continuously built and updated and will be provided as soon as the customer requests it;<\/li>\n<li>As a Vietnamese law firm, we have a thorough understanding of Vietnam&#8217;s legal regulations, and grasp the psychology of employees, employers, and working methods at competent authorities;<\/li>\n<li>CDLAF&#8217;s team of lawyers has many years of experience in the field of labor and enterprises, as well as human resources and financial advisory.<\/li>\n<li>Strict information security procedures throughout the service performance and even after the service is completed.<\/li>\n<\/ul>\n<\/div>\n<p><strong style=\"color: #a32411;\">You can refer for more information:<\/strong><\/p>\n<ul>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/who-is-the-beneficial-owner-legal-perspective-from-the-latest-regulations-of-vietnamese-enterprise-law\/\">Who is the Beneficial Owner? \u2013 Legal Perspective from the Latest Regulations of Vietnamese Enterprise Law<\/a><\/li>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/latest-social-insurance-obligations-for-foreign-enterprises-in-vietnam-in-2025\/\">Latest social insurance obligations for foreign enterprises in Vietnam in 2025<\/a><\/li>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/deduction-of-input-vat-under-decree-181-2025-nd-cp-what-are-the-considerations-for-enterprises\/\">Deduction of input VAT under Decree 181\/2025\/N\u0110-CP: What are the considerations for enterprises?<\/a><\/li>\n<li><a href=\"https:\/\/cdlaf.vn\/en\/0-vat-rate-under-decree-no-181-2025-what-conditions-must-enterprises-satisfy\/\">0% VAT Rate under Decree No. 181\/2025: What Conditions Must Enterprises Satisfy?<\/a><\/li>\n<\/ul>\n\n<div class=\"wpcf7 no-js\" id=\"wpcf7-f2681-o1\" lang=\"en-US\" dir=\"ltr\" data-wpcf7-id=\"2681\">\n<div class=\"screen-reader-response\"><p role=\"status\" aria-live=\"polite\" aria-atomic=\"true\"><\/p> <ul><\/ul><\/div>\n<form action=\"\/en\/wp-json\/wp\/v2\/posts\/12545#wpcf7-f2681-o1\" method=\"post\" class=\"wpcf7-form init\" aria-label=\"Contact form\" novalidate=\"novalidate\" data-status=\"init\">\n<fieldset class=\"hidden-fields-container\"><input type=\"hidden\" name=\"_wpcf7\" value=\"2681\" \/><input type=\"hidden\" name=\"_wpcf7_version\" value=\"6.1.5\" \/><input type=\"hidden\" name=\"_wpcf7_locale\" value=\"en_US\" \/><input type=\"hidden\" name=\"_wpcf7_unit_tag\" value=\"wpcf7-f2681-o1\" \/><input type=\"hidden\" name=\"_wpcf7_container_post\" value=\"0\" \/><input type=\"hidden\" name=\"_wpcf7_posted_data_hash\" value=\"\" \/>\n<\/fieldset>\n<h2 class=\"tt-form\"><span class=\"ez-toc-section\" id=\"SEND_CONSULTATION_REQUEST\"><\/span>SEND CONSULTATION REQUEST\n<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p><label>Full name<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"full-name\"><input size=\"40\" maxlength=\"400\" class=\"wpcf7-form-control wpcf7-text wpcf7-validates-as-required\" aria-required=\"true\" aria-invalid=\"false\" value=\"\" type=\"text\" name=\"full-name\" \/><\/span><br \/>\n<label>Email<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"email\"><input size=\"40\" maxlength=\"400\" class=\"wpcf7-form-control wpcf7-email wpcf7-validates-as-required wpcf7-text wpcf7-validates-as-email\" aria-required=\"true\" aria-invalid=\"false\" value=\"\" type=\"email\" name=\"email\" \/><\/span><br \/>\n<label>Phone Number<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"phone\"><input size=\"40\" maxlength=\"400\" class=\"wpcf7-form-control wpcf7-tel wpcf7-text wpcf7-validates-as-tel\" aria-invalid=\"false\" value=\"\" type=\"tel\" name=\"phone\" \/><\/span><br \/>\n<label>Message<\/label><br \/>\n<span class=\"wpcf7-form-control-wrap\" data-name=\"coment\"><textarea cols=\"40\" rows=\"10\" maxlength=\"2000\" class=\"wpcf7-form-control wpcf7-textarea\" aria-invalid=\"false\" name=\"coment\"><\/textarea><\/span><br \/>\n<input class=\"wpcf7-form-control wpcf7-submit has-spinner btn-yellow\" type=\"submit\" value=\"Send\" \/>\n<\/p><div class=\"wpcf7-response-output\" aria-hidden=\"true\"><\/div>\n<\/form>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>The term \u201cbeneficial owner\u201d is no longer unfamiliar to enterprises, as it has been explicitly defined under the Law on Anti-Money Laundering 2022. However, prior to the adoption of this law, there were no mandatory requirements for enterprises to declare beneficial ownership, nor were there any official guidelines regarding the forms, methods of identification, or&#8230;<\/p>\n","protected":false},"author":4,"featured_media":12533,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[64],"tags":[],"class_list":["post-12545","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-articles"],"acf":[],"_links":{"self":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts\/12545","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/comments?post=12545"}],"version-history":[{"count":2,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts\/12545\/revisions"}],"predecessor-version":[{"id":12547,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/posts\/12545\/revisions\/12547"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/media\/12533"}],"wp:attachment":[{"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/media?parent=12545"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/categories?post=12545"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/cdlaf.vn\/en\/wp-json\/wp\/v2\/tags?post=12545"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}