What is capital contribution to the company?

According to Clause 18, Article 4 of the Law on Enterprises 2020, capital contribution is the contribution of assets to form the company's charter capital, including capital contribution to establish a company or additional charter capital contribution of an already established company.

Pursuant to Article 34 of the Law on Enterprises 2020, assets contributed as capital are regulated as follows:

"Contributed assets include VND, convertible foreign currencies, gold, land use right (LUR), intellectual property rights, technologies, technical secrets, other assets that can be converted into VND.”

Thus, contributed capital must be assets listed according to the above regulations or other assets valued in Vietnam Dong. Note, contributing capital with "effort" or contributing with "intellect" is not considered a form of capital contribution because these are objects that are not considered assets.

Currently, business law does not stipulate the minimum amount of capital that must be contributed to the company, but will depend on the needs of each company. However, some business sectors and professions require fines to reach the minimum amount of contributed capital (legal capital) to be allowed to operate business, for example:

- Real estate business: 20 billion VND

- Labor export services: 05 billion VND

Foreign investors can contribute cash capital to the company

According to Clause 1, Article 3 Circular No. 06/2019/TT-NHNN regulations on "foreign investors": means any individual that has a foreign nationality or any organization that is established in accordance with a foreign country’s law and makes direct investment.

Foreign investors contribute capital to an enterprise through the issuance of an investment license in accordance with the provisions of investment law.

Clause 3, Article 4, Circular No. 06/2019/TT-NHNH stipulates:

“3. The monetary capital contribution by foreign or Vietnamese investors must be transferred to the direct investment account.”

So, When foreign investors contribute capital to a company in Vietnam to conduct investment and business activities, they are required to contribute in the form of bank transfer and cannot contribute in cash.