REGULATIONS APPLICABLE TO FOREIGN INVESTORS ENGAGING IN SOUND RECORDING SERVICES IN VIETNAM

1. Legal Basis

- WTO General Schedule of Commitments on Trade and Services (GATS);

- AFAS, VJEPA, VKFTA, EVFTA, CPTPP;

- Law on Investment No. 143/2025/QH15 dated 11 February 2025.

2. Market Access Restrictions for Sound Recording Services in Vietnam

Vietnam has not undertaken any specific commitments regarding sound recording services under the WTO, AFAS, VJEPA, VKFTA, or EVFTA..

However, under the CPTPP (Annex II-VN-14), Vietnam reserves the right to adopt or maintain any measure relating to sound recording services, except that foreign investors are permitted to own up to 51% of the charter capital of an enterprise engaged in sound recording services.

3. Investment Procedures for Foreign Investors in Vietnam

Pursuant to the Law on Investment 2025, investors may invest in Vietnam through the following forms:

(i) Establishment of an economic organization.

(ii) Capital contribution, acquisition of shares, or acquisition of capital contributions.

(iii) Implementation of an investment project.

(iv) Investment under a Business Cooperation Contract (BCC).

(v) Other investment forms or new types of economic organizations as prescribed by the Government.

3.1. Establishment of an Economic Organization

1. Domestic investors may establish economic organizations in accordance with the Law on Enterprises and other laws governing the relevant types of economic organizations.

2. Foreign investors may establish an economic organization to implement an investment project before carrying out the procedures for the issuance or amendment of an Investment Registration Certificate. In doing so, foreign investors must satisfy the market access conditions applicable to foreign investors as prescribed in Article 8 of the Law on Investment.

3.2. Capital Contribution, Share Acquisition, or Acquisition of Capital Contributions

1. Investors have the right to contribute capital to, purchase shares in, or acquire capital contributions of economic organizations.

2. A foreign investor's capital contribution, share acquisition, or acquisition of capital contributions must satisfy the following conditions:

a) Compliance with the market access conditions applicable to foreign investors under Article 8 of the Law on Investment;

b) Compliance with national defense and security requirements under the Law on Investment and other relevant laws;

c) Compliance with land law provisions regarding the conditions for obtaining land use rights and land use in islands, border communes/wards/special administrative zones, coastal communes/wards, and other areas affecting national defense and security.

3. A foreign investor must complete the registration procedure for capital contribution, share acquisition, or acquisition of capital contributions before any change of members or shareholders if one of the following circumstances applies:

a) The transaction increases the foreign ownership ratio in an economic organization operating in a business sector subject to market access conditions applicable to foreign investors;

b) VCapital contributions, share purchases, or equity purchases resulting in foreign investors or economic organizations specified in points a, b, and c of Clause 1, Article 20 of this Law holding more than 50% of the charter capital of an economic organization are permitted in the following cases: increasing the foreign investor's ownership ratio of charter capital from less than or equal to 50% to over 50%; increasing the foreign investor's ownership ratio of charter capital when the foreign investor already owns more than 50% of the charter capital in the economic organization;

c) The foreign investor acquires capital in an economic organization holding a Land Use Rights Certificate for land located on islands, in border communes/wards/special administrative zones, coastal communes/wards, or other areas affecting national defense and security.

3.3. Investment under a Business Cooperation Contract (BCC)

1. A BCC entered into between domestic investors shall be governed by the Civil Code and other relevant laws.

2. A BCC entered into between domestic and foreign investors, or solely among foreign investors, requires the issuance of an Investment Registration Certificate in accordance with Article 26 of the Law on Investment.

3. The parties to a BCC shall establish a coordination board to implement the contract. The functions, duties, and powers of the coordination board shall be agreed upon by the parties.

4. During the implementation of the BCC, the parties may agree to use assets created through the business cooperation to establish an enterprise in accordance with the Law on Enterprises.

Vietnam's international commitments play an important role in determining the market access regime applicable to foreign investors in the sound recording services sector. However, the application of these commitments must be considered in conjunction with Vietnam's domestic laws and the specific international agreement under which the foreign investor seeks to claim benefits. Accordingly, before making an investment in Vietnam, foreign investors should carefully identify the applicable international treaty as well as the relevant domestic legal requirements to ensure full compliance with Vietnamese law.