Ms. Pham Thi Huong (Hanoi) company with 100% foreign investment, has been granted an Investment Registration Certificate. The certificate of capital contribution is 20 billion VND, equivalent to 851,063 USD (the exchange rate is 23,500 VND/USD).

The investor has fully contributed capital in USD through the direct investment capital account with the amount of 851,063 USD, converted at the exchange rate of the bank at the time of capital contribution is equivalent to 19,702,108,450 VND (the exchange rate). is 23,150 VND/USD). Due to the decrease in exchange rate, the amount of capital contributed in VND is still 297,891,550 VND, but the bank does not allow investors to contribute more because it is enough in USD.

Ms. Huong asked, is this case should it be considered enough capital contribution? Is contributed capital calculated in VND or USD?

The State Bank of Vietnam responded to this issue as follows:

Clause 1, Article 4 of Circular No. 06/2019/TT-NHNN dated September 26, 2019 of the State Bank of Vietnam guiding foreign exchange management for foreign direct investment activities in Vietnam stipulates:

"Foreign investors and Vietnamese investors are allowed to contribute investment capital in foreign currencies or Vietnam dong according to the amount of capital contributed by the investor in the Certificate of Investment Registration, License for Establishment and Operation. in accordance with specialized laws (for foreign direct investment enterprises established and operating under specialized laws), Notification of satisfaction of conditions for capital contribution, share purchase, and redemption capital contribution of the foreign investor, the PPP contract signed with the competent state agency, and other documents proving that the foreign investor's capital contribution is in accordance with the provisions of law.

Clause 2, Article 5 of Circular No. 06/2019/TT-NHNN stipulates as follows:

"... b) Corresponding to the type of foreign currency in which investment capital is contributed, only one direct investment capital account in that foreign currency may be opened at an authorized bank.

c) In case of investment in Vietnam dong, open a direct investment capital account in Vietnam dong at an authorized bank...".

Pursuant to the above provisions, foreign investors are allowed to contribute investment capital in foreign direct investment enterprises in foreign currency or VND corresponding to the actual contributed currency of the foreign investor, in accordance with the provisions of this Law. with the amount of contributed capital stated in the Investment Registration Certificate.

Credit institutions are responsible for checking, reviewing documents and recording capital contributions for foreign investors in accordance with the Investment Registration Certificate/other equivalent documents and relevant regulations at the time of capital contribution by foreign investors.