What is Joint Venture under Vietnamese law?

A Joint Venture is an enterprise established in Vietnam on the basis of a joint venture contract signed by two or more parties for the purpose of conducting investment and business in Vietnam. One or more of the parties can be foreign entities. A joint venture can be formed in a variety of combinations, though in all cases it is understood as an enterprise with foreign capital investment comprising less than 100 percent of the total investment capital. A joint venture contract may be entered into between:

• Vietnamese and foreign party
• Vietnamese party and 100% foreign-owned entity
• Joint ventures and foreign party
• Joint ventures and 100% foreign-owned entity
• Two or more joint ventures
• Joint ventures and Vietnamese party

As is also the case with a 100 percent foreign-owned entity, a joint venture may be setup as a limited liability company, a joint stock company or a partnership. In a joint venture, profits and risks are distributed and shared between the parties in proportion to their respective capital contribution to the joint venture unless otherwise agreed to in the joint venture contract.