A Vietnamese special purpose vehicle, shortly known as SPV is an entity established with a specific objective. It is also referred to as a subsidiary. Among its uses are securing financing for various projects or the creation of a structured investment vehicle or securitization.
If you want to open a SPV company in Vietnam, you can rely on our local consultants. We offer tailored company formation services in Vietnam for foreign investors and enterprises.
Steps to open a SPV in Vietnam
The special purpose vehicle can take one of the forms established by the Vietnamese Company Law. For overseas investors, one of the preferred entities is the foreign-owned enterprise.
The main stages for opening a company in Vietnam to operate as a SPV are:
- applying for a registration investment certificate (this requirement is available for foreign investors only);
- applying for the enterprise registration certificate, which is the same as Trade Register incorporation in Western countries.
For the second step, there are several documents that need to be prepared by the SPV owner. Among these:
- the company charter (Articles of Incorporation) – our Vietnam company formation agents can assist with the creation of these documents;
- a list of all management board members;
- a list of legal representatives, if the company has more than one representatives;
- the appointment and authorization letters for company representatives;
- the application form for enterprise registration.
Following these stages, the company can then open the bank account and register for taxation purposes in Vietnam.
You can rely on our Vietnamese company registration agents for guidance during the incorporation procedure.
Uses of a Vietnamese SPV company
If you decide to set up a SPV Company in Vietnam, you should note that such entities are usually employed for specific purposes. Such companies are usually used for accounting, tax, and insolvency purposes since they are independent of the investors/companies that set them up.
Other uses imply:
- the transfer of assets;
- the transfer of risks, where the parent firm creates an SPV to protect itself from various hazards;
- raising money without changing the investors’ ownership percentage;
- the increase of the parent company’s liquidity;
- holding company establishment, with the purpose of acquiring other businesses.
Most of the time, SPV companies are used to create investment funds in Vietnam. Our company formation agents in Vietnam can also assist with the establishment of investment funds.
Types of SPV companies
Based on the reason for creation, there are several types of SPVs that can be opened in Vietnam. Some of the most common are:
- project-based SPVs that are used for infrastructure construction and/or other public-private initiatives;
- investment vehicles that are companies designed to purchase investments that take advantage of the interest rate differential between short- and long-term debt;
- intermediate special purpose vehicles (SPVs) for private equity transactions, which are frequently utilized to separate certain assets and liabilities from the parent company’s.
Please note that in the case of project-based SPVs in Vietnam, special regulations apply, such as having a specific share capital and obtaining additional licenses.
From a financial point of view when it comes to the SPV, you can get in touch with our accountants in Vietnam.
Here is also a video guide on this entity:
How many companies are there in Vietnam?
According to recent data:
- in September 2023, there were 12.6 thousand new companies established in Vietnam;
- in October 2023, 15.4 thousand new companies were incorporated in Vietnam;
- the number of new companies registered in November 2023 was 14.3 thousand;
- at the end of November 2023, the total number of companies operating in Vietnam was 146 thousand.
If you want to open a SPV company in Vietnam and need assistance, please contact us.