Asia Legal

We advised a corporate client in a transaction to acquire 3 ha-land and assets attached to land (hereinafter referred to as “the land”) in a Northern province of Vietnam, from another company. We act on behalf of the Buyer. Since our client is not familiar with legal services and it is the first time they have been using legal services, our scope of works is limited to a number of key works such as drafting the contract, assisting the client during negotiations of the contract and following up until our client is legally recorded as the new owner of the land. Other works which our client can do itself including checking master plan to make sure that the land they acquire is not included in the construction planning for other projects, are carried out by the client. Nevertheless, when drafting the contract, we still include “representations and warranties” clause into the contract, in which we clearly specify that the Seller undertakes and warrants that the land is not included in any ...

Few months ago, a corporate client (the Buyer) requested me to assist in its purchase of 100% equity from the owners of a private university in Vietnam (the Sellers). The Buyer and the Sellers had worked together before and reached an agreement on the payment. Accordingly, the Buyer shall deposit 10% of the value of the sale and purchase agreement (the SPA) to the Sellers after signing the Memorandum of Understanding and the remaining 90% shall be paid after the Buyer and the Sellers sign the notarized SPA at a licensed notary office, and after the Sellers hand over all original legal documents in connection with the private university to the Buyer. This way of doing transaction was quite familiar in Vietnam 15-20 years ago. However, it is so risky for the Buyer if it follows this transaction structure when key steps in an M&A transaction, including without limitation, legal and financial due diligence are not done, which can help define the requirements that the Sellers must meet...

I often receive the same and popular question from many of my clients whether they can write contract value in Vietnamese Dong, which is converted from USD in their contracts? One of the reasons, among others, why many Vietnamese people want to write the contract value in USD or in Vietnamese Dong, which is converted from USD in their contracts, is because of the exchange rate fluctuations between VND and USD, where the VND is often seen to suffer from price escalation. It is very simple to answer this kind of question as it is clearly stated under the applicable regulations of Vietnam. Specifically, pursuant to Ordinance No. 06/2013/UBTVQH13, within the territory of Vietnam, all transactions, payments, listings, advertisements, quotation, pricing, writing price on contracts, agreements and other similar forms of residents and non- residents must not be effected in foreign exchange except for cases permitted in accordance with regulation of the State bank of Vietnam. This regulation i...