INVESTMENT UNDER BCC CONTRACTS

Question: How is investment under a BCC (Business Cooperation Contract) implemented?

Gattaca Law attorney answers:

Investment under a BCC contract is a form of investment in which investors sign a contract to carry out investment activities without establishing an economic organization .

In cases where a BCC investment involves a foreign investor as a party to the contract, the investor must apply for an Investment Registration Certificate and an Operational Office Registration Certificate (if applicable) from the investment registration authority. The investor does not need to complete procedures related to the Enterprise Registration Certificate to establish an economic organization.

A BCC contract includes the following key contents:
(i) The parties involved in the contract; the transaction address or the location where the investment project is implemented;
(ii) The objectives and scope of business investment activities;
(iii) The contributions of the parties involved in the contract and the division of business investment results between the parties;
(iv) The schedule and duration of the contract;
(v) The rights and obligations of the parties involved in the contract;
(vi) Amendments, transfers, and termination of the contract;
(vii) Liability for breach of contract and methods of dispute resolution.

The parties involved in a BCC contract establish a coordination board to execute the contract. The functions, duties, and powers of the coordination board are agreed upon by the parties.

During the execution of a BCC contract, the parties can agree to use assets formed through business cooperation to establish a new enterprise.

Foreign investors in a BCC contract are allowed to establish an executive office in Vietnam to carry out the contract. The executive office of a foreign investor in a BCC contract may have its own seal, open bank accounts, hire employees, sign contracts, and conduct business activities within the rights and obligations defined in the BCC contract. The Investment Registration Certificate for the establishment of the executive office is issued by the investment registration authority.

(Source: Vietnam Investment Guidebook)