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Accounting violations by foreign-invested companies in Vietnam may sometimes go beyond administrative penalties and be examined from a criminal perspective if authorities detect signs of fraud or significant damage. In practice, many FDI enterprises only realize the legal risks when tax authorities or investigation agencies request meetings regarding accounting books and financial documents. However, not every accounting error leads to criminal liability, as the law also considers the seriousness of the violation, the element of intent, and the actual consequences of the conduct. So in which situations can accounting violations by an FDI company in Vietnam lead to criminal liability?
According to the Accounting Law 2015, enterprises operating in Vietnam must comply with principles relating to accounting books, accounting documents, financial statements, and data storage. For foreign-invested enterprises, these obligations are the same as those applied to Vietnamese companies.
However, violations of these regulations may lead to two levels of legal consequences: administrative sanctions or criminal prosecution.
In practice, when advising foreign-invested enterprises in Vietnam, lawyers often encounter situations such as:
Failure to record all revenue in the accounting system
Maintaining two separate accounting book systems
Using illegal invoices or fake documents
Failure to prepare or store accounting documents as required
Concealing related-party transactions or transfer pricing
Under Article 13 of the Accounting Law 2015, prohibited acts include:
Forging or falsifying accounting documents
Destroying accounting documents illegally
Maintaining multiple accounting systems to conceal financial information
In many cases, these acts are initially subject only to administrative sanctions under Decree 41/2018/ND-CP (as amended) with fines that may reach hundreds of millions of VND.
However, if such conduct is related to tax fraud or causes significant damage, the case may move to criminal investigation.
Certain offences under the Criminal Code 2015 (amended 2017) may apply if accounting violations involve fraudulent elements or serious consequences.
For example:
Tax evasion – Article 200 of the Criminal Code
If inaccurate accounting records are used to evade a large amount of tax, the responsible individual may face criminal liability.
Depending on the amount of tax evaded, penalties may include:
monetary fines
non-custodial reform
or imprisonment.
Violation of accounting regulations causing serious consequences – Article 221 of the Criminal Code
This offence may apply to individuals who:
maintain two or more accounting systems
provide false accounting information
illegally destroy accounting documents
if the acts cause significant damage to the State or an organization.
It is important to understand that not every accounting mistake constitutes a criminal offence. Investigation authorities must assess factors such as:
level of damage
intent or negligence
the role of each individual in the company.
A common question from foreign managers is:
“If the company violates accounting regulations, can I personally face criminal liability in Vietnam?”
The answer is yes, but not in every situation.
Under Vietnamese law, criminal liability mainly applies to individuals who commit the violating acts.
In FDI companies, those who may be examined include:
Director or General Director
Chief accountant
Person directly responsible for financial management
Person approving financial reports or related documents
However, investigation authorities must prove that the individual:
knew about the violation, and
actively carried out or directed the conduct.
If a manager was not directly involved in preparing documents or was unaware of fraudulent activities, the possibility of criminal liability may differ.
This is why the role of lawyers in the early stage of investigation is very important.
Under the provisions on criminal liability of commercial legal entities in the Criminal Code, certain offences such as tax evasion may apply to the company itself, not only individuals.
In such cases, the enterprise may face:
very large fines
suspension of operations
prohibition from operating in certain sectors.
For foreign-invested companies, this may create serious risks for investment activities in Vietnam.
Khi nhận được giấy mời làm việc từ cơ quan công an, cơ quan thuế hoặc cơ quan điều tra, nhiều người nước ngoài thường rơi vào trạng thái hoang mang. Một số người thậm chí vội vàng khai báo hoặc cung cấp tài liệu khi chưa hiểu rõ tình hình pháp lý của mình. Điều này đôi khi có thể gây bất lợi cho chính họ.
When receiving a request to work from the police, tax authorities or investigation agencies, many foreigners become anxious. Some even provide statements or documents without fully understanding their legal situation, which may sometimes be unfavorable.
According to the Vietnamese Criminal Procedure Code, a summoned person has basic rights such as:
the right to present opinions
the right to provide documents and evidence
the right to invite a lawyer to protect their interests.
For foreigners, language barriers and differences in legal systems can make working with authorities more difficult.
Therefore, having a lawyer familiar with Vietnamese law and experienced in assisting international clients can help:
clarify the legal status of the case
prepare appropriate documents
ensure legitimate rights during the investigation.
In cases involving accounting or tax matters, actions taken at the early stage may significantly affect the direction of the case.
For example:
identifying the nature of the accounting error
evaluating whether the case involves criminal elements or only administrative violations
preparing documents demonstrating willingness to remedy the issue.
An appropriate legal strategy may help minimize legal risks for both individuals and businesses.
However, each case has its own circumstances, and legal responsibility must be assessed based on the specific case file.
In practice, many foreign clients only contact lawyers after the situation becomes serious. Consulting a lawyer as soon as there are signs of investigation often gives companies and individuals more legal options.
DEDICA is a law firm in Ho Chi Minh City with lawyers who previously worked at international law firms and multinational corporations. We regularly:
advise foreign-invested enterprises in Vietnam
assist foreign clients in working with investigation authorities
protect or defend clients in criminal and economic cases.
Understanding legal regulations and preparing an appropriate legal strategy can help clients avoid unnecessary risks during legal proceedings. Nevertheless, each case must be carefully assessed based on actual documents, and lawyers cannot guarantee the outcome of a case.
Contact DEDICA Law for appropriate legal strategy advice.
📞 Hotline: (+84) 39 969 0012 (WhatsApp, WeChat, Zalo available)
🕒 Working hours: Monday – Friday (8:30 – 18:00)
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