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Vietnam has become a key destination for foreign investment, with many Vietnamese companies appointing foreign directors, CEOs, or legal representatives to manage daily operations. While this structure brings expertise and international standards, it also creates serious legal risks when a foreign director becomes involved in a criminal investigation in Vietnam.
For shareholders, investors, and business partners, the immediate concern is often:
If a Vietnamese company’s foreign director is under criminal investigation, what should the company do to protect itself?
The answer requires careful legal handling. A poorly managed response can expose the company to operational paralysis, reputational damage, and even secondary legal liability.
The first and most important point is this:
A criminal investigation against a foreign director does not automatically mean the company is criminally liable.
Under Vietnamese law:
Criminal liability is generally personal
Companies are only liable if corporate criminal responsibility applies
Many investigations focus solely on the individual’s conduct
However, the company can still be heavily affected, even if it is not formally accused.
Foreign directors may come under investigation due to:
Alleged fraud or misrepresentation
Abuse of trust or misappropriation of funds
Tax-related allegations
Violations connected to contracts or investments
Disputes that escalate from civil to criminal complaints
In many cases, what begins as a commercial dispute later attracts criminal scrutiny, especially when large sums or multiple parties are involved.
Once a foreign director is under investigation, companies often face urgent operational risks, including:
The director being summoned or restricted from travel
Temporary detention or exit bans
Inability to sign contracts or bank documents
Frozen accounts or delayed transactions
If the foreign director also serves as the legal representative, these risks multiply.
The company should immediately clarify:
Whether the director is a suspect, witness, or accused person
Whether the investigation targets personal conduct or company activities
Whether any coercive measures apply (travel bans, asset freezes)
This assessment determines how urgently the company must restructure its management and authority.
A critical mistake many businesses make is failing to distinguish the company from the individual.
The company should:
Avoid using company resources for personal legal matters without advice
Ensure internal records clearly separate personal transactions from corporate ones
Refrain from public statements that admit or deny allegations prematurely
Clear separation helps prevent the investigation from expanding to the company itself.
If the foreign director holds key roles, the company should consider:
Appointing an interim or additional legal representative
Adjusting bank signatory powers
Updating internal authorization documents
These steps help maintain business continuity while reducing legal exposure.
Criminal investigations often involve document review.
The company should:
Secure corporate records and accounting data
Preserve emails, contracts, and transaction evidence
Prevent unauthorized document destruction or alteration
Improper handling of documents can create additional legal problems for both the director and the company.
Some companies attempt to resolve matters by:
Pressuring complainants
Informally returning funds
Negotiating without legal guidance
These actions may be interpreted as obstruction or admission, making the situation worse.
All actions should be legally structured and carefully documented.
Even without a conviction, a criminal investigation can:
Damage relationships with banks and partners
Affect investor confidence
Delay licensing, approvals, or transactions
Proactive legal management helps limit reputational fallout.
In certain cases, yes.
If authorities believe that:
The alleged conduct was carried out on behalf of the company
Corporate systems enabled the offense
The company benefited from the conduct
Then corporate criminal liability or administrative sanctions may be considered.
Early legal assessment is essential to prevent escalation.
Vietnamese criminal procedures move faster than many foreigners expect.
Delays in legal response may result in:
Missed opportunities to clarify misunderstandings
Loss of control over the narrative
Increased procedural restrictions
Early legal intervention often makes the difference between containment and escalation.
A criminal investigation does not automatically mean:
The director will be convicted
The company must shut down
Investments are lost
However, inaction is far riskier than action.
A calm, legally structured response protects both the company and its stakeholders.
Cases involving foreign directors require lawyers who:
Understand Vietnamese criminal and corporate law
Have experience working with foreign nationals
Can communicate clearly in English and other languages
Understand cross-border business and cultural context
Miscommunication or poor strategy can permanently harm the company.
When a Vietnamese company’s foreign director is under criminal investigation, the situation must be handled carefully—but not emotionally.
The key priorities are:
Understanding the director’s legal status
Protecting the company from secondary liability
Ensuring business continuity
Seeking early advice from experienced legal counsel
With proper legal guidance, many investigations can be managed without catastrophic impact on the business.
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