When investing and operating in Vietnam, FDI enterprises often face many hidden legal risks. From investment licenses, taxation, and labor to contract disputes, what issues force foreign-invested companies to seek legal counsel? Without careful preparation, legal consequences can go far beyond initial expectations.
As Vietnam increasingly tightens the management of foreign investment, FDI enterprises not only need capital and business strategies but also a solid legal foundation. Many companies only realize the risks when they are already subject to inspections, audits, or disputes.
One of the first legal questions FDI enterprises often ask lawyers is:
“Is my investment license truly suitable for my current operations?”
In reality, many FDI enterprises:
Register business lines that are incomplete or inconsistent with actual operations
Fail to amend the Investment Registration Certificate when changing capital, location, or project objectives
Do not fully understand foreign investment conditions applicable to specific industries
These mistakes may lead to administrative penalties, suspension of operations, or even revocation of the investment project. This is why FDI enterprises often seek corporate lawyers to review their entire legal dossier from the very beginning.
Taxation is always a “sensitive area” for FDI enterprises. Legal issues frequently raised with lawyers include:
Corporate income tax, contractor tax, and profit remittance tax obligations
Related-party transactions and risks of tax reassessment due to transfer pricing
Incomplete or non-compliant transfer pricing documentation
As tax authorities intensify inspections of FDI enterprises, even minor errors can result in significant tax arrears and penalties, directly affecting cash flow and corporate reputation.
Once an FDI enterprise is operating stably, legal questions extend beyond licenses and taxes to many aspects of daily operations.
Many FDI enterprises face legal risks due to insufficient understanding of Vietnamese labor law. Common issues include:
Drafting labor contracts for foreign and Vietnamese employees
Termination of labor contracts and dismissal of senior executives
Internal labor regulations, collective bargaining agreements, and disciplinary procedures
Many companies are sued in labor courts simply because they apply internal policies based on “parent company standards” that are inconsistent with Vietnamese law. These are silent risks with long-lasting and costly consequences.
During cooperation with suppliers, customers, or local partners, contract disputes are often unavoidable. FDI enterprises usually consult lawyers when:
Contracts lack clarity on governing law or dispute resolution clauses
Partners breach obligations, making debt recovery difficult
Disputes arise in M&A transactions, capital contributions, or project transfers
Without a legal strategy from the outset, FDI enterprises may spend years in litigation without achieving the desired outcome.
Identifying risks is only the first step. What FDI enterprises truly need is a long-term legal solution—not only to handle incidents but also to prevent risks at their root.
Instead of seeking lawyers only when problems arise, many FDI enterprises now choose outsourced legal department services. Under this model, lawyers will:
Periodically review contracts and legal documents
Provide early warnings of tax, labor, and investment risks
Advise on legal strategies aligned with business objectives
This approach helps FDI enterprises reduce costs while ensuring sustainable compliance with Vietnamese law.
Lawyers are not merely “dispute resolvers” but strategic partners of FDI enterprises. A legal team that understands Vietnam’s investment environment can help enterprises:
Optimize investment structures and business models
Minimize legal risks when expanding projects or conducting M&A
Protect legitimate rights and interests before authorities and business partners
At DEDICA Law, we have accompanied many FDI enterprises from market entry to expansion and restructuring, helping them avoid common “legal traps.”
Are you facing similar legal issues while operating an FDI enterprise in Vietnam?
Don’t wait until risks turn into disputes. Let DEDICA Law help you build a safe, effective legal strategy aligned with your business goals.
Contact DEDICA Law Firm for in-depth legal consultation!
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