Acquiring a Land-Rich Target in Vietnam raises a threshold question every buyer must answer early: structure the deal as a share purchase or an asset purchase?
When a target company holds significant land use rights — a factory, an industrial park facility, a real estate project — the choice between a share deal and an asset deal becomes the most important structuring decision in the transaction, particularly since the 2024 Land Law took effect early, on 1 August 2024.
This briefing, prepared by IVLF Advisors’ M&A advisory team, analyses the legal differences between the two structures and the key points a foreign buyer needs to consider.
Why share deals dominate for foreign buyers
Foreign investors generally cannot directly hold Vietnamese land use rights.
This is the core reason a share deal — acquiring equity in the Vietnamese company that already holds the land use right — is the dominant structure for foreign buyers: the land use right certificate stays in the target company’s name unchanged; only the company’s ownership structure changes.
The 2024 Land Law (Article 28) contains a narrow exception allowing foreign-invested economic organisations to receive a land-use-right capital contribution transfer from an entity using state-allocated or leased land within industrial zones or high-tech zones — a specific, conditional exception rather than a general right.
Asset deals: a separate transfer registration process
In an asset deal, the land use right/asset is transferred directly, requiring a separate land registration change procedure with the land registry, with processing time varying by province.
This structure is less common for foreign buyers precisely because of the land-holding restriction above, but is still used where a buyer wants to acquire specific assets only rather than the entire legal entity (and its attendant contingent liabilities).
Financial obligations: a point requiring careful diligence
Transferring land use rights/assets in an asset deal can trigger VAT and a registration fee (approximately 0.5% under current regulations) that a share deal typically does not trigger at the asset level.
Whether an asset deal additionally triggers a re-assessment of land use fees/land rent based on current land price schedules is a point requiring case-by-case and province-specific confirmation — this is not a uniformly applied rule, so it should be confirmed with the local tax/land authority before structuring the deal.
M&A approval under the 2025 Investment Law
For share deals involving a foreign investor, the transaction still must comply with capital contribution/share purchase registration procedures under the Investment Law — currently the 2025 Investment Law (Law No. 143/2025/QH15, effective from 1 March 2026, with certain conditional-sector provisions applying from 1 July 2026).
As this is a newly enacted law, detailed implementing guidance is still being finalised — businesses should confirm the specific procedure applicable to their transaction at the time of execution rather than relying entirely on prior experience under the 2020 Investment Law.
The 2023 Real Estate Business Law: expanded scope for foreign-invested economic organisations
The 2023 Real Estate Business Law (Law No. 29/2023/QH15) expanded, rather than narrowed, the permitted activities of foreign-invested economic organisations compared with the 2014 law — allowing purchase and hire-purchase of houses and buildings for use, and sub-leasing of leased space.
That said, compared with domestic entities, foreign-invested organisations still face certain restrictions, particularly around directly holding land use rights and the scope of permitted housing development.
Counsel’s view: For most land-related M&A transactions involving foreign investors, the share deal remains the default choice given the land-holding restriction under the 2024 Land Law; an asset deal should only be considered where the buyer wants to carve specific assets out of the target’s contingent liabilities and is prepared to handle the additional land registration procedure.
Frequently asked questions
Can a foreign investor directly acquire land use rights in Vietnam?
Generally not, except for a narrow exception under Article 28 of the 2024 Land Law for industrial zone/high-tech zone land.
This is why share deals are the dominant structure.
Does an asset deal increase financial obligations compared with a share deal?
It can trigger VAT and a registration fee; whether land use fees are reassessed needs case-by-case confirmation, not a blanket rule.
What changed under the 2025 Investment Law for foreign-invested M&A?
Law No. 143/2025/QH15 took effect on 1 March 2026; detailed implementing guidance is still being finalised, so businesses should confirm the specific procedure at the time of the transaction.
IVLF Advisors’ M&A advisory team helps investors select and structure acquisitions of land-holding companies in Vietnam.
Speak with our team about your deal structure for tailored advice.
Land-Rich Target: Practical Takeaway
Structuring a Land-Rich Target acquisition as a share deal usually preserves existing land use rights and licenses, while an asset deal can trigger re-approval and land-use fee exposure that materially changes deal economics.
For related structuring guidance, see IVLF Advisors’ M&A advisory services.
Buyers should also review guidance from the National Business Registration Portal on land use right transfer procedures that affect closing timelines.
Careful due diligence on any Land-Rich Target reduces the risk of unexpected land-use liabilities after closing.
Land-Rich Target Vietnam Acquisition Checklist
A Land-Rich Target requires enhanced review of land-use rights, project approvals, mortgages, tax and transfer restrictions.
Buying a Land-Rich Target through a share deal may preserve permits, while an asset deal can isolate selected liabilities.
Complete land acquisition due diligence Vietnam investors can rely on before comparing a share deal vs asset deal Vietnam.
Our Vietnam real estate M&A team and experienced Vietnam M&A lawyer can support the transaction; official land rules are available through the Government legal portal.
A Land-Rich Target review should convert identified issues into conditions precedent, indemnities and closing deliverables. Early Land-Rich Target advice reduces licensing and enforcement risk.
This article is provided for general information only and does not constitute legal advice for any specific case. Regulations may change – please consult a qualified professional before acting. Should further analysis be required, please contact one of our lawyers below.
