The costliest foreign exchange errors in Vietnamese inbound investment are made before the company exists. A founder pays the office deposit by personal card, a parent wires “capital” to an ordinary account, an affiliate settles the incorporation fees. Each payment is commercially sensible; each can leave pre-incorporation capital Vietnam treasury teams thought they had invested outside the record that banks, auditors and the State Bank of Vietnam (SBV) rely on.
Two changes this year make the point sharper. Law on Investment 143/2025/QH15 now lets a foreign investor form the company before the investment registration certificate (IRC), and Circular 38/2026/TT-NHNN has rewritten the account rules. This article reads both together, separates what the circular says from what it leaves open, rates the risks and sets out remediation for funds already trapped.
Pre-incorporation capital Vietnam: the legal map after Circular 38/2026
Regulatory update as of 10 October 2026: Circular 38/2026/TT-NHNN took effect on 18 August 2026 and replaced Circular 06/2019/TT-NHNN (Article 18). It does not use the label “DICA”; it speaks of the “investment capital account”, renamed in Article 18.5 the “foreign investment capital account in Vietnam”. We keep DICA as the market term. Any checklist still citing Circular 06/2019 is out of date.
Vietnam tracks inbound capital through two systems: the registration record (who owns what) and the foreign exchange record (how the money arrived). Pre-incorporation capital Vietnam planning succeeds only when the two match. The table maps the provisions that matter.
| Provision | Rule for pre-incorporation capital Vietnam | Status of the point |
|---|---|---|
| Law on Investment, Art. 19.2 | Foreign investor may form the company before IRC procedures, subject to market access conditions | Verified text |
| Circular 38/2026, Arts. 5.1, 7.3 | Account available to an entity already established but without an IRC; use limited to charter capital, interest, lawful pre-investment costs and refund | Verified text |
| Circular 38/2026, Art. 4.4 | Monetary contributions by bank transfer into the account | Verified text |
| Circular 38/2026, Art. 4.5 | Transfers may precede registration of a capital increase or change | Verified text |
| Account for pre-incorporation capital Vietnam before the company exists | Not expressly addressed by the circular | [Verification Required] |
| Bank onboarding documents | Set by each bank’s KYC policy | [State Authority Practice / Verification Required] |
What Circular 38/2026 allows for pre-incorporation capital Vietnam before the IRC
Under Articles 5.1 and 7.3 of Circular 38/2026, an entity that is already established but has not yet been granted or adjusted its IRC may use the account. Before the IRC, use is limited to receiving charter capital and interest, paying lawful pre-investment costs and refunding capital if no IRC is issued. After the IRC, further foreign-currency accounts may be opened.
Article 5.1 also fixes who may fund the account at this stage. A foreign investor may transfer from abroad or from a Vietnamese payment account; a member enterprise (a Vietnamese company that is itself a member) may transfer only from a Vietnamese payment account. Pre-incorporation capital Vietnam flows therefore have a defined, narrow purpose before the IRC: capital in, lawful costs out, refund if the project fails.
The open point: pre-incorporation capital Vietnam and an account before the company exists
The wording of Articles 5.1 and 7.3 presupposes an entity that is “already established”. Article 19.2 of Law 143/2025/QH15 now lets the company exist without an IRC, so the circular fits the company-first route. It does not expressly address opening an account before the company itself is registered. Whether a bank will open or pre-reserve an account for an investor whose company has no enterprise registration certificate (ERC) yet is a practice point [Verification Required].
Decree 296/2026/NĐ-CP (Article 7) and Decree 168/2025/NĐ-CP (Article 24.5) allow the ERC dossier to omit the IRC and require a market access commitment. Meanwhile the 90-day contribution clock under the Law on Enterprises (Articles 47, 75 and 113; pinpoints to be verified) runs from ERC issuance. The practical squeeze is that the clock starts when the ERC issues, while the account that must receive pre-incorporation capital Vietnam funds may not yet exist.
Pre-incorporation expenses Vietnam: what may be paid, by whom
Some costs cannot wait: feasibility work, legal and translation fees, office deposits, recruitment. The question is not whether they may be incurred, but whether they can later be recognised as part of the investor’s capital.
Payer and channel rules for pre-incorporation capital Vietnam
Article 5.1 allows the account to pay “lawful pre-investment costs” once the entity exists. For costs paid earlier, the circular is silent on channel, so the safest evidential position is payment by the registered investor itself, from its own account, to a named supplier. Payments by founders from personal funds or by affiliates are the weakest route, because the payer differs from the investor whose capital record will later be examined [State Authority Practice / Verification Required].
Articles 14.2 and 15.2 explain why. Banks record the amount and purpose of each transfer, and investors must state the purpose truthfully and support it with documents. A bank cannot match an unexplained third-party payment to any category the circular recognises. The circular does not address third-party payments at all, which is itself a warning.
Recognising expenses as contributed capital
Recognition of pre-incorporation expenses Vietnam investors have paid is a corporate and evidential step, not an automatic result. In practice it requires an owner’s or members’ resolution identifying the costs as part of the contribution, a cost register (supplier, invoice, amount, currency, payer) and a bank willing to accept the file [State Authority Practice / Verification Required]. Amounts not recognised remain a receivable from, or payable to, the investor.
Decide in writing, before spending, which pre-incorporation expenses Vietnam rules and your bank will let you capitalise, and route each payment accordingly.
Planning Your Market Entry into Vietnam?
Foreign ownership restrictions and capital account regulations vary significantly by industry sector. Send your proposed business scope and target timeline to our Corporate Practice Team via WhatsApp or Email for a complimentary 24-hour Feasibility & Regulatory Check.
How to open DICA Vietnam for pre-incorporation capital Vietnam and evidence the source of funds
Investors who open DICA Vietnam accounts without preparation lose weeks to bank queries. Preparation means choosing the bank, the currency and the payer before the first transfer, and building the source of funds file in parallel with the ERC dossier.
Account architecture, currency and bank transfer rule
Article 6 obliges foreign-invested economic organisations to open the account. Article 7.1 allows one foreign-currency account and/or one VND account per entity at the same authorised bank, with one account per currency; a change of bank means opening a new account, moving the full balance and closing the old one. For pre-incorporation capital Vietnam funding, three rules from Article 4 matter most:
- Bank transfer only. Monetary contributions must be made by bank transfer into the account (Article 4.4); cash and third-party settlement are outside the model.
- Amount within the IRC. Contributions are in foreign currency or VND within the amounts stated in the IRC and related documents; with several currencies, the investor picks one conversion currency and applies it consistently.
- Timing. Transfers may be made before a capital increase or change is registered (Article 4.5). The article addresses registered changes; it does not say how this works before the company exists.
Source of funds for pre-incorporation capital Vietnam and purpose statements
A source of funds file explains where the money comes from, not merely who sends it. For corporate investors, banks commonly expect the parent’s board resolution, recent financial statements and statements of the remitting account. For individuals, they ask for evidence of income, asset sales or savings [State Authority Practice / Verification Required]. Beneficial-owner data must match the enterprise registration record: Article 17 of Decree 168/2025/NĐ-CP defines the owner as a natural person with 25% or more of charter capital or voting shares, or with control.
The remitting account holder, the registered investor and the beneficial owner should line up; every mismatch adds a query, and some banks reject the inflow. The transfer narrative should name the investor, the company and the purpose, because Article 15.2 makes the stated purpose the investor’s responsibility.
Trapped funds Vietnam: risk matrix for pre-incorporation capital Vietnam
The matrix rates the common causes of trapped funds Vietnam investors meet at the first audit, exit or profit remittance. Discovery during an exit is usually more costly than at audit.
| Issue | Source of the problem | Commercial impact | Risk | Mitigation |
|---|---|---|---|---|
| Capital paid to an ordinary payment account | Circular 38/2026, Arts. 4.4, 7; Art. 19 | Capital not traceable; outflow later refused | High | Use the Article 19.1 transfer where available [verify] |
| Payment from a founder’s personal account | Payer is not the registered investor (Art. 5.1) | Contribution disputed; AML queries | High | Return funds; re-remit from the investor’s account |
| Affiliate pays on the investor’s behalf | Payer mismatch; Arts. 14.2, 15.2 | Recognition and audit issues | Medium | Restructure as investor payment or lawfully change investor |
| Contribution after the 90-day deadline | Law on Enterprises [verify pinpoint] | Ownership and penalty exposure | Medium | Register charter capital adjustment |
| Funds labelled as a loan | Foreign borrowing rules [verify] | Not equity; possible registration duty | Medium | Formalise the loan or reverse |
| Pre-incorporation expenses without documents | Art. 5.1 “lawful” costs; bank practice | Costs written off, not capitalised | Low | Collect invoices before the account opens |
Remediation of pre-incorporation capital Vietnam and foreign exchange compliance Vietnam
Remediation is fact-specific and normally bank-led. The aim is a coherent record of pre-incorporation capital Vietnam flows under foreign exchange compliance Vietnam rules, without creating a second breach. Start with one chronology of every payment, account and document.
Using Article 19 and refund routes
Article 19.1 lets existing foreign-invested enterprises that received charter capital in payment accounts move the funds to the investment capital account. Whether this transitional route is open to flows misdirected after 18 August 2026 is not stated and should be verified with the bank [Verification Required]. Article 5.1 separately recognises refund of capital where no IRC is issued, which supports the cleaner alternative: return the funds to the original remitter and re-send them from the investor through the account.
Loan reclassification and charter capital
Where return is impractical, the inflow may be documented as a shareholder loan; flows then follow the foreign borrowing rules, and the circular adds no separate registration procedure. Interest raises transfer pricing and withholding questions for our banking and finance team to coordinate with tax advisers. Where contribution is late, the Law on Enterprises requires charter capital to be adjusted to the amount actually contributed, and sanctions under the banking sanctions decree [verify current decree and amounts] are more likely to be mitigated by voluntary correction than by discovery at audit.
Hypothetical scenario. A Singapore founder forms a Vietnamese LLC company-first and, worried about the 90-day deadline, sends USD 150,000 from a personal account to the company’s ordinary USD account. At the first audit the bank will not treat it as capital. The fix: return the funds, re-remit from the Singapore holding company through the investment capital account, and adjust charter capital for the gap. A pre-transfer review would have cost a fraction of that.
IVLF’s usual path is a Funds-Flow & DICA Opening Memo before the first transfer, then account set-up and bank liaison with our company incorporation practice, tax registration and work-permit filings for the expatriate team, and an annual DICA compliance retainer.
Planning Your Market Entry into Vietnam?
Foreign ownership restrictions and capital account regulations vary significantly by industry sector. Send your proposed business scope and target timeline to our Corporate Practice Team via WhatsApp or Email for a complimentary 24-hour Feasibility & Regulatory Check.
Frequently Asked Questions
Can a founder pay pre-incorporation capital Vietnam funds from a personal account?
It is risky. Where the registered investor is a company, a personal-account payment creates a payer mismatch (Article 5.1 contemplates investor transfers). Banks may refuse to treat it as capital, which complicates later remittance.
Can an investment capital account be opened before the IRC?
Yes for an established entity without an IRC (Articles 5.1, 7.3), with limited uses. For an investor whose company is not yet registered, the circular is silent [Verification Required]; ask the bank in writing.
Can pre-incorporation expenses count as contributed capital?
Potentially, if lawful, documented, linked to the project, approved by the owner or members and accepted by the bank. Personally paid or undocumented costs are frequently rejected [State Authority Practice / Verification Required].
Is there a deadline for pre-incorporation capital Vietnam transfers?
Circular 38/2026 sets none for this. The Law on Enterprises 90-day contribution period runs from ERC issuance (Articles 47, 75, 113; verify pinpoints), so the real deadline is corporate, not foreign exchange.
How are trapped funds usually remediated?
By returning and re-remitting through the account, using the Article 19.1 transfer where available, documenting a shareholder loan, or adjusting charter capital. The route depends on the facts and the bank.
Conclusion
Before any transfer of pre-incorporation capital Vietnam counsel should fix the investor of record and the remitting account, obtain the bank’s written position on the company-first account question, and keep pre-incorporation spending documented and minimal. Then audit past flows against Circular 38/2026 and cure any misrouted funds before the first audit.
This article provides general information on Vietnamese law as of 10 October 2026 and is not legal advice for any specific matter. Foreign exchange treatment depends on the facts and on the practice of the account bank and the State Bank of Vietnam. Obtain advice before remitting funds.
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.
