Vietnam's 2025 Amendment to the Law on Enterprises: The Definition of ‘Beneficial Owner’ and Companies' Disclosure and Recordkeeping Obligations

01 - Which Companies Are Subject to the Obligation to Declare, Notify, and Retain Records on Beneficial Owners?
The obligation applies to single-member limited liability companies, multi-member limited liability companies, joint-stock companies, and general partnerships. State-owned enterprises, sole proprietorships, listed companies, and companies already registered with the securities depository are exempt.

02 - Who Qualifies as a Beneficial Owner? How Companies Should Determine Beneficial Ownership in Practice
There are three categories: a direct beneficial owner (one who directly holds 25% or more of the registered charter capital or of voting shares); an indirect beneficial owner (one who indirectly holds 25% or more through another legal entity, with multiple ownership chains aggregated together); and an individual with controlling influence (a person who, regardless of their equity stake, holds substantive control over matters such as the appointment/removal of directors or amendments to the charter). Worked examples illustrate the calculation method, including how to aggregate multiple ownership chains and how to calculate effective holdings through successive shareholding percentages.

03 - Who Is Responsible for Declaring, Notifying, and Identifying Beneficial Owner (CSHHL) Information?
At the time of incorporation, the founders bear this responsibility; once the company is operating, the company itself is responsible for reporting any changes. When incorporating a joint-stock company, the founding shareholders are responsible for declaring information about any corporate shareholder holding 25% or more of the shares.

Summary: The purpose of these rules is to prevent money laundering and to ensure a clear picture of actual ownership through greater transparency. For foreign-invested companies with complex capital structures, identifying the ultimate controlling person and tracing indirect ownership chains is a particularly important challenge.