Dear Clients and Partners,

As we navigate the mid-point of 2026, the regulatory landscape in Vietnam continues to evolve at a rapid pace. For any business operating within our borders, staying ahead of compliance is no longer just a best practice: it is a fundamental necessity for survival and growth. One of the most significant shifts we have seen recently is the implementation of the strict "Beneficiary Owner" disclosure rules under the Amended Law on Enterprises 2025.

While the phrase "Ultimate Beneficial Owner" (UBO) may have once felt like a niche term reserved for high-level banking transactions, it is now a household term for every director and shareholder in Vietnam. At BLaw Vietnam, we understand that these changes can feel overwhelming. That is why we have prepared this comprehensive guide to help you streamline your compliance efforts and ensure your business remains on the right side of the law.

Why the Change? The Road to Transparency

To understand the current rules, we must look back at the catalyst. In 2023, the Financial Action Task Force (FATF) placed Vietnam on its "grey list" due to deficiencies in anti-money laundering (AML) and counter-terrorist financing (CTF) frameworks. The Vietnamese government responded decisively with the Amended Law on Enterprises 2025 (Law No. 76/2025/QH15), which became effective on July 1, 2025.

The primary goal is simple: transparency. By identifying the actual flesh-and-blood individuals who benefit from a company’s profits or control its movements, the state aims to eliminate "nominee" arrangements and prevent financial crimes. This move aligns Vietnam with international standards, making our market more attractive to high-quality foreign investment.

Defining the "Beneficiary Owner": The 25% Rule and Beyond

The most common question we receive is: “Who exactly is a beneficial owner?” Under the current 2026 regulatory framework, a beneficial owner is defined as any individual who fits into one of two categories:

1. The Ownership Threshold

Any individual who directly or indirectly holds 25% or more of the charter capital or voting shares of a legal entity.

Determining direct ownership is straightforward, but indirect ownership requires a deep dive into your corporate structure. If Person A owns 100% of Company X, and Company X owns 30% of your Vietnamese subsidiary, Person A is your indirect beneficial owner. You must multiply the percentages through the entire chain to find the ultimate individual at the top.

2. The Control Factor

Ownership is not the only metric. Even if an individual owns 0% of the shares, they are considered a beneficial owner if they exercise "ultimate control" over the company. This includes individuals who have the power to:

• Appoint or dismiss the majority of the Board of Directors.
• Influence significant corporate decisions, such as mergers, acquisitions, or changes in business lines.
• Directly manage the company’s strategic direction through side agreements or shadow directorships.

The Disclosure Checklist: What You Need to Prepare

Transparency requires data. When registering or updating your business information with the Business Registration Office (BRO), you are now required to provide a specific set of details for every identified UBO. This is a significant shift from the era when only direct shareholders were listed.

To ensure you are prepared, your compliance team should gather the following for each beneficial owner:

• Full Legal Name: As it appears on their passport or national ID.
• Date of Birth and Nationality: Crucial for cross-referencing with international watchlists.
• Residential Address: Their actual place of living, not just a registered office address.
• Nature of Ownership: Is it direct, indirect, or through control/influence?
• Supporting Documentation: Proof of the ownership chain (e.g., share certificates or articles of incorporation for parent companies).

If you are unsure whether your current disclosures are sufficient, we recommend reviewing our guide on 7 mistakes you’re making with beneficial owner disclosures and how to fix them to avoid common pitfalls.

Procedural Requirements: Forms 10 and 12

In 2026, the administrative process has been digitized but remains rigorous. Companies must use Form No. 10 and Form No. 12 to declare their UBOs. These forms must be submitted:

1. At the time of incorporation: For all new businesses.
2. During any amendment: For existing businesses, the first time you change any registration detail (such as a legal representative or business address), you must update your UBO information simultaneously.
3. Within 10 days of a change: If your ownership structure changes, you have a very narrow window to notify the authorities.

We have seen many businesses struggle with the "Comply or Explain" aspect of these filings. If you are struggling to identify a UBO due to a highly fragmented ownership structure, you may need to provide a detailed explanation to the authorities. For a breakdown of this philosophy, see our post on Vietnam’s comply or explain rule explained in under 3 minutes.

The 5-Year Record Retention Rule

One of the most overlooked aspects of the 2025/2026 legal updates is the retention requirement. It is not enough to simply submit a form and forget about it. Under Article 14 of the Amended Law on Enterprises, companies are mandated to maintain internal records of their beneficial owners.

These records must be kept:

• Accurate and up-to-date throughout the life of the company.
• For at least five years after the company has been dissolved or liquidated.

This means that even after your business ceases to exist, the historical data regarding who owned and controlled it must remain accessible to the authorities. Failure to maintain these records can lead to significant retrospective penalties for former directors and legal representatives.

Risks and Penalties: What Is at Stake?

The Vietnamese government has signaled that they are moving away from "education-based" enforcement toward "penalty-based" enforcement. If your business fails to comply with the new UBO rules, you face several risks:

• Administrative Fines: Significant financial penalties for late or inaccurate filings.
• Operational Blockages: The BRO may refuse to process other essential changes (like capital increases or license renewals) until the UBO data is rectified.
• Reputational Damage: Being flagged for non-compliance can affect your relationships with banks and international partners.
• Director Liability: In extreme cases, directors may be held personally liable for failing to oversee corporate transparency. This is part of a broader trend we’ve discussed regarding 7 mistakes you’re making with director liability.

Integrating UBO Compliance into Your 2026 Strategy

UBO disclosure should not be treated as an isolated task. It is a core component of your broader corporate governance strategy. In the current market, transparency is often tied to your ability to secure funding and build trust with stakeholders. Investors are increasingly looking at Vietnam’s new disclosure rules as a benchmark for a company’s health and reliability.

Furthermore, if your business is looking into bond funding or private placements, these UBO disclosures are often the first thing due diligence teams will verify. For more on how this impacts your financial strategy, you can explore our insights on the ultimate guide to the 2026 Corporate Governance Code.

How BLaw Vietnam Supports Your Compliance Journey

At BLaw Vietnam, we specialize in demystifying complex legal requirements for our international and domestic clients. Our highly qualified team can assist you in:

• UBO Identification: Analyzing complex, multi-layered ownership structures to identify the correct individuals for disclosure.
• Document Preparation: Handling the filing of Forms 10 and 12 to ensure 100% accuracy and timely submission.
• Internal Audits: Reviewing your current record-keeping practices to ensure you meet the 5-year retention mandate.
• Strategic Consulting: Aligning your ownership structure with the latest 2026 investment and tax laws to optimize your corporate footprint.

The world of corporate governance in Vietnam is more transparent than ever before. While the "Beneficiary Owner" rules might seem like a hurdle, they are ultimately a step toward a more mature and stable economic environment. By acting now and ensuring your disclosures are accurate, you are protecting your business’s future.

Should you have any questions regarding your specific ownership structure or if you require assistance with your next BRO filing, we invite you to reach out to our team. We are committed to providing you with the efficient, cost-effective, and professional legal support you need to succeed in Vietnam.

Contact BLaw Vietnam today to schedule a consultation and ensure your business remains a leader in transparency and compliance.