Dear Clients and Partners,

In the dynamic landscape of the Vietnamese market, corporate restructuring is not merely an option; it is often a necessity for growth, tax optimization, and operational efficiency. However, as your business evolves, a persistent question often looms over the boardroom: Do we need to notify the Vietnam Competition Commission (VCC) about this internal move?

The fear of "gun-jumping": implementing a transaction before receiving regulatory clearance: can paralyze decision-making. Conversely, over-notifying can lead to unnecessary delays, legal fees, and the disclosure of sensitive internal data. At BLaw Vietnam, we believe in empowering your business with clarity. The truth is that while many internal restructures are exempt, the line between a "purely internal" shuffle and a "notifiable merger" is thinner than you might think.

This guide explores the nuances of competition law in 2026, helping you determine when you can proceed with confidence and when you must pause for a VCC filing.

Understanding the Core Rule: The Definition of Economic Concentration

Under the current Law on Competition and Decree 35/2020/ND-CP, the VCC is primarily concerned with "economic concentrations." In Vietnam, this includes mergers, consolidations, acquisitions, and joint ventures.

You only need to notify the VCC if your transaction meets two specific criteria:

1. It qualifies as an economic concentration (specifically an acquisition of control).
2. It meets the statutory thresholds regarding assets, turnover, transaction value, or market share in Vietnam.

The common misconception is that "internal" means "exempt." In reality, the VCC does not look at your internal intent; it looks at the legal shift in control.

The "Internal Restructuring" Loophole: When is it Safe?

Generally, a transaction is not considered a notifiable economic concentration if it does not result in a "change of control" in the eyes of competition law. If you are simply moving assets or shares between two entities that are both 100% owned by the same ultimate parent company, the market structure remains unchanged.

You usually do not need to notify the VCC when:

• Wholly-Owned Transfers: You move a business unit from "Subsidiary A" to "Subsidiary B," where both are 100% owned by your Global Holdco.
• Internal Rationalization: You collapse three dormant subsidiaries into one single operating entity to update your company registration and stay compliant.
• Inserting a Holdco: You insert a new Vietnamese holding company between your foreign parent and your local factory, provided the ultimate ownership percentages remain identical.

In these scenarios, the "Ultimate Controlling Shareholder" remains the same. Since no "new" person or entity is gaining the ability to influence the market, the VCC typically has no grounds to intervene.

The "Change in Control" Test: The Hidden Trap

The danger arises when a restructure: even one labeled as "internal": alters the balance of power. The VCC cares deeply about who holds the "signing power" and "veto rights."

A restructure might become notifiable if it triggers a change in control as defined by the law. This doesn't just mean owning more than 50% of the shares. Control, in a competition sense, can be established if a party gains the power to:

1. Appoint or remove the majority of the Board of Directors.
2. Decide on fundamental business strategies (budgets, business plans, or senior management changes).
3. Veto key resolutions that affect the competitive conduct of the firm.

As we discussed in our recent article on why the 2025 Enterprise Law changes how you disclose control, the transparency requirements for beneficial owners are stricter than ever. If your internal shuffle results in an external party gaining these rights, you are in the "Notification Zone."

When "Internal" Becomes "Notifiable": 3 Risk Scenarios

Even if your transaction stays "within the family," you must look closer if any of the following apply:

1. The Entry of an External Minority Shareholder

Imagine you are restructuring to prepare for a future IPO or to bring in a strategic partner. If, as part of the "internal" cleanup, you issue new shares to an external investor: even a minority one: and that investor gains veto rights over strategic decisions, this is a "creation of joint control." If the financial thresholds are met, this is notifiable.

2. Shift from Joint Control to Sole Control

If a subsidiary was previously a joint venture between your group and a local partner, and you buy out the local partner as part of an internal consolidation, you have moved from "joint control" to "sole control." Under Vietnam’s competition framework, this is a structural change that the VCC may want to review, especially if the subsidiary holds significant market share.

3. Changes Affecting External Veto Rights

If an external minority shareholder already existed in one of your subsidiaries, and the restructure moves that subsidiary under a new parent where the minority shareholder’s veto rights are expanded or significantly altered, you may have triggered a notification requirement.

Practical Checklist: Before You Implement Your Restructure

To ensure your business stays compliant and avoids the heavy penalties associated with unnotified mergers, run through this checklist with your legal counsel:

1. Identity of the Ultimate Parent: Will the ultimate parent company (the top-level entity) remain the same after the transaction?
2. Board Composition: Will any new entity or individual gain the right to appoint more than 50% of the Board or the General Director?
3. Veto Analysis: Does any external party (someone outside the 100% ownership chain) gain "negative control" (the power to block key decisions)?
4. Threshold Check: Even if there is a change in control, do the parties meet the thresholds? In Vietnam, for 2026, you must check:
   • Total assets in Vietnam.
   • Total turnover in Vietnam.
   • The transaction value (for domestic deals).
   • The combined market share in the relevant market.

If the answer to a change in control is "Yes" and the thresholds are met, a filing is mandatory. Failure to do so can result in fines of up to 10% of your total turnover from the preceding financial year.

Integrating Competition Compliance into Your M&A Strategy

In the current climate, competition law cannot be an afterthought. Whether you are dealing with IRC/ERC simplifications or navigating new debt-to-equity caps, the VCC's oversight is a critical pillar of your compliance framework.

Through the above analysis, it is clear that while "pure" intra-group shuffles are generally safe, the definition of "pure" is strictly interpreted. If your restructuring involves moving assets between entities with different minority shareholders, or if it changes the ultimate "control" structure of your Vietnamese operations, you must proceed with caution.

Why Transparency is Your Best Defense

The VCC has become increasingly sophisticated in its monitoring of the Vietnamese market. In 2026, data sharing between the Ministry of Planning and Investment (MPI) and the VCC is more streamlined. An update to your Enterprise Registration Certificate (ERC) can trigger a red flag if the ownership change looks like an unnotified acquisition.

By conducting a "Competition Impact Assessment" during the planning phase of your restructure, you can:

• Optimize Timing: Build the 30–60 day VCC review period into your project timeline.
• Reduce Risk: Avoid the "stop-work" orders that come with an investigation.
• Enhance Reputation: Show the Vietnamese regulators that your business is a compliant, transparent corporate citizen.

Conclusion: Partnering for Compliance

Navigating the intersection of the Enterprise Law, the Investment Law, and the Law on Competition requires a specialized touch. Internal restructuring should be a tool for your business's success, not a source of regulatory anxiety.

If you are planning a corporate reorganization, a shift in your labor structure, or a significant change in your shareholding, BLaw Vietnam is here to help. We provide the "Substance over Form" analysis required to determine if your move is truly internal or if it requires a conversation with the VCC.

Are you unsure if your upcoming restructure requires VCC notification? Don’t leave it to chance. Contact the team at BLaw Vietnam today for a confidential consultation. We will help you streamline your path to compliance, ensuring your business remains agile and legally sound in 2026 and beyond.

For more updates on Vietnam's legal landscape, visit our announcements page or explore our comprehensive sitemap.