When engaging in foreign direct investment (FDI) in Vietnam, DICA plays a vital role. It not only helps investors comply with foreign exchange regulations but also ensures lawful fund transfers. So, this article by DNP Vietnam Law Firm provides a clear overview of DICA along with practical notes for foreign investors.
1. What is DICA?
– DICA stands for Direct Investment Capital Account.
– As defined in Clause 5, Article 3 of Circular No. 06/2019/TT-NHNN, a DICA is a payment account that:
- The account is either denominated in a foreign currency or in Vietnamese Dong (VND).
- In addition, it must be opened by an FDI enterprise or a foreign investor at a licensed bank.
- Moreover, it is specifically used for transactions related to foreign direct investment activities in Vietnam.
2. Key Principles for Using DICA
According to Article 4 of Circular No. 06/2019/TT-NHNN:
– Foreign and Vietnamese investors must contribute capital in foreign currency or VND as specified in the Investment Registration Certificate, establishment license, or equivalent legal documents.
– Investors may use their own foreign currency for capital contribution.
– All monetary capital contributions must be made through a DICA.
– FDI enterprises must comply with regulations on foreign borrowing and debt repayment.
– Foreign investors must comply with foreign exchange control rules when using distributed profits.
3. Who Must Open and Use a DICA?
As stated in Article 5 of Circular No. 06/2019/TT-NHNN, investors must correctly identify whether they are required to open a DICA.
The following parties are subject to this requirement:
(1) FDI Enterprises, including:
- Enterprises established through direct investment by foreign investors, who act as members or shareholders and are granted an Investment Registration Certificate;
- Enterprises with foreign ownership of 51% or more of the charter capital;
- PPP project companies established by foreign investors.
(2) Participate in Business Cooperation Contracts (BCC) or directly implement PPP projects without forming a project company.
* Important Notes:
- Each currency used for capital contribution must correspond to one DICA at one licensed bank.
- If contributing capital in VND, investors must open an additional VND-denominated DICA.
- For participation in multiple BCCs or PPP projects, each contract/project must have its own separate DICA.
4. Key Notes for Foreign Investors When Using DICA
4.1. Transactions in Foreign Currency via DICA
According to Article 6 of Circular No. 06/2019/TT-NHNN:
| Incoming Transactions | Outgoing Transactions |
| – Receive capital contributions in foreign currency from foreign and Vietnamese investors. – Receive payments for capital transfers or investment projects. – Receive foreign currency purchased from credit institutions for transferring capital or profits abroad. – Receive transfers from the enterprise’s or investor’s own foreign currency account. | – Transfer funds to the enterprise’s or investor’s foreign currency account. – Sell foreign currency and transfer the proceeds to the enterprise’s or investor’s VND account. – Pay the transfer price for capital or projects to the transferor. – Transfer profits, capital, and other lawful proceeds abroad. |
| For more details, refer to Article 6 of Circular No. 06/2019/TT-NHNN. | |
4.2. Transactions in Vietnamese Dong via DICA
According to Article 7 of Circular No. 06/2019/TT-NHNN:
| Incoming Transactions | Outgoing Transactions |
| – Receive capital contributions in Vietnamese Dong from both foreign and Vietnamese investors. – Receive payments for capital transfers and investment projects. – Collect transferred profits in VND from foreign and Vietnamese investors in FDI enterprises to increase capital and expand investment in Vietnam. – Receive transfers directly from the company’s own VND account or the investor’s VND account. | – Transfer funds to the VND account of the company or the investor. – Pay capital transfer and project transfer values to the transferor in Vietnam. – Buy foreign currency to remit profits and other lawful earnings abroad. – Transfer investment capital in VND to Vietnamese investors or buy foreign currency to remit funds to foreign investors when reducing capital or terminating the project. |
| For more details, refer to Article 7 of Circular No. 06/2019/TT-NHNN. | |
5. Conclusion
In conclusion, DICA serves as an essential tool for carrying out investment transactions in compliance with the law. To begin with, foreign investors must correctly determine if they need to open a DICA. Once confirmed, they should strictly follow the legal principles for both incoming and outgoing transactions through DICA. Finally, proper use of DICA helps ensure legal compliance and maximize investment efficiency in Vietnam.
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