Please see the first post on why investment in Vietnam via Singapore is preferred by all here

But does it mean the Singapore route is ‘one-size fit all’?

No, far from that. Before engaging a Singapore’s corporate lawyer, please be sure you looked at the followings:

  • Though it just takes a few days to set up the SingCo, opening its bank account may, due to the KYC procedures, last around two months (even more with ICO or crypto currency-related vehicle).
  • Maintaining a SingCo would incur some administrative costs such as hiring local director, secretary and other filing works, etc.
  • Any investment outside Vietnam (please see footnote #4) without registration with or approval of the Government of Vietnam can be considered illegal and expose the founders, the startup’s business, etc. to unexpected legal consequences in Vietnam (e.g. – possible license revocation, administrative penalties, etc.).
  • Information of founders can be easily tracked on official Singapore’s business portals.
  • The SingCo’s investment in Vietnam may be subject to market access restrictions applicable to foreign investment. 
This could be a huge problem because, for business sectors which are deemed ‘too new’, the licensing authority would be hesitant to give the green-light and the entire investment may get stuck forever. For example, it did take months, if not years, for relevant State bodies of Vietnam to name, classify and ultimately permit services provided by Uber.

Then who may not need the Singapore route at all?

Startups who:

  • are intended to be mainly bootstrapped (meaning ones without being funded particularly from foreign VCs);
  • conduct business lines which are either legally or technically restrictive to foreign investment without clear similar precedents having been made;
  • seek to be funded by local backers due to Vietnamese’s strict restrictions on offshore investment (e.g. – M&A) and funding (e.g. – KISS, SAFE or other forms of convertible debts) by local funds. 
  • do not want to expose itself to possible legal risks due to their breach of Vietnamese law on outbound investment.



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