Individual And Corporate Offshore Banking In Vietnam
Offshore banking is an attractive option that has gained more attention in recent times, because of the many features it provides compared to national accounts.
The ability to make payments in multiple currencies, transfer funds from anywhere in the world, and have access to the money with ease on the go are just few of these.
Another notable edge is that while national bank accounts levy significant fees on expenses and transfers made across borders, many offshore banking channels provide highly competitive rates for the same.
How It Works
Offshore banking is a way for private citizens and companies to carry out financial transfers using a banking account not held in their country of residence or location.
The immediate advantages are that it gives holders increased flexibility when it comes to asset management, and also makes the funds available for investment in regions other than their own.
Apart from this, banks and offering institutions may also be able to facilitate the formation of companies and commercial entities, giving them tax benefits, and safeguards against unpredictable financial changes.
The choices among offshore banking accounts are many, each designed with a specific individual or entity in mind, and often offering a unique set of advantages.
Offshore accounts can be personal, in which case the main purpose and benefit is being able to have access to an offshore source of funds.
Corporate accounts are meant for business purposes, investment accounts are held for the main purpose of accruing profits, and client holding accounts provide the service of collecting funds from third party sources.
Investing In Offshore Accounts And The Law
According to the law in the country, indirect offshore investments refer to the sale of offshore securities, or investing using financial entities overseas.
The law gives Vietnamese people and corporate organizations, including limited liability companies and shareholding companies the ability to open an offshore bank account in vietnam – Global Eye Vietnam.
This also covers companies in the country being invested in by foreigners, with the foreign capital threshold at 51%. For now, there are no particular legal rules giving companies with more than that percentage of foreign capital to engage in offshore investments.
Offshore Investments By Corporations
There are two ways for corporation entities to carry out offshore investments. The first is entrustment, by which it entrusts funds in foreign currency to a local entity, referred to as the entrusted company. This local company will carry out offshore investment on behalf of the principal company, pursuant to a trust contract.
The other mechanism is self-trading, using which corporations can deal in offshore securities for their own use.
Vietnamese individuals are not permitted to engage in self-trading or entrustment. For them to participate in offshore banking, they have to become part of a share awarding system carried out by a foreign organization.