The Ministry of Industry and Trade has raised two options for regulating overseas investment in the oil and gas sector in a draft decree which was recently made public for comments.

In the first option, sources of capital for investment abroad in oil and gas included legal money and other lawful assets of the investors, including equity, loans in Viet Nam transferred abroad, and profits earned from offshore oil and gas projects which were retained for overseas investments.

Legal money and other lawful assets as prescribed included foreign currencies on accounts at authorised credit institutions or purchased at credit institutions in accordance with the established laws, Vietnamese dong, machinery, equipment, supplies, raw materials, fuel, finished goods and semi-finished goods.

In addition, intellectual property, technology, brand values, property rights and shares were also considered capital for overseas investment in oil and gas.

Profits earned from oil and gas projects abroad were allowed to be retained for reinvestment.

Capital that was transferred abroad but recovered and repatriated to the home country would not be included in the amount which was remitted abroad.

Vietnamese investors could use their stakes and capital contribution or their projects in Viet Nam to make payments or exchange for the purchase of stakes in oil and gas projects abroad. In this case, Vietnamese investors would conduct procedures for overseas investment certificates first then foreign investors would conduct procedures for investing in Viet Nam following the established laws.

In the second option, the ministry said that investing in the oil and gas sector abroad would be regulated by Article 69 of the Government’s Decree No 31/2021/ND-CP dated March 26 guiding the implementation of some points of the Law on Investment.

The ministry also proposed two options for regulating overseas investment in oil and gas of foreign-invested economic organisations in Viet Nam.

In the first option, economic organisations in Viet Nam in which foreign investors held from 50 per cent of charter capital, the capital source for investing abroad must be equity and not include their contributed capital in Viet Nam.

In the second option, when investing in oil and gas abroad, economic organisations with foreign stakes must comply with Article 70 under the Decree 31/2021/ND-CP. — VNS