Comprehensive guidance on procedures, conditions, and documentation for increasing charter capital of joint-stock companies pursuant to the Law on Enterprises 2020, updated with the latest regulations in 2026.
Increasing chartered capital is one of the important activities that helps joint stock companies expand their business scale, enhance financial capacity, and establish their position in the market. However, this process requires enterprises to strictly comply with legal regulations regarding procedures, conditions, and documentation. This article will provide a detailed analysis of regulations governing the increase of chartered capital for joint stock companies under current law.
Concept and significance of increasing chartered capital
According to the provisions of the Enterprise Law 2020, increasing the chartered capital of a joint stock company is the process by which the company adjusts upward the level of capital recognized in the Enterprise Registration Certificate. This is an important legal procedure that helps enterprises mobilize additional financial resources for development.
Increasing chartered capital brings practical benefits to enterprises, including: strengthening financial capacity to implement major investment projects, enhancing credibility and competitiveness in the market, meeting requirements for minimum capital for certain regulated business sectors, and creating opportunities for better access to credit from financial institutions with more favorable terms.
Forms of increasing chartered capital for joint stock companies
Based on Article 123 of the Enterprise Law 2020, share offering is the process by which the company increases the number and types of shares that may be offered to increase chartered capital. Joint stock companies may choose one of the following forms:
Share offering to existing shareholders
This is a preferred method giving existing shareholders of the company the right to purchase additional shares in proportion to their current ownership. This method helps maintain the original ownership structure and protect the interests of existing shareholders, while also simplifying procedures compared to public offerings.
Private share placement
A company may offer shares to specific investors without conducting a public offering. This method is typically applied when the company needs to attract strategic investors or quickly mobilize capital from financially strong partners.
Public share offering
For public companies, share offerings to the public must comply with securities law regulations. According to Decree 155/2020/NĐ-CP as amended by Decree 245/2025/NĐ-CP, enterprises must meet strict conditions and fully implement information disclosure procedures.
Increasing capital from shareholders' equity sources
A company may issue shares to increase chartered capital from sources such as: capital surplus, development investment funds, undistributed after-tax profits, or other funds belonging to shareholders' equity as prescribed by law.
Conditions for increasing chartered capital of joint stock companies
To legally increase chartered capital, joint stock companies must meet all the following conditions:
General conditions
The company must have completed the initial committed capital contribution. According to regulations, shareholders must have fully paid for the shares they registered to purchase before the company implements a new capital increase plan.
The increase in chartered capital must be approved by the Shareholders' General Meeting, except where the company's Charter provides that the Board of Directors has the authority to decide within a certain scope.
Specific conditions according to the form of capital increase
In the case of issuing shares to pay dividends, the company must have sufficient undistributed after-tax profit for payment according to the most recently audited financial report.
When increasing capital from shareholders' equity sources, the company must ensure it has sufficient shareholders' equity to implement the capital increase, including capital surplus, development investment funds, undistributed after-tax profits, and other funds permitted for use.
Conditions for special enterprises
For securities companies and fund management companies, according to Article 187 of Decree 155/2020/NĐ-CP, these enterprises may not increase chartered capital when they have not officially commenced securities business operations.
Non-bank credit institutions that increase chartered capital must comply with regulations under Circular 49/2025/TT-NHNN, including submission of documentation for approval by the State Bank and compliance with operational safety criteria.
Procedures and documentation for increasing chartered capital
Implementation sequence
Step 1: The Board of Directors develops a capital increase plan, including the reasons for the increase, the method of increase, the number of shares to be issued, the issuance price, the implementation timeline, and the plan for use of capital.
Step 2: Convene the Shareholders' General Meeting to approve the capital increase plan. The resolution of the Shareholders' General Meeting must be approved by the proportion of votes specified in the company's Charter and by law.
Step 3: Implement the approved capital increase plan, including offering shares, collecting payments from investors, and issuing share certificates.
Step 4: Complete the capital increase and implement the procedure for changing business registration at the Business Registration Office within 10 days from the date of completion of the issuance.
Documentation for registering changes to chartered capital
According to Decree 168/2025/NĐ-CP on business registration, the documentation for registering changes to chartered capital includes:
- Application form for registration of changes to business registration
- Resolution or Decision regarding the capital increase of the company
- List of shareholders and ownership percentages following the capital increase for joint stock companies
- Certified copies of documents evidencing full payment of newly issued shares
Resolution timeframe
The business registration office is responsible for issuing an Enterprise Registration Certificate within 03 working days from the date of receipt of complete and valid documentation. If the documentation is incomplete or invalid, the business registration office must notify the enterprise in writing within 03 working days to request supplementation or completion.
Important notes for certain special cases
Increasing chartered capital during the equitization process
For state-owned enterprises undergoing equitization, according to Decree 57/2026/NĐ-CP on restructuring of state capital in enterprises, there are three main forms:
- Maintaining the current state capital and issuing additional shares to increase chartered capital
- Selling part of the state capital or combining both selling part of capital and issuing additional shares
- Selling all state capital or combining both selling all capital and issuing additional shares
Increasing chartered capital for companies with foreign investors
When a company with foreign investor shareholders increases capital, attention must be paid to the foreign ownership ratio under legal regulations. For certain business sectors, Vietnamese law specifies the maximum ownership ratio for foreign investors; therefore, the capital increase must ensure compliance with such ratio.
According to Circular 11/2026/TT-NHNN, when credit institutions increase chartered capital, the documentation must include a list of shareholders who are foreign investors and the expected ownership ratio after capital increase so that regulatory authorities can monitor compliance with foreign ownership regulations.
Information disclosure obligations
For public companies and listed companies, the increase in chartered capital must be disclosed according to regulations under Circular 96/2020/TT-BTC. The company must disclose the Shareholders' General Meeting resolution on the capital increase plan, results of the share offering, and completion of the capital increase within the specified timeframe.
Administrative penalties for violations related to increasing chartered capital
Failure to increase chartered capital in compliance with regulations may result in administrative penalties. According to Decree 156/2020/NĐ-CP, for securities companies that increase or decrease chartered capital in violation of legal provisions, the fine may reach 150,000,000 Vietnamese Dong.
Common violations include: failure to register changes to chartered capital within the prescribed timeframe, inaccurate or incomplete disclosure of information regarding the capital increase plan, implementation of capital increase when conditions required by law have not been met.
Role of professional legal counsel
The process of increasing chartered capital for joint stock companies involves many complex legal regulations, from the Enterprise Law, the Securities Law, to various detailed guidance documents. Failure to fully comply with such regulations may result in serious legal consequences, affecting the enterprise's business operations.
A&D Law Firm, with a team of attorneys experienced in corporate legal advisory services in Vietnam, provides comprehensive advisory services on capital increase procedures, including: developing a capital increase plan suitable to the enterprise's specific characteristics, drafting complete and accurate legal documentation, representing the enterprise in procedures with competent government authorities, advising on information disclosure obligations and legal issues arising during the capital increase process.
With the principle of placing client interests first, A&D Law Firm commits to accompanying enterprises through every stage of development, ensuring that all legal activities are conducted in compliance with regulations, efficiently, and cost-effectively.
This article is for reference purposes only and does not replace official legal advice for specific enterprise situations. Each capital increase situation may have unique characteristics requiring appropriate legal solutions. For detailed and accurate advice on your company's specific circumstances, please contact A&D Law Firm attorneys directly for professional assistance.
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