By Lawyer Le Phuong Thanh – UniLaw LLC

ROCKET LAWYER PARTNERSHIP AGREEMENT VIETNAMESE – UNILAW

In the age of digital transformation, many entrepreneurs turn to online platforms like Rocket Lawyer to find a “Partnership Agreement Vietnamese” template. While templates offer a quick start, the complexity of the Vietnamese legal landscape—particularly concerning foreign investment, land use rights, and the distinction between corporate equity and business cooperation—often renders generic forms insufficient. To avoid costly litigation, seeking advice from a specialized contract attorney or a contract law lawyer is not just a luxury; it is a necessity for safeguarding your assets and reputation in Vietnam.

The Risk of Misinterpreting “Partnership” in Vietnam: A Real Case Study

A poignant example of how informal or misunderstood “partnership” arrangements can lead to decade-long legal battles is seen in Judgment No. 10/2022/KDTM-PT, dated March 31, 2022, from the High People’s Court in Da Nang.

The Situation: The dispute involved multiple family members, including Mr. B1, Mr. P1, Ms. Th, and Ms. L. In December 2017 and May 2018, the parties signed “Agreements” (Văn bản thỏa thuận) that were notarized. These documents explicitly stated that Mr. B1 was the name on the business registration of Company M (a one-member limited liability company) and held the land use rights for a 15,634 m2 plot in Buon Ma Thuot, along with several vehicles and a coffee shop. However, these agreements acknowledged that all these assets were “common property” (tài sản chung) of the four co-founders, who had contributed capital since 1998. Each member was recognized as having a 33.33% or 25% stake in the value of the company and its assets. When the relationship soured, Mr. B1 attempted to deny these rights, leading the other members to sue for formal recognition as contributing members of the company.

The Verdict: The court faced a complex challenge: Company M was registered as a “One-Member LLC” owned by Mr. B1, yet the notarized agreements clearly showed a multi-party partnership. The Appeal Court ruled in favor of the plaintiffs, upholding the validity of the 2017 and 2018 agreements. The court emphasized that notarized documents reflecting the true will of the parties regarding capital contribution and asset ownership are legally binding, even if the formal business license has not yet been updated to reflect a multi-member structure. This case serves as a warning that without a precise legal contract lawyer to formalize the transition from an informal partnership to a multi-member corporate entity, years of litigation may follow to prove one’s ownership rights.

Understanding Business Cooperation Contracts (BCC) vs. Equity Partnerships

In Vietnam, a “partnership” can take two primary legal forms: establishing a new corporate entity or entering into a Business Cooperation Contract (BCC). Investors must understand the distinction, as the liability and profit-sharing mechanisms differ significantly. A contract lawyer will often guide clients to the Law on Investment 2020 for the definition of a BCC.

Article 3, Clause 28 of the Law on Investment 2020:

“Business cooperation contract (hereinafter referred to as BCC) means a contract signed between investors for business cooperation, division of profits, or division of products in accordance with law without establishing an economic organization.”

Plain Language: A BCC is a way for companies or individuals to work together on a specific project and share the money or products made, without having to start a brand-new company together.

This distinction is crucial, as demonstrated in Judgment No. 20/2018/KDTM-PT. In this case, Ms. H contributed 1 billion VND to a project by Company TNQN to plant trees in Laos. She believed this made her a shareholder of the company. However, the court analyzed the “Capital Contribution Contract” and the “Resolution of the Board of Directors” and determined that the relationship was actually a BCC focused only on a specific 100-hectare project in Laos.

The Verdict in the TNQN Case: Because the contract was a BCC and the project had not yet generated profit due to “unfavorable natural conditions,” Ms. H’s request to have her 1 billion VND returned was rejected. The court ruled that as a participant in a BCC, she shared the business risks, and there was no evidence of fraud or deception by the company. This highlights why a contract attorney must ensure that the contract title and its internal clauses match the client’s intent—whether to be a “shareholder” with permanent ownership or a “project partner” sharing temporary risks and rewards.

The Essential Content of a Partnership Agreement Under Vietnamese Law

Whether you use a template or draft from scratch, the Law on Investment sets a mandatory minimum for BCC-style partnerships. Neglecting these can lead to the contract being declared invalid or unenforceable.

Article 28 of the Law on Investment 2020:

“A BCC shall include the following main contents:

a) Names, addresses, and authorized representatives of the parties to the contract; transaction address or location for project implementation;

b) Objectives and scope of business investment activities;

c) Contributions by the parties to the contract and distribution of business investment results between the parties;

d) Schedule and duration of contract performance;

dd) Rights and obligations of the parties to the contract;

e) Amendment, assignment, and termination of the contract;

g) Responsibility for breach of contract, and method of dispute resolution.”

Plain Language: Every business cooperation agreement must clearly state who is involved, what they are doing, how much money or equipment each person puts in, how profits are split, how long the project lasts, and what happens if someone breaks the rules or they want to quit.

A legal contract lawyer will go beyond these basics. For instance, in an internal UNILAW memo regarding an International Bakery Joint Venture (Client Case 2025_Ho_1), the focus was on protecting “Intellectual Property” (IP) for the Vietnamese side, which only held a 30% stake. The advice included creating “Strategic Veto Rights.”

Article 182, Clause 3 of the Law on Enterprises 2020 (relating to partnership management):

“The Members’ Council has the right to decide all business activities of the company. Unless otherwise provided by the Charter, decisions on the following issues must be approved by at least three-quarters of the total number of general members: a) Orientation and development strategy of the company; b) Amending and supplementing the Charter…”

Plain Language: The big decisions in a partnership, like changing the company rules or the overall business plan, usually need a “super-majority” vote (like 75%) to pass, unless the partners agree on a different number in their initial contract.

By leveraging this, a contract attorney can draft a Charter that requires a 75% vote for any use of the “Secret Recipe” or “Brand Name,” effectively giving the 30% minority partner a “veto” over their IP.

Navigating Capital Contributions: Cash vs. Assets

One of the most frequent sources of dispute is the valuation and transfer of non-cash contributions, such as land or machinery. Under Vietnamese law, simply “promising” an asset is not enough; the ownership must be legally transferred to the entity.

Article 36, Clause 1 of the Law on Enterprises 2014 (similar to current 2020 law):

“Members of a limited liability company… must transfer ownership of assets contributed as capital to the company… For assets with registered ownership or land use rights, the contributor must perform procedures to transfer the ownership of such assets or land use rights to the company at a competent state agency.”

Plain Language: If you are joining a company and contributing a piece of land or a car as your share, you must legally sign over the title of that property to the company’s name at the government office. Just saying it is the company’s isn’t enough.

In Judgment No. 13/2025/KDTM-PT (regarding a construction joint venture), the parties attempted to share profits using “land use rights” within a housing project. The court ruled that under the Law on Housing, developers cannot distribute land or houses to capital contributors unless they establish a new legal entity that is formally assigned as the project owner. This resulted in the “Investment Cooperation Agreement” being declared partially invalid because it promised a distribution (land) that was legally impossible to fulfill.

This is a classic trap for those using a generic “Partnership Agreement Vietnamese” found online. A contract law lawyer would have identified that under Article 425 of the Civil Code 2015, a contract can be canceled if it becomes impossible to perform, leading to the return of all contributions plus interest.

Rights and Obligations of Partners: The General vs. Limited Distinction

If you choose to establish a “Partnership Company” (Công ty hợp danh) rather than an LLC, you enter a world of “Unlimited Liability” for general partners. This is often a shock to foreign investors accustomed to limited liability structures.

Article 181 of the Law on Enterprises 2020:

“General members have the following rights: …b) To conduct business in the company’s name… g) Upon dissolution or bankruptcy, to be divided the remaining value of assets corresponding to the proportion of capital contribution…”

Plain Language: General partners in a partnership company have the right to sign deals in the company’s name and share in the final assets if the company closes down.

However, this comes with a heavy burden:

Article 181, Clause 2, Point dd of the Law on Enterprises 2020:

“General members have the obligation to: …Jointly and severally be responsible for paying the remaining debts of the company if the company’s assets are not enough to cover the company’s debts.”

Plain Language: If the company runs out of money and still owes debts, the general partners must use their own personal bank accounts and property to pay off the rest of those company debts.

To mitigate this, a contract lawyer might suggest including “Contributing Members” (Thành viên góp vốn) who have limited liability.

Article 187, Clause 2 of the Law on Enterprises 2020:

“Contributing members have the obligation to: a) Be responsible for the debts and other property obligations of the company within the scope of the capital amount committed to be contributed.”

Plain Language: Unlike general partners, contributing members only risk losing the money they originally put into the business. They don’t have to pay company debts out of their own personal pockets.

The Role of a Contract Attorney in Transferring Interests

Exiting a partnership is often harder than entering one. In Vietnam, you cannot simply walk away or sell your stake to anyone. There are strict “First Right of Refusal” rules designed to keep the partnership’s “closed” nature.

Article 53, Clause 1 of the Law on Enterprises 2014 (and 2020):

“…a member of a limited liability company with two or more members has the right to transfer part or all of their capital contribution to another person according to the following rules:

a) Must offer to sell that portion of capital to the remaining members in proportion to their capital contribution…

b) Can only transfer to a non-member if the remaining members do not buy or do not buy all of it within 30 days…”

Plain Language: If you want to sell your share of a company, you must first ask your existing partners if they want to buy it. You can only sell to an outsider if your partners say “no” or don’t answer within 30 days.

Failure to follow this procedure can lead to the entire sale being declared void. In Judgment No. 101/2024/KDTM-PT, a dispute arose when a member, Mr. P, agreed to transfer his 40% stake in a chemical company to the wife of the other partner, Mr. N. Because the “offer to remaining members” procedure wasn’t perfectly documented and notarized, the validity of the transfer was challenged years later during a divorce and asset division. A legal contract lawyer ensures that every notice and waiver is signed, dated, and stored to prevent these “technical” invalidations.

Dispute Resolution: Choosing the Right Forum

When “Rocket Lawyer” templates are translated or adapted for Vietnam, they often include clauses for “Arbitration in Singapore” or “New York Law.” While this sounds professional, it can be a nightmare for domestic operations. UNILAW frequently advises clients on the risks of choosing foreign forums for local disputes.

In the case of VMG vs. GPS and UTC (Phán quyết ngày 14/10/2021 của SIAC), the parties agreed to the Singapore International Arbitration Centre (SIAC) using Singapore law for a stock purchase agreement. However, when a dispute arose over “extra-contractual damages” (tort/fraud), the SIAC tribunal applied Singapore’s “Misrepresentation Act”. The Vietnamese court later found that for actions occurring in Vietnam regarding a Vietnamese company, the tribunal should have applied the Civil Code of Vietnam. This discrepancy led to significant challenges in getting the foreign award recognized and enforced in Vietnam, as it was seen as “contrary to basic principles of Vietnamese law”.

For most partnerships operating within Vietnam, a contract attorney will recommend the Vietnam International Arbitration Centre (VIAC). As stated in many Unilaw-drafted agreements, such as for Client Case “GIOLIBELLO”:

“Any dispute… shall be resolved through negotiation, mediation… or the Vietnam International Arbitration Centre (VIAC) at Hanoi…”.

Case Study: The Dangers of “Shadow” or “Namending” Agreements

In some partnerships, particularly those involving foreign investors who cannot yet meet certain licensing requirements, parties enter into “Nominee” or “Standing-in-name” agreements. These are highly risky and often declared void by courts.

In an internal Legal Memo for Sunshare International Technology (Client Case 2018_Neosysvietloi_1), UNILAW dealt with the aftermath of a capital transfer where one party had “stood in the name” (đứng tên hộ) for another. The contract law lawyer had to draft a “Post-Transfer Agreement” to explicitly indemnify the nominee from all past liabilities and administrative fines incurred while they were the “legal” owner on paper.

Article 124 of the Civil Code 2015 (relating to invalidity due to falsity):

“When the parties establish a civil transaction falsifiedly for the purpose of concealing another transaction, the falsified transaction is invalid, while the concealed transaction is still valid…”.

Plain Language: If you sign a contract for one thing (like a sale) just to hide what you’re really doing (như là đứng tên hộ), the “fake” contract is canceled by the court. The “real” deal might still count, but it’s much harder to prove.

In Judgment No. 04/2025/KDTM-PT, a capital transfer agreement between a husband (Mr. L) and wife (Ms. H) for 14.7 billion VND was declared void due to falsity. The court found that the transfer was only made to “formalize the change of business type” to help the company get a bank loan, and no actual money ever changed hands. The court ordered the parties to return to the original ownership status.

The ” coordination committee” in BCC Partnerships

Because a BCC does not create a new company with a Director or CEO, the law provides for a unique management structure. A contract lawyer must carefully define the powers of this group.

Article 27, Clause 3 of the Law on Investment 2020:

“Parties to a BCC shall establish a coordination committee to perform the BCC. Functions, tasks, and powers of the coordination committee shall be agreed upon by the parties.”

Plain Language: Since there is no “Boss” in a BCC, the partners must create a small committee (like a board of directors for the project) to make decisions together. The partners decide exactly what this committee is allowed to do.

Without a clear agreement on how the coordination committee operates, the project can stall. In Judgment No. 20/2024/KDTM-PT, a joint venture for a residential project in An Giang failed because one partner (Company K9) unilaterally transferred 33 plots of land to the local government to pay off a debt without the consent of the other partners. The court ruled that “every unilateral change has no value” and that all three parties had equal rights to manage and control the project’s assets. This is why a contract attorney will include strict “unanimous consent” or “voting threshold” clauses for the coordination committee.

Protecting Yourself: The 5 Golden Rules for Partnership Agreements in Vietnam

1. Don’t rely solely on templates: A “Rocket Lawyer Partnership Agreement Vietnamese” might miss the mandatory coordinating committee rules of the Law on Investment or the land use restrictions of the Law on Housing.
2. Notarize your Agreements: As shown in Judgment No. 10/2022/KDTM-PT, a notarized agreement on capital contribution can be a lifesaver even if the corporate license is outdated.
3. Clarify the EXIT: Use the 30-day “First Right of Refusal” period mandated by Article 53 of the Law on Enterprises to structure your buyout clauses.
4. Define IP Ownership early: Ensure that recipes, brands, and software modules remain the property of the contributor and are only “licensed” for use during the partnership.
5. Consult a Contract Lawyer: Whether it’s drafting a complex BCC for an alumina transport project (Client Case 2014_A_3) or managing a 39-million-dollar garment factory (Client Case 2017_Huy_1), having a legal expert ensure compliance with Decree 09/2018/NĐ-CP on distribution rights or environmental regulations is essential.

Conclusion

Partnering in Vietnam offers immense opportunities, but it requires a sophisticated legal foundation. From the “Unlimited Liability” of general partners in a Partnership Company to the “Impossible Distribution” traps in real estate BCCs, the pitfalls are many. By working with a dedicated contract attorney or legal contract lawyer at UNILAW, you ensure that your partnership is built on the rock-solid ground of Vietnamese law, rather than a shaky foundation of generic online templates. We don’t just draft contracts; we build the legal architecture for your long-term success in Southeast Asia.