Taxation of Cross-border Mergers and Acquisitions
11/02/2022 07:00
We are pleased to provide our latest update on Taxation relating to Cross-Border Mergers and Acquisitions, which has been prepared by our Head of Tax – Phan Xuan Qui.
Tax is one of the most important elements to be considered during the structuring of any M & A transaction, and a good tax planning strategy can bring significant benefits to the overall investment structure.
In this article, we discuss popular types of business transfer and our recommendations from a Vietnamese tax perspective. This update will address three fundamental decisions that face a prospective buyer:
* Is it better to acquire the target’s assets or its equity?
* Which acquisition vehicle should be used?
* What issues should be considered in financing the acquisition vehicle?
The tax laws and regulations in Vietnam, while improving, are changing rapidly and the interpretations often aggressively favour the Vietnamese tax authorities. As one would expect in an emerging market, investors in Vietnam should not expect the same degree of legal certainty that is available in more developed jurisdictions.