Factory in Vietnam for a Brazilian Company: Taxes and CBE

A Brazilian company can manufacture in Vietnam through a local subsidiary, but Brazil keeps taxing the factory's profit. If the parent is a legal entity, Law No. 12,973/2014 (Lei 12.973/2014) applies; if it is an individual, Law No. 14,754/2023 (Lei 14.754/2023). In either case, assets held abroad come onto the Central Bank's radar under Law No. 14,286/2021 (Lei 14.286/2021).

This guide separates what is Brazilian rule (checked against the laws on the Planalto website and the Central Bank) from what is Vietnamese rule (checked on Vietnamese government pages). What could not be checked against an official source was left out or appears as "consult." Checked on October 3, 2026.

How does a Brazilian company open a factory in Vietnam?

The foreign investor must obtain an Investment Registration Certificate (IRC) for the project. Vietnam's 2025 Law on Investment provides, in art. 26, item 1, point "a," that projects of foreign investors go through the certificate issuance procedure. Projects of domestic investors do not need it (art. 26, item 2).

The law has been in effect since March 1, 2026 (art. 51). Art. 7 and Annex IV, which list the sectors with conditions for investment, have been in effect since July 1, 2026.

Points that change the path for your factory:

• •Who issues the certificate. Inside industrial parks, export processing zones, high-tech zones and economic zones, issuance is up to the zone's management board (art. 27, item 1). Outside them, it is up to the province's department of finance (art. 27, item 2), subject to the exceptions in item 3.
• •A subsidiary also counts as foreign. A company with more than 50% of its charter capital held by foreign investors follows the foreign investor rules when it invests in another company or project (art. 20, item 1).
• •Prohibited and conditional sectors. Art. 6 lists the prohibited activities and art. 7 refers to the conditional sectors. Check your sector before any contract.
• •Documents and deadlines. The law delegates to the Government, by decree, the conditions, documents and procedure for the certificate (art. 26, item 5). Check the decree in force with your local lawyer.

The translation of the law we used was published by the Vietnamese government's news portal. For contract decisions, always ask for the official text in Vietnamese.

How does Brazil tax the factory's profit when the parent is a legal entity?

The factory's profit goes into the calculation of the Brazilian parent's IRPJ and CSLL every year, without waiting for dividend distribution. Art. 77 of Law 12,973/2014 requires including in taxable profit and in the CSLL base the portion of the controlled entity's result abroad equivalent to profits before income tax, excluding exchange variation. Art. 79, item I, fixes the timing: the December 31 balance sheet of the year in which the profit was earned.

Three practical rules from the same law:

1. •Consolidation. Through calendar year 2029, profits and losses of controlled entities may be consolidated (art. 78, as worded by Law No. 15,079/2024 (Lei 15.079/2024)). Excluded are controlled entities in a country without a treaty or act with a tax information exchange clause, those located in a favored-taxation country or with a privileged tax regime (Law No. 9,430/1996 (Lei 9.430/1996), arts. 24 and 24-A) and those controlled by someone in those situations. Confirm with Brazil's Federal Revenue Service (Receita Federal) whether Brazil has an information exchange instrument with Vietnam.
2. •Loss without consolidation. Without consolidating, the factory's loss can only offset future profits of the same company abroad (art. 79, item II).
3. •Credit for tax paid abroad. The parent deducts the income tax paid abroad by the factory, in proportion to its holding, up to the limit of the Brazilian taxes levied on the same portions (art. 87). The tax must be proven by an official document from the foreign tax administration (art. 87, § 1).

These entries appear in the ECF (Escrituração Contábil Fiscal). See how it works in the guide on the ECF and affiliated companies abroad.

And when an individual controls the factory?

The individual pays 15% IRPF on income from capital invested abroad, including profits and dividends of controlled entities (Law 14,754/2023, art. 2, § 1). The timing of taxation depends on the factory's profile.

• •Profit taxed on December 31. Applies to a controlled entity that is in a favored-taxation country or has a privileged regime, or whose own active income is below 60% of total income (art. 5, caput and § 5). Own active income is the revenue from the entity's own economic activity, excluding royalties, interest, dividends, rents, financial investments and other revenue listed in § 6.
• •Profit taxed when made available. For profits earned since January 1, 2024 by controlled entities that do not fall under art. 5, § 5, the tax applies when the profit is effectively made available (art. 6, item II). The sole paragraph of art. 6 considers profit made available when it is paid, credited, delivered, used or remitted, whichever occurs first.
• •Control. There is control when the individual, alone or with related parties, holds more than 50% of the capital or the power to elect the majority of the directors (art. 5, § 1).
• •Foreign tax credit. The tax owed abroad by the controlled entity can be deducted in proportion to the individual's holding, up to the limit of the tax owed in Brazil on that profit (art. 5, § 15).

A factory with its own operating revenue tends to have high active income, but classification as a favored-taxation country depends on Receita's list (IN RFB 1,037/2010). Check both criteria before building the structure.

Does Brazil have a treaty with Vietnam to avoid double taxation?

We did not find one. The Receita Federal page with the agreements to avoid double taxation, updated on August 28, 2026, does not list Vietnam. On October 3, 2026, the list showed countries such as China, South Korea, the Philippines, India, Japan and Singapore, and no agreement with Vietnam.

In practice, the credit for tax paid in Vietnam comes from Brazilian domestic law (art. 87 of Law 12,973 and art. 5, § 15 of Law 14,754), not from a treaty. Since there is no convention, you also cannot count on a treaty withholding table for dividends, interest and royalties. Check the Vietnamese legislation in force for those remittances before finalizing the cash model.

What is Vietnam's corporate income tax and what incentives exist?

Vietnam's general corporate income tax rate is 20%. Art. 10, item 1, of the Corporate Income Tax Law (Law 67/2025/QH15) sets that percentage, subject to the rates in items 2 to 4 and the incentives in art. 13. The law was promulgated on June 14, 2025 and took effect on October 1, 2025, according to the government page.

The same art. 10 provides 15% for companies with annual revenue of up to 3 billion dong and 17% for those with more than 3 billion up to 50 billion dong. Check with the Vietnamese authority whether your company falls into any bracket.

The rate incentives are in art. 13 and depend on sector, location and an implementing decree. We do not publish incentive percentages because we did not open art. 13 or the decree. Ask the body that issues your investment certificate for the updated list.

Large multinational groups should also look at the global minimum tax (Pillar Two).

Does the factory in Vietnam have to be declared to the Central Bank (CBE)?

Yes, when assets abroad reach the threshold. Law 14,286/2021 defines Brazilian capital abroad as funds, assets, rights and holdings of any nature held outside the country by residents (art. 8, item I) and authorizes the Central Bank to request information about them (art. 10, item III). The stake in the Vietnamese subsidiary is one of those assets.

BCB Resolution 279/2022 sets the rules for the declaration:

• •Annual CBE: mandatory when total Brazilian capital abroad reaches USD 1,000,000.00 or more on the reference date of December 31 (art. 10). It is filed from February 15 to April 5 of the following year (art. 13).
• •Quarterly CBE: required from USD 100,000,000.00 on the reference dates of March 31, June 30 and September 30 (art. 11).

The threshold adds up all assets abroad, not just the factory. For fines and the form, use the official CBE page.

How do sales between the Brazilian parent and the factory work?

The parent and the factory are related parties, so prices between them follow the transfer pricing rules. Law No. 14,596/2023 (Lei 14.596/2023) applies to legal entities domiciled in Brazil that carry out controlled transactions with related parties abroad (art. 1, sole paragraph). The terms and conditions of those transactions must be those that would be set between unrelated parties in comparable transactions (art. 2).

This applies to sales of inputs to the factory, purchases of the finished product, royalties and services between the two companies. Document each flow. Our guides on transfer pricing and on transfer pricing compliance in Brazil detail the documentation.