Legal due diligence in Vietnam

Understand the target before you commit

Legal due diligence examines a defined set of records against a proposed transaction. Its purpose is to identify legal issues that may affect structure, price negotiations, contractual protection, closing conditions or the decision to proceed. It is a scoped review, rather than a certification that a business has no liabilities.

Duong Tri Law agrees the target entities, review period, materiality, access arrangements and reporting format before starting. A buyer-side review, vendor preparation and a focused red-flag review have different objectives and should not be treated as interchangeable.

Agree the review perimeter

A report that supports decisions

The agreed output may be a concise red-flag memorandum or a fuller legal due diligence report. Each material finding should explain the document or fact supporting it, the uncertainty, its possible transaction effect and the recommended next action.

• Executive issues list, organised by priority and transaction relevance.
• Scope, review period, materials examined, assumptions and exclusions.
• Outstanding document requests and questions requiring target confirmation.
• Recommended remediation, contractual protection or closing evidence.
• A follow-up discussion to clarify findings and allocate next actions.

Risk labels help prioritise attention; they do not quantify financial exposure unless that assessment is separately supported. The report is addressed to the agreed client, with reliance and circulation terms set in the engagement.

What to provide at the outset

• Transaction outline, target entities, structure chart and intended timetable.
• Data-room index, access permissions and the proposed confidentiality arrangements.
• Corporate and ownership records, licences, key contracts and financing information.
• Known issues, disputes and areas the commercial team considers material.
• The scope of parallel tax, financial, technical or environmental reviews.

Use an agreed secure channel for the data room. Do not send employee files or other sensitive records in an initial enquiry.

From initial review to agreed next steps

1. Set scope and access

   Agree entities, materiality, reporting format, review period and the information request list.

2. Examine records and ask questions

   Review documents, record evidence and seek clarification where records conflict or are incomplete.

3. Report implications

   Separate confirmed findings, open questions and exclusions; explain their relevance to the proposed transaction.

4. Support the next decision

   Discuss the report and, if commissioned, carry findings into transaction documents or the closing checklist.

Timing, fees and limitations

Timing depends on the number of entities, the volume and quality of records, languages, access and the speed of responses. A deadline can be agreed only against those dependencies. Service fees, translation, searches and specialist costs should be identified separately.

A document review cannot reveal every undisclosed fact. Financial audit, tax computations, valuation, physical inspection, technical testing and ongoing monitoring are outside scope unless expressly included. Material new information after the review date may require an update.

Connect the findings to the deal

Return to M&A & transactions to plan the wider deal. Where the structure involves a share acquisition, review the registration workstream separately from diligence.