07 key considerations for due diligence of Intellectual Property in Technology Company M&A Transactions in Vietnam

Vietnamese law does not define the concept of a technology company. However, Clause 1 of Article 58 of Law on Science and Technology 2013, amended and supplemented in 2018, states that a science and technology enterprise is an enterprise that engages in production, business, and scientific and technological services to create products and goods from the results of scientific research and technological development.

In practice, a technology enterprise can belong to various industries according to the Vietnam Standard Industrial Classification under Decision No. 27/2018/QD-TTg, but technology enterprises have several common level 2 industry groups, as follows:

1. Industry groups 61: Telecommunications;
2. Industry groups 62: Computer programming, consultancy and related activities;
3. Industry groups 63: Information service activities;
4. Industry groups 72: Scientific research and development;
5. Industry groups 74: Other professional, scientific and technical activities.

Besides the aforementioned technology companies, Decree No. 94/2025/ND-CP stipulates a sandbox mechanism in the banking sector, creating conditions for financial technology companies (Fintech companies) to experiment with new financial services. According to Decree No. 94/2025/ND-CP, which will take effect on 01 July 2025, a Fintech company refers to an organization that is not a credit institution or a branch of a foreign bank; is licensed or legally registered to operate in Vietnam; and independently provides Fintech solutions or cooperates with credit institutions, branches of foreign banks to provide Fintech solutions. Some prominent Fintech companies in Vietnam include MoMo, Timo, and Finhay.

In this article, BLawyers Vietnam will focus on typical information technology companies (“IT Company”).

1. Key consideration No. 1: What due diligence aspects of intellectual property are typically considered in a technology company M&A? What is the difference between a full merger/share purchase and a partial merger/purchase of the intellectual property of the company being appraised (“Target Company”)?

1.1. In Vietnam, the due diligence aspects of intellectual property that are typically considered in M&A transactions involving an IT Company include:

1. Reviewing the list of Invention Patents, Utility solution Patents, Certificates of mark registration for goods or services, Industrial design Patents, Certificates of registration of semiconductor integrated circuit layout design and other international protection titles owned by the Target Company; verifying the status, mortgage history, ownership history, expiration dates of protection (if any), scope of protection, and industrial property rights for these assets;
2. Reviewing and analyzing industrial property object licence contracts (also known as “Licensing Contracts”) related to invention, utility solution, trademark for goods or services, trade secret, industrial design, semiconductor integrated circuit layout design owned or used by the Target Company, including contracts where the Target Company is the owner of the industrial property objects, and contracts where the Target Company is granted the right to use the industrial property objects;
3. Identifying and analyzing any disputes related to intellectual property owned or used by the Target Company;
4. Reviewing and checking the registration status of copyright for computer programs, data collections, and the list of Copyright registration Certificates for computer programs and data collections;
5. Reviewing the list of trade secrets, including the basis for forming these trade secrets and the necessary measures to protect them, as well as non-disclosure agreements; and
6. Reviewing the list of domain names owned or used by the Target Company and the related documents.

1.2. In the case of a partial merger or asset purchase of the Target Company, only a portion of the Target Company’s assets are transferred to the buyer. Therefore, important intellectual properties and/or technology systems may remain with the Target Company and not be transferred to the buyer. Consequently, when considering a partial merger or asset purchase of the Target Company, the following issues need to be considered:

1. Identifying the intellectual property/technology systems included in the transaction and those excluded from the transaction scope;
2. Reviewing and determining which assets and related elements need to be transferred and which do not need to be transferred;
3. Identifying the resources shared between the merged part of the Target Company and the part of the Target Company that remains unchanged;
4. Developing plans to separate the two enterprises;
5. Identifying the dependent resources between the merged part of the Target Company and the part of the Target Company that remains unchanged;
6. Assessing the necessity of transferring industrial property objects and copyrights between the parties;
7. Determining whether the seller has the right to transfer third-party source code or data.

2. Key consideration No. 2: What types of public information can be collected or referenced when conducting due diligence on intellectual property in an IT Company M&A?

2.1. For industrial property rights related to invention, mark, industrial designs, semiconductor integrated circuit layout design

For information on industrial property rights that require the industrial property owner to register with the Intellectual Property Office of Vietnam (“IP Vietnam”), the search and collection of information are usually conducted using the Search – Statistics Tool on IP Vietnam’s Portal. However, in practice, it takes some time before the latest information on protection titles for industrial property rights is published and updated on IP Vietnam’s Portal. Therefore, enterprises often directly search, collect, and review the registration documents and materials of the Target Company to compare and supplement the search results from IP Vietnam’s Portal.

2.2. For copyrights

Copyright arises at the moment a work is created and fixed in a certain material form, irrespective of its content, quality, form, mode, language, irrespective of whether or not such work has been published or registered. However, in cases where copyright is registered, information on the author, the work, the copyright owner, and the related rights owner will be recorded on the Copyright registration Certificate and in the database of the Copyright Office of Vietnam. Therefore, in case of disputes, the organization that has been granted the Copyright registration Certificate is not obliged to prove that the copyright belongs to them. Consequently, the Copyright registration Certificate for intellectual property such as computer programs and data collections is often used as a source of document for enterprises to collect when conducting M&A transactions.

3. Key consideration No. 3: What types of intellectual property can be registered, and what types of intellectual property cannot or do not need to be registered? How is due diligence for each type of intellectual property conducted in M&A transactions?

3.1. Types of intellectual property that can be registered, including:

1. Invention, industrial design, semiconductor integrated circuit layout design, mark: Industrial property rights to the above industrial property objects are established on the basis of the decision to grant protection titles by the competent authority according to the registration procedures prescribed in the Law on Intellectual Property, or recognition of international registration according to international treaties of which Vietnam is a member;
2. Computer programs, data collections: as stated in Item 2.2, copyright for computer programs and data collections arises independently of registration or publication. However, the Law on Intellectual Property 2005, amended 2023 still stipulates a copyright registration procedure, so that the competent authority can record information about the author, the work, and the copyright owner;
3. Domain names: according to Vietnamese intellectual property law, domain names are not regulated as intellectual property. However, the Target Company can register and maintain domain names through Domain name registrars as stipulated in Decree No. 147/2024/ND-CP, thereby ensuring the security of domain name data and the information of the domain name registrant. Additionally, for registered domain names, enterprises can look up information about domain name registrants on the Domain Name Lookup System of the Ministry of Information and Communications (https://tracuutenmien.gov.vn/).

3.2. Types of intellectual property that cannot or do not need to be registered

1. Industrial property rights for well-known marks are established on the basis of use, regardless of registration procedures. However, the mark must be assessed against the criteria prescribed in the Law on Intellectual Property 2005, amended 2023, to be considered as well-known marks;
2. Industrial property rights for trade name are established based on the lawful use of those trade names. To ensure the protection of trade names, enterprises need to ensure that trade names meet the conditions specified in Law on Intellectual Property 2005, amended 2023;
3. Industrial property rights for trade secrets are established based on the lawful acquisition of the trade secret and the implementation of measures to protect that trade secret. Accordingly, trade secrets are protected if they meet the conditions stipulated in the Law on Intellectual Property 2005, amended 2023.

3.3. Due diligence of intellectual property

1. Industrial property rights for inventions, industrial designs, semiconductor integrated circuit layout design, marks, copyrights, domain names: normally, the buyer will request the Target Company to provide a list of protection titles, Copyright registration Certificate, a list of applications and a list of domain names. These lists are usually cross-checked with the databases of the information systems mentioned in Item 2 to verify the accuracy and completeness of the information;
2. Industrial property rights for well-known marks, trade names, trade secrets: for industrial property rights that cannot be registered, the evaluation criteria and the level of protection of these industrial property rights should be considered. Additionally, it is necessary to review and assess how the Target Company manages and secures these types of properties.

4. Key consideration No. 4: Can intellectual property be used as collateral? If so, how are these properties identified and assessed?

4.1. According to the Civil Code 2015, only economic rights to subjects of intellectual property rights (e.g., the right to use or authorize others to use industrial property objects) are identified as property. Additionally, according to Decree No. 21/2021/ND-CP, owners of economic rights deriving from intellectual property rights can use economic rights regarding subjects of author’s rights, industrial ownership rights as security for obligation fulfillment. On that basis, only economic rights to subjects of intellectual property rights can be used as collateral for obligation fulfillment.

However, there will be differences in the scope and conditions for economic rights to subjects of intellectual property rights to become collateral. Therefore, BLawyers Vietnam classifies these types of collateral for enterprises to easily identify:

1. Economic rights to subjects of copyrights: Vietnamese law allows copyright owners to transfer the ownership of the economic rights to subjects of copyrights to other organizations and individuals pursuant to a contract or in accordance with a relevant provision of law. Additionally, copyright owners can transfer the right to publish their works or to authorize other persons to publish their works – the only moral rights that can be transferred. Therefore, the aforementioned economic rights can fully become collateral to secure the performance of obligations;
2. Economic rights to subjects of industrial property rights: The owner of industrial property rights can transfer their industrial property rights – within the scope of protection, to other organizations or individuals. However, enterprises should consider the conditions restricting the transfer of industrial property rights to specifically determine which economic rights to subjects of industrial property rights can be transferred, and under what specific conditions. Accordingly, only economic rights that can be transferred under specific conditions can become collateral to secure the performance of obligations.

Examples of conditions restricting the transfer of industrial property rights include: The transfer of the rights to marks must not cause confusion as to properties or origins of goods or services bearing such marks (Article 139.4 of Law on Intellectual Property 2005, amended 2023); or rights to marks may only be transferred to organizations or individuals who satisfy conditions for persons having the right to register such marks (Article 139.5 of Law on Intellectual Property 2005, amended 2023).

4.2. Due diligence of intellectual property used as collateral

Once the intellectual properties used as collateral have been identified, the following specific aspects of these intellectual property need to be assessed:

1. Verifying the status, history of use as collateral, scope of protection, and expiration date of the protection for intellectual properties used as collateral;
2. Identifying disputes related to intellectual properties used as collateral of the Target Company;
3. Assessing the value of intellectual properties used as collateral at the time of the due diligence of the Target Company, in accordance with the Law on Price 2023 and Circular No. 37/2024/TT-BTC on Vietnamese Valuation Standards for the valuation of intangible assets.

5. Key consideration No. 5: What due diligence process is typically conducted for intellectual property created by employees and/or contractors of the Target Company?

5.1. Regarding industrial property rights

Organizations and individuals have the right to register inventions, industrial designs, semiconductor integrated circuit layout design including (i) the author who creates the invention, industrial design, semiconductor integrated circuit layout design through their own effort and expense; and (ii) organizations and individuals who have supplied funds and material facilities to authors in the form of job assignment or hiring, unless otherwise agreed to by the parties involved and provided that such agreements are not contrary to the provisions of law. Therefore, the Target Company has the right to register inventions, industrial designs, semiconductor integrated circuit layout design in cases where they supply funds and material facilities to authors in the form of job assignment or hiring, specifically employees and/or contractors providing related services.

In addition to moral rights, the author of inventions, industrial designs, or semiconductor integrated circuit layout design has the right to receive remuneration as stipulated in the Law on Intellectual Property 2005, amended 2023. Accordingly, if the Target Company is the owner of inventions, industrial designs, or semiconductor integrated circuit layout design created by their employees and/or contractors, the Target Company is obligated to pay corresponding remuneration.

The following documents and issues of the Target Company need to be reviewed/assessed in this case:

1. List of inventions, industrial designs, and semiconductor integrated circuit layout design owned by the Target Company created by their employees and/or contractors;
2. Documents recording the assignment or hiring to create inventions, industrial designs, semiconductor integrated circuit layout design of the Target Company to their employees and/or contractors;
3. Internal regulations/agreements on remuneration for authors of inventions, industrial designs, semiconductor integrated circuit layout design of the Target Company;
4. Actual payment of remuneration to authors of inventions, industrial designs, semiconductor integrated circuit layout design by the Target Company; and
5. Detailed information on any ongoing disputes related to the remuneration of the Target Company.

5.2. Regarding copyrights

The Target Company owns the copyright for computer programs and data collections created by their employees and/or contractors in the following cases: (i) The Target Company assigns the creative task to the author who is its employee; and/ or (ii) The Target Company enters into a contract with the creative author.

If any of the aforementioned cases apply, the Target Company will have the right to publish or authorize others to publish computer programs, data collection and economic rights as mentioned in Item 4.(i).

However, note that the author (in this case are the employee or contractor of the Target Company) retains their moral rights including: (i) Naming their work; (ii) having their real name or pseudonym attached to their work; being credited with their real name or pseudonym when the work is published or used; and (iii) protecting the integrity of the work, preventing others from modifying, editing or distorting the work in any way that harms the author’s honor and reputation. Therefore, even as the copyright owner, the Target Company must not infringe upon these rights to avoid future disputes.

The following documents and issues of the Target Company need to be reviewed/assessed in this case:

1. List of computer programs and data collections owned by the Target Company, created by its employees or contractors;
2. Documents recording the “assignment of creative tasks” for computer programs and data collections to the employees of the Target Company, such as employment contracts, job descriptions, and notices/decisions of the Target Company,…
3. Contracts between the Target Company and contractors related to the creation of computer programs and data collections.

6. Key consideration No. 6: What requirements must be met to carry out the transfer of intellectual property rights or licensing to subjects of intellectual property rights?

6.1. Regarding industrial property rights

To transfer industrial property rights or license industrial property objects, the Target Company must meet the following specific conditions:

1. The transfer of industrial property rights and the licensing industrial property objects must be established in the form of a written contract;
2. Industrial property right transfer contract is only valid upon its registration with the competent authority for industrial property rights for industrial property rights established on the basis of registration; and
3. Licensing Contracts are effective according to the agreement between the parties, but except for mark-related Licensing Contracts, other Licensing Contracts must be registered with the competent authority for industrial property rights to have legal effect against third parties.

6.2. Regarding copyrights

To transfer copyright or license copyright, the Target Company must meet the following specific conditions:

1. The transfer of copyright and the licensing of copyright must be made in writing; and
2. When changing the copyright owner after signing the copyright transfer contract, the copyright owner must request the competent authority to issue a new Copyright registration Certificate.

7. Key consideration No. 7: What types of due diligence are commonly performed on software?

The software due diligence process typically includes the following aspects:

1. List of all software owned by the Target Company, along with copies of all related contracts;
2. List of all third-party software used by the Target Company, along with copies of all related contracts;
3. All other agreements with third parties related to the Target Company’s use of software;
4. Identify the open-source software used by the Target Company and evaluate its usage to ensure compliance with open-source software license conditions;
5. Identify key personnel involved in the software development of the Target Company and review their Non-disclosure agreements and Non-compete agreements;
6. Detailed information on future plans for software or IT system upgrades; and
7. Detailed information on software issues of the Target Company.

The above is not official advice from BLawyers Vietnam. If you have any questions or suggestions about the above, please contact us at info@blawyersvn.com. BLawyers Vietnam would love to hear from you.

Date: 08 July 2025

Writers: Thai Bui & Thu Ha