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Vietnam: Business result update of the enterprises being suspected of transfer pricing activities?

Transfer pricing not only occurs in Vietnam but also in many countries around the world, transfer pricing is an act of collusion between independent companies in different countries and territories. Businesses avoid corporate income tax and increase profits by setting a higher cost, take advantage of loopholes in the law.

Transfer pricing often happens to FDI enterprises using many tricks. Making legal decisions on a transfer pricing enterprise was difficult. Because all the indexes in financial report are from the enterprises themselves, lacking information from the market to clarify.

In Vietnam, there were many enterprises suspected of implementing transfer pricing to evade taxes such as Coca cola, PepsiCo, Heineken, Mega Market (Metro), Adidas, Big C, Aon Vina, Meiko... In this article, Vietdata will review some highlights in the financial statements of the above enterprises.


Adidas has officially operated in Vietnam since 2009, 100% owned by Adidas International BV - Amsterdam, Netherlands. Adidas Vietnam once admitted to making associated transactions in 2012, when it was inspected by the Tax Department of Ho Chi Minh City. Since then, Adidas recorded a significant decrease in selling costs, and the profits also increased.

Adidas' revenue grew well year by year, but slowed down and dropped quite high during the Covid-19 epidemic. Adidas has a gross margin that was high but is fluctuated. The enterprise recorded the highest gross profit in 2018 with over 830 billion, although the revenue was only about 1.4 trillion, lower than the revenue in 2020, 1.7 trillion.

Aon Vina

Aon Vina Company is a 100% Korean owned real estate company. Present in Vietnam since July 2007 under the name Keangnam Vina. The company signed a contract to assign Keangnam Enterprise as the general contractor, with a total contract value of up to USD 871 million. The expenses were hundreds of millions of dollars. Five years later, Keangnam Vina continuously reported losses and did not pay corporate income tax. After being inspected, the enterprise admitted to transfer pricing behavior, adjusted profits and paid taxes.

Real estate business activities slowed down because of the Covid-19 epidemic, which affected Aon Vina. Their net revenue decreased sharply in 2020-2021 (from nearly 1.5 trillion VND in 2019 to about 1.2 trillion VND in 2021). However, thanks to maintaining good profits, the profit margin of the enterprise still increased.

Big C and Mega Market (Metro)

Big C and Mega Market are two businesses operating in the same field of retail and are both multinational enterprises. Both businesses are constantly reporting losses for a long time and only became profitable recently. Mega Market was discovered by the General Department of Taxation in 2015. The Big C system is quite complicated because it belongs to many companies operating independently. The fact that Big C continuously reports losses, and the Group that owns Big C has a subsidiary in Hong Kong-a "tax heaven" made the government inspect Big C.

Although the Revenue was high and increased year by year, Big C still maintained low profit. Big C's revenue dropped during the Covid-19 epidemic, from over 17 trillion VND in 2020 to about 16.5 trillion VND in 2021. Big C lost nearly 130 billion VND from a profit of 120 billion VND in 2021. Although revenue only decreased slightly by about 4%, Big C reduced their profit to about 207%.

After being inspected in 2015, there was a change in Mega Market’s profit and had an increase, though gross profit margin was still very low. Mega Market achieved the highest profit margin in 2017. With net revenue was only about 3.1 trillion VND, gross profit was about 412 billion VND. The revenue of the business increased dramatically in 2018, up to about 312%, but the profit only increased by about 216%.

Coca-Cola and Suntory PepsiCo

Coca-Cola and Suntory PepsiCo are currently two FDI enterprises dominating the non-alcoholic beverage market in Vietnam. According to the Tax Department of Ho Chi Minh City, from the beginning of operation in Vietnam, these two companies continuously reported losses until the end of 2012, although the output still grew by over 25% per year, Factory construction and development activities were still underway.

As of December 2012, the total accumulated losses of Coca-Cola Vietnam amounted to VND 3,768 billion, exceeding the initial investment of VND 2,950 billion. Thus, technically, Coca-Cola Vietnam should have gone bankrupt. However, instead of closing or downsizing its operations, in 2014, Coca-Cola continued to invest another $210 million to expand its business in Vietnam.

After many efforts of the Vietnamese government, in 2013, Coca-Cola Vietnam reported profits and pay corporate income tax to the Government of Vietnam. Currently, Coca-Cola's business report shows that growth and profits have been more positive.

Pepsi established in Vietnam earlier than Coca-Cola (1991) but during nearly 20 years of operation, Pepsi Vietnam also continuously declared losses and did not have to pay corporate income tax. However, Pepsi Vietnam continues to invest in many new factories in other provinces and cities across the country to expand market share. Despite achieving quite high profits, Pepsi's gross profit margin is not too high and stable, only surpassing the industry average since 2019.


Heineken was once arrears and fined over VND 917 billion by the General Department of Taxation in 2019 for not paying tax on the transferring of Heineken Vietnam - Hanoi brewery from the parent company in Singapore to the company in Vietnam. Enterprises in Vietnam have declared tax, but businesses in Singapore still send documents to request tax exemption or reduction according to the tax rate in Singapore.

Heineken still had positive business results. Profit margin was stable, net revenue and gross profit increased steadily until 2019, then decreased slightly because of the influence of the Law on Prevention of Alcohol Harm and the Covid-19 epidemic. However, there was a high increase in revenue in the first quarter of 2022.


Meiko VN Electronics Co., Ltd. reported a loss of 3 years (2009-2011) to over 300 billion dong. While the data shows, Meiko Electronics Factory in Hanoi was one of the 10 largest FDI projects at the time of licensing in 2006. Since being inspected in 2012, Meiko has changed costs and profits.

Meiko's revenue increased, but profit was not stable over the years, Meiko's profit margin increased to 0.19 in 2018, but reached the lowest level of about 0.13 in 2020.

The investigation of transfer pricing in Vietnam faces various difficulties. The government cannot tighten tax regulations too much to attract FDI to Vietnam. However, the inspection and supervision of transfer pricing activities has brought many benefits to our country. After the inspection process, enterprises adjusted their costs to be more reasonable, increased profits, and declared and pay taxes.

Source: Vietdata financial platform


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