Under the applicable labor laws of Vietnam, in order to work in this
country, the foreign nationals must, besides satisfying with other conditions,
obtain a work permit issued by the competent authority in Vietnam. Having a
work permit is likely to be the biggest hindrance to the foreign nationals.
However, the foreign nationals must avoid the need for work permit through the
exemption case: internal transfer within an enterprise.
According to Decree No. 102/2013/ND-CP of the Government dated 5
September 2013 implementing the Labour Code on foreigners working in Vietnam, foreigner
internally transferring within an enterprise means a manager, executive
director, expert or technician of a foreign enterprise which has established a
commercial presence within the territory of Vietnam who temporarily transfers
internally within the enterprise to the commercial presence within the
territory of Vietnam and who was recruited [or employed] by the foreign
enterprise at least twelve (12) months prior to such transfer. The foreign
nationals who are subject to this definition will be exempted from work permit.
However, to be legally accepted for working in Vietnam, the foreigner subject
to the internal transfer within an enterprise must obtain a certification of
work permit exemption which may not be much different from a work permit,
mostly like a “baby permit” and the procedures for obtaining this baby permit
have not yet been witnessed. Actually, before, the regulatory frameworks on
work permit do not provide the basis and procedures for identifying and in
consequence, the provincial-level Departments of Labor, War Invalid and Social
Affairs who are in charge for work permit issuance (“DOLISA”) has not yet been issued any exemption certification for
work permit. The Labor Code 2012 of Vietnam and its’ implementing legal
documents just regulated in general that the foreign nationals subject to the
Internal transfer within an enterprise and within the scope of the List of
Commitments on Services of Vietnam with World Trade Organization (“WTO”), will
be exempted from work permit.
Recently, the Ministry of Trade and Industry (“MOIT”) issued the
Circular No. 41/2014/TT-BCT of the Ministry of Industry and Trade on guiding
the bases and procedures for identifying foreign nationals reassigned within
enterprises within eleven (11) service industries in Vietnam’s WTO Schedule of
Specific Commitments in Services who are not subject to work permit (“Circular 41/2014”). Under the Circular
No. 41/2014, the bases for confirming that a foreign employee is internally
transferring within an enterprise belonging to 1 of the 11 services on the
Service Sectors List, and is therefore not required to have a work permit are
as follows:
i.
The foreign enterprise has already established a commercial presence
within the territory of Vietnam.
Commercial presence comprises the following forms: (a) Business
co-operation contract; (b) Joint venture enterprise or enterprise with 100%
foreign invested capital; (c) Representative office or branch of a foreign
enterprise.
ii.
The foreign employee was recruited by the foreign enterprise at least 12
months prior being appointed to come to Vietnam to work in the commercial
presence of such enterprise in Vietnam. The foreign employee here must be
divided into 02 groups: (i) the manager, executive director or expert and (ii) technician.
In order to prove that The foreign employee was recruited by the foreign
enterprise at least 12 months prior being appointed to come to Vietnam to work,
it is required to provide one of the following documents: (i) a labour
contract; (ii) A letter of confirmation from the employer; (iii) a decision
recruiting the foreign employee; (iv) A certificate of the foreign employee
having paid tax or insurance premiums.
iii.
The commercial presence of the foreign enterprise in Vietnam operates in
one of the 11 service sectors under WTO’s Commitments on Services of Vietnam;
Under the WTO’s Commitments on Services of Vietnam, the eleven (11) services comprise: business
services; information services; construction services; distribution services;
education services; environment services; financial services; medical health
services; tourism services; culture and entertainment services; and
transportation services. The Circular No. 41/2014 further described and
identified those service sectors under WTO’s Commitments on Services of Vietnam
into 02 appendixes: Appendix 1 and Appendix 2 respectively for the manager, executive
director or expert and the technician.
This identification is quite clear and detailed as each service sector is
specified into many components of a larger Central Product Classification (CPC)
item (a more extensive service sectors).
In case the enterprise in Vietnam where the foreign national internally
transferee opine that he/she is
qualified for the above basis, such enterprise must directly lodge a written
request with the DOLISA requesting for the confirmation that that foreign
national is not in the category required to have a work permit. The DOLISA has
the responsibility for issuing this confirmation.
Notably, the Circular No. 41/2014 does only require for either an
original or a copy of the above document and if the document is in a foreign
language, it need not be consularized but must be translated into Vietnamese
and certified in accordance with the law of Vietnam. This is quite a
significant development and reduce the paper works for the applicant.
The Circular No. 41/2014 provides some grounds for identifying an
internal transferee and allows the DOLISA to send a written request (original)
to the MOIT for its’ opinion if the DOLISA has difficulty in confirming that a
foreigner is internally transferring within an enterprise. Meanwhile, the
enterprise to recruit the foreign nationals may send a request to the MOIT for
its’ opinion in case such enterprise does not disagree with an opinion of the
DOLISA refusing the confirmation. This seems to be an opportunity for the
enterprise to object the DOLISA’s refusal.
However, the Circular No. 41/2014 narrows this advantage by regulating
that based on the official opinion from the MOIT, the DOLISA is responsible to
reconsider confirming whether or not the foreigner requires a work permit. The
Circular No. 41/2014 should have empowered the MOIT to decide the
identification of an internal transferee, other than passing a reconsideration
right to the DOLISA.
The issuance of Circular No. 41/2014 is expected
to ease the licensing procedures on work permits in Vietnam and brings a big
hope to the foreign nationals to be certified as work permit exemption under
the internal transfer within an enterprise. However, as a matter of practice in
Vietnam, it will take some more time to see how this new regulation is
implemented.