Upcoming ASEAN Economic Community From The Perspective Of A Non ASEAN

Establishment of ASEAN Economic Community

The ASEAN Economic Community (AEC) originates from the ASEAN Vision 2020, which was adopted in 1997 on the 30th anniversary of the Association of Southeast Asian Nations, made up of Brunei Darussalam, Myanmar, Cambodia, Indonesia, Laos, Malaysia, Philippines, Singapore, Thailand and Vietnam (ASEAN). With a population of more than 600 million and a nominal GDP of about $2.31 trillion, ASEAN is a strong economic community in Asia and also a driver of global growth.

The AEC is the realisation of the end goal of economic integration as espoused in the Vision 2020, which is based on a convergence of interests of ASEAN member countries to deepen and broaden economic integration through existing and new initiatives with clear timelines. AEC will have to envisage the key characteristics: (i) a single market and production base, (ii) a highly competitive economic region, (iii) a region of equitable economic development, and (iv) a region fully integrated into the global economy. By end of 2015, the AEC will be already started to realize those goals of regional economic integration and to create a single market and production base for the region by 2020.

Vietnam - A Future International Competitor in Wind Energy?

Potential of Wind Energy Industry in Vietnam

Vietnam has a significant potential for wind energy with an average wind speed of more than 6m/s, surpassing that of all neighbouring Southeast Asian countries. With more than 3,000 km coastline and plenty of islands, the total potential of wind energy in Vietnam is estimated to be as high as 713,000 MW – 510,000 MW on land and 203,000 MW in islands. In comparison, this is 200 times more than the production volume of the largest hydropower plant, Son La (Vietnam), in Southeast Asia and 10 times larger than the projected total capacity of the electricity industry in 2020.

New PPP laws in Vietnam:moving closer towards bankable projects?

Overview on Public – Private Partnership (“PPP”) Laws in Vietnam

Vietnam’s infrastructure development has struggled to keep up with continued economic and population growth. According to the statistics, Vietnam needs about US$170 billion for infrastructure investment in the period from 2011 to 2020 while the State budget is constrained, capital sources from state budget and official development assistance (“ODA”) are estimated to meet only a half of the identified requirements.

In this situation, PPP is the most appropriate mechanism for Vietnam. In practice, other countries have successfully implemented partnership between the public and private sector. Put it simply, the idea is that the public sector has the ‘users’ (or customers) and land and can provide other incentives, such as tax breaks while the private sector can bring in technology, capital, and efficiency through experience.

Regulatory framework on food safety testing

i.          General regulatory framework on food safety

The Law on the Quality of Products and Goods No. 05/2007/QH12 dated 21 November 2007 (“QPG Law”) and Law on Food Safety 55/2010/QH12 dated 17 June 2010 (“FS Law”), together with their guiding regulations, are the legal documents primarily regulating food safety matters in Vietnam.

The QPG Law (effective as of 1 July 2008) regulates the responsibilities of manufacturers/ traders for the quality of their products and provides for the Ministry of Science and Technology’s overall responsibility for State management of the quality of goods, including foods. The FS Law (effective as of 1 July 2011), specifies the responsibilities to the Ministry of Health (MOH), Ministry of Agriculture and Rural Development (MARD) and Ministry of Industry and Trade (MOIT) for the safety of food; and describes the rights and obligations of organizations and individuals in respect of food safety, conditions to ensure food safety and doing business in food, advertising, labeling food etc.

Disaster of Domestic Arbitration Verdict Annulment in Vietnam – How to avoid?

Enforcement Of Domestic Arbitral Awards In Vietnam

Recently, the media of Vietnam paid much attention to Vinalines case, the largest shipping corporation in Vietnam who lost an arbitration case brought to the Vietnam International Arbitration Center (VIAC). However, Vinalines then asked the court in Hanoi, Vietnam for annulment of VIAC’s verdict. Under the VIAC verdict, Vinalines has to pay VND 62.5bn to the South Korean SK E&C to compensate for its’ breach of a harbor construction contract with SK E&C at Van Phong transit port, Khanh Hoa province. Vinalines did accept this verdict but later on submitted a request to the Hanoi People’s Court for this verdict’s annulment. Meanwhile Vinalines also asked for the intervention and support of the relevant ministries.

Investing in big motorcycle industry in Vietnam

Key notes: Generally speaking, there are more and more foreign motorbike manufacturers flock to Vietnam in the context that the driving license policy in this country has been loosened and the Vietnamese nationals now have more opportunities to possess large capacity motorbikes.

I.              Trading right

After the WTO accession in 2007, Vietnam opened the market for importing the big motorcycle (175cc+), officially entitled to import as from June 2007.

As of 1 January 2009, foreign invested companies engaging in distribution services will be permitted to engage in the commission agents', wholesale and retail business of tractors; motor vehicles; cars and motorcycles.

Thus, there is no limitation to the foreign investor on the market access. However, the establishment of outlets for retail services (beyond the first one) shall be allowed on the basis of an Economic Needs Test (ENT).

Exemption Of Work Permit By Internal Corporate Transfer

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.

New foundations for real estate deals

New foundations for real estate deals - Vietnam Investment Review

The recent National Assembly session passed the Law on Enterprise, Law on Investment, Law on Residential Housing and Law on Real Estate Business. These new laws contain provisions which help to create a more transparent, consistent and conducive legal environment for domestic and foreign real estate investors alike.

These provisions should help revitalise the real estate market by paving the way for investment and mergers and acquisitions. David Lim, managing partner at Zicolaw Vietnam outlines the main provisions in the new laws.

The real estate sector has been an attractive investment field. However, it is also a challenging sector due to restrictions and complicated rules imposed on investors and real estate transactions. It is important to understand the new provisions in laws to take advantage of the investment opportunities provided. 

From now, 05 year visa will be granted for the foreign investors in Vietnam

With the enforcement of the Law on Entry, Exit and Residence of Foreigners in Vietnam No. 47/2014/QH13 dated 16 June 2013 by the National Assembly of Vietnam (“Law No. 47/2014”), as from 01 January 2015, the foreign nationals who have the business investment in Vietnam may be granted a 05 year visa.  Previously, the foreign nationals were only allowed to obtain one year visas and three years residency cards.

Under the Law No. 47/2014, the foreign investors in Vietnam who are eligible will be issued a visa named “ĐT” which has the duration of maximum 05 years. A temporary residence card will be accordingly considered for issuance to those who have got this type of visa. The Law No. 47/2014 also allows the foreigners that are parents, spouse, children under 18 years of age of the foreigners issued with a ĐT visa to receive the same treatment.

In order to be considered as the foreign investor in Vietnam, the foreign nationals must qualify for the definition of foreign investor under the Law on Investment in Vietnam and also obtain an investment certificate for their business investment in this country.

Engaging in securities service business in Vietnam

According to the commitments made to the World Trade Organization (WTO) during its 2007 accession, Vietnam only allow the foreign investor to enter into Vietnamese market in respect to the service under the list up which Vietnam committed to open. In the case of not subject to the list, Vietnam has the right to decide to allow a foreign investor to access the market or not on the basis of case by case. That is subject to the approval of the Prime Minister or the managing Ministries depending on the investment capital scale, type of service.

At present, Vietnam did commit on opening up securities service sector under the WTO commitments, accordingly, after 5 years from the date of accession (i.e. January 11th 2007), the foreign investor is allowed to engage in securities service business with establishment of 100% foreign invested capital enterprises and for some limited services, the branches of foreign securities services suppliers shall be permitted. Therefore, the foreign investor from a WTO member country generally speaking, can freely acquire minority/majority shares in domestic enterprises; establish a wholly – owned subsidiary or a branch in Vietnam.

How does the appeal process work in Vietnam?

Under the Penal Proceeding Code of Vietnam, the appeal process will be applied when the first-instance judgments or decisions in such cases are appealed or protested against before they become legally valid.

Under the applicable regulations, the entitled persons, e.g. defendants, victims and their lawful representatives, civil plaintiffs, civil defendants and their lawful representatives, etc… will be entitled to appeal while the procuracy bodies shall have the right to protest against first-instance judgments or decisions.

In case of appeal or protest, the appellants or protestants must send their written appeals to the courts within fifteen days after the date of pronouncement of judgments and the competent court of appeal must open appellate court sessions within sixty days for provincial-level court; within ninety days for Supreme People’s Court after receiving the case files. The appellants must send their written appeals to the courts within fifteen days after the date of pronouncement of judgments. The late appeals may be accepted if plausible reasons can be given that are reviewed and decided by the trial panel of the court of appeal.

Health check-up for work permit: HIV testing result is required?

In Vietnam’s practice, when guiding the foreign employee to have health check, the medical centers often require for the blood test and the HIV testing result is also shown on the health check certificate. That certificate is submitted to the provincial department of Labor, War Invalids and Social Affairs for work permit application. However, that practice does not comply with the laws of Vietnam.

Under the applicable laws, the HIV testing is conducted on the basis of voluntariness of the person to be tested and the compulsory HIV testing in the specific cases required by the laws. The employee has the right to refuse this test. The employer may not request a job applicant to have an HIV test or produce an HIV test result, or refuse to recruit a person on the ground that such person is infected with HIV, except for the case specified by this Law.

Tiền lương đóng bảo hiểm xã hội là bao nhiêu?

Thực tiễn hiện tại là nhiều các doanh nghiệp, đặc biệt là doanh nghiệp sản xuất tại các khu công nghiệp lựa chọn mức đóng Bảo hiểm xã hội cho người lao động bằng mức lương tối thiểu, và thấp hơn tổng tiền lương thực trả hàng tháng. Tuy nhiên nhiều ý kiến cho rằng mức lương đóng Bảo hiểm xã hội phải là mức lương thực trả hàng tháng. Vậy nên hiểu mức lương đóng bảo hiểm theo quy định pháp luật hiện nay là như thế nào?

Regulations on holding a suspicious in Vietnam

I.              Cases of the suspicious person being held

Under the Penal Proceeding Code of Vietnam, the suspicious person may being held under the mode of custody or temporary detention with a certain timeframe depend on each case.

A person who is arrested in urgent cases, offenders caught red-handed, offenders who confessed or surrendered themselves or persons arrested under pursuit warrants, may be applied for custody. Applied for custody means that person will be held for a temporary period when the competent authority opine that it is necessary to apply for the custody, e.g. the custody will support for the investigation or may prevent the suspicious person from continuing to perform the crime or escaping, etc… In other cases, the suspicious person may be allowed to leave, normally after completing the minutes with the competent authority.

Practising Law in Vietnam

A lawyer in Vietnam is entitled to select either of the following forms of legal practice:

1.            Practice in a legal practising organization, implemented by establishing or participating in the establishment of a legal practising organizations; [or] by working pursuant to a labor contract for a legal practising organization.

2.            Practice as an individual meant the lawyer works pursuant to a labor contract for a body or organization not being a legal practising organization.

The legal practising organizations shall comprise (i) Lawyer’s offices and (ii) Law companies

The benefits of a definite-term labor contract employee

Under the Labor Code of Vietnam, when the employer signs a definite-term labor contract with a 12 month fixed term with an employee and this employee will be entitled to the benefits in accordance with this type of labor contract as follows:
Firstly, the laws of Vietnam require the employer and the employee to participate in compulsory social insurance, health insurance and unemployment insurance. The employer and the employee must together contribute 32.5 % of the employee’s gross salary to the social insurance funds.

The responsibility of the Employer for PIT payment

Under the applicable laws on Personal Income Tax (“PIT”), the Employer as the income-paying organization who pays income subject to PIT, must conduct tax declaration and tax finalization in accordance with the guidelines on procedures and documentation in the documents providing guidelines on tax management.

The principles of tax declaration are notably as follows:

i.              The Employer withholds PIT make tax declaration on a monthly or quarterly basis. No tax declaration is required if no PIT is withheld in the month or quarter by the income-paying organization or individual.

Regulatory background on telecommunication

Telecommunication sector in Vietnam is generally regulated by the below legal documents:

- WTO commitment on telecommunication services

- Law on Telecommunication No. 41/2009/QH12 of the National Assembly

- Law on Information Technology No. 67/2006/QH11 of the National Assembly

- Law on Electronic Transactions No. 51/2005/QH11of the National Assembly

- Decree 25/2011/ND-CP of the Government guiding Law on Telecommunication

Under Vietnam’s WTO commitments, telecommunication services are classified into Basic telecommunication services (e.g. Voice telephone services; Packet-switched data transmission services; Circuit-switched data transmission services) and Value-added services (e.g. Electronic mail; Voice mail; On-line information and database retrieval; Electronic data interchange (EDI))

New laws help harness capital inflows

Vietnam Investment Review - New laws help harness capital inflows

On November 26, 2014, the National Assembly passed the new Law on Investment and Law on Enterprises. Both changes were initiated to spur additional foreign investment interest that should commence after the signing of the Free Trade Agreement with the European Union and the Trans-Pacific Partnership (TPP).

Chairman of the Vietnam Chamber of Commerce and Industry Dr. Vu Tien Loc, in a recent conference on the subject of foreign investment in Hanoi, indicated that foreign investment was responsible for creating between 21 per cent and 30 per cent of the social development in the country as well as contributing close to 20 per cent of the gross domestic product of Vietnam. There is no question that foreign investment is of vital importance to the continued growth and prosperity of Vietnam.

Environment protection of small businesses in Vietnam

The obligations on environment protection in respect to the individual, small business, e.g. bar, restaurant business are generally regulated under a number of legal documents, e.g. the Law on Environment protection No. 52/2005/QH11 dated November 29^th 2005, Decree No. 29/2011/ND-CP dated April 18^th 2011 regulating on strategic environment assessment report, environmental impact assessment reports, commitment to environmental protection; Decree No. 117/2009/ND-CP dated December 31^st 2009 on dealing with violation in the field of environment protection (Decree No. 117/2009/ND-CP).

Under the applicable laws on environment protection (Article No. 24 of Law on Environment Protection), the household scaled production, business and service units and objects that are not fallen into the categories required for preparation of Strategic Environment Assessment Reports and Environmental Impact Assessment Reports shall be subject to the commitment to environmental protection made in written form.