Some Modifications on Business Registration from October 10th, 2018

   Decree no.108/2018/ND-CP amending and supplementing a number of articles of Decree No.78/2015/ND-CP effective from October 10th, 2018 has provided many new procedures of business registration.

The new decree stipulates clarification on some contents about the procedure on business registration, of which, the highlight are the procedures that do not to require the seal stamped on the dossier on business registration and that the power of attorney for a person whom establishes the company does not need notarization, authentication at Clause 1 and 2 of Article 1 Decree No. 108/2018/ND-CP. In the past, due to the lack of clarification on the above matters, some competent authorities require to affix the seal on the dossier of business registration and request the notarization of the power of attorney. These procedures created some troublesome in practice.

Another regulation that facilitate the business transaction is that previously enterprises can only set up business locations in the province or city under central authority where their head office or branch is located. It means that if an enterprise wishes to set up another business location where the office is located, it has to go through two procedures: setting up a branch first then setting up a business location. The procedure of setting up a branch is more complex more than the establishment of business locations. With the changes in the decree 108/2018/ND-CP, enterprises are allowed to set up business locations in other provinces or centrally-run cities where their head offices or branches are opened. The scope of work is simpler and more cost-effective, the transactions of the place of business are accounted for by the parent company, thereby reducing the workload for the accountant of the company.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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Conditional Investment Sectors and Investment Conditions in Vietnam

   When setting up a trading company in Vietnam, beside other conditions, the foreign investors have to prove experience in trading area. Areas such as banking, financial services, real estate, security services will require minimum investment. Foreign investment lawyers should be consulted for advice on investment licensing matters.

In general, foreign investors making investment in Vietnam are encouraged. However, there are areas although not prohibited, but are “conditional” areas including the project could affect national defense, security, social order and safety; finance and banking; field that affect public health; culture, information, press, publishing; entertainment services; the real estate business; prospecting, exploring and exploiting of natural resources, ecological projects and the environment; education and training, and professional services i.e. legal, accounting, tax…

The conditions required by Vietnam laws on investment toward the foreign investors are business requirements that the investor must meet after the incorporation of the company, not as a condition for receiving the investment license. However, in the case of a foreign investor applies for an investment license for a new project, the law requires that all business conditions must be satisfied before the grant of the investment license.

Conditions that the foreign investors have to meet when investing in conditional business could be related to the forms of the investment, the nationality of foreign investors, the professional expertise of the investor, the scale of investment projects, type of goods and services, time implementation of investment projects.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have law firm in Hanoi, law firm in Ho Chi Minh City and law firm in Da Nang.

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Which Authority Approves Business Setting up in Vietnam?

    Investment projects in Vietnam could be evaluated and approved for business setting up at top level of the government, at ministerial levels or at the provincial levels.

The licensing authorities for business setting up in Vietnam has been divided to distribute workloads at different state agencies with aim to speed up the process and attract more quality investment projects in Vietnam.

In practice, the process for establishing companies or executing investment projects in Vietnam would take from one month for simple project, three to six month for areas categorized under conditional investment areas, requiring sub-licenses, or additional time for more complicated projects. At the provincial levels, there might be inconsistency between cities and provinces due to different interpretation of laws. For investment project with difficulty to manage, the provincial levels would need to consult with technical department of central government agencies, as such the time taken to process the investment certificate would be lengthen.

Understanding the mechanism and the work division of Vietnam authorities that evaluate and approve business licensing at different government agencies would help foreign investors to smoothen the process and improve their experience in Vietnam.

It is notable that, the government level will be focusing on significant projects, in special area at large investment capital with impact on social economic situations. Most of the investment licensing procedures will be carried out at the provincial levels where the investment projects exist.

The following will point out directions for foreigners to approach respective agencies based on the particular area of interests, scale, and nature of the investment. However, to avoid delay and increase effectiveness, it is advisable that the foreign clients would consult with Vietnam law firms to help advise and represent them in preparing and executing the investment in Vietnam.

I. Projects evaluated and granted investment licensing at government level

Depending on the business nature, industry sector, investment scale, and investment policy, the Vietnam Prime Minister, on behalf of the government will evaluate and approve investment licensing for setting up business.

1. The investment project in Vietnam the government will evaluate and approve regardless of funding, the scale of investment are in the following areas:

a) Development and commercialization of airports and air transport;

b) Development and commercialization of national port;

c) Exploration, mining and processing of oil and gas; exploration and exploitation of minerals;

d) Radio, television;

e) Casino;

f) Production of cigarettes;

g) Establishment of university level educational institute;

h) Establishment of industrial zones, export processing zones, high-tech zones and economic zones.

2. Although investment projects which do not fall under the cases listed above, but the government of Vietnam also evaluates and approves investment project with investment capital of VND 1,500 billion (around USD 75 mil) upwards regardless of funding and in the following areas:

a) Sales of electricity, mineral processing, metallurgical;

b) Construction of railway infrastructure, roads, inland waterways;

c) Production, sales of wine and beer.

3. Further, the government of Vietnam also evaluates and approve investment projects with foreign investment in the following areas:

a) Maritime transport;

b) Establishment of networks and provision of postal services, courier, telecommunication and internet; network setup and signal transmission;

c) Printing and distribution of newspapers; publication;

d) Establishment of independent scientific research.

4. Where the investment projects specified in the above cases are in the plan which the Prime Minister has approved or authorized other agencies to approve, and that the investment projects meet the conditions prescribed by law and treaties to which Vietnam Nam is a member, the agency granted investment certificates perform the procedure for issuance of investment certificates is not required to submit to the Prime Minister to decide on the investment policy.

5. Where the investment projects specified in the above case is not in the plan which has been approved by the Vietnam Prime Minister or authorized other agency to approve, and that the projects do not meet the conditions for market access provisions in international treaties which Vietnam is a member, the agency granted investment certificates shall consult with other of relevant industries and submit to the Prime Minister for investment policy decision.

II. Projects evaluated and granted investment licensing at ministerial level

1. The Vietnam Ministry of Planning and Investment shall evaluate and approve licensing for investment projects in the form of BOT, BTO, BT.

2. Other ministries will be evaluating and granting license for investment in some sectors.

a.Vietnam Ministry of Commerce and Industry shall evaluate and approve licensing for investment project in oil and gas sector;

b. Vietnam State Bank shall grant licensing for financial institutions;

c. Vietnam Ministry of Finance shall be responsible for issuing license for investment project of insurance business.

III. Projects evaluated and granted investment licensing at provincial levels

1. Department of Planning and Investment shall be the single point of contact that receive the application and evaluate the investment plan of the foreign investors wishing to establish business in Vietnam for projects

a. Outside of Industrial Zone, Industrial Processing Zone;

b. Infrastructure development project for Industrial Zone, Industrial Processing Zone which management board of industrial zone and industrial processing zone are not yet established.

2. The management board of Industrial Zone, and Industrial Processing Zone:

a. For investment projects within the Industrial Zone, and Industrial Processing Zone which are not under the authority of the Prime Minister;

b. Infrastructure development project to for industrial zone and industrial processing zone.

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Hau Giang Reduces 50% Investment Licensing Time

   Hau Giang province affirmed to speed up administrative procedures reformation, reducing 50% of the time for granting investment licenses and business registration, creating favorable conditions for investors when they set up business.

In which, Hau Giang province is calling for investment in 7 key projects, including industrial zone infrastructure development, hi-tech agriculture and ecotourism… with a total investment of nearly 300 million USD.

According to the vice chairman of Hau Giang People’s Committee, besides the policies in accordance with general regulations, localities also have their own incentive mechanisms for investors such as tax incentives, land rent exemption and reduction, investment support for manufacturing, preservation and processing facilities…, especially projects for sustainable development of agriculture and high technology application…

Furthermore, Department of Planning and Investment of Hau Giang province affirmed that the local authorities will shorten the maximum time for carrying out procedures, creating favorable conditions for enterprises and investors. Specifically, the business registration procedure is 3 days according to the law, but the locality can complete in 1.5 days. Regarding the investment policy, the law regulates 32 days but it is shortened to 15 days by the locality; time to receive and appraise for issuing investment certificate is only 3 days; discounted 2 days as prescribed.

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Where Foreign Investors Obtain Investment License in Vietnam?

   To set up a business in Vietnam through foreign direct investment, foreign investors need to register the investment license from Vietnam Ministry of Planning and Investment (MPI).

Depending on investment business lines, investment conditions, scale of the projects, where investment project is located, other Vietnam State authorities would be involved. MPI in Vietnam takes charge of developing legislation, guiding, consulting and coordinating with other State authority in regard to all investment in Vietnam. Foreign investors apply for investment license at MPI which is acting as the contact point. People’s Committee will be the government body that administer investment activities within its city or province and issue the investment license to the foreign investor.

In case the foreign investor setting-up a business within an industrial zone, the management board of an industrial zone will have authority over the investment licensing process. For investment project which is larger than VND 300 billion (around USD 14.2 million) or in conditional investment area, MPI and other ministries will be involved in the evaluation process to recommend to the Prime Minister for approval. Other ministries involved in investment project licensing would be Ministry of Trade and Commerce and Minsitry of Finance for setting up a trading company in Vietnam; Ministry of Science and Technology for investment in high-tech projects in Vietnam; Ministry of Education and Training for setting up education institute; Ministry of Health for investment in hospital in Vietnam, etc to ensure they are complying with the specific industry’s regulations.

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What Has Changed in Vietnam Investment Law 2014?

  The new Investment Law 2014 announced by Vietnam Government on December 26th, 2014 has come into effect on July 1st, 2015. The new law introduces changes which include more opening policies for foreign investors to establish and set-up businesses in Vietnam.

What makes foreign investors hesitate to invest and set-up business in Vietnam? The administrative problems and lack of transparency; the inconsistencies in implementing the principle of freedom to do business.

Theoretically, the new Investment Law 2014 will resolve the above mentioned issues by offering a faster amendment mechanism on registering changes or issuing the new Business Registration Certificate or Investment Certificate. Generally, the process and procedures are expected to become more straightforward and convenient for foreign owned companies compared with 2005 Investment Law and the 2005 Enterprise Law by reducing the volume of paper and the administrative works.

In conclusion, the 2014 Investment Law will help clear up some of the confusions that accompanied the 2005 Investment Law and the 2005 Enterprise Law and their application, as well as ease and simplify the foreign investment process which, it is hoped, will promote business activities and investment into Vietnam. The investment of foreign investor into a Vietnamese company in certain situations would be treated in the same manner as a domestic investor that provides an opportunity to offer clients creative structuring solutions to facilitate investment in Vietnam.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have law firm in Hanoi, law firm in Ho Chi Minh City and law firm in Da Nang. 

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Notable Improvements in Vietnam Investment Law 2014

   Vietnam Investment Law 2014 taking effect from July 1st, 2015, replaces the Investment Law 2005 with notable improvements, especially the provisions on business registration in investment projects which foreign investors making investment in Vietnam or setting up business in Vietnam are welcome.

The new Vietnam Investment Law in 2014 has brought up the concept of “business investments” to replace the previous two concepts as “direct investment” and “indirect investment”.

Under the Investment Law 2005, prohibited investment sectors are generally and broadly defined i.e. detrimental to defense and security, national interests which are vague concepts subject to arbitrary explanation of the Vietnam State authorities. The prohibited business activities in the new regulations are listed down specifically. This change has been considered as a huge development which confirm that the foreign investors have the right to conduct investment in Vietnam in the segments not prohibited by law. The new law specifies 267 conditional investment areas which clearly define the restrictions in one document instead of referring to various laws. This shall also avoid different interpretations of the legal enforcement and application of the laws in Vietnam.

According to the Vietnam Investment Law 2005, regardless of the proportion of foreign invested capital, all projects involving foreign ownership are subject to investment certificate. Under the new law, only the projects of foreign investors or enterprises with foreign investment capital contributed 51% of charter capital or more must apply for new registration certificate for the project investment of foreign investment. This is a big step to attract and encourage investment for foreign investors investing in Vietnam through reducing the amount of administrative formalities which foreign investors had to go through.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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How Vietnam Support Start-up Company in Vietnam?

   Start-up company is a topic that is receiving much attention in Vietnam, especially in the context of the country’s strong integration with the world economy. Starting a business is expected to create economic growth, make a positive contribution to socio-economic development. From start-up ideas gradually appears startup businesses in Vietnam. Every year, Vietnam has hundreds of new businesses established, in which the number of small and medium enterprises account for the majority. Because they are small and medium-sized enterprises, it is inevitable to face great competitive pressure from large traditional enterprises as well as competitors.

The identification of small and medium enterprises is the basis for the State to have supportive policies to help enterprises face competitive pressure in the market. Criteria to determine small and medium enterprises include: field of operation, average number of employees participating in social insurance per year, total revenue or total capital of the enterprise.

Firstly, micro-enterprise in the field of agriculture, forestry, aquaculture; industry and construction that has an average annual number of employees who participate in social insurance not exceeding 10 people and the total revenue in the year not exceeding 3 billion VND or the total capital of the year is not more than 3 billion VND. Micro enterprises in the field of commerce and services employing no more than 10 employees per year on average with social insurance contributions and total annual revenue is not more than 10 billion VND or the year’s total capital is not more than 3 billion VND.

Second, small enterprise in the field of agriculture, forestry, aquaculture; industry and construction that has an average annual number of employees who participate in social insurance not exceeding 100 people, total revenue in the year not exceeding 50 billion VND or total capital of the year not exceeding 20 billion VND, except micro-enterprises. Small enterprises in the field of commerce and service that have an average annual number of employees who participate in social insurance no more than 50 employees total revenue in the year is not more than 100 billion VND or total capital of the year is not more than 30 billion VND, except micro enterprises.

Third, medium enterprise in the field of agriculture, forestry, aquaculture; industry and construction that has an average annual number of employees who participate in social insurance not exceeding 200 people, total revenue in the year not exceeding 200 billion VND or total capital of the year not exceeding 100 billion VND but not micro-enterprises and small enterprises. Medium enterprises in the field of commerce and service that have an average annual number of employees who participate in social insurance no more than 100 employees, total revenue in the year is not more than 300 billion VND or total capital of the year is not more than 100 billion VND but not micro enterprises and small enterprises.

Because there are a large number of enterprises in the Vietnamese market, the State has introduced policies to support small and medium enterprises such as technology support, information support, consulting support, supporting human resource development, supporting small and medium enterprises to transform from household businesses, small and medium enterprises to innovative start-ups, small and medium enterprises joining industry clusters, value chains. Small and medium enterprises play an increasingly important role in the economic development of countries around the world. With the ability to create business opportunities and effective jobs, this business model is increasingly encouraged to develop and receive support from state agencies to expand and develop this business model in Vietnam.

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What Foreign Investors Should Know When Setting up company in Vietnam in 2022?

   In the period of global economic integration, especially Post-Covid-19 era, Vietnam – a developing country is considered one of the countries with potential markets that foreign investors choose to establish the business here taking advantage of the government policy to promote the economy i.e. “new normal” adaption living with Covid-19, quick opening of border allowing tourists to visit Vietnam since Apr 2022, tax reduction, public investment increase…

Whom can set up business in Vietnam?

First, the objects allowed to establish and manage enterprises in Vietnam are all organizations and individuals who are not in the following cases: (i) Minors; people with limited legal capacity; incapacitated people; people having difficulties controlling their behaviors; organizations that are not juridical persons; (ii) People who are facing criminal prosecution, kept in temporary detention, serving an imprisonment sentence, serving an administrative penalty in a correctional institution or rehabilitation center, has limited legal capacity or is incapacitated, is not able to control his/her own behaviors, is banned by the court from holding certain positions or doing certain works; other cases prescribed by the Law on Bankruptcy and the Anti-corruption Law. At the same time, individuals with foreign nationality implementing business investment activities in Vietnam are considered foreign investors. The implementation of investment forms; the scope of operation as well as related procedures must meet the conditions under the Investment Law; related legal documents; other conditions of international treaties that Vietnam is a member.

How to invest and set up business in Vietnam?

Second, foreigners, foreign investors must explore legal forms of investment in Vietnam including: (i) Investing in establishing economic organizations; (ii) Invest in capital contribution, share purchase and purchase capital; (iii) Implementing investment project; (iv) Investment in the form of BCC contract; (v) Forms of investment and new economic organizations according to the Government’s regulations. They need to consider projects planning to invest in Vietnam in case of requesting approval of investment policy of 2020 Investment Law. The investment project of foreign investors is required to carry out procedures for granting investment registration certificates. If the case must be proposed to approve the investment policy, they must prepare dossiers and carry out procedures to request approval of investment policies. When completing the procedure, they will be granted a written decision on investment policy and investment registration certificates. If not falling in the case of approval of investment policy, foreign investors conduct procedures for applying for investment registration certificates.

What documents required to set up company in Vietnam?

Third, after being granted a certificate of foreign investment registration, foreign investors shall continue the procedures for enterprise registration. Vietnam laws do not have to limit the type of enterprise to foreign investors, hence investors can choose: One member limited liability Company; Two-member limited liability companies or more; Joint stock company; Partnerships. Each type of business has different advantages and disadvantages, and foreign investors should base on the purpose and investment scale to choose the type of suitable form of investment. In addition, the investment under the conditional business lines need to fully meet the conditions according to the provisions of law. Depending on the type of business, there will be the document requirements that need to register accordingly. And most importantly, foreign investors must prepare necessary conditions and sufficient conditions (validated documents for use in Vietnam, business name, head office address, business line, charter capital, legal representative,…) attached to the understanding and implementation of the order and procedures when they want to establish a certain type of enterprise in accordance with the Enterprise Law 2020.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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What Foreign Investors Should Know When Setting up company in Vietnam in 2022?

    In the period of global economic integration, especially Post-Covid-19 era, Vietnam – a developing country is considered one of the countries with potential markets that foreign investors choose to establish the business here taking advantage of the government policy to promote the economy i.e. “new normal” adaption living with Covid-19, quick opening of border allowing tourists to visit Vietnam since Apr 2022, tax reduction, public investment increase…

Whom can set up business in Vietnam?

First, the objects allowed to establish and manage enterprises in Vietnam are all organizations and individuals who are not in the following cases: (i) Minors; people with limited legal capacity; incapacitated people; people having difficulties controlling their behaviors; organizations that are not juridical persons; (ii) People who are facing criminal prosecution, kept in temporary detention, serving an imprisonment sentence, serving an administrative penalty in a correctional institution or rehabilitation center, has limited legal capacity or is incapacitated, is not able to control his/her own behaviors, is banned by the court from holding certain positions or doing certain works; other cases prescribed by the Law on Bankruptcy and the Anti-corruption Law. At the same time, individuals with foreign nationality implementing business investment activities in Vietnam are considered foreign investors. The implementation of investment forms; the scope of operation as well as related procedures must meet the conditions under the Investment Law; related legal documents; other conditions of international treaties that Vietnam is a member.

How to invest and set up business in Vietnam?

Second, foreigners, foreign investors must explore legal forms of investment in Vietnam including: (i) Investing in establishing economic organizations; (ii) Invest in capital contribution, share purchase and purchase capital; (iii) Implementing investment project; (iv) Investment in the form of BCC contract; (v) Forms of investment and new economic organizations according to the Government’s regulations. They need to consider projects planning to invest in Vietnam in case of requesting approval of investment policy of 2020 Investment Law. The investment project of foreign investors is required to carry out procedures for granting investment registration certificates. If the case must be proposed to approve the investment policy, they must prepare dossiers and carry out procedures to request approval of investment policies. When completing the procedure, they will be granted a written decision on investment policy and investment registration certificates. If not falling in the case of approval of investment policy, foreign investors conduct procedures for applying for investment registration certificates.

What documents required to set up company in Vietnam?

Third, after being granted a certificate of foreign investment registration, foreign investors shall continue the procedures for enterprise registration. Vietnam laws do not have to limit the type of enterprise to foreign investors, hence investors can choose: One member limited liability Company; Two-member limited liability companies or more; Joint stock company; Partnerships. Each type of business has different advantages and disadvantages, and foreign investors should base on the purpose and investment scale to choose the type of suitable form of investment. In addition, the investment under the conditional business lines need to fully meet the conditions according to the provisions of law. Depending on the type of business, there will be the document requirements that need to register accordingly. And most importantly, foreign investors must prepare necessary conditions and sufficient conditions (validated documents for use in Vietnam, business name, head office address, business line, charter capital, legal representative,…) attached to the understanding and implementation of the order and procedures when they want to establish a certain type of enterprise in accordance with the Enterprise Law 2020.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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Vietnam Attracts Japanese Investors

During the volatility of the Covid-19 pandemic, the decision to invest in Vietnam became more and more interesting to Japanese investors.

Since 10 years ago, many Japanese enterprises have considered Vietnam as a promising foreign investment market after China. However, the outbreak of Covid-19 has left serious consequences for the Chinese economy, when a series of the world’s no.1 supply chains in this country were broken. Many foreign investors have chosen ASEAN, including Vietnam to invest, where there is a safe political system and a stable health system, and a favorable legal corridor.

According to the report of the Ministry of Planning and Investment, as of mid-June this year, the total foreign investment in Vietnam reached 15.67 billion USD. Japan ranks 4th among countries with total registered capital to invest in the Vietnam market. In the investment scenarios in Vietnam, finding local businesses becomes a short but effective step. Foreign investors choose potential businesses to invest in or buy back businesses. In which, Saizo is a typical example.

Saizo Japan is a prestigious brand in Japan, famous for its comprehensive range of health care products. During the scientific cooperation at the Center for Scientific Research of Vietnam, realizing the potential for development from products of natural origin, Saizo Japan planned to invest in chain technology, as well as the application of the Japanese biological science and technology background.

Saizo Japan is a prestigious brand in the country of the sun, famous for its comprehensive range of health care products. During the scientific cooperation at the Center for Scientific Research of Vietnam with Master of Science Nguyen Xuan Phu, realizing the potential for development from products of natural origin, Saizo Japan planned to invest in chain technology, as well as the application of the Japanese biological science and technology.

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Investor State Dispute Settlement between Foreign Investor and Host State under CPTPP Agreement and EVIPA Agreement

New-generation FTAs not only limit the field of goods and services but also expand regulation of scope of invesment. The majority of these FTAs include liberalization principles of investment and protection of investor through regulation on dispute settlement mechanism between investor and state (ISDS). The two agreements that have recently been paid attention to are the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) with Chapter 9 of Investment taking effect from January 14th, 2019 in Vietnam and EU – Vietnam Investment Protection Agreement (EVIPA) (from EU-Vietnam Free Trade Agreement – EVFTA) whose all member states are going to ratify before taking effect.

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Firstly, in regard to transparency rule of the dispute settlement, both of CPTPP and EVIPA have provision improving the transparency of the proceedings. Accordingly, all documents (submitted by parties, decision of arbitral tribunal) except for protected information shall be made available to the public. Hearings shall be conducted open to the public for relevant parties to attend. EVIPA has applied the UNCITRAL Transparency Rules while CPTPP does not apply this Rules but only some regulation specified in Article 9.24 (Article 9.24 of CPTPP and Article 3.46 of EVIPA).

Secondly, EVIPA has established a permanent tribunal being different with the ad-hoc tribunal in CPTPP. In EVIPA, investment tribunal system includes two tribunals: Tribunal and Appeal Tribunal. This is the first time there is permanent tribunal in a Investment Protection Agreement of Vietnam.

Thirdly, award of tribunal. In EVIPA, final award shall be obeyed by the parties without appeal, review, set aside, annulment or any other remedy. Vietnam is extended for a period of 5 years following the date of entry into force of this Agreement, or a longer period determined by the Committee. In that time, if Vietnam is the respondent, recognition and enforcement of a final award shall be conducted pursuant to the New York Convention of 1958 (Article 3.57). When 5-year period is expired, recognition and enforcement shall be conducted pursuant to ICSID Convention (without domestic procedures of recognition and enforcement). Diplomatic protection shall not be applied unless one party has failed to abide by and comply with the award (Article 3.58). Meanwhile, according to Article 9.29, CPTPP still allow revision or annulment of award. CPTPP has more enforcement mechanism than EVIPA, including ICSID Convention (without domestic procedures of recognition and enforcement), the New York Convention or the Inter-American Convention (with domestic procedures of recognition and enforcement).

Finally, both EVIPA and CPTPP improve the independence, impartiality and quality of arbitrators or members of the tribunal while issuing a code of conduct them. In EVIPA, this code of conduct is specified in Annex 11, while in CPTPP, this code is not specified but shall be provided later by contracting parties on the basis of Code of Conduct for Dispute Settlement Proceedings under Chapter 28 (Dispute Settlement) (Paragraph 6, Article 9.22 of CPTPP).

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Promote Vietnam-Canada investment under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP)

Within the framework of CPTPP, Vietnam and Canada organized a “Business in Vietnam” Workshop organized by the City of Toronto and the Canada-Vietnam Trade Council in Toronto, Canada to promote investors to invest in Vietnam and set up company and factory.

Through the workshop, the participants discussed the topics “Looking back on a year of implementation of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and opportunities in Vietnam” and “sharing business experience in Vietnam”. The parties assessed the investment opportunities in the field of aviation, information technology, telecommunications, agricultural products and services in Vietnam by Canadian investors.

The Export Development Canada Agency (EDC) representative affirmed that with the favorable demographics and the growing in middle class, the Vietnam economy brings many opportunities for Canadian businesses. Besides, before entering the market in Vietnam, enterprises should prepare to invest time and resources to build sustainable relationships in the local and recommend that Canadian exporters should choose a local representative to import/distribute their products.

The agencies like EDC and TCS (trade support agencies, under the Department of Global Affairs, which has than 1,000 Canadian trade experts) could play an important role in assisting businesses with go to the new market during the term of business. In 2019, Vietnam continues to be Canada’s largest trading partner in Southeast Asia, with two-way trade turnover estimated at CAD 7.8 billion (USD 5.98 billion).

Participants mentioned the potential of cooperation between Vietnam and Canada in the field of finance, in the context of the value of financial services import into Vietnam reaching 523 million USD in 2018. Vietnam’s investment in transport infrastructure – an area where Canada has many strengths – is expected to increase to USD 11 billion by 2020 and USD 17 billion by 2025. This is considered to be “expected land” that businesses of the two countries should promote exploitation.

Representative of Canada-Vietnam Trade Council opined that this seminar attracted the attention from the Canadian Government, the provincial Government of Ontario and especially Canadian businesses because they received many opportunities in Vietnam, a country with a stable economy and strong growth. As part of a cooperation agreement between Toronto and Ho Chi Minh City, the Canada-Vietnam Trade Council in collaboration with the Toronto city is planning a business trip to explore the market of Ho Chi Minh City to facilitate connecting Toronto businesses to access Vietnam market, set up company in Vietnam.

The participants expressed their desire to further promote investment opportunities from both countries. Thereby, it is hoped that in 2020, there will be more Canadian investors investing in Vietnam, which will help the parties improve the effectiveness of long-term cooperation in the future.

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Protecting Invention Abroad via Patent Cooperation Treaty (PCT)

Patent is an intellectual property right which owner could benefit from limited monopoly or commercialize through licensing the patent to others in return for royalty. To protect invention internationally, an inventor may file an international application with a national or regional patent office or WIPO and this aplication must comply with the Patent Cooperation Treaty (PCT) formality requirements. The patent owner should have a patent lawyer to help out with the process of patent registration, and filing an international protection through PCT process.

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What is Patent Cooperation Treaty?

The PCT is an international treaty with 153 Contracting States. This treaty helps the applicant in protecting their invention internationally when filing only one international patent application to be protected in a large number of countries instead of filing several separate national or regional patent applications. The granting of patents remains under the control of the national or regional patent offices in what is called the “national phase”.

The general procedures when filing an PCT application would be:

Filing, International search, International Publication, Supplementary International Search (optional), International Preliminary Examination (optional), National Phase.

With the filing step, the applicant needs to file an international application with a national or regional patent office or WIPO, complying with the PCT formality requirements, in one language, pay one set of fees. Before International Publication, the patent must go through an International Search by an “International Searching Authority” (ISA) (one of the world’s major patent offices). The purpose of this Search is to identify the published patent documents and technical literature which may have an influence on whether invention is patentable. After that, a written opinion on invention’s potential patentability will be issued. Then, the PCT application can go directly to national phase. However, there are two optional steps which applicants may go through: (i) Supplementary International Search (optional), and (ii) International Preliminary Examination (optional). These two steps based on applicant’s request should publish documents which may not have been found by the first ISA and carry out an additional patentability analysis, usually on an amended version of application, respectively.

How long does the PCT process take? Normally, applicant will have 30 months from the filing date of the initial patent application of which they claim priority or up to an additional 18 months from the time applicant files their international patent application before they have to begin the national phase procedures with individual patent offices and to fulfill the national requirements.

At any time, however, applicant may request an early entry into the national phase instead of waiting for the expiration of 30 months from the earliest filing date of their patent application. Once the application has gone into national phase, the time required for the examination and grant of a patent varies across patent offices of each state.

One of the important steps in filing PCT is to make sure the translation into Vietnamese language match up with the original language. Patent attorneys at ANT Lawyers will assist along the process including the translation of the patent and work with the national office of intellectual property in Vietnam to follow the instructions to complete the registration process in Vietnam.

How ANT Lawyers Could Help Your Business?

Please click here to learn more about ANT Lawyers Foreign Investment Practice or contact our Law firms in Vietnam for advice via email ant@antlawyers.vn or call our office at +84 28 730 86 529

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Brief Reminder of Time Schedule to Apply PCT Application into Vietnam

According to Vietnam Law on Intellectual property, a PCT applicant who would like to go into Vietnamese phase after the end of PCT procedures need to submit the application within the following duration:

If an international application designates Vietnam, the National Office of Intellectual Property in Vietnam (NOIP) is the designated office. In this case, in order to enter the national phase, the applicant shall submit, within 31 months from the date of priority, to the NOIP the following:

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Register business in Vietnam

-Written declaration requesting invention registration, made according to a set form;

-Copy of the international application (if the applicant requests the entry into the national phase before the date of publication of the international publication);

-Vietnamese translation of the international application: The description, consisting of a description section, protection request, annotations for drawings and abstract (the published copy or initially filed original application, if the application has not yet been published, and modified copy and explanation of modified contents, if the international application has been modified underArticle 19 of Patent Cooperation Treaty;

-National charges and fees.

If an international application elects Vietnam, the NOIP is the elected office. In this case, if the election of Vietnam is made within 19 months from the date of priority, in order to enter the national phase, the applicant shall submit, within 31 months from the date of priority, to the NOIP the following documents:

-Written declaration request;

-sting invention registration, made according to a set form;

-Vietnamese translation of the international application: The description, consisting of a description section, protection request, annotations for drawings and abstract (the published copy or initially filed original application, if the application has not yet been published, and modified copy and explanation of modified contents, if the international application has been modified under Article 19 and/or Article 34(2)(b) of the Treaty);

-Vietnamese translations of annexes to the international preliminary examination report (when substantive examination of the application is requested);

-National charges and fees.

After having submitted the application, the time when the processing of an international application designating or electing Vietnam in the national phase starts is the first day of the thirty second month from the date of priority if the applicant files no written request for entry into the national phase earlier than the above time limits. The international application shall be put to formality examination and substantive examination according to the procedures applicable to ordinary invention registration applications. If the applicant requests in writing earlier examination of his/her application and pay the prescribed charge, the international application shall be examined earlier than the time limit specified above in accordance with the provisions of Article 2 3(2) of the Treaty.

Please be noted that in addition to the cases where an international application is considered withdrawn specified in the Treaty and the Regulation on implementation of the Treaty, an international application designating or electing Vietnam shall be considered withdrawn if the national fees are not paid to the NOIP or there is no Vietnamese translation upon the expiration of the set time limit.

It is important to adhere to the deadline and patent attorney of ANT Lawyers always follow up with the Client to remind on the schedule to follow when submitting for PCT application in Vietnam

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Regulation On Imposing Anti-Dumping Duty under Vietnam Laws

Imposition of anti-dumping measure includes imposition of provisional anti-dumping duty and official anti-dumping duty. According to Law on export and import duties 2016, anti-dumping duty means an additional import duty imposed upon dumped imports in Vietnam that cause or threaten to cause considerable damage to domestic manufacturing or prevent the formation of domestic manufacturing.

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The imposition of provisional anti-dumping duty is decided by the Minister of Industry and Trade according to the preliminary determination provided by the investigating authority. The rate of provisional anti-dumping duty shall not exceed the dumping margin defined in the preliminary determination. The maximum duration of imposition of provisional anti-dumping duty is 120 days from the days on which the decision on imposition of anti-dumping duty comes into force. In case of the request of an exporter of like products exported to Vietnam, the Minister of Industry and Trade may give an extension of provisional anti-dumping duty up to 60 days. The provisional anti-dumping duty shall be imposed after 60 days since the issuance of the decision on investigation of the Minister of Industry and Trade. The amount of anti-dumping duty paid under decision on imposition provisional anti-dumping duty issued by the Minister of Industry and Trade that is in excess of the payable amount after the official decision of Minister of Industry and Trade shall be refunded to the taxpayer.

The imposition official anti-dumping duty is decided by the Minister of Industry and Trade according to the final determination provided by the investigating authority. The rate of anti-dumping duty shall not exceed the dumping margin defined in the final determination. The maximum duration of anti-dumping duty is five years from the day on which the decision on imposition of anti-dumping duty comes into force, unless it is extended as prescribed in the law.

Two conditions for applying anti-dumping duties are the imports being dumped in Vietnam and the dumping margin must be determined and the dumping causes or threatens to cause considerable damage to domestic manufacturing or prevents the formation of domestic manufacturing. Rules for applying anti-dumping duties include: (1) Anti-dumping duty may only be applied to a reasonable extent to prevent or minimize damage to domestic manufacturing; (2) The anti-dumping duties shall be applied after an investigation is carried out and conform to the investigation conclusion as prescribed by law; (3) Anti-dumping duty shall be imposed upon dumped imports in Vietnam; (4) The application of anti-dumping duties must not cause damage to domestic socio-economic interest.

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Distinguish Assignment of Industrial Property Rights And the Licensing of Industrial Property Rights

According to Law on Intellectual Property in Vietnam, industrial property rights means rights of an organization or individual to inventions, industrial designs, designs of semi-conducting closed circuits, trademarks, trade names and geographical indications, trade secrets which such organization or individual created or owns, and the right to prevent unfair competition.

Accordingly, these rights may be transferred to other organizations and individuals that are not creators or owners of those objects. Transfer of industrial property rights includes two types of “assignment of industrial property rights” and “licensing of industrial property rights”.

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The assignment of industrial property rights means the transfer of ownership right by the owner of such industrial property right to another organization or individual. It means assignor shall have to transfer all the rights of the industrial property object to assignee and after the two parties complete the transfer procedure, assignee shall be fully entitled to make decisions upon that industrial property object. However, when transferring, the parties should pay attention to the following matters: (i) Industrial property right owners may only assign their rights within the scope of protection; (ii) Rights to geographical indications shall not be assignable because this object is physical and cannot be moved; (iii) Rights to trade names may only be assigned together with the transfer of the entire business establishment and business activities under such trade name for instance under merger and acquisitions; (iv) The assignment of the rights to marks must not cause confusion as to properties or origins of goods or services bearing such marks (v) Rights to marks may only be assigned to organizations or individuals who satisfy conditions for persons having the right to register such marks.

Licensing of industrial property objects means permission by the owner of such industrial property object for another organization or individual to use the industrial property object within the scope of the owner’s right. Unlike assignment, licensing of rights is when the owner of industrial property object temporarily grant rights to other organizations and individuals to use their industrial property objects for a definite period of time. Licensing of industrial property rights also has certain restrictions such as (i) The right to use geographical indications or trade names shall not be licensable; (ii) The right to use collective marks must not be licensed to organizations or individuals who are not members of the owners of such collective marks; (iii) The licensee must not enter into a sub-license contract with a third party unless allowed by the owner; (iv) Mark licensees shall be obliged to indicate on goods and goods packages that such goods have been manufactured under mark license contracts; (v) Invention licensees under exclusive contracts shall be obliged to use such inventions in the same manner as the invention owners.

Accordingly, the parties need to understand the purpose, scope and object of transfer of industrial property rights, and thereafter sign corresponding agreements being being assignment of industrial property rights or licensing of industrial property rights. Copyright, trademark, patent lawyers could be of help to provide consultancy and legal advice to ensure the rights and obligations are clearly spelled out to avoid potential dispute in Vietnam during the transfer of industrial property rights.

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Vietnam Expects to Attract High Quality Capital Flow from Sweden

The interest of Swedish investors is opening the future for a new wave of investment from this country to invest in Vietnam.

Although being one of the earliest investor communities present in Vietnam, it is not until recent years that the names of enterprises from Sweden really caught the attention.

If before, when talking about Swedish investment, one could know ABB Group, a corporation established in Vietnam since 1993, which has a factory and focuses on 4 main areas which are electrical products, robotization, automatic technology and power grid. Or another case is Electrolux, Ericsson…

Now, with the rapid opening of the domestic market, the brands from Sweden have become more and more familiar. Referring to Sweden, consumers can now spot famous and familiar brands such as Skype voice and messaging software, H&M fashion brands, IKEA furniture, and Tetra Park in the industrial sector with milk and soft drinks packaging products…

And it is impossible not to mention a brand that is considered a symbol of this country, which is the luxury car brand Volvo. Only started to enter the market of imported luxury cars in Vietnam in recent years, but this brand has quickly attracted the great attention of the middle class in the country.

According to the Swedish Ambassador to Vietnam, Volvo is a symbol, or an important milestone in the promising relationship between Sweden and Vietnam. Although trade or investment turnover between the two countries is still modest, it still increases steadily, similar to the interest of Swedish enterprises for investment and production in Vietnam.

The rapid increase in brands or capital inflows from this Nordic country is even more apparent when looking at statistics.

If the third quarter of 2017, accumulated investment from Sweden into Vietnam only reached over 100 million USD, with Tetra Pak’s new factory with scale of 110 million USD, this capital doubled at the end of the year. Until now, after only one and a half years, this investment has reached 365 million USD, an increase of 3.5 times.

It can be seen that the investment picture of Sweden has changed dramatically and along with that, Vietnam is becoming more and more attractive in the eyes of this nation’s investors and businesses.

The presence of hundreds of large enterprises and leaders of the two countries, the presence of Victoria’s successor Princess, Prince Daniel, Royal Swedish representative at the Vietnam – Sweden Business Summit was held on May 7th 2019 is the clearest evidence for the potential for cooperation in investment and trade between the two countries.

The event was evaluated as a great opportunity for representatives of the top businesses and leaders of the two countries to exchange views, ideas, experiences and share best practices towards mutual benefits.

Speaking at the Conference, the Swedish Minister of Foreign Trade acknowledged there are many reasons to look for current trade and business opportunities in Vietnam, such as high economic growth, the growing middle class, the market opens through many free trade agreements, dynamic business ecosystems…

It is easy to see that Sweden’s investment has increased rapidly over the past time, but has focused heavily on the consumer sector. Therefore, with the appearance of 50 leading Swedish enterprises this time, Swedish capital will join more strongly in Vietnam in the fields of health, transportation, green production and start-up.

Vietnam is starting to embrace a new wave of investment in high-tech fields, areas of high added value and innovation.

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Vietnam and Japan Signed 12 Cooperation Agreements

The Secretary General of Liberal Democratic Party of Japan, the President of Japan – Vietnam Friendship Parliamentary Union- Nikai Toshihiro, on January 12th, 2020 met with the Vietnam’s Prime Minister- Mr. Nguyen Xuan Phuc in Hoi An to discuss economic, cultural and tourist exchange topics.

At the meeting, the representative of Vietnam welcomed the Japanese delegation to come and exchange of economic, cultural and tourism exchanges of the two countries. The representative of Vietnam affirmed that Vietnam appreciate the cooperation with Japan, especially in economic matters. At the moment, Japan is the top country with FDI in Danang in particular and Vietnam in general. The Japanese investors set up company, obtain investment registation certificate and invest in various business lines including IT, trading, real estate, design consultancy, engineering. Based on the cooperation between the countries, Vietnam and Japan have achieved many positive effects on the economy, education, culture, social security.

The representative of Vietnam confirmed that the relationship between the countries developed into many fields as “extensive strategic partnership for peace and prosperity in Asia” established in 2014, in which, Japan always is the trustful, important partner of Vietnam.

The representative of Japan expressed his pleasure to visit Vietnam in the beginning of 2020. He said that the organization of the delegation has the largest scale ever with more than 1,000 delegates, and diverse members from National Assembly deputies, representatives of ministries, branches, local leaders, businesses and people of Japan showed high interest and consensus within Japan from the National Assembly, the Government, localities, business community and people towards strengthening and deepening friendly and cooperative relations with Vietnam in the coming time.

By this meeting, the representatives of the two countries witnessed the signing and exchange of 12 cooperation documents, memorandums of understanding between ministries, branches, localities and businesses of the two countries. By these cooperation documents, the two countries hope that in the future, they will cooperate more together in all aspects of culture, education, economy and society to realize their construction goals and develop the countries.

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Hanoi Topped the Country in Attracting FDI after 7 Months

The Foreign Investment Agency (Ministry of Planning and Investment) has recently released the data on foreign direct investment (FDI) activities in Vietnam in the first 7 months of 2018, in which Hanoi is the province that attract the most FDI with the total registered capital of 6.17 billion USD, accounting for 26.9% of total investment. It shows that Hanoi is an attractive destination for foreign investors

With a total registered capital of 6.17 billion USD, accounting for 26.9% of total investment capital in 7 months, Hanoi surpassed the second place with 4.12 billion USD registered capital of Ho Chi Minh City (accounting for 17.9% of the total investment capital), Ba Ria – Vung Tau with the total registered capital of 2.15 billion USD, accounting for 9.4% of the total investment capital.

To achieve these results, in the past 7 months there have been many large-scale projects registered to invest in Hanoi. Among them is the “smart city” project in Hai Boi commune, Vinh Ngoc district, Dong Anh district, Hanoi with a total investment of 4,138 billion USD invested by Sumitomo Corporation (Japan); The Lotte Mall Hanoi project, with a registered capital of 600 million USD, which is invested by a Korean investor in Hanoi with the goal of building a high-end international standard complex comprising of shopping centers, hotels, offices, apartments for short-term business travelers.

At the conference “Hanoi 2018 – Investment and Development Cooperation”, Hanoi also handed over the decision approving the investment policy and investment registration certificates for 71 projects, with total investment capital of more than 400,000 billion VND (nearly 20 billion USD). Of which, there are 11 FDI projects with a total capital of more than 130 trillion VND (5.428 billion USD). This is a very impressive achievement, the result of the best foreign investment attraction so far and the hallmark of Hanoi in the work of attracting FDI.

According to the Hanoi Statistics Office, in the first 7 months of 2018, the production and business situation of foreign-invested enterprises still maintained a growth rate of 14,791 billion VND, equivalent to 48.3% of the plan, increase by 3.6% over the same period in 2017. This also shows that the prospect of attracting investment in Hanoi in the coming time will continue to flourish.

According to the Foreign Investment Department, across the country, in the first 7 months of 2018, foreign investors have invested in 17 industries, of which the processing and manufacturing sector attracts the most attention of foreign investors with a total of 9.63 billion USD, accounting for 41.95% of the total registered capital. The real estate business ranks second with total investment capital of 5.6 billion USD, accounting for 24.4% of total registered capital. The third is wholesale and retail sector with a total registered capital of 1.69 billion USD, accounting for 7.4% of total registered capital.

In addition, in 7 months, 96 countries and territories have invested in Vietnam. Japan ranked first with total investment of 6.88 billion USD, accounting for nearly 30% of total investment; Korea ranked second with total registered capital of 5.46 billion USD, accounting for 23.8% of total investment in Vietnam; Singapore ranked third with total registered capital of USD 2.73 billion, accounting for 11.9% of total investment capital…

How ANT Lawyers Could Help Your Business?

Please click here to learn more about ANT Lawyers Foreign Investment Practice or contact our Law firms in Vietnam for advice via email ant@antlawyers.vn or call our office at +84 28 730 86 529

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