How Foreign Investors Comply with Reports Submissions in Vietnam

Foreign investors setting up business in Vietnam have to comply with statistics report submissions according to Vietnam laws.  To ensure compliance, corporate lawyers should be consulted to ensure compliance with reports applicable to foreign owned enterprises in Vietnam.

As the current regulation, foreign owned enterprises are obliged to submit monthly, quarterly, six month and annual reports to the Vietnam Department of Statistics or State agency for foreign direct investment of respective province or city.

Monthly reports are applicable to businesses and projects operating in the industry: mining, processing industry, electricity, gas, water supply, waste disposal, water treatment, information and communications, real estate, transport, warehousing, trade and services.

Quarterly reports are applicable to businesses and projects operating in agriculture, forestry and fisheries, construction;

All foreign owned enterprises have to report every 6 months on employment and income of the employee;

On annual basis, all foreign owned enterprises have to submit reports on the identification information of the business; financial indicators reflecting business results including revenue by business lines, taxes, fees, expenses, and profit; and capital investments made during the year by investment sources and investment category.

We at foreign investment practice of ANT Lawyers, a law firm in Vietnam with offices in Hanoi and Ho Chi Minh City would be able to assist clients in regulatory and licensing matters relating to the investment and the operation of the foreign investor enterprises in Vietnam.  We could be reached at email:ant@antlawyers.vn or office tel: +848 35202779.

Source: antlawyers.vn

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Do You Need a Lawyer to Write a Demand Letter for Payment?

Not in every case the Buyer admits to being wrong or responsible for payment as agreed in contract. They may plead substantially contractual breach of the Seller or insist on the null and void of contract for their non-performance of payment. For strengthening arguments, the Seller have to base on legal grounds and evidences to request for payment under contracts. Even if the Buyer is not in good faith, the Seller has right to claim an interest on delayed payment. In a easy case and having a small total amount of payment, you can write a demand letter by yourself. Contrarily, if your case is complicated with a lager damage, an attorney’s advice is probably necessary.

Legal grounds for request the Buyer/ Debtor conforms to the payment obligation as follows:

(i) Contract, purchase order (signed by legal representative of authorized representative);

(ii Applicant laws which is referred in the contract;

(iii) International commercial customs which is referred in the contract: Incoterm, UCP, ISBP (International Standard Banking Practice), etc.

It should be emphasized that the right to claim for payment of the Seller must accompany by their obligations as per contract. If the Seller fails to conform with obligations such as: quality of goods, quantity of goods, time of delivery, manner of delivery, etc that cause miss-achievement of contract purpose for the Buyer, the Seller might disable to claim for payment by laws.

Generally, the Buyer shall make payment punctually with method agreed by parties. Accepting request for postponement of payment performance from the Buyer without any conditions shall be deemed that the payment performance is timely made. As a result, the Buyer shall not be fined for breach. It should be advised that all notifications and responses to acceptance or reject the request for postponement of payment performance must be made in written form as fax, email, mal or instead of oral forms. The more carefully retain evidences, the more effective your demand letter becomes. Then, you can attach them to your demand letters for threatening the Buyer/ Debtor.

In many case, dispute settlement provision provides that “Should there be any dispute as for contract is concerned and this cannot be resolved amicably, by negotiations between parties or through mediation of professionals, the Court of Vietnam shall have exclusive jurisdiction”. In that case, the Seller shall notice the Buyer by a demand letter after the payment term is overdue. A demand letter should be clearly expressed your intention of legal actions.

There are some suggestions that you can follow related to writing a demand letter on the first or second times. If your demand letters do not effectively work, you should request supports from lawyers as soon as possible. They have enough experience in both legal knowledge and technical language skills to press the Buyer/Debtor for payment. Moreover, ANT Lawyers has many experienced professional experts to collect information about finance, legal status… prior to give legal advice. Besides representing our Clients to follow up and negotiate with the Debtor on their action plan to pay the Debt, we can support them to file lawsuits, request the Court of Vietnam to enforce judgments, or submit written requests for initiation of bankruptcy process.

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Forms of Disputes and Approaches to Settlement

Dispute in Vietnam could be between parties in business transaction, foreign investors and Vietnam government, or between countries in implementing international treaties.

The formation of market economy in Vietnam took place in the context of the development in the width and depth of the economic ties at a significant fast pace that make Vietnam an important part of the world supply chain.  Vietnam suppliers could sell the goods and services to the world and the foreign supplier could also export their goods and services to Vietnam market.  Further, as the Vietnam market opens up, foreign investors could invest through various forms of investments in Vietnam i.e. acquire equities in Vietnam companies, establish business in Vietnam.  During this process, disputes are an inevitable result which has been growing in scale and complexity.

Most should agree that disputes shall be construed as the dissent, inconsistencies or conflicts of interests, rights and obligations between the parties in the economic relations at different levels. Accordingly, economic disputes can have the following basic forms:

1. Disputes in business are between the participants in a business transaction including investments, production to consumption of products or performance of services on the market for profit purposes i.e. professional and product liability, debt disputes over a business transaction, franchise disputes, intellectual property disputes, and disputes over contract for supply of goods or services…
2. Disputes between foreign investors with Vietnam government agencies, arising in the implementation of the BTO, BT, BOT, and the implementation of international agreements on promotion and protection bilateral and multilateral investment i.e. government policy and policy measures, concession to water and sewerage, power or energy supply, project or contract payment…
3. Disputes between countries in the implementation of the international bilateral and multilateral agreements.

In Vietnam, as the disputes arise, parties involved could consider resolving the matters through negotiation, mediation, arbitration, or taking court actions after taking consideration of various factors including cost, time, and the complexity of the disputes.  Litigation law firm in Vietnam with skillful dispute lawyers should be consulted to provide the suitable advice for dispute resolution.

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HCMC has 400 household businesses upgraded into firms

There have been 413 household businesses upgraded into firms in HCMC this year as the city has been trying to persuade household business owners to register as companies.

A report on the city’s economic performance showed January-May has seen 15,500 enterprises in the city receiving business registration certificates with total registered capital of VND193.8 trillion (about US$8.53 billion), up 10.4% and 54.2% respectively.

Meanwhile, fresh foreign direct investment approvals, including for mergers and acquisitions (M&A),in the first five months of 2017 in the city have shot up 46% against the same period last year to US$1.37 billion.

South Korea is the city’s biggest foreign investor with total investment pledges of US$95.11 million, 27.8% of the total, followed by Malaysia with US$45.07 million (13.2%), Singapore with US$39.91 million (11.7%) and Japan with US$38.9 million (11.4%).

The city government said that in the coming months, the city will continue fostering the startup ecosystem and support the upgrade of household businesses to companies.

The city looks to have 60,000 enterprises newly registered this year and the total number of firms in the city will rise to half a million by 2020. The total number of sactive firm here at the moment is around 300,000.

A recent report of the HCMC Tax Department showed the city has more than 36,472 household businesses eligible for upgrade to firms. The city expects 21,000 of them to become firms this year.

Once upgraded to firms, household businesses will have the opportunity to expand operations, promote brands, and gain easier access to bank loans and other benefits. In case of losses, they will be exempted from corporate income tax and can carry forward losses to the following years.

Source: The SaigonTimes

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Maritime Insurance: Complexity and Disputes

In the insurance sector, the insurance of goods transported by sea is much more complex and causes most disputes in the process of claim settlement.

Marine  insurance  is  the  insurance  operations  related  to  the  operation  of  the ship, the  human or the  goods are transported on the sea or the  insurance operation risks at sea, on land, in river relating to sea voyage

The import and export activities of Vietnam are growing strong in recent years. Therefore, the revenue from cargo insurance is growing well. Insured clients are companies export and import of goods, logistics companies, shipping companies, the investors and contractors of projects…

Risks for cargo insurance is not high, mainly are risks occurred during transportation.The  loss ratio of the market is quite low, which was 27% in 2012, 21.6% in 2013 were 21.6% (excluding the losses that are being resolved), with the causes mainly are deficiencies and damages in transportation process.

Understanding the principles of the compensation in maritime insurance will help us to limit the disputes.  When incident happen, insurance lawyers in shipping, transportation sector are always called in for advice and dispute resolution.

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Decree No. 30/2013/ND-CP on aviation business and operations

On Apr 8th, 2013, the Government issued Decree No. 30/2013/ND-CP on business air transport and general aviation operations to replace Decree 76/2007/ND-CP dated May 9th, 2007.

The new Decree regulates on conditions and procedures for granting business permits for air transport, general business aviation license for commercial purpose, registration certificate of general aviation operation for commercial purpose, the use of brand, franchise businesses in air transport business and air transport operation enterprises for commercial purposes.

According to this Decree, the age of the used aircraft imported into Vietnam is regulated as following:

a) For passenger aircraft: Not exceeding 10 years from the date of manufacture to the point of entry into Vietnam under the purchase contract, lease purchase contract; does not exceed 20 years from the date of manufacture to the expiry of the leasing contract; 25 years from the date of manufacture to the expiry of the lease contract for helicopters;

b) For cargo aircraft, postal parcels and business aviation for commercial purposes: Not exceeding 15 years from the date of manufacture to the point of entry into Vietnam under the purchase contract, lease purchase contract; not exceeding 25 years from the date of manufacture to the expiry of the lease contract;

c) The type of aircraft other than those specified above: Not exceeding 20 years from the date of manufacture to the point of entry into Vietnam under the purchase contract, lease purchase contract; does not exceed 30 years from the date of manufacture to the expiry of the lease contract.

In addition, the decree also provides for capital requirements:

1. Minimum capital requirement to establish and operate airline air transportation business:

a) Operation upto 10 aircrafts: 700 billion VND (or USD 25m) for airlines to do international air transport; 300 billion VND for airline operators in domestic air transportation;

b) Operation from 11 to 30 aircrafts: 1,000 billion VND for airlines to do international air transport; 600 billion VND for airline operators in domestic air transport ;

c) Operation from 30 aircrafts or more: 1,300 billion VND for airlines to do international air transport; 700 billion VND for airline operators in domestic air transport.

2. Minimum capital requirement for the establishment of the airline business for commercial purposes: 100 billion VND Vietnam.

This Decree shall be effective from the date of 06/01/2013.

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Circumstances in which Foreigners are required to obtain a Criminal Record

In the process to grant the work permit for foreigner working in Vietnam, it is required the foreigner to have the criminal record in their dossier.

Foreigner applying for criminal record to obtain work permit in Vietnam is divided into 2 cases.

In the first case, foreigner who is in foreign country or in Vietnam less than 06 months has to apply for criminal record in foreign country. The laws of each country are not the same therefore the regulation on criminal record application is also different.

Also please note that the criminal record which is issued by another country, when using in Vietnam to apply for work permit, it must be translated, legalized and notarized in accordance with the law of Vietnam.

In the second case, foreigner temporarily residing continuously in Vietnam for 06 months or above can apply for criminal record in Vietnam. In Vietnam, the competent authority that granting the criminal record for foreigner is the Department of Justice of the province or city where foreigner is residing.

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