U.S. firms seek to invest in Danang real estate

HCMC – More than 40 enterprises from the U.S. sought investment opportunities in the real estate sector in Danang City at an investment forum held in the city on April 2. 

The Danang – U.S. Investment Forum was jointly held by the Danang Investment Promotion Agency (IPA Danang) and the Vietnamese National Association of Real Estate Professionals (VNARP) in the U.S., with an aim to help enterprises sound out investment opportunities and forge partnerships. In addition to 40 U.S. companies, the forum was attended by 25 real estate firms in Danang.

At the forum, a representative of U.S.-based Keller Williams Silicon City, a member of VNARP, asked the Danang City government to allow the company to study and invest in a 500-hectare complex providing education, leisure and healthcare services in Hoa Vang District.

Keller William Silicon City has earlier inked a cooperative agreement with Danang Construction Material and House - Building JSC to develop some components of the project.

Hilda Ramirez, CEO of Keller William Silicon City, said she was impressed by Danang’s rapid growth, especially in the resort sector. She and some overseas Vietnamese businessmen have plans to return to Vietnam in the coming time for investment in Danang.

See more: Benefits of Investors in Setting up a Business in Da Nang

Some U.S. companies are interested in projects that the Danang government is calling for investment in and incentives offered by the Danang Hi-Tech Park (DHTP). Jonathan George Hanhan, senior vice president of CSR Commercial Real Estate Service, said his company is interested in the Silicon Valley project in DHTP.

Huynh Duc Tho, chairman of Danang, said the city is promoting investment in tourism and information technology, which have much room for real estate investment.

IPA Danang and the Danang Department of Construction will do their best to support U.S. firms, Tho said, adding that DHTP is offering the best tax incentives in Vietnam.

In addition to learning more about the investment environment in Danang, overseas Vietnamese businessmen also called on Vietnamese businesses to penetrate the U.S. real estate market.

Evan Phong Huynh, executive director of D1 Gateway for Silicon Valley, called on Vietnamese enterprises to invest in the company’s project to develop a US$100 million complex gathering Asian businesses in the Silicon Valley.

Lieu Nguyen, member of the Northern Virginia Association of Realtors, said Virginia and Washington D.C. are the promising land for Vietnamese real estate developers.

According to Michael Q. Le, general director of Robert Mullins International, the U.S. investment policies have become more favorable for Vietnamese investors. As president of the Thua Thien-Hue Union of Friendship Organizations in the U.S., he pledged to support Vietnamese enterprises to do business in the U.S.

The Danang – U.S. Investment Forum is part of the Vietnam trip that will last until April 6 of a U.S. business delegation. After the forum, the U.S. businesses would visit Quang Nam Province.

At present, there are 52 projects invested by U.S. firms in Danang, with investment capital totaling more than US$518 million, accounting for over 16% of the city’s total foreign direct investment (FDI). U.S. firms mainly invest in real estate, finance, trade, tourism, education and hi-tech sectors.

Source: The SaigonTimes

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How to Prepare Application for Anti-dumping Review

The review of anti-dumping measures on imported goods will be conducted by Vietnam Competition Authority (VCA) 12 month from the decision by Ministry of Trade and Commerce is issued

Application dossiers requesting for review of imposition of anti-dumping measures shall including (i) Application and (ii) Other documents and information deemed necessary by the requesting party, in Public and Limited version to be submitted to VCA.

The followings information must be provided by the requesting party at the submission of application for review of the anti-dumping duty imposition:

The status of dumping of imports

This section focuses on the change in the dumping status of imports into Vietnam during the period from the imposition of anti-dumping duty to the time the applicant submits the application.

The information to be provided includes, but is not limited to, expanding / narrowing the scope of the goods subject to the imposition of anti-dumping measures; Type / type of goods, producer / exporter selected to calculate the change in dumping margin, change in margin of dumping, normal price, export price for one or a group of foreign producers/ exporter (Note: The method of calculating the data must be consistent with the methodology which the VCA has guided in the dossier requesting the application of anti-dumping measures.)

Material damages or threaten to material damages

This section identifies evidence of substantial damages / threat of material damages to the domestic industry caused by imported goods dumped into Vietnam for investigation by the VCA, decide according to the actual situation.

Requesting party should provide the following information:

– The situation of importing goods

Information and data on the situation of import of goods subject to anti-dumping measures (amount and value) from the date of application of the anti-dumping measure before the submission of the dossier according to the set form and two (02) years earlier.

– Market share of similar goods domestically produced and imported goods

Comparative information on market share of domestically produced and imported goods shall be subject to dumping from the time of imposition of tax prior to the filing of the application in the form and the previous two (02) years.

– Impact of imports on domestic prices

Information on the impact of imported goods on the prices of domestically produced goods from the time of imposition of tax prior to the submission of dossiers according to the set form and two (02) years earlier.

– The situation of production and business activities of the domestic manufacturing industry

Information on production and business activities of the manufacturing industry from the date of application of the tax prior to the date of application and two (2) years before.

– Invest in upgrading machines and infrastructure to meet domestic demand

Information on fundamental changes in machinery and factory infrastructure is related to changes in capacity and capacity to meet the needs of the Vietnamese market from the time of application of the tax before submission and two (02) years earlier of the domestic industry. Data should be shown in the following table:

Current situation of employers in the domestic industry

Number of employees (or estimated number) engaged in the production, management and distribution of domestically produced goods subject of the investigation.

Inventory fluctuations

The amount and value of inventory requested for the application of the measure anti- dumping domestic production.

Scope of goods subject to anti-dumping measures

– Purpose, reason for requesting exclusion of products imported by the company from the scope of application of anti-dumping measures.

– Information on products the company proposes to exclude from the scope of application of anti-dumping measures: HS code, technical specifications, technology, use purpose, production process, …

– The list of domestic enterprises producing the same products as the imported products of the company.

– List of other importing enterprises jointly importing the company’s proposed goods for exclusion.

– Documents indicating the difference between the company’s products proposed exclusion and similar products domestically produced. If there are quality comparisons, please indicate the source of these quality criteria (e.g.Vietnamese standards sets, internationally recognized standards …).

– Information on alternative sources of imports, the difference between those sources.

– Other information, documents and evidence that the company deems appropriate to explain the exclusion of the product is appropriate.

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Process of Anti-dumping Review in Vietnam

After 12 month from the day on which the decision on imposition of anti-dumping measures is issued, the Vietnam Minister of Industry and Trade may decide to review anti-dumping measures at the request of one or multiple interested parties and evidence provided by them.

The time limit for the review is 06 months from the day on which the decision on review is issued, with a possible extension up to 3 months if necessary.

Within 60 days before the end of one year from the date of issuance of the decision on the imposition of official anti-dumping measures, the related parties may submit the application dossiers for review of anti-dumping measures.

1. Subject of the application:

The following related parties shall have right to submit the application for review of the anti-dumping measures imposition:

• Domestic producers;

• Foreign producers and exporters may submit dossiers for review of the imposition of official anti-dumping measures against themselves;

• Importers of goods subject to anti-dumping measures;

• Governments of foreign producers and exporters which may submit dossiers for review of the imposition of official anti-dumping measures of such foreign producers and exporters.

2. Contents of the application

Contents of the review at the request of related parties

• The dumping margin, the level of subsidy of one, some or all of the foreign producers and exporters;

• Commitments to eliminate dumping and subsidies of one, some or all of the foreign producers and exporters who commit;

• Damages of the domestic industry and the causal relationship between the dumping on goods/ good subsidies of relevant foreign producers and exporters and the damage to domestic industry;

• Scope of imposition of anti-dumping measure and countervailing measure.

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Why foreigners aren't buying houses in Vietnam

There's a wealth of expats and overseas Vietnamese interested in the real estate market, but red tape is putting them off.

“Only a few expats are able to buy houses in Vietnam because there are still so many legal barriers,” said real estate manager Nguyen Chien Thang, counting on his fingers the number of potential foreign buyers who had visited the housing developments he's in charge of in Hanoi over the past two years.

Thang said there is foreign interest in Vietnam's housing market, but it often fades due to the complicated rules and excessive paperwork.

“Expats do not have a clear understanding of the legal procedures here, while some administrative agencies are not used to dealing with foreign buyers,” he said.

Official estimates vary greatly. The Ministry of Construction was widely quoted by local media last August as saying that 750 foreigners had bought houses in Vietnam since a new housing law came into effect two years before. That’s six times more than before, the ministry said in a statement, claiming that the new procedures were “really clear and open.”

The 2015 Housing Law allows foreign investment funds, foreigners with valid visas and international firms operating in Vietnam and overseas to buy unlimited residential properties with leaseholds of 50 years.

Before that they had been only eligible to buy one apartment providing they were either married to a Vietnamese national, held a managerial position or had contributed to the country.

However, earlier this week, Ho Chi Minh City's Department of Construction said only 15 foreigners had bought houses in Vietnam since the new law came into effect.

While the data remains strikingly conflicting, industry insiders have taken the ministry’s statement with a grain of salt.

Sitting in his office overlooking Hanoi’s skyscraper-dotted West Lake, Thang’s own estimate stands in the hundreds, and that’s counting since 2009 when Vietnam first opened its real estate market to foreigners. With 80,000 expats and more than four million overseas Vietnamese, that’s virtually an untapped gold mine.

“The expat community living and working in Vietnam is large, while the number of overseas Vietnamese is huge,” he said. “Many of them have money and want to own houses in the country, but only a small number are able to do it.”

The shortage of publicized projects that foreigners are eligible to buy is one of the biggest obstacles, according to industry insiders.

According to the Housing Law, developers can sell a maximum of 30 percent of units in an apartment building to foreigners, and a maximum of 250 houses in a ward. Areas considered sensitive to national defense and security are off-limits to foreign buyers.

Given the restrictions, authorities are required to publicize housing projects eligible for sale to foreigners, but in practice they don’t.

Another barrier facing foreigners and overseas Vietnamese is the lack of property title insurance, a standard document issued in many countries, said economist Nguyen Tri Hieu, who is an overseas Vietnamese.

Because of this, Hieu, who returned home eight years ago after living in the U.S. for 30 years, has been unable to buy a house.

“Unlike Vietnamese people who buy houses with their savings, expats often need bank loans," he said. “However, foreign banks will only offer a mortgage if their customers can provide property title insurance, which is unavailable in Vietnam, so they are unable to access credit.”

Hieu said many overseas Vietnamese want to buy houses in their home country. “Many old people buy houses so they can spend the rest of their lives in their homeland, while young people want to invest in the lucrative property sector.”

Hot market

In a move aimed at attracting more foreign buyers, the Ministry of Planning and Investment tabled a draft law in August suggesting that foreigners should be offered leaseholds of 99 years in special economic zones.

Vietnam has 18 special economic zones and is developing more in Quang Ninh Province near the Chinese border, the central province of Khanh Hoa, and Phu Quoc Island in the southern province of Kien Giang.

Industry insiders believe that removing more barriers would create more interest in the local housing market.

Vietnam is becoming one of the region’s hottest property markets for Hong Kong and mainland Chinese investors, as prices continue to go through the roof at home, according to the South China Morning Post.

More than 300 potential individual investors recently attended a two-day Vietnam property investment seminar in Hong Kong .

Encouraged by fast economic growth, supportive government policies and low entry costs, housing prices in the country’s two largest cities, Saigon and Hanoi, have seen considerable growth in recent years.

In Saigon, new apartment prices grew 6.9 percent in the first quarter of 2017, and 7.3 percent in Hanoi, data from real estate firm Jones Lang LaSalle shows.

It now forecasts 8 to 10 percent annual growth in residential value in the country’s major cities this year.

“On the back of its economic improvement and with a GDP target of 6.7 percent in 2017, market sentiment is very positive,” said Stephen Wyatt, the country head of JLL Vietnam.

“Foreign buyers typically like the new urban districts such as Ho Chi Minh City’s District 2 and District 7,” he said. “And many investors from mainland China are hoping to see these cities replicate the same growth as Beijing and Shanghai.”

There is also a trend to buy second homes in coastal areas such as Da Nang, he added.

Neil Jensen, a financial industrial worker from Malaysia, said Vietnam would be an ideal property market for investors if legal procedures are improved.

He is looking to buy a condominium in Saigon to lease to overseas workers there.

“I will do it only when legal procedures are clearer and opener," Jensen, 34, said. "I don’t want to take risks.”

Source: evnexpress

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Vietnam emerging as attractive destination for foreign property investors

Property prices in Vietnam are among the best value in Southeast Asia.

Vietnam has emerged as a favored destination among foreign firms looking to invest in property, with prices standing at among the best value in Southeast Asia.

Last year, Japanese investors Nishi Nippon Railroad and Hankyu Realty hooked up with a local property firm to develop a residential project with total investment of $350 million in Ho Chi Minh City. Half of the funding came from the two Japanese firms, while the rest was put up by their local partner.

Japan’s Mitsubishi Corp. has also diversified its portfolio in Vietnam by buying into a property development project in Hanoi, which has total investment of $1.9 billion.

The company signed a partnership deal with Vietnam’s Bitexco Group after acquiring a 45 percent stake in the first phase of the former’s The Manor Central Park project in Hoang Mai District. Bitexco holds the remaining 55 percent.

This foreign interest has been attributed to high property prices in their home markets, which makes them less attractive to investors, while prices in Vietnam are still low but rising rapidly.

Luxury flat prices in cities like Hanoi have been trending upwards since 2015 but have yet to catch up with other vibrant economic hubs in Southeast Asia, South China Morning Post quoted Kingston Lai, founder and chief executive of the Asia Banker’s Club, as saying.

Luxury flat prices in Hanoi were up 50 percent in the 10 year period to 2016, while mid-market flats were up 80 percent during the same period, Lai quoted figures from real estate firm CBRE as saying.

“Today, quality residences in Hanoi’s city center, on average, are sold at only around HK$1,500 ($191.32) per square foot (100 square feet = 9.3 square meters), half of Bangkok’s level,” Lai said.

“Prices of high-quality housing will catch up with neighboring cities amid the gradual completion of infrastructure such as railways and airport expansion, and as more foreign corporations bring investments to the market,” Lai added.

There are many other factors driving foreign investment in Vietnam’s real estate market including its fast-growing economy, rapid urbanization and expanding middle-class, which is growing at the fastest pace in Southeast Asia, according to HSBC.

The bank projects Vietnam's middle class will jump from 12 million people in 2012 to 33 million by 2020.

A loosening of restrictions in the country's regulatory environment has also helped boost sales.

Last year, Vietnam eased restrictions on foreign property ownership to improve market liquidity.

The amended law went into effect in July of last year and allowed foreign investment funds, foreigners with valid visas, international firms with operations in Vietnam and overseas Vietnamese to buy residential properties.

The Vietnam Real Estate Association (VNREA) has forecast a promising outlook for the local real estate market as demand from foreign buyers drives market growth.

The number of foreigners living in the country has reached 320,000, according to the property association.

Investors with business interests in Vietnam are the most likely to buy local properties because they are attracted by potential returns of between seven and eight percent here, according to the VNREA.

Bright prospects

Neil MacGregor, managing director of property firm Savills Vietnam, said Savills expects to see a considerable amount of inbound investment into real estate in 2018, with strong interest from Japan, Korea, Singapore and increasingly China.

He said that existing free trade agreements and the ongoing discussions regarding the Regional Comprehensive Economic Partnership (RCEP), involving China, are all important drivers for continued investment.

“We have seen that trade with countries such as Japan and Korea typically comes together with FDI, importantly fueling investment into infrastructure and real estate,” he added.

Vietnam’s actual foreign direct investment reached an estimated $17 billion in 2017, the highest annual amount ever recorded by the country, according to the Foreign Investment Agency.

South Korea was the country’s biggest investor out of more than 100 countries and territories, with registered capital worth $57.5 billion, followed by Japan and Singapore.

Sharing MacGregor's opinion, Lai said: “Apple, Samsung and Microsoft have set up major plants near Hanoi, with Samsung contributing 22.7 per cent to the country’s exports in 2016. Their employees are target renters for overseas investors.”

However, it remains challenging for foreign investors to identify quality real estate investments with clear ownership, and transactions involving operating assets will remain scarce, said Neil.

Foreign investors pledged to invest $312.1 million in Vietnam’s real estate sector in the first two months of this year, according to the Foreign Investment Agency.

The sum represented 9.3 percent of pledged foreign direct investment in the country in January and February

Source: The Saigon Times

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Infringement of Intellectual Property Rights Under Vietnam’s Criminal Code

For the purpose of ensuring legitimate interest of manufacturers as well as consumers, reduction and elimination unfair commercial competition, the Vietnam government has been increasingly focusing on protection of intellectual property (IP) rights. This is expected to contribute to technical enhancement in domestic production industry, foreign investment attraction, reduction of IP infringements in Vietnam.

Intellectual property rights always plays an important role in international trade agreements which Vietnam has been a contracting party, especially ASEAN and WTO. The WTO requires its members to impose penalties or fines, or both, to prevent acts of intellectual property infringement for commercial purposes, in accordance with the penalty applicable to the crime of corresponding severity.

In order to consolidate and protect the social order; punish crimes; raise people’s awareness of compliance with the law; prevent and fight crimes, Vietnam has legalized sanctions for infringements of intellectual property rights under administrative, civil and criminal measures.

The Criminal Code 1999 (amended and supplemented in 2009) regulated provisions on “Infringement of industrial property rights” (Article 171). The criminal sanctions for infringement of intellectual property right are regulated in Article 225 and Article 226 of the Criminal Code 2015.

Regarding the subject of infringement of intellectual property rights, the offenders shall be (i) person who is at the sufficient age to bear criminal responsibilities; or (ii) corporate legal entity as defined in the Civil Code.

The effective protection of intellectual property rights will be an important factor that protect the interests of consumers, manufacturers, eliminating “distortion” of competition and commerce. In common playgrounds, Vietnam as well as other member countries must strictly comply with the regulations on IP issues to integrate into global economy.

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Japanese firms interested in tourism and IT in Danang

DANANG – A delegation of Japanese businesses has visited the central city of Danang to sound out investment opportunities in the tourism and information technology (IT) sectors.

The delegation of the Japan-Mekong Business Cooperation Committee (JMBCC) comprising businesses active in tourism, aviation, IT and banking held talks with leaders of Danang City on March 14 to promote trade and investment ties.

At the meeting, JBMCC chairman Yoichi Kobayashi said Japanese firms highly valued the potential of tourism and IT cooperation with Danang. But they worry about the shortage of high-skilled workers in the city, especially those who speak Japanese.

Danang chairman Huynh Duc Tho said the city is seeking cooperation with its partners to address the worker shortage.

Tho said the city has achieved growth of about 20% in recent years, putting pressure on tourism infrastructure. He proposed Japanese businesses invest in leisure, exhibition and environmental protection projects.

The Danang leader suggested Japanese firms active in electronics, software, nanotechnology and environmental technology invest in the Danang Hi-Tech Park which offers numerous incentives to investors.

As of late 2017, US$629 million of US$3.04 billion in total foreign direct investment approvals in Danang had come from Japanese firms. The city welcomed 2.3 million foreign tourists last year, with 140,000 visitors from Japan.

Source: The Saigon Times

See more: Why Da Nang is a Place for Setting up Business?

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Vietnam to benefit from sweeping trade deal

Vietnam and 10 other countries including Japan and Canada signed a landmark Asia-Pacific trade pact without the United States last week in what the World Bank said would greatly benefit the Vietnamese economy.

The Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) will bring huge economic benefits to Vietnam, according to a World Bank (WB) report released last Friday after 11 Pacific Rim countries signed the agreement in Santiago, Chile.

The report on economic and distribution impacts of the CPTPP showed that the pact will further boost Vietnam’s investment and export-driven growth model. Even under conservative assumptions, the CPTPP would increase Vietnam’s gross domestic product (GDP) by 1.1% by 2030. Assuming a modest boost to productivity, the estimated increase of GDP would amount to 3.5%, said Ousmane Dione, the WB country director for Vietnam.

All workers are expected to benefit from the agreement, especially higher-skilled ones in the top 60% of the income distribution. Moreover, the increase in foreign investments will lead to a further expansion of the service sector and boost productivity growth, said the report.

It is also expected to create opportunities for domestic private firms to integrate into global value chains, promoting the development of small and medium enterprises.

Sebastian Eckardt, the WB chief economist in Vietnam, said the new trade agreement would bring direct benefits to Vietnam from trade liberalization and improved market access. Most importantly, it would help stimulate and accelerate domestic reforms in many areas such as competition, services, customs, e-commerce, environment, government procurement, intellectual property, investment, labor standards and legal issues.

He added that delivering commitments under the CPTPP will promote transparency and support the creation of modern institutions in Vietnam.

The CPTPP was earlier known as Trans-Pacific Partnership (TPP) from which President Donald Trump withdrew the United States shortly after he was sworn in early last year.

Chilean Minister of Foreign Affairs Heraldo Munoz called the deal a powerful signal against protectionism and trade wars. It is aimed at cutting tariffs among the member countries and removing non-tariff barriers.

The new deal consists of mechanisms to deal with disputes between governments and enterprises which allow firms to file lawsuits against governments if law amendments affect their profits.

The CPTPP comprises Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. The Asian member countries are seen reaping more benefits from the deal.

The Peterson Institute for International Economics estimated the CPTPP would increase Malaysia’s, Singapore’s, Brunei’s and Vietnam’s GDP by 2% by 2030 while the rate will be some 1% for New Zealand, Japan, Canada, Mexico, Chile and Australia.

Australian Prime Minister Malcolm Turnbull said 20 provisions initiated by the U.S. had been suspended in the freshly signed deal. Therefore, it would be hard for the U.S. to re-enter the agreement.

The trade pact is set to take effect in early 2019 after it is ratified by at least six member countries.

Vietnamese Minister of Industry and Trade Tran Tuan Anh said on the ministry’s website that Vietnam commits to open up its market, lift tariff barriers, facilitate trade, and streamline State management of market development.

Through the agreement, he noted, the competitiveness of the Vietnamese economy and businesses will be boosted. 

The pact would facilitate capital flow into Vietnam thanks to reforms in all sectors. Sectors like garment/textile, footwear, food processing, beverage, confectionery, tobacco, wine and beer will benefit most from the deal.

However, the country will have to fulfill its integration commitments, and implement reforms towards sustainable development and higher added value, Anh said.

Before the signing of the CPTPP, some other economies such as Thailand, Indonesia, the Philippines, South Korea, Taiwan and the UK. had expressed interest in joining the trade bloc. Despite the U.S. withdrawal, the CPTPP now accounts for 14% of global GDP and one-sixth of global trade, and involves 500 million consumers, even larger than the European Union’s population.

The agreement retains the high standards, economic significance and integrity of the TPP while ensuring the commercial and other interests of all the signatories. Up to 95-98% of taxes will be exempted as soon as the CPTPP takes effect, instead of five to seven years as stipulated in bilateral trade agreements.

Vo Tri Thanh, former deputy director of the Central Institute for Economic Management (CIEM), said the CPTPP would force Vietnam to make drastic legal reforms to create a more competitive business environment and prop up its competitiveness.

The 11 members reached a broad agreement lVietnam to benefit from sweeping trade dealast November and ag

Source: The Saigon Times

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Japanese firm hopes sun will shine on new solar power plant in Vietnam

The 50-megawatt plant will cost nearly $50 million in Vietnam’s Gia Lai Province.

A Vietnamese electricity company has signed a deal with Japanese engineering company JGC to design and build a 50-megawatt solar power plant.

The deal, signed by Gia Lai Electricity, is estimated to be worth over 5 billion yen ($47.4 million), with the facility to be set up in Gia Lai Province by November, according to the Nikkei Asian Review.

It's the second deal to be signed with Vietnam since the government introduced a feed-in tariff program in March 2017.

Vietnam is accelerating the construction of solar power plants to make up for an anticipated power shortfall due to the recent cancellation of several nuclear power projects.

The government is trying to nurture solar energy as the country's main source of electrical output. Solar power currently accounts for 0.01 percent of the country's total power output, but the government plans to increase the ratio to 3.3 percent by 2030 and 20 percent by 2050.

The cost of solar panels is falling, and the government is expected to introduce a system of buying excess solar power.

The Vietnamese government had planned to build two nuclear power plants with Russia and Japan, but the plan was cancelled in November 2016 due to the hefty up-front costs of several billion dollars for each reactor.

Investing in renewable energy is an emerging trend in Vietnam, and projects worth billions of dollars have been registered across the country.

An increasing demand for energy and limited reserves of fossil fuels are the first reasons for this new investment trend in Vietnam, said Nguyen Anh Tuan, a senior energy official at the industry and trade ministry.

With the development of new technologies, the cost of producing clean energy has dropped from VND3,500 to VND2,200-2,500 per kilowatt-hour (kWh), Tuan said.

He added that government incentives for solar power projects are another reason for this trend. The government has raised its buying price from 7.8 to 9.35 U.S. cents/kWh, while offering investors tax breaks and cutting land use fees.

Vietnam currently relies mainly on coal and hydroelectric power generation. The country is aiming to produce 10.7 percent of its total electricity through renewable energy by 2030, mainly through solar and wind energy, up from the 6 percent as previously planned.

Source: evnexpress

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Intellectual Property remains a big challenge for Vietnam under CPTPP

At an informal meeting of representatives from 11 countries (without US) taking place on the Asia-Pacific Economic Cooperation (APEC) dated on November 10th, 2017, the parties agreed to change from Trans-Pacific Partnership Agreement (TPP) to the Comprehensive and Progressive Partnership for Trans-Pacific Partnership (CPTPP).

Accordingly, the CPTPP contains 8,000 pages of documents, but only 20 articles of the TPP agreement, including 10 articles related to intellectual property (IP) and 4 points are reserved for the parties to negotiate in next time. Each member will list its delimited list of restrictions of their country.

According to the Vietnam Minister of Industry and Trade, CPTPP still guarantees a quality agreement like TPP-12, while ensuring new equilibria for member countries. The content of the CPTPP is not only about trade, investment, but also on intellectual property (albeit temporarily postponed) and other broad areas.

With CPTPP, Vietnam may not be the most beneficiary country like the proposed TPP, but it is still very important, because it brings together many of the criteria associated with reform, particularly institutional reform, improving the investment climate, business.

Vietnam law on Intellectual Properties will need to be amended because the legal system of Vietnam’s IP is not consistent with the legal system of developed countries. The Law on Intellectual Property of Vietnam, after many proposals, has not yet been approved by the National Assembly. Meanwhile, the amended Law on Technology Transfer, though approved in June 2017, still lacks specific guidelines on technology transfer.

Intellectual property rights in the TPP not only contain general provisions and requirements relating to areas of cooperation, patents, test data, designs, trademarks, geographical indications or copyright but also focuses on the legal enforcement of this right by nations.

The CPTPP is based on agreed commitments at the TPP, which are particularly important in paving the way for Vietnamese goods to penetrate into the members’ markets.

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Foreign investors register to invest 1.25 billion USD in January

Foreign investors registered to invest nearly 1.25 billion USD in Vietnam in January, which will include funding for new projects, in addition to existing projects and buying stakes in projects, which will equal 75.9 percent, compared to the same period last year.

In January, the disbursement of foreign direct investment (FDI) saw a positive increase of 10.5 percent to 1.05 billion USD year on year, according to statistics from the Ministry of Planning and Investment’s Foreign Investment Agency.

A number of large projects were granted licences during the month, including Kefico Vietnam Company Ltd, which was allowed to add 120 million USD in investment capital; Vina Cell Technology Company Ltd, which added 100 million USD; the Nam Dinh Ramatex Textile and Garment Factory project with total capital of 80 million USD in Nam Dinh province, funded by a Singapore investor; and Jotun Paint Company Ltd in HCM City, invested by a Norwegian investor with funds of 70 million USD.

Out of 125 countries and territories with FDI projects in Vietnam, the Republic of Korea was the most significant investor with 58.1 billion USD, accounting for 18.1 percent of total capital. Japan was in second place with 49.46 billion USD at 15.4 percent, followed by Singapore, Taiwan, Britishvirgin Island and Hong Kong.

In terms of investment in foreign countries, Vietnam granted licences for investments in foreign countries for six projects in January, with a total investment capital of 6.46 million USD.

Three of these projects were in retail and wholesale areas, while the remainders were in the fields of processing and manufacturing, residential services and science and technology.

The projects are being conducted in Canada, Campuchia, New Zealand, Germany, Belize and Myanmar.

- dtinews -

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Penalties on Working Without Work Permit in Vietnam

Vietnam has become an attractive destination for foreigner investors due to the impressive development of socio – economic in recent years. This is such a good opportunity for Vietnamese enterprises to get cooperation in business with foreign partners.

To take advantage of the opportunities to be the pioneer and market share, many of them have demand in employees with good skills and qualifications. To meet these requirements, more and more companies hire foreign workers for specific positions which might lack of human resources within Vietnam territory.

According to Labor Code 2012, the employer wishing to recruit the foreign workers has to explain their labor demand to the People’s Committee of provinces and obtain written approval from this agency. Pursuant to this written approval, the employer shall submit the application for the work permit to the Department of Labor, War Invalids and Social Affairs of the province where the planned working place of such foreign workers is located.

Work permit in Vietnam

A foreign citizen wishing to work in Vietnam must fully meet the following conditions:

Possessing full civil act capacity;

Possessing technical and professional qualifications and skills and health appropriate to the work requirement;

Not being a criminal or subject to penal liability examination according to Vietnamese and foreign laws;

Possessing a work permit granted by a competent Vietnamese state agency, except the cases specified in Labor Code.

Therefore, based on regulations of the Labor Code of Vietnam, except for the foreign citizens exempted from work permit i.e. investor of company established in Vietnam, all of cases the foreign citizens wishing to work in Vietnam shall be subject to work permit application. A foreign employee shall produce his/her work permit when carrying out immigration procedures or upon request of a competent state agency.

In case foreign citizens who do not belong to work permit exemption being found working in Vietnam without work permit, that person shall be considered violation of the law of Vietnam. In addition, the employer that uses the violated employee without work permit shall be punished accordingly.

According to Decree No. 95/2013/ND-CP amendments to the government’s Decree No. 95/2013/ND-CP dated August 22, 2013 on Penalties for administrative violations against regulations on employment, social insurance, social insurance, and Vietnamese guest workers:

i) Foreign citizen that working without work permits, except for the cases in which the work permit is exempt shall be expelled.

ii) Employers who employ foreign workers in Vietnam without work permits or certificates of exemption from work permits, or employ foreign workers using expired work permits shall be implied:

a. A fine from VND 30,000,000 to VND 45,000,000 if the violation involves 01 – 10 workers;

b. A fine From VND 45,000,000 to VND 60,000,000 if the violation involves 11 – 20 workers;

c. A fine From VND 60,000,000 to VND 75,000,000 if the violation involves more than 20 workers;

Additional penalty: The employer who commits the violation mentioned herein shall have its operation suspended for 1 – 3 months.

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From January 1, 2018, the license for import business is legally required for automobiles vehicle import

This is one of the provisions laid down in the Decree No. 116/2017/ND-CP prescribing statutory conditions for manufacture, assembly, import of automobiles vehicles and trade in automobiles vehicle maintenance and repair services.

Pursuant to this Decree, from January 1, 2018, enterprises will be allowed to import automobiles vehicles only if they satisfy statutory conditions and have already obtained the license for automobiles vehicle import business in accordance with applicable regulations. 

In order to obtain this license, enterprises are required to:

- Legally own, contractually lease or authorize automobiles vehicle servicing premises that conform to prescribed requirements.

- Have a confirmation or document evidencing that they are entrusted to act on behalf of foreign automotive manufacturing and assembling enterprises to recall automobiles vehicles imported in Vietnam.

Application documentation for the license is discussed in detail in the Decree No. 116/2017/ND-CP set to commence on October 1, 2017.

Source: Thuvienphapluat .vn

See more: Process Setting-up Foreign Owned Import Export Business in Vietnam

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Regulations on items not subject to VAT amended

This is one of the highlights of the Decree No. 146/2017/ND-CP amending the Decree No. 100/2016/ND-CP and the Decree No. 12/2015/ND-CP on Value-Added Tax (VAT) and Corporate Income Tax (CIT).

- They are mineral resources which have yet to be processed or transformed into other products;

- They are goods which are made directly from main materials that are mineral resources, and which have the aggregation of value of such mineral resources plus the energy cost that accounts for at least 51% of their production cost, except to the extent that:     

+ Such exported products are finished products produced from other intermediate products which are made from mineral resources.

These mineral resources may be directly extracted and processed into, or purchased for further production of, or processed by hiring other toll manufacturers into, exported products, by business establishments.    

+ Such exported products are final products made from main materials which are other than mineral resources (these mineral resources have been processed into other products).

The Decree No. 146/2017/ND-CP is set to commence on February 1, 2018.

Source: Thuvienphapluat .vn

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04 important things that enterprises must take into consideration in 2018

The policies and guidelines in effect from 2018 which may have significant influence on enterprises, including:

1. Simplification of documentation required for application for enterprise registration:

This is a guideline set out in the Resolution No. 136/NQ-CP dated December 27, 2017 on the plan to simplify administrative procedures and citizen's papers related to management of residents under the jurisdiction of the Ministry of Planning and Investment.

Accordingly, documentation requirements and contents of application and declaration forms necessary to apply for registration of establishment of enterprises will be subject to changes in the coming time, specifically including:

- Repealing the documentation requirement such as “Citizen Identification card, ID card, passport or other legally-required documents" for application of registration of enterprises.

- Replacing certain personal identification information by “personal identity numbers" existing in sample forms and declarations required by enterprise registration formalities.

Additionally, the Resolution provides a guideline to cancellation of the requirement for submission of personal identification documents in several formalities for outward and inward investment in Vietnam.

2. Support policies for Small and Medium-sized Enterprises

From January 1, 2018 the 2017 Law on Support for Small and Medium-sized Enterprises enters into force and provides a number of support policies for these enterprises, specifically including:

- Credit access support: Establishing the Credit Guarantee Fund to grant guarantee for corporate credit;

- Tax and accounting support: Allowing enterprises to apply the CIT rate in the definite term which is less than the one normally applied to other enterprises.

- Production premise support: Allocating unoccupied land for development and construction of industrial clusters, agricultural, forestry and aquacultural product processing zones; granting subsidies for the price of land lease for industrial parks, hi-tech parks and industrial clusters operating in local jurisdictions.

- Technological support; support for incubation centers, technical centers and shared working places: Supporting technological innovation and development; granting exemption from and reduction in land rental, non-agricultural land use and corporate income tax.

- Market expansion support: Establishing product distribution chains.

- Information, consultancy and legal support: Permitting enterprises to have access to information through the national portal for corporate support; granting exemption from and reduction in consultancy costs charged for use of consultants’ services.

- Personnel development support: Granting relief from costs of participation in business and business management training courses.

Especially, the Law prescribes particular policies intended for enterprises transformed from business households and small or medium-sized startups.

3. Elimination of a great number of business requirements

The Decree No. 08/2018/ND-CP provides for removal and reduction of a lot of business requirements in such sectors as oil and gasoline, cigarettes, electricity, commercial franchising, electronic commerce, chemical, industrial explosive and food. Below are typical examples:

- Elimination of certain requirements concerning oil and gasoline manufacturing and business;

- Elimination of requirements concerning the franchisee party involved in commercial franchising activities;

- Repeal of the requirement saying, "it is mandatory that websites must have legitimate domain names and conform to regulations on management of information available on the Internet”, which is one of the requirements for establishment of e-commerce websites for sale of commodities and provision of services.

The Decree No. 08/2018/ND-CP will enter into force from January 15, 2018.

4. Requirements for granting business licenses to foreign investors

The Decree No. 09/2018/ND-CP entering into force from January 15, 2018 has laid down provisions on innovation of requirements for granting the license to purchase and sell goods to foreign investors, specifically including:

- Covering more persons eligible for being granted the business license, including foreign investors who do not belong to member countries or territories of international treaties of which Vietnam is a member (in contrast to the previous regulation under which only foreign investors belonging to member countries of international treaties of which Vietnam is a member are eligible for such business license).

- Covering more goods and services which are eligible for the business license, including those which are not endorsed in international treaties of which Vietnam is a member (in contrast to the previous regulation under which only goods or services in which Vietnam is committed to open the market are eligible for such business license).

In each of the aforesaid cases, foreign investors are bound to meet certain requirements and criteria.

Source: Thuvienphapluat .vn

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