Property sector lures over US$800 million in FDI in Jan-May

HCMC – The first five months of the year saw foreign direct investment (FDI) enterprises pouring a total of US$806.5 million into the real estate sector, making up 11.3% of all fresh FDI approvals, according to local media reports.

The newly approved projects have total capital of US$623.3 million.

Most investors were keen on the high-end property segment given multiple incentives. According to experts, foreign investors have a lot of experience in mapping out, developing and operating high-end real estate projects.

Su Ngoc Khuong, investment director at Savills Vietnam, said the domestic property market is attractive to foreign investors owing to handsome profits, high economic growth and preferential policies for foreign investors.

As of May 20, 1,076 FDI projects had been approved with total registered capital of US$4.6 billion, up 14.6% in number of projects but down 16.8% in capital over the year-ago period. In addition, FDI investors had registered an additional US$2.49 billion for 393 operational projects in the country.

Thus, FDI capital poured into the real estate sector by May had totaled US$7.1 billion, plunging 30.8% year-on-year.

HCMC received the most newly-registered FDI capital, US$540.9 million, accounting for 11.6%, followed by Hanoi with US$525.6 million.

Among 50 countries and territories that invested in the country in the first five months of the year, South Korea took the lead with US$1 billion, representing 21.9% of the total newly-registered capital. Japan ranked second with US$904.8 million and Thailand came third with US$536.2 million, making up 19.4% and 11.5% respectively.

Manufacturing and processing sectors attracted the most foreign investment money, US$4.52 billion, which accounted for more than half of the new capital pledges, followed by real estate and wholesale/retail sectors.

Foreign investors also penetrated into the Vietnamese real estate market through mergers and acquisitions deals.

Source: The Saigon Times

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Conditional Business Lines Under Law on Investment in Vietnam

Law on amendment and supplement to Article 6 and Annex 4 on the list of conditional business lines stipulated in the Law on Investment has been ratified by the 14th national assembly of the Socialist Republic of Vietnam at the second meeting session dated November 22nd, 2016.

Accordingly, pursuant to the constitution of the Socialist Republic of Vietnam, the National Assembly issues the list of conditional business lines stipulated in the Law on Investment no. 67/2014/QH13.

The enterprises which are established to operate in the area of conditional business have to comply with conditions regulated by law before conducting business operation in Vietnam.

Foreign investor if wishing to set up company in the conditional areas has to meet additional investment conditions depending on international treaties, WTO commitment by Vietnam, and other specialized laws in Vietnam. It is advised that the foreign investor to contact Vietnam law firms to be advised on the establishment of company in Vietnam to receive the proper legal advice.

We are listing the conditional business lines for the reference below.

No. LINES OF BUSINESS

1. Manufacture of seals

2. Sale (and repair) of combat gear

3. Sale of fireworks other than firecrackers

4. Sale of camouflaged software and equipment used for audio and video recording and positioning;

5. Paintball gun business

6. Sale of military equipment and military goods for the use of the armed forces, military weapons, specialized military equipment and vehicles for the use of the army and police; special military components, accessories, materials and equipment and military engineering

7. Pawning services

8. Massage services

9. Sale emergency signaling devices

10. Debt collection services

11. Security services

12. Fire safety services

13. Lawyer’s practice

14. Notary’s practice

15. Judicial assessment in the fields of finance, banking, construction, antiques, relics, copyrights

16. Auctioneering services

17. Commercial arbitration services

18. Bailiff’s practice

19. Liquidation and safeguarding of assets of enterprises and cooperatives in the pending time of bankruptcy

20. Accounting services

21. Auditing services

22. Tax agent services

23. Customs brokerage services

24. Sale of duty-free goods

25. Bonded warehouse and container freight station business

26. Premises for conducting customs procedures, customs gathering, inspection and supervision for rent.

27. Securities trading

28. Securities registration, depository, offsetting, and liquidation services by Vietnam Securities Depository/organizations trading in listed securities and other securities.

29. Insurance business

30. Reinsurance business

31. Insurance brokerage

32. Insurance agents

33. Property assessment service

34. Lottery business

35. Casino video games for foreigners

36. Debt trade services

37. Ratings services

38. Casino business

39. Betting business

40. Voluntary pension fund management services

41. Oil and gas business

42. Gas trading

43. Manufacture and repair of liquefied petroleum gas (LPG) bottles

44. Commercial assessment services

45. Sale and destruction of industrial explosives

46. Sale of explosive precursors

47. Industrial explosives and explosive precursors –based business

48. Blasting services

49. Sale of chemicals other than prohibited chemicals stipulated in the International Convention on prohibition of development, production, stockpiling and use of chemical weapons on their destruction

50. Alcohol business

51. Sale of tobacco, cigarette, machinery and equipment for tobacco industries

52. Sale of foods under the administration of the Ministry of Industry and Trade

53. Commodity exchange operation

54. Electricity generation, transmission, distribution, wholesale, retail, import, export and consultancy

55. Rice export

56. Temporary import and re-export of goods subjected to special excise duty

57. Temporary import and export frozen foods

58. Temporary import and re-export of goods on the List of used goods

59. Franchising

60. Logistics services

61. Sale of minerals

62. Sale of industrial precursors

63. Commodity trading and business activities directly related to commodity trading by foreign investors and foreign-invested business entities

64. Multi-level marketing business

65. E-commerce business

66. Petroleum business

67. Energy audit

68. Vocational training

69. Assessment of the quality of vocational education

70. Occupational skill assessment services

71. Occupational safety inspection services

72. Occupational safety and health training

73. Employment agencies

74. Overseas employment services

75. Voluntary drug detoxification services

76. Outsourcing

77. Road transport services

78. Automobile maintenance

79. Manufacture, assembly and import of automobiles

80. Motor vehicles inspection services

81. Driver training services

82. Traffic safety inspector training services

83. Driving test services

84. Traffic safety inspection services

85. Waterway transport services

86. Building, repair and renovation of watercraft

87. Inland watercraft crewmen and operator training services

88. Training, recruitment and supply of marine crews

89. Maritime safety services

90. Shipping services and shipping agencies

91. Towage services

92. Import and demolition of used ships

93. Building, renovation and repair of ships

94. Seaport operation business

95. Air transport business

96. Design, manufacture, maintenance and testing of aircrafts, their engines, propellers, avionics and equipment thereof in Vietnam

97. Airport operation business

98. Aviation service at airports

99. Air navigation services

100. Flight crew training services

101. Rail transport business

102. Rail infrastructure business

103. Urban railway business

104. Multimodal transport

105. Transport of dangerous goods

106. Pipeline transport business

107. Real estate business

108. Provision of training in real estate brokerage and property exchange operation

109. Provision of training in apartment building operation.

110. Construction management consulting services

111. Construction surveying services

112. (Construction) design and assessment services

113. Construction supervision services

114. Construction services

115. Construction activities by foreign contractors

116. Construction cost management services

117. Construction quality assessment services

118. Construction experiment services

119. Apartment building operation services

120. Cremation facility operation services

121. Construction planning services

122. Urban planning consulting services provided by foreign entities

123. Sale of white asbestos of Serpentine group

124. Postal services

125. Telecommunications services

126. Certification of digital signatures

127. Publishing

128. Printing services, except for printing of package

129. Publication services

130. Social networking services

131. Online game business

132. Paid radio and television services

133. News website development services

134. Processing, recycling, repair and renovation of used IT products of foreign owners which are on the List of used IT products banned from import

135. Provision of information via telecommunications and internets

136. “.vn” domain name registration and maintenance services

137. Cybersecurity products and services

138. Civil cryptography services and products

139. Sale of potable jamming devices

140. Preschool education business

141. Secondary school education business

142. Higher education business

143. Operation of foreign-invested education institutions, representative offices of foreign education institutions in Vietnam and branches of foreign-invested education institutions

144. Continuing education business

145. Operation of special schools

146. Association in education with foreign countries

147. Education quality assessment

148. Overseas study consulting services

149. Fishing

150. Sale of aquatic products

151. Sale of aquatic feed and animal feeds

152. Animal feed and aquatic feed testing services

153. Sale of biological preparations, microorganism, chemicals and environmental remediation agents used for aquaculture

154. Building and renovation of fishing vessels

155. Breeding, raising, artificial propagation of wild animals and plants according to CITES Appendix

156. Breeding, raising, artificial propagation of wild, endangered and rare animals and plants according to CITES Appendix

157. Breeding and raising of normal wild animals

158. Export, import, re-export, transit and introduction of marine specimens stipulated in CITES Appendix

159. Export, import and re-export of specimens bred, raised and artificially propagated according to CITES Appendix

160. Sale of forest animals and plants restricted from use for commercial purposes

161. Sale of plant protection products

162. Processing of items subjected to undergo plant quarantine

163. Pesticide testing services

164. Plant protection services

165. Sale of veterinary medicines, vaccines, biological preparations, microorganisms and chemicals used in veterinary medicine

166. Veterinary technical services

167. Animal testing and surgery

168. Provision of vaccination, diagnosis, prescription, treatment and healthcare services for animals

169. Veterinary medicine testing and assay (including veterinary medicines, aquatic veterinary medicines, biological preparations, microorganisms and chemicals used for veterinary medicines, aquatic veterinary medicines)

170. Concentrated husbandry

171. Slaughtering

172. Sale of foods under the administration of the Ministry of Agriculture and Rural Development

173. Animals and animal product quarantine services

174. Sale of fertilizers

175. Fertilizer testing services

176. Sale of plant varieties and animal breeds

177. Sale of aquatic breeds

178. Testing of plant varieties and animal breeds

179. Aquatic breed testing services

180. Testing and assay of biological preparations, microorganism, chemicals and environmental remediation agents used for aquaculture

181. Sale of genetically modified products

182. Medical treatment and examination

183. HIV testing services

184. Tissue banking services

185. Reproduction assistance, sperm and embryo cryopreservation

186. Testing of microorganisms causing infectious diseases

187. Vaccination

188. Opioid substitution therapy

189. Plastic surgery

190. Surrogacy service

191. Pharmaceutical business

192. Cosmetics production

193. Sale of chemicals, pesticides, germicides for the use in medical appliances

194. Sale of foods under the administration of the Ministry of Health

195. Sale of medical equipment

196. Medical equipment classification services

197. Medical equipment testing services

198. Appraisal of intellectual property (including appraisal of the copyrights and others relevant, appraisal of industrial properties and plant breeder’s rights)

199. Radiological services

200. Assistance in application of atomic energy

201. Assessment of conformity

202. Testing, calibration and inspection of measuring instruments and measurement standards

203. Manufacture of biker helmets

204. Technology assessment and evaluation services

205. Intellectual property presentation services

206. Film production and distribution

207. Antique appraisal services

208. Development of project planning, construction, project supervision, maintenance, renovation and restoration of relics

209. Karaoke and nightclub business

210. Travel services

211. Sport business and professional sport clubs

212. Business involving art and fashion shows, model contests and beauty pageants

213. Sale of art performance video and audio recording

214. Accommodation services

215. Advertising

216. Trading in national relics, antiques and treasures

217. Export of relics and antiques other than those under the ownerships of the Government, political organizations and political-social organizations; import of cultural products under the administration of the Ministry of Culture, Sports and Tourism

218. Museum services

219. Video game business (other than casino video games for foreigners and online casino video games)

220. Land assessment and survey consulting services

221. Land use planning services

222. Information technology infrastructure and land information software system development services

223. Land database development services

224. Land pricing services

225. Geodesic and cartographic services

226. Meteorological and hydrological forecasting services

227. Groundwater drilling and exploration services

228. Extraction and use of water resources, discharge of wastewater into water sources

229. Basic survey and consulting services for preparation of water resource planning, schemes and reports

230. Mineral exploration

231. Mineral extraction

232. Transport and treatment of hazardous wastes

233. Import of scraps

234. Environmental monitoring services

235. Sale of biological preparations from waste treatment

236. Commercial bank business operations

237. Non-credit institution business operations

238. Business operations of cooperatives, people’s credit funds and microfinance institutions

239. Payment intermediary services

240. Credit information services

241. Foreign exchange activities by non-credit institutions

242. Gold trading

243. Money printing and minting

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How Exploiting and Using Water Resources are Regulated in Vietnam

Water is an important resource of the country, all business activities, production and living all need water resources. Therefore, the exploitation and use of water resources are under the control of the Vietnam state authorities, to protect the resources, and avoid the waste that impact the environment.

The Vietnamese legal system has a wide range of legal provisions on water resources, including the Law on Water Resources; Law on Environmental Protection and supporting decrees. These legal documents are firm legal basis in the management and protection of water resources.

The state shall define the principles for exploitation, use and protection of water resources, which are the responsibility of all agencies, organizations and individuals; Must comply with strategies and master plans on water resources already approved by competent state management agencies; Effective exploitation and use, the law stipulates the order of priority for allocating water sources to ensure the balance between regions and domains. This priority includes prioritizing regional allocations (agreements between regions, governmental decisions) and prioritizing allocations based on water use purposes (domestic, agricultural, fisheries, power generation, industrial, transportation, preservation of cultural and historical value, exploitation and processing of minerals).

The Vietnam legal system on water resources is divided into two groups, one is the exploitation and use of water resources without registration and permission; the other is the exploitation and uses of water resources have to register and apply the license. For exploitation and use, registration must include water used for household activities; Small scale use for production, business and services; using sea water to produce salt; using water for religious activities, scientific research; water use for fire prevention, incident response and other emergencies. Water users will be required to pay water use fees as agreed in the water service contract. The price of water used by state agencies is determined and adjusted in accordance with the principles and actual use.

Apart from the above-said cases, the exploitation and use of water resources for permission of state agencies, including: exploitation of surface water and sea water; Groundwater exploration; exploitation and use of underground water; The above-said forms must be registered, permitted and permitted to conduct investment activities only when they are granted permits according to the provisions of law. The term of the license varies from 2 years to 10 years, suitable for exploitation and use, ensuring the stability as well as the protection of the environment to the maximum. At the end of the license period, the license renewal will be considered.

In addition to the exploitation and use of water resources of individuals and organizations, water resources investigation and assessment are also strictly regulated. Accordingly, the inventory of water resources must be implemented uniformly throughout the country, every five years, in accordance with national socio-economic development regulations. The responsibility for inventorying water resources is the coordination among relevant agencies, ministries and agencies such as the Ministry of Natural Resources and Environment; Ministries and ministerial-level agencies related to construction activities; Provincial People’s Committee.

In addition to using, exploiting water resources, another issue that is always on top of wastewater treatment. The treatment of wastewater must comply with the technical standards for wastewater. The Vietnam state always has projects and incentives for investment in wastewater treatment such as preferential land use fees, technical infrastructure investment support, other incentives,

All acts of violating the provisions of law on water resource and waste water treatment shall be handled according to the provisions of law. Depending on the circumstances, the level of treatment will be different, such as the handling of administrative violations or the handling of criminal offenses. The maximum fines amount to 1 billion VND for individual violations and 2 billion VND for organizations.

ANT Lawyers is a law firm in Vietnam located in the business centers of Hanoi, Danang and Ho Chi Minh City. We provide convenient access to our clients. Please contact us to book your time in advanced to let us provide our best service. 

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The Government Continues to Exempt Visas for Western European Countries

It has been announced on May 3rd, 2018 that visa exemption policy for 5 Western European countries has been extended as part of the Vietnam immigration policy to attract tourists to Vietnam. At the same time, the Government has decided to increase the exemption period from one year to three years.

Accordingly, the Government has a high consensus and the Prime Minister has decided to continue the visa exemption for five Western European countries, including England, France, Germany, Spain and Italy. As previous regulation, the visa exemption will be expired at the end of June 2018. The exemption period has also increased from one year to three years.

Visa policy is considered to be an extension of the tourism industry because Vietnam is a country has strict visa policies, with only visa exemption for citizens of 24 countries, much less than other countries in the region.

For example, Indonesia exempts visas from 168 countries, Malaysia 162 countries, Singapore or the Philippines 159 countries, Thailand 57 countries. Besides that, these countries apply the policy of issuing visas at the border and electronic visas.

Western Europe is considered a high-paying group. Statistics show that the first visa exemption year (2015) has 720 thousand guests. In 2016, the number of visitors increased 16%, turnover reached 202 million.

In 2017, Western European visitors reached 1.5 million people, contributing to the record of the first-time Vietnam reaching 12.9 million international visitors.

According to many experts, if visas for these countries are not renewed, tourism industry of Vietnam will lose 20% of its visitors from large markets with a loss of several hundred million USD. However, losses will not stop there, as guests may form a habit of not coming to Vietnam.

This new immigration regulation will start from July 1st, 2018.

ANT Lawyers is a law firm in Vietnam located in the business centers of Hanoi, Danang and Ho Chi Minh City. We provide convenient access to our clients. Please contact us to book your time in advanced to let us provide our best service. 

Call us at (+84) 24 32 23 27 71 or send us email ant@antlawyers.vn 

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Preferential Policies When Investing in DaNang Hi-Tech Park

Danang has been growing to become attractive destination for investment due to favourable conditions offered by the city administration to bring foreign investor investing into hi-tech park.

Danang is one of the five large cities of Vietnam and is the key economic hub of Central Vietnam. The location of Danang is one of the important gateway to the sea of the Central Highlands and Laos, Cambodia and Thailand to the Northeast Asia countries through the East-West Economic Corridor, and located in one of the international sea routes and air routes. Danang has a geographic location that is particularly conducive to rapid and sustainable development.

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

Danang Hi-tech Park was established in accordance with Decision No.1979/QD-TTg dated October 28th2010, after two Hi-tech Parks in Hanoi and Ho Chi Minh City, with the hope of developing the science and technology of Da Nang, the Central Region and Central Highlands of Vietnam. Covering an area of 1,129.76 hectares and the infrastructure is gradually being completed with production areas, research and development, training and nursery enterprises, administrative management, housing, logistics, logistics and high- tech services. Da Nang Hi-tech Park is expected to be the attractive place where domestic and foreign investors favourable infrastructure and incentives. Danang Hi-tech Park shall give priority to the setting up of company in high-tech areas i.e. bio-technology for agriculture, fisheries and health; microelectronics, mechatronics and optoelectronics, automation and precision engineering; information technology, communication, informatics software; petrochemical service technology. Danang is a priority city for the development of environmentally friendly industries and services, therefore investors will not be allowed to trade in industries that threaten to pollute the environment and affect national security or industries using obsolete technologies.

In addition to the infrastructure development, Danang also offers investment incentives to attract domestic and foreign investors to invest in Danang Hi-tech Park such as Decision No. 36/2013/QD-UBND and most recently Decree No. 04/2018/ND-CP will take effect from February. Decree No. 04/2018/ND-CP has given great investment incentives to investors when investing in Danang Hi-tech park. Having policies to attract domestic investment and FDI, whereby investors invest in Danang Hi-tech Park will be exempted from all or part of land rent and site clearance in some specific cases. In addition, when investing in Danang Hi-tech Park, the enterprises will be entitled to corporate income tax incentives for 15 to 30 years and exemption on corporate income tax for 4 years, and reduction of 50% for 9 years later to enterprise having new investment projects. Goods imported to be fixed assets in Hi-tech Park or machinery and equipment which cannot be produced at domestic will be exempted from import tax. In addition, experts and workers who are foreigners/overseas Vietnamese working in Hi-tech park and their family members may be considered for issuance of multiple entry and exit visas with appropriate time limits for entry purposes in accordance with the laws.

The economics of Danang is growing and the special incentives have been offered to attract investment from the city administration. This is the opportunities for investors both domestic and foreigners to invest in Danang.

ANT Lawyers is a law firm in Vietnam located in the business centers of Hanoi, Danang and Ho Chi Minh City. We provide convenient access to our clients. Please contact us to book your time in advanced to let us provide our best service. 

Call us at (+84) 24 32 23 27 71 or send us email ant@antlawyers.vn

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The Purposes of Using Criminal Record Card

Under Clause 1, Article 2 of the Law on Criminal Record 2009, criminal record card is the records on the previous convictions of a person that is sentenced under valid court judgments or decisions, and banning individual from holding position, establishing or managing enterprises and cooperatives in cases where the enterprises or cooperatives are declared bankrupt by the court.

Article 7 – The Law on Criminal Record 2009 regulates that the following individual, agencies and organizations may request competent agencies to issue Criminal Record card:

Vietnamese citizens and foreigners who have been or are residing in Vietnam have the right to request the issuance of their criminal record cards;

Proceeding agencies may request the issuance of criminal record card for investigation, prosecution and trial;

State agencies, political organizations and socio-political organizations may request the issuance of criminal record to serve the personnel management, business registration, establishment and management of enterprises and cooperatives.

Criminal record cards include:

a/ Criminal record card no.1 is issued to individual, agencies and organizations defined in Clauses 1 and 3, Article 7 of this Law;

b/ Criminal record card no.2 is issued to agencies conducting the proceedings, defined in Clause 2, Article 7 of this Law and issued at the request of the individual so that he/she can know the contents of his/her criminal resume.

The basic difference of these two types is that the criminal record card no.1 only records the sentence has not been removed. If the case has been deleted, it will state “no criminal record”. The criminal record card no.2 records all previous criminal convictions regardless of whether they were deleted or not.

ANT Lawyers is a law firm in Vietnam located in the business centers of Hanoi, Danang and Ho Chi Minh City. We provide convenient access to our clients. Please contact us to book your time in advanced to let us provide our best service. 

Call us at (+84) 24 32 23 27 71 or send us email ant@antlawyers.vn 

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Equity of PPP investors must make up 20% of total investment

Investors involved in projects under the public-private partnership (PPP) must have equity accounting for at least 20% of total investment capital, according to a recently released decree of the Government.

Decree 63/2018 issued early this month to replace Decree 15/2015 will come into force on June 19, 2018, with some radical revisions, one of which is an equity requirement of 20% instead of 15%. However, this rule only applies to projects worth less than VND1.5 trillion or roughly US$65 million.

With projects whose total investments are over VND1.5 trillion, the ratio of equity cannot be lower than 20% of the VND1.5-trillion amount and is not smaller than 10% of the remaining amount. 

The involvement of the State in PPP projects includes capital contributed by the State, payments for investors, land, office space, infrastructure handed over to investors, business rights transferred to investors in case of build-transfer (BT) contracts, capital to assist construction of supporting works, compensation, site clearance and resettlement.

See more: Transfer of Investment Projects in Vietnam

Meanwhile, Decree 15/2015 limits State investments in PPP projects to State capital, government bonds, municipal bonds, official development assistance (ODA) capital, and concessional loans from international donors.

According to the Ministry of Planning and Investment, the old decree restricts the participation of other legal public capital sources, which hence does not make it attractive to investors.

Regarding project transfers, the new decree provides tighter conditions than the old one. In particular, Decree 15/2015 allows an investor to transfer partial or entire rights and obligations in a certain project to the lender or another investor, even when the project is being implemented or is already finished.

Meanwhile, under Decree 63/2018, the investor can transfer partial or entire rights and duties in the project to the lender or another investor after construction work is done or when the project is in operation.

Regarding investment incentives, investors are given preferential corporate income tax, and get land use fees exempted or reduced while implementing the project.

In addition, legal assets of investors are not nationalized or seized with administrative measures.

In case of asset seizure for security purposes, investors will get compensation.

Source: The Saigon Times

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