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ASIA COUNSEL INSIGHTS
August 2017
Asia Counsel Insights provide an overview
of the key trending legal and business
issues in Vietnam and how they may
impact your business. Please enjoy your
read.
Deal Update
• The Blue Circle’s 40MW Dam Nai wind
farm located in Ninh Thuan saw the
installation of its first G114-2.625 MW
Gamesa turbine in August 2017;
• The Deutsches Haus, a two-tower
office building in the heart of Ho Chi
Minh City, built on a unique
partnership between the German
and the Vietnamese Government,
will open its doors in September 2017.
Securities Finance Safety Criteria and Remedies
On 15 August 2017, the Ministry of
Finance issued Circular 87/2017/TT-BTC
on finance safety criteria and remedies
to be taken by securities firms if they fail
to comply. Here are some of the main
points:
• SSC can apply remedial measures
for any securities firms that fail to
comply with the criteria such as
issuing warnings or take control of
the firm;
• The term of special control will not
exceed 4 months. After 2 months of
special control, the Stock Exchange
will temporarily cease any
transactions of the clients of the
securities firm. After the expiry date
of special control, if the securities
firms cannot remedy their status
and their gross loss reaches 50% of
its charter capital, the firms will be
suspended and license revoked.
This Circular takes effect on 10 October
2017.
Tax Draft Law amending VAT, CIT, PIT
The Ministry of Finance published a
draft law on 23 August 2017
proposing a number changes to the
tax law. Some of the key proposals
for CIT and VAT are below.
VAT: (i) increase of the standard rate
from 10% to 12% from 1 Jan 2019; (ii)
the 5% rate to increase to 6% for
certain goods and services; (iii) move
a number of goods/services into the
standard rate; (iv) transfer of land
use rights to be taxable at standard
rate (currently exempt from VAT).
CIT: (i) gains from real estate transfers
to be set off against operational
losses; (ii)capital/share transfers by
non-residents proposed to be 0.1%
on proceeds of sale rather than 20%
on net gain. The draft law is
expected to be debated by the
National Assembly later this year.
Commercial State Exclusive Commercial Activities
On 10 August 2017, the Government
issued Decree 94/2017/ND-CP
stipulating the goods and services
that the state has a monopoly. In
principle, this applies to goods and
services related to national defence,
security and welfare. However, it also
includes monopolies in other
economic sectors.
Currently, there are 20 goods and
services that can only be produced
or conducted by the state, including:
• Money (printing, and casting);
• National electricity system
(transmission and moderation);
• Broadcasting (publishing,
excluding printing and
distribution); and
• Gold sheets and bullions
(production).
This decree takes effect on 1
October 2017.
About Asia Counsel Asia Counsel is a dynamic international corporate and commercial law firm dedicated to serving clients in Vietnam. Our partners have over eight years of
experience in working on complex and challenging matters in Vietnam. We are committed to helping clients achieve their business strategies and providing
outstanding legal services.
If you have any questions on any of the items discussed above, please do not hesitate to contact us.
Christian Schaefer
Managing Partner
Minh Duong
Partner
Asia Counsel Vietnam Law Company Limited, Level 5, 18 HBT Building, 16-18 Hai Ba Trung Street, Ben Nghe Ward, District 1, Ho Chi Minh City
ASIA COUNSEL INSIGHTS
August 2017
Employment Online work permit application
Foreign employees can apply for a
work permit online via the website
http://dvc.vieclamvietnam.gov.vn
“(Online Portal”) from 2 October
2017 under Circular 23/2017/TT-
BLDTBXH issued on 15 August 2017.
The application process under this
Circular is as follows:
• before the expat commences
working, the employer must
submit the report on demand on
foreign employees and
application for work permit/ work
permit exemption to the Online
Portal;
• the authority will give feedback
on the online application’s
validity via e-mail, within 3-5
working days;
• after that, if the online
application is valid, the employer
must submit the original
application to the authority. The
relevant result will then be
available within 8 hours of receipt
of the original application
documents.
This Circular takes effect from 2
October 2017.
Competition VCA 2016 Annual Report
The Vietnam Competition Agency
(“VCA”) has released the annual
report 2016.
In 2016, the VCA received and
dealt with four applications for
merger and acquisition clearance
in the dairy, ceramic retail
supermarket and veterinary
medicine sectors. The economic
concentrations were
Vinamilk/Lamsonmilk; Lixil
Vietnam/American Standard
Vietnam; Central Group/BigC
Vietnam; and Boehringer/Sanofi
SA.
In light of some examples above,
offshore economic concentration
cases can be reviewed if the
parties to the economic
concentration have business
activities in Vietnam.
The VCA also investigated a
number of anti-competitive
practices in 2016 including abuse
of dominant positions from CGV, a
major film distributor and cinema
operator and price collusion by
insurance companies in maritime
insurance products.
Vietnam Fact Box Vietnam exported $17.5
billion in July 2017, based on
a report from the General
Statistics Office (GSO). This
reflects a decrease of 1.7%
compared to June. Of this
amount, Vietnamese
enterprises exported $4.9
billion and foreign invested
enterprises $12.6 billion.
Compared to the exports of
the same period last year,
Vietnam’s export turnover
increased by 17.9%, including
13.1% from Vietnamese
enterprises and 19.9% from
foreign invested enterprises.
Source : VIETNAMNET
Gaming Casino Business
On 30 August, State Bank issued
Circular 10/2017/TT-NHNN on foreign
exchange management for casino
business (“Circular 10”). Circular 10
provides the following:
• the exchange rate from VND to
other foreign currencies and vice
verse is based on the spot buying
rate of the bank where the casino
enterprise opens its specialized
account for foreign currency;
• it is mandatory for casino
enterprises to open one
specialized account for each type
of foreign currencies for specific
transactions of the casino business;
• casino enterprises are permitted to
transfer foreign currencies from the
specialized account to the current
account for foreign currency
needs of the casino business;
• based on the business situation of
the casino business, the casino
enterprise must register the amount
of cash in foreign currencies.
This Circular takes effect from 15
October 2017.
Agriculture Transitional provisions on animal and aqua feed products
On 18 August 2017, the Government issued Decree 100/2017/ND-CP (“Decree 100”)
amending and supplementing provisions of Decree 39/2017/ND-CP (“Decree 39”)
on the regulatory framework for animal and aqua feed.
Under Decree 39, animal and aqua feed products, which were approved for sale in
Vietnam by the Ministry of Agriculture and Rural Development before Decree 39
came into effect on 20 May 2017, shall be approved for free sale within a period of
5 years from the recognition date.
Decree 100 adds that animal and aqua feed products, which ceased to be valid
for circulation between 20 November 2016 and 20 November 2017, are permitted to
circulate for sale in the market for a period of not more than 18 months.
