Special mechanism for Long Thanh airport project gets thumbs-up

HCMC – Prime Minister Nguyen Xuan Phuc has told the Ministry of Transport to design a special compensation, support and resettlement mechanism for the Long Thanh airport project in Dong Nai Province, the Vietnam News Agency reports.

The ministry should coordinate with the Ministry of Natural Resources and Environment, the government of Dong Nai Province, and relevant agencies to map out a plan for compensation, support and resettlement, treat it as a separate component, and report results to the PM.

The special plan should be submitted to the National Assembly (NA) before the NA passes the feasibility study for the big-ticket airport project.

The Transport Ministry will work with authorities of Dong Nai to devise a policy framework for compensation and resettlement assistance.

The project would affect around 4,700 households with nearly 15,000 people in Binh Son, Suoi Trau, Cam Duong, Long An, Long Phuoc and Bac Can communes.

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Around 40 kilometers from HCMC and 30 kilometers from Bien Hoa City, the airport would meet 4F standards of the International Civil Aviation Organization (ICAO).

Phase one of the project is scheduled to get off the ground in 2019, with one runway and one terminal to be put into operation by 2025 to handle 25 million passengers and 1.2 million tons of cargo a year.

One more runway and terminal would be built in the second phase to increase the airport’s annual capacity to 50 million passengers and 1.5 million tons of cargo. The airport would handle 100 million and five million tons a year after phase three is complete.

More than VND336.76 trillion (over US$16 billion) will be needed for the project, including nearly US$5.5 billion for the first phase. The funding will be sourced from the State budget, official development assistance (ODA) loans, investment of enterprises, proceeds from equitization of State-owned enterprises and other sources.

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Chinese contractors sue Vietnam hydropower project owner

HANOI - A consortium of Chinese contractors has filed a case against the Vietnamese owner of the Upper Kon Tum hydroelectric project for termination of the contract, according to a report which the Government has passed to the National Assembly.

The report deals with two hydropower projects – Song Bung 4 and Upper Kon Tum. Vinh Son-Song Hinh Hydropower JSC (VSH) is the owner of the Upper Kon Tum hydropower project on the Dak Nghe River, the upstream tributary of the Sesan River.

The consortium comprising East China Investigation and Design Institute under China Hydropower Engineering Group and China Railway 18th Bureau Group has sent a petition against VSH to the Vietnam International Arbitration Center (VIAC).

This move comes after VSH cancelled the contract with the Chinese contractors and reclaimed the entire contract execution and advance payment guarantees.

The termination of the contract resulted from “serious delays” in the construction of the plant and power lines, as well as from the “unfriendly behavior” of the contractors, says the report.

VIAC set May 23, 2016 as the date for verbal argument, with a ruling by the arbitration council expected to come out by the end of this year.

Due to the complexity of the case, the completion of necessary papers, the gathering of evidence and the addition of legal documents must be sufficiently and carefully done. The verbal argument was rescheduled to April 20, 2017, and the ruling is expected in the middle of next year.

The Government says in the report that after the Chinese contractors filed the case, VSH filed a self-protection statement and a proposal to VIAC seeking arbitration in the consortium’s breach of contract terms.

VSH signed a legal consulting service contract with local and international law firms, namely YKVN Singapore with a branch in Vietnam and EP Legal Vietnam. After a review of the records, the two legal consultants proposed VHS invite Singapore’s Drew & Napier LLC to join the case.

VHS is now working with counsels over evidence and documents to prepare a testimony.

The Government said this case is complex with many potential risks. Since the ruling of the arbitration council is slated for mid-2017, the progress and efficiency of this project will be certainly affected.

The Government report notes that VHS has reassessed the remaining workload for the power transmission lines and hydropower plant, which is actually the job of the Chinese contractors. Currently, new contractors have taken over the job of constructing the transmission lines and plant.

The Government says the total investment cost of this project is VND7.4 trillion.

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What Are the Forms of Public Private Partnership (PPP) in Vietnam?

Public  Investment  Law  No.  49/2014  /  QH13  issued on  June  18th,  2014,  effective  January  1st, 2015 and Decree No. 15/2015 / ND-CP on investment  in the  form of public-private partnership issued February 14th, 2015, effective April 10th, 2015 has been expected to help overcome one of the  biggest  obstacles  in  the  attraction  of  investment  in  private  sector,  from  both  domestic  and foreign investment in public-private partnership (PPP) projects.

The key matter is that the new laws would share the  risks that investors face in terms of capital, fees  structures  and  fees  amount  determination. It  is  important  that  the  regulation  has  been changed  that  only  requires  the  minimum  of  owner’s  equity  of  not  less  than  15%  of  the  total investment  of  the  regular  project;  and  not  lower  than  10%,  if  the  project  investment  is  over  15 trillion  VND.The  investors  may  transfer  part  or  all  rights  and  obligations  under  the  project contract  to  the  lender  or  other  investors  if  the  transfer  does  not  affect  the  objectives,  scope, technical  standards,  progress  of  the  project,  and  must  meet  the  conditions  for  investment  and business in accordance with provisions the law on investment and other conditions agreed  in the project contract signed with the competent state agency.

Investment  in  PPP  has  now  been  expanded  to  vast  areas  requiring  significant  investment including transportation infrastructure, power plant, water, health, the environment management, education,  vocational  training,  culture,  sports  and  science  and  technology  projects,  economic zones, industrial zones.

The  investment  contracts  in  the  form  of  public-private  partnership  are  defined  in  Vietnam  as following.

BOT Contract

“Build – Operate – Transfer contract” (referred to as BOT contract) means a type of contract to build  an   infrastructure  project  between  a   competent  state  agency  and  an   investor;  after completing the construction, the  investor shall  be entitled to operate it  for a  specified period of time; eventually, the investor shall transfer it to the Vietnam competent state agency.

BTO Contract

“Build – Transfer – Operate contract” (referred to as BTO contract) means a type of contract to build  an   infrastructure  project  between  a   competent  state  agency  and  an   investor;  after completing  the  construction,  the  investor  shall  transfer  it  to the  competent  agency,  and  shall  be entitled to operate it for an agreed period of time.

BT Contract

“Build –  Transfer  contract”  (referred  to  as  BT  contract)  means  a  type  of  contract  to build  an infrastructure  project  between  a  regulatory  agency  and  an  investor;  after  completing  the construction, the investor shall transfer it to the competent agency, and then the investor will be allotted a land parcel used for carrying out another project.

BOO Contract

“Build – Own – Operate contract” (referred to as BOO contract) is a type of contract to build an infrastructure  project  between  a  competent  agency  and  an investor;  after  completing  the construction, the investor shall take ownership of this project and have the right to operate it for a specified period of time.

BTL Contract

The Build – Transfer – Lease contract (referred to as BTL contract) means a type of contract to build an infrastructure project between a competent agency and an investor; after completing the construction, the investor shall transfer it to the regulatory agency and shall be entitled to provide services  on  the  basis  of  operation  of  such  project  for a  specified  period  of  time;  the  competent agency shall lease and make payment for the investor’s services.

BLT Contract

“Build –  Lease –  Transfer  contract”  (referred  to  as  BLT  contract)  means  a  type  of  contract  to build an infrastructure project between a competent agency and an investor; after completing the construction,  the  investor  shall  have  the  right  to  provide  services  on  the  basis  of  operation  of such  projector  a  specified  period  of  time;  the  competent  agency  shall  lease  and  make  payment for the investor’s services according to the regulation; when the lease term expires, such project shall be transferred to the competent agency.

O&M Contract

“Operation & Management contract” (hereinafter referred to as O&M contract) means a type of contract to operate the project between a competent agency and an investor for a specified period of time.

The  law  on  Public  Private  Partnership  in  Vietnam  creates  an  important  legal  basis  in  the management of public investment. However, this is only the beginning of an inevitable trend that attract resources from private sectors.  The laws has been evolving and there will be changes in the coming time which ANT Lawyers will monitor and provide relevant update.

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Ministries want guidelines for conditional business regulations

HCMC – Several ministries and departments said they want guidance for implementing regulations on conditional businesses that are prescribed in the Law on Investment that has been approved by the National Assembly (NA)

Unlike other laws, the law amending and supplementing Article 6 and Annex 4 of the Investment Law on the list of conditional business and investment fields is said to be clear and therefore, the Government is not eassignd to issue guidelines for its implementation.

But many are of the opinion that such guidance is still needed, heard a meeting between the Ministry of Justice and other ministries and agencies on Wednesday.

Those agencies voice such concerns as the Government recently requested them to review and make suggestions for detailed regulations on new business fields and those which need to be adjusted, and report to the Government within this month.

According to the Ministry of Justice, most business conditions added into the investment law have already been regulated by current rules and therefore, the list of conditional business fields can be applied from January 1 next year.

The Ministry of Planning and Investment said the law amending and supplementing Article 6 and Annex 4 of the Investment Law has removed 20 sectors from the conditional business list while the list of conditional business fields has been included in the appendix of the investment law.

As such, ministries and departments should just follow those lists and regulations, said the ministry.

However, related ministries and departments said without specific guidance, enterprises operating in the four conditional sectors, including overseas study consultancy service, educational quality accreditation, and manufacturing, assembling and importing autos will face difficulties.

Source The Saigon Times

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ANT Lawyers is Vietnam exclusive member of Prae Legal, an international law firm network, providing full ranges of legal services in Vietnam

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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Experts present three scenarios for property market next year

Experts, speaking at a conference in Hanoi on Tuesday, gave three scenarios for the 2017 domestic property market, with the most likely one being that the market will move sideways. The other two scenarios are that the market will continue growing, which are the least probable, or will go down.

The conference on prospects for the real estate market next year was held by Nha Dau Tu magazine, the Vietnam Real Estate Association (VNREA) and Dau Tu newspaper in Hanoi on Tuesday.

Tran Kim Chung, vice president of the Central Institute for Economic Management (CIEM), told the conference that the property market would cool in the coming time as speculation has eased.

Chung said certain housing projects with a strong financial position remain attractive to homebuyers. However, real estate credit will drop since banks are tightening short-term capital for the property sector.

He said big-ticket projects costing VND5 trillion (US$224.2 million) or VND7 trillion or VND10 trillion each will become rare next year compared to 2016.

Chung suggested three scenarios for the 2017 real estate market.

First, it will be better than in 2016, which is desired by many. The scenario will only become a reality if the global economy grows well and does not enter a recession and Vietnam’s economic growth reaches its peak. Chung said this scenario would unlikely happen.

Second, the property market will move sideways with some segments plunging and some others edging higher. Chung said this is the most likely scenario but the market structure will change.

Third, the real estate market will cool if the world economy remains unstable and Vietnam’s economy faces unfavorable developments.

Do Thu Hang of Savills Vietnam said housing supply next year will stay high in both Hanoi and HCMC. Many more social housing projects will come on stream to meet rising demand of middle-income people and workers at industrial parks.

Of some 2.6 million workers at industrial parks, 75% are migrants, 75% are under 35 years old, and they have annual income of US$2,500 on average. They are potential customers of the social housing market, Hang said.

Chung of CIEM said the social housing segment would be the spotlight of the property market next year. However, the segment needs the Government’s supporting policies to grow.

Nguyen Manh Ha, vice chairman of VNREA, said the real estate market will remain stable in 2017 with the low-end and social housing segments performing better.

He said growth in the social housing and mid- and low-end segments will be impacted by State policies. Meanwhile, the shop-house and villa segments will continue attracting clients as many homebuyers prefer an independent house to an apartment.  

Source The Saigon Times

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ANT Lawyers is a reputable law firm in Vietnam with English speaking lawyers whom understand the laws of Vietnam within the business and the local culture context.

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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Real estate credit up strongly

HCMC – Bank loans for the property sector are estimated at some VND150 trillion (US$6.7 billion) this year, a 14.2% pickup from a year earlier, according the HCMC Real Estate Association (HoREA).

The 14.2% spike is the highest in recent years, HoREA said in a report. Meanwhile, the bad debt ratio stays at some 2.6%.

The association noted that HCMC-based realty developers also invest in other central and southern localities.   

Notably, outstanding consumer loans in HCMC are expected to reach VND202 trillion at the end of this month, making up 14.7% of total outstanding loans. Of the sum, over VND70 trillion are taken out by customers to build and repair houses, meaning the amount of credit for real estate is higher than reported. These bank loans should be monitored as borrowers may use them to invest in the property sector.

According to the State Bank of Vietnam (SBV), credit had grown 14.57% by end-November with Vietnam dong credit growth staying at 15.81%.

In HCMC alone, outstanding loans had amounted to VND1,374 trillion, or roughly US$60 billion, up 16.4% and accounting for the biggest proportion of the country’s total. The bad debt ratio had stood at 3.79% and may fall to 2.03% if bad debts of Ocean Bank, Vietnam Construction Bank and Global Petroleum Bank, the three ailing banks acquired by the SBV at zero dong, are excluded.

HoREA said capital inflows in the real estate sector in southern provinces and cities would continue rising in the coming time.

The association explained that private investors have injected money into the property sector in recent years. Besides, investment funds and foreign businesses have increased investment in Vietnam’s property sector via stake acquisitions, partnerships with local firms and lending.

Real estate has been among the three biggest absorbers of foreign direct investment over the years.

Incoming remittances to Vietnam stand at some US$10-13 billion per year. This year’s incoming remittances are estimated at US$5.7 billion in HCMC with 21% going to the housing sector.

However, HoREA warned that huge bank loans and private capital have been poured in the property sector, with a focus on big firms, and the number of investors on the secondary housing market has surged.   

Market watchers expressed concerns over an increase in property credit though HoREA said a real estate bubble will unlikely occur next year.

Source The Saigon Times

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ANT Lawyers is a reputable law firm in Vietnam with English speaking lawyers whom understand the laws of Vietnam within the business and the local culture context.

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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Thailand may slap anti-dumping tax on Vietnam steel sheets

HCMC – Thailand may impose anti-dumping tariffs of up to 60.26% on color-coated steel sheets imports from Vietnam, according to the Vietnam Competition Authority under the Ministry of Industry and Trade.

The Department of Foreign Trade (DFT) under the Thai Ministry of Commerce on December 12 released preliminary results of an anti-dumping probe into Vietnam’s color-coated steel sheets, including painted hot-dip galvanized cold rolled steel, or aluminum zinc alloy-coated cold rolled steel, with dumping margins expected to range from 4.51% to 60.26%.

DFT will give relevant businesses and agencies from Vietnam a chance to respond to the investigation results and send evidence to the department by January 6 before a hearing is organized on January 16.

The Thai agency said it had got a dumping investigation petition from NS BlueScope Company for an alleged dumping margin of up to 89.58% in September last year.

Statistics of the Vietnam Competition Authority show that the country’s exported steel products are subject to most anti-dumping lawsuits. As of May 2016, there had been 25 trade cases against Vietnam’s steel products, of which 18 were anti-dumping ones initiated by ASEAN nations like Thailand and Malaysia.

Earlier, the Vietnam Steel Association had requested producers of metallic-coated and color-coated steel sheets to reduce their export shipments and control selling prices to the Malaysian and Thai markets for risks of anti-dumping measures.

Steel firms of these two nations have repeatedly complained about huge volumes of Vietnam’s steel products imported into their countries at low prices, adversely affecting their production.

Source The Saigon Times

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ANT Lawyers is Vietnam exclusive member of Prae Legal, an international law firm network, providing full ranges of legal services in Vietnam

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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Construction ministry warns against resort real estate glut

HANOI – Investors should be cautious in resort real estate projects as the strong growth of resort real estate this year may lead to an oversupply in the future, the Ministry of Construction advised.

Resort real estate has developed strongly since 2015 with many projects mainly in Danang, Khanh Hoa and Phu Quoc opened for sale, said Pham Van Truong, head of the real estate market management office under the ministry’s Department of House and Real Estate Market Management at a review conference on the real estate market in 2016 and market trends in 2017 held by the Vietnam Association of Property Brokers last Friday.

Many resort projects have been licensed in the coastal provinces. Particularly, there were 46 licensed projects covering more than 3,000 hectares in Khanh Hoa Province and 75 licensed projects occupying more than 2,000 hectares in Vung Tau.

If all of these projects are completed, there will be hundreds of thousands of villas, leading to an oversupply in the market, Truong said.

Nguyen Quoc Khanh, board chairman of DTJ Investment and Distribution Joint Stock Co., said at the conference that resort properties have boomed this year. The number of projects opened for sale has increased sharply this year while last year saw only one to two projects put up for sale.

There have been only two projects opened for sale in Danang and Lao Cai in the fourth quarter this year, the lowest quarterly number in 2016, but in the third quarter, there were as many as 11 projects opened up for sale in Khanh Hoa, Danang and Quang Ninh.

This year has witnessed the recovery of the resort real estate market and a boom in the sector in three major destinations namely Danang, Nha Trang, and Phu Quoc. Some 35 projects with 12,000 apartments and 2,000 villas have been offered for sale, Khanh said.

Source The Saigon Times

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ANT Lawyers is a Vietnam law firm with English speaking lawyers whom understand the laws of Vietnam within the business and the local culture context.

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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Construction Operation License Instead of Contractor’s Permits for Foreign Contractor in Vietnam

The foreign contractors are only permitted to carry out construction activities in Vietnam so long as being granted construction operation license by Ministry of Construction as per the Construction Law.

EPC Contractors have increasingly been interested to learn the requirements of licenses and permits to operate in Vietnam.  It is advised that the construction law firm in Vietnam with lawyers specializing in construction area to assist the foreign contractors to understand the legal frameworks, and requirements of foreign contractors before and after taking on construction projects in Vietnam after bidding result.

The regulations and procedures are promulgated in Decree No. 59/2015/NĐ-CP on management of construction investment projects and Circular No.14/2016/TT-BXD guiding on licensing construction activities and management of foreign construction contractors in Vietnam.

Investment in construction activities has been growingly rapidly.  In order to meet the tender conditions and take part in construction activities in Vietnam, foreign contractors shall follow the regulations in Vietnam and obtain proper license during the preparation and the execution of the construction of the project.

Prior to construction operation license, foreign constructors have experienced another form of permit named contractor’s permits for foreign contractors in Vietnam.  These are two concepts however the process of registration and document requirements are not so different.

There has been an effort to harmonize and reduce differences and conflicts arisen in many fields of laws regulating the mentioned subject and the new provisions of the Law on Bidding, Construction Law and the Investment Law to be issued in 2014 which establish a stable legal framework for the implementation of foreign contractor’s bidding and construction activities in Vietnam.  This changes does not differentiate which position the foreign contractors are appointed from the lead contractor, the main contractor, contractor to subcontractor consortium. Unlike domestic contractors, foreign contractors must be granted construction operation license for each awarded contract.  The amendment from the contractor’s permits for foreign contractor contribute to the unity of the same concept in different legal instruments regulating the license procedure of foreign contractors operating within the territory of Vietnam, and limit the unnecessary overlaps, difficulties to law interpretation and application of legal entities.

We shouldn’t forget to mention that the amendment of the foreign contractor’s construction operation license is to increase the relevance between the name and nature of the licensed activities of foreign contractors in construction operation. One of the initial conditions to a foreign contractor to be licensed is when the contractor has won a bid or been selected to be sub-contractor of an investment project. Therefore, the terms construction operation license shall demonstrate the role of the contractor in the construction projects they have been participated in.

The new construction operation license for foreign contractor is expected to be easier to relate to when foreign contractor take part in construction project in Vietnam.  This would attract more foreign contractors to undertake construction projects in Vietnam to bring in the technology equipment, as well as the management skills to Vietnam.

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TPP withdrawal of The US – Vietnam investment impacts

Improved Legal Environment Will Boost Vietnam Despite Possible Failure of TPP

After Donald Trump, the US president-elect issued a note of intent to withdraw from Trans-Pacific Partnership (TPP) trade deal, there is a question raised on the attraction of FDI into Vietnam: would foreign investors continue to flood to Vietnam to set-up company?

Vietnam as well as other countries has delayed TPP ratification awaiting for the approval of the US because it has been assured that TPP would be meaningful if only the US is a member and if TPP is ratified, Vietnam will attract large volumes of FDI capital.

Nevertheless, there are opinions that Vietnam will continue to grow and attract FDI remarkably regardless of TPP approval from the US.

Vietnam has recently signed a number of trade agreements with other nations and territories which could attract foreign investments into Vietnam in the coming years.  For the US, there is a potential that instead of TPP, the US would negotiate and conclude other bilateral trade agreements with Vietnam.

Vietnam might attract foreign investment capital through TPP and this statement could not be denied. Therefore, in the process of speedy preparation to welcome TPP, Vietnam has changed the legal policies and regulations to adapt to TPP Agreement.  A number of newly passed laws have been considered that improve the rights and benefits of private enterprises in Vietnam such as Civil Code, Law on Investment, Law on Public Investment, Law on Environmental Protection, Labour Code… The new legal framework will create more opportunities in the process of international economic integration for Vietnam, encouraging foreigners to invest and set-up business in Vietnam.

In conclusion, TPP, despite the potential for not being approved by the US would not significantly negatively impact Vietnam.  Besides the continuously improved legal environment, Vietnam still has its own value in competitive labour, growing number of mid income earners, and  stable government to attract investment.

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ANT Lawyers is Vietnam exclusive member of Prae Legal, an international law firm network, providing full ranges of legal services in Vietnam

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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Korea launches anti-dumping investigation into Vietnam’s alloy steel

HCMC – The Korea Trade Commission (KTC) has decided to launch an anti-dumping investigation into alloy steel imports from Vietnam, Ukraine, and India, according to the Vietnam Competition Authority at the Ministry of Industry and Trade.

The KTC decision comes after Korean firms, including Dongbu Metal, Simpac Metalloy, and Taekyung Industrial, which manufacture and sell alloy products, sent their petitions to KTC in September this year.

This is the second time Korea has opened anti-dumping and anti-subsidy investigations into Vietnamese products, according to the Vietnam Chamber of Commerce and Industry (VCCI).

The competition authority said KTC has named one Vietnamese firm on the list of enterprises to be inspected. However, other firms that want to voluntarily join the probe can send a request to the commission.

It is expected that KTC will make a preliminary investigation in three months, starting from December 7 to March 6, and announce its official results in June.

The current stringent economic climate, along with the removal of tariff barriers thanks to the Free Trade Agreements (FTAs), has prompted many countries to launch anti-dumping and anti-subsidy probes against imports as a way to prevent risks and injuries for their local industries.

ANT Lawyers is a Vietnam law firm with English speaking lawyers whom understand the laws of Vietnam within the business and the local culture context.

For Vietnam legal matters or services, the clients could reach ANT Lawyers, the exclusive Vietnam law firm members via email at ant@antlawyers.vn or call the telephone at +848 35202779.

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What lawyers should not promise

In Vietnam, the law has continuously played an important role in the life and contribute to protect and maintain the stability and development of society. In the trend of integration of the world economy, the role of the law has once again been confirmed with a new level in order to contribute to promoting the integration of Vietnam into world economy and opens a new opportunity for those who are practicing law in general and lawyers in particular in Vietnam.

In general, lawyer profession in Vietnam has been a noble profession for the purpose of contributing to the protection of justice, while contributing to the socio-economic development. In reflection, lawyers themselves take professionalism as the basic foundation of the profession, and should always have the responsibility to self-improve skills and widen knowledge in various areas to meet the growing demands as Vietnam develops i.e. corporate, commercial, investment, construction, environment, securities laws…etc.

Sometimes, when providing legal services to clients in handling disputes claim against damages for breach of contractual obligations, the customer has requested a lawyer to promise and guarantee the results of the dispute.

The lawyer, whom represents the client to protect the legitimate rights and interests of the client, has to follow the law, and the ethics. Responding to the request of the client to promise and guarantee the result, the lawyer shall refuse because the outcome of such will depend on the facts and legal grounds of the disputed matters in Vietnam.

The lawyer shall collect comprehensive information from the client then analyze possibilities of outcome. Lawyers should not promise the results or the percentage of success which could potentially lead to the wrong decision made by the client. If the results are not as customer’s expectation, it will be a great loss to the prestige, and the image of lawyers. A good lawyer will have the skills to analyze problems, look at the details, and propose solutions but cannot guarantee the outcome of a case. Each case is different and there are too many unknown factors, and the unanswered questions.

In a litigation case, the lawyers will tell the customers what they are facing, what the lawyers could do, the best situation and what is worst. Good lawyers will know how to analyze and clarify the issue. Both the client and the lawyer should have a positive attitude to solve the problems in regard to the disputing matters.

The only thing ANT Lawyers could promise in a dispute case is that we will follow the laws of Vietnam.

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HCMC more cautious about choosing FDI projects

HCMC has turned more careful in choosing foreign direct investment (FDI) projects so as to avoid those requiring much land and using outdated technologies which are detrimental to the environment, a city official told local media last week.

The city authorities even make more careful choices when it comes to projects registered in industrial parks (IP) and high-tech zones, said Su Ngoc Anh, director of the municipal Department of Planning and Investment.

“The city has recently faced a problem with a big FDI project whose investor requires nearly 200 hectares of land, which is a very large area,” he said.

Regarding the solution for attracting FDI projects in the future, Anh said IPs are preparing land lots to serve Japanese and South Korean investors who use advanced technologies but do not require large land lots. Such IPs are building multi-story facilities to cater to these investors.

The city is now home to 6,500 operational FDI projects with combined registered capital of nearly US$41 billion, many of which will expire in the next five to ten years. The city will screen all such projects, and allow them to expand their scales and extend their operational durations.

District-level authorities will also make lists of projects that they need to call for foreign investments.

Anh noted that foreign investors tend to change their business policies when investing in HCMC by switching from pouring investments in wholly-owned projects to establishing joint ventures, contributing capital or acquiring stakes in operational projects as the move allows them to save time and costs for clearing land and building workshops.

Total investment in the city in 2016 is estimated at VND310 trillion (US$13.68 billion), with 17% of it from foreign investors, 8% from the city’s budget, 11% from State-owned firms and the rest from local people, according to Anh’s department.

The data reflects the role of FDI in the city’s socio-economic development when its share in the total investment in the city’s economy has increased from 15% in 2010 to the current level.

This year, the city expects to attract 713 FDI projects worth a combined US$1.3 billion and sees 174 FDI projects raising their capital by US$465 million.

The city also has allowed 1,900 foreign investors to spend US$1.9 billion contributing capital and acquiring stakes in enterprises here.

In all, the city expects to lure an estimated US$3.7 billion of FDI capital this year.

Source: The Saigon Times

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Worries over housing tax

Suggestions let fly by the Ministry of Finance to collect the housing tax have stirred up objections from many experts who challenge the foundation for such a plan. They argue that the reasons behind the ministry’s intention are not convincible.

As covered in local media, the Taxation Policy Department under the ministry has been assigned to flesh out the plan to collect the housing tax, especially those people with two or more houses. Those people with only one house will likely be exempted from this tax, but the tax rate will increase progressively from the second home. Deputy Minister of Finance Huynh Quang Hai says in Tuoi Tre that “the housing tax will surely be collected, not only to increase revenues for the State budget but also because the housing tax has been collected in many countries for long.”

Such an approach immediately draws fire.

In many countries worldwide, as reasoned by experts, the housing tax is often meant by the State to regulate the market so as to curb excessive speculation, thus ensuring healthy development of the property sector, beside the goal of generating more income for the State budget.

In Vietnam, they say, the Ministry of Finance needs to spell out its key goal - whether it is to earn more revenue or to intervene in the market - and needs to take a prudent approach in both cases.

If the primary goal is to create a new source of income for the State budget, a rethink is needed, since the burden of taxes and fees in the country is deemed to be already rather heavy for businesses and the people. Creating a new tax will make life harder for many people.

Meanwhile, if the goal is to introduce State intervention to ensure justice among all market players, the goal can hardly be realized if the tax is simply based on the number of houses one owns, and speculators will still have ways to ensure their profit margin by factoring the tax sum into their prices. That is to say the rich can still defend their wealth, while poorer people will suffer if housing prices climb due to the new tax.

In addition, a certain homeowner can have two or three houses, but the total value of their properties is far lower than one with only a big house in a prime location. In major cities, a big house in a good commercial quarter may cost hundreds of billions of dong, while a house on the outskirts is priced at hundreds of millions or less, and if the tax is imposed on multiple-home owners, then justice cannot be ensured. That is not to mention the vast difference between a home in a major city and another in the countryside.

As such, the housing tax – if it is to come into life – must be conceived in another way, and should be based on the value of properties as the core rather than merely the number of properties, besides a set of criteria scientifically mapped out to ensure that State intervention in the market will work to make life easier for the general public. It should stabilize the market rather than stirring up public worries.

Source Saigon Times Daily

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