Requirements for establishment of foreign-invested vocational colleges

This is the highlight of the Decree No. 15/2019/ND-CP elaborating on certain articles of and measures to implement the Law on Vocational Education.

Pursuant to the Decree, application requirements for establishment of foreign-invested vocational colleges in Vietnam are specified in Article 9 in the Decree, including the specific regulations as follows:

- Put forward proposals for establishment in line with the planning scheme for development of the Vietnamese network of vocational education institutions; 

- Have already been granted investment registration certificates (in case where regulatory procedures for grant of such certificates are required); 

- Keep sites available for construction of facilities provided that each site intended for construction of urban zones and non-urban zones needs to cover the minimum area of 20,000 m2 and 40,000 m2, respectively;

- Total investment funded by legitimate capital must be at least 100 billion dong (exclusive of value of real property);

- Have recommended organization structures; facilities and equipment; curriculum and syllabus; staff of teachers and administrators meeting requirements for registration of vocational education in accordance with regulations in force; so on.

-Thuvienphapluatvn-

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Incorporation of CPTPP Agreement Relating to Origin Rules into Vietnam Laws

The CPTPP Agreement took effect in Vietnam as of January 14th, 2019 including 11 founding countries including Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, Singapore, New Zealand, Peru and Vietnam. On January 22nd, 2019, the Vietnam Ministry of Industry and Trade issued Circular No. 03/2019/TT-BCT (Circular 03) regulating rules of origin of goods in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) to incorporate and implement the commitments of CPTPP. These rules are important for investors whom are transitioning their factories and manufacturing sites from neighboring counties to Vietnam and set up company to obtain the certificate of origin from Vietnam. However, the understanding of regulations of the circular and relating laws requires the consultation of international trade lawyers in Vietnam for application in particular cases.

Goods are treated as an originating goods if meeting the following requirements:

-Wholly obtained or produced entirely in the territory of one or more of the Member States;

-Produced entirely from materials originating in the territory of one or more of the Member States; or

-Produced entirely in the territory of one or more of the Member States using non-originating materials provided that the goods satisfy all applicable requirements of Annex I attached to the Circular 03.

Moreover, CPTPP Agreement stipulates the origin rule for the Remanufactured Good and Sets of Goods, regulated in Article 7 and Article 20 of Circular 03 respectively.

-Regarding the Sets of Goods, the set is treated as originating if the value of all the non-originating goods in the set does not exceed 10% of the value of the set.

-Regarding the Remanufactured Good, Remanufactured Good are committed to treat as new goods at the same type. CPTPP also has very flexible rules regarding rules of origin for these Good: a recovered material derived in the territory of one or more of the Member States is treated as originating when it is used in the production of, and incorporated into, a Remanufactured Good.

Both CPTPP Agreement and Circular 03 (Article 14) also provide De Minimis regulations, which means that a goods that contains non-originating materials that do not satisfy the applicable change in tariff classification requirement for the good is nonetheless an originating good if the value of all those materials does not exceed 10% of the value of the goods.

In addition to Build-up Method and Build-down Method for calculating Regional Value Content (RVC) based on the value of originating and non-originating materials respectively, CPTPP also stipules Focused Value Method based on the value of specified non- originating materials and Net Cost Method for automotive goods only.

Relating to C/O granting, Vietnam shall use the mechanism of certification by competent authority for goods exported to other Member States. The time for implement the mechanism of self-certification of goods origin by exporters is carried out from 5 to 10 years under the guidance of the Ministry of Industry and Trade. The mechanism of Vietnamese importers self-certifying their origin is implemented after 5 years from the effective date of CPTPP. The procedures of certification and inspection of goods origin shall comply with the provisions of Decree No. 31/2018/ND-CP dated on March 8th, 2018 of the Government detailing the Law on Foreign Trade Management on goods origin and other related documents.

Lawyers at International Trade and Taxes practice of ANT Lawyers always follow the changes in law to update client for decision making process in investing and optimizing operations in Vietnam.

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Requirements concerning submission of notarized or certified true copies of several administrative formalities are about to take effect

On January 30, 2019, the Government promulgated the Decree No. 11/2019/ND-CP (in force from March 15, 2019) amending Decrees prescribing administrative formalities regarding requirements for submission of notarized or certified true copies of documents under the management of the Ministry of Culture, Sports and Tourism.

The Decree prescribes that persons implementing administrative procedures must submit certified true copies or must submit duplicate copies and present original copies for verification purposes if they wish to submit their documents in person; must submit certified true copies if they wish to submit documents by post, including:

- Enterprise registration certificates included in the application package for grant of dance hall licenses or karaoke licenses.

- Sample contract for use of artistic works or sample authorization letter of the art work owner included in the application package for permits for duplication of fine art works related to cultural famous persons, national heroes or father-figures. 

- Representative office establishment license included in the application package for amendments or modifications to a representative office establishment license.

-Thuvienphapluatvn-

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M&A makes up majority of foreign capital inflows

HCMC - Some US$6 billion out of US$7.63 billion in foreign investment capital pledged to HCMC last year came from capital contributions, share acquisitions and purchases of stakes from domestic businesses.

HCMC vice chairman Le Thanh Liem said at a conference in Binh Duong Province on February 14 that the pledged investment capital from foreign investors for HCMC last year picked up by 15.59% against the previous year. Of these, there were 1,060 new projects, with total registered capital of US$811.68 million, and 244 projects with additional capital of over US$835 million.

Last year also saw 3,283 cases in which foreign investors received approval to contribute capital, buy shares and contribute capital to domestic firms, with registered capital totalling US$5.99 billion.

With these results, HCMC received around 60% of foreign capital.

According to Liem, the 2014 investment law has provided a favorable legal corridor for foreign investors to proceed with mergers and acquisitions (M&As).

There have been continuous increases in the number and value of these investments, with only US$1.5 billion received in 2016, US$3.68 billion in 2017 and almost US$6 billion last year.

Liem noted that registered capital through M&As in HCMC had so far reached US$10 billion, 22% of the total foreign capital the city has attracted since 1988.

Also, in HCMC private investments are overwhelming foreign investments. Liem pointed out that the amounts of private capital and foreign direct investment (FDI) capital were almost the same, 29% and 29.5% in 2000, but 68.1% and 15.6% in 2015.

Regarding absolute values, private investments in the city have risen 33-fold, from VND7.4 trillion to VND250 trillion, whereas FDI capital has soared by 7.45 times, from VND7.6 trillion to VND56 trillion.

As shared by Liem, in the past, FDI businesses tended to dominate major property projects, which required heavy investment and advanced construction technology, but local businesses are now able to compete and even buy some projects owned by FDI firms.

On a national scale, Liem said that many economic groups have grown rapidly, dominated the markets and competed with FDI firms in areas where Vietnam is often weaker such as telecoms, automobile manufacturing and electronics manufacturing.

This, according to Liem, has confirmed the position and role of domestic firms in the new age.

However, Liem raised the issue of whether FDI attraction policies are no longer able to maintain their effectiveness as they once did.

He also highlighted the need to build a separate policy to attract special partners. “We have attracted many large investors to Vietnam, but what we have not been able to do is get multinational companies to base their headquarters or research and development wings in Vietnam.”

This is partly due to the fact that Vietnam’s investment environment is not ripe enough to be appealing and the country has yet to impose drastic measures to attract special partners, Liem added.

Last month, the Ministry of Planning and Investment coordinated with the Government Office; relevant ministries and agencies; and the governments of Haiphong, Bac Ninh and Hanoi to organize meetings on foreign investment attraction. These meetings, chaired by Deputy Prime Minister Vuong Dinh Hue, were intended to gather the opinions and proposals of local governments on foreign investment policies.

The meeting in Binh Duong on February 14 was attended by more than 650 representatives of the Central Economic Commission, ministries and agencies, governments of southern localities and authorities of economic zones, industrial parks, associations and investment organizations.

-TheSaigontime-

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Danang to call on investment in hi-tech, real estate after Tet

DANANG – The central coastal city of Danang plans to call for investment in 44 projects mostly in the fields of hi-tech and real estate after the Tet holiday, with each of them needing US$30,000 to US$400 million, according to a representative of the Danang Investment Promotion Agency.

Half of the 44 projects are in the information-technology and hi-tech sectors and will be executed in Danang Hi-Tech Park.

The city is seeking investors for a solar energy project which needs US$150 million to US$400 million, and a US$200-million project to manufacture semiconductor materials for electronic parts and circuits. A 60-hectare urban area project and Truoc Dong Lake ecological zone covering 100 hectares of land are also in need of investment capital.

Apart from that, the city plans to resume work on the delayed projects that have yet to be licensed for investment, including a No.2 software park project covering over 50 hectares. Singapore's firm Sembcorp proposed injecting over US$90 million into the project long ago, but it has been awaiting word from the ministries of Foreign Affairs, Public Security, and National Defense as it is located in a maritime boundary area.

Meanwhile, Matrix Holdings Limited from Hong Kong wants to build a racetrack and horse training and multiplication center in the city, with total capital of US$200 million. An appropriate site is still being sought for it.

Further, Danang will prioritize foreign direct investment in digital, biotechnology, hi-tech agricultural projects, meaning that projects that apply outdated technologies and harm the environment will not be accepted. Investors from Japan, South Korea and Europe are preferred.

-Thesaigontimes-

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Multimodal Transport Business Regulations in Vietnam

On October 16th, 2018, Vietnam Government issued Decree No. 144/2018/ND-CP amending, supplementing the decrees on multimodal transport. Under the law of Vietnam, multimodal transport (“MT”) is the transportation of goods performed with at least two different modes of transport under the multimodal transport contract from an original place to a place designated for delivery, the carrier is liable for the entire carriage. MT business includes: International multimodal transport (“IMT”) and Domestic multimodal transport (“DMT”).

The new decree eliminates and simplifies regulations on IMT business conditions and abolishes DMT business as a conditional business line. In fact, DMT including many transportations such as transport by sea, air,… is governed by specialized laws on each transport, hence it is not necessary to stipulate additional business conditions when conducting the combined transport.

Regarding the conditions of IMT business, the new Decree no longer differentiates between domestic and foreign enterprises as in the past, all enterprises therefore must meet the followings:

(1) Maintaining a minimum amount of assets equivalent to SDR 80,000 or provide an equivalent guarantee or an alternative of financial character as regulated by laws;

(2) Having a liability insurance policy for multimodal transport operator or an equivalent guarantee.

In addition, in order to facilitate member state of the ASEAN Framework Agreement on Multimodal Transport or another international treaty on multimodal transport to which Vietnam is a signatory, new regulations are stipulated as follows:

(1) Having a registration certificate of international multimodal transport or another document of equivalent validity issued by the competent national body of its country;

(2) Having a liability insurance policy for multimodal transport operator or an equivalent guarantee.

The licenses to provide international multimodal transport service issued by competent authorities of Vietnam before the date of entry into force of this Decree are still valid until their expiration dates.

With the role of supporting trading activities, modern transports need to meet the increasingly complex requirements of the domestic and international transport market, which not only deliver goods but also connect the transport process into an uninterrupted transport chain to ensure a faster and safer transport process.

Transport lawyers at ANT Lawyers, the law firm in Vietnam have always following up the legal development on transportation to provide our clients with regular update on the matters.

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