* Barriers to private businesses’ access to official development assistance (ODA) to be lifted: According to Thoi bao Kinh te
This situation is about to change after the Prime Minister issued a document requesting the Ministry of Planning and Investment, the Ministry of Finance and the State Bank of Vietnam to jointly draft a decree to replace, by the end of the year as planned, Decree No. 131/2006/ND-CP on management and use of ODA loans, aiming to introduce a new mechanism for better utilization of these loans, permitting private businesses to access ODA and other foreign loans for implementing the Government’s prioritized programs and projects.
Discrimination against private companies in other areas, such as international commerce, trading agency for foreign parties, export and import,… though not spelt out under current regulations, does exist in reality and will be gradually addressed by the Government by adopting specific mechanisms to facilitate access to loans by these companies, especially in carrying out socially and economically effective projects.
* Auxiliary materials and equipment under EPC contracts to be put in dutiable separate packages for domestic bidding: The Industry and Trade Ministry has recently proposed the Finance Ministry to give import duty exemption for all imported materials and equipment included in complete packages accompanying main equipment of engineering-provision-construction (EPC) projects, reported Saigon Economic Times.
This proposal stems from the reality that most domestic thermal power projects are being implemented by bid-winning or designated EPC contractors that prefer ordering supply of complete sets of materials and equipment from overseas (their own countries or third countries) to procuring domestically available ones, including refractory bricks, electric cables, metal pipes…, which cannot be assembled together into complete equipment units. The procedures for calculation and payment of import duty on those imported items are too complicated and time-consuming to EPC contractors, thus delaying the project implementation.
Meanwhile, imported materials and equipment accompanying auxiliary equipment are required to be separated into different packages for domestic bidding and subject to import duty.
* Shorter period for overseas remittance of profits: Dau Tu (Investment) newspaper reported that the General Department of Taxation (GDT) has accepted proposals of Castrol BP Petco Company Limited and some foreign-invested businesses for overseas remittance of profits they earn in
However, before the GDT recommends to the Finance Ministry amendments to Circular No. 186/2010/TT-BTC, guiding the overseas remittance of profits of foreign entities from direct investment in
* Mining fee to be raised: The Ministry of Finance is planning to collect a fee per mineral exploitation license at the levels of VND 4, 10 and 15 million, for a to-be-explored area of 100 ha, between 100 ha and 50,000 ha, and over 50,000 ha, respectively, reported Thoi bao Kinh te Vietnam (Vietnam Economic Times) newspaper.
For mineral exploitation, the licensing fee will be VND 1, 10 and 15 million, depending on exploitation area and output, for sand and gravel. The fee for licensing the exploitation of other common construction materials without using industrial explosives will be VND 15, 20 or 30 million, for an annual exploitation output of under 5,000 m3, between 5,000 and 10,000 m3 or over 10,000 m3, respectively.
Licensing fees of VND 60, 80 and 100 million will be applicable to exploiters of pit minerals, precious and rare minerals, special or noxious minerals.
* Detailed guidance to better protect consumers: In a recent interview with Vietnam Economic Times, director of the Industry and Trade Ministry’s Competition Management Department Bach Van Mung said that the Department has been assigned by the Prime Minister to draw up a list of essential products, commodities and services, such as power; water; insurance, banking, telecommunications and Internet services, which are subject to compulsory registration by sellers and providers and approval of model contracts, in order to assure that all contract terms are fair to consumers and service users.
Any contracts on provision of registered products or services containing terms unfair to consumers must be terminated.
The Department also plans to coordinate with the Trade Promotion Agency, provincial-level Industry and Trade Departments and Consumer Protection Societies in drafting documents to detail the provisions of the Consumer Protection Law, which took effect on July 1, on sales promotion, seller/provider’s warranty obligation and protection of the interests of customers of sellers/providers without business registration or in remote and rural marketplaces.
To effectively enforce the Law, the Department will also set up a center and maintain a website and hotlines to provide advice to consumers, answer their inquiries and receive and settle their complaints.
* Proposal for loans to build workshops: As reported by Tuoi Tre (Youth) newspaper, the Construction Ministry has recently proposed the State Bank of Vietnam not to tighten credit lending on infrastructure works to serve operations to production or business establishments (workshops), building trade centers and marketplaces, building or repairing private homes or completing uncompleted projects for sale or operation to recover investment capital.
The real estate market has been greatly affected by the Government’s recent tightening monetary policy on non-production sectors, including real estate, and the Construction Ministry suggested flexible adjustment of lending ratios for selected types of real estate projects.
Earlier, the Construction Ministry recommended some solutions to stabilizing the real estate market, including introducing higher criteria for real estate developers to get loans, founding a house saving fund to financially support people with housing needs and a real estate trust fund to pump capital into the real estate market, ensuring foreign investment in real estate projects made according to registered capital amounts and requiring a higher construction completion percentage prior to fund raising.
* Legal instructions and assistance to insurers: More detailed guidance on insurance bidding, especially in aviation, petroleum and agriculture, and cross-border insurance services has been suggested by insurance businesses at a recent roundtable meeting with a view to effectively implementing these new provisions of the amended Insurance Business Law (effective as of July 1), according to Vietnam Economic Times.
Many participants were of the view that insurance bidding for state-funded projects and in the above-said special sectors is unnecessary and insurance for these projects or sectors should be left to specialized insurance businesses related to enterprises implementing these projects or within leading corporations in these sectors, in order to avoid re-insurance costs. Other participants held that insurance bidding is necessary to comply with WTO regulations on anti-discrimination, promote transparency and increase customer choice of insurers.
Regarding cross-border insurance, most businesses proposed enactment of regulations to secure fairness and equality for domestic insurers to compete with financially advantaged foreign insurers and more clearly define which kinds of insurers eligible for providing cross-border health insurance products and requirements on reporting on these products.
In 2011, the Finance Ministry will issue as many as 60 legal documents on insurance business. The Legal Department of the Ministry will also provide training courses for insurers’ legal officers in dealing with insurance-related lawsuits.
* Financial supports for investment in agriculture: The Finance Ministry has just finalized a number of financial policies to support investors in agriculture and rural development.
According to Investment newspaper, from August 1, businesses with investment projects on agriculture and rural development will receive state budget supports in human resource training, marketing, consultancy on and application of scientific and technological advances and transport freight.
Annually, the state budget will partially cover domestic job-training expenses for agricultural projects eligible for special investment incentives, investment incentives or investment promotion (mini, small-sized and medium-sized businesses will get 100%, 70% and 50% of their expenses, respectively, covered).
Expenses for agricultural businesses to advertise themselves and their products in the mass media, participate in domestic exhibitions and trade fairs, purchase market and service information from the state trade promotion agency, hire investment and management consultants, conduct market surveys,…will also be partially covered by the state budget.
* Import procedures to be loosened for some luxury items: The Industry and Trade Ministry has issued a reply to an official letter of the General Department of Customs proposing exclusion of some import items (liquor, cosmetics, cell phones and 9-seat or smaller cars) from the list of those subject to stringent import procedures under Notice No. 197 (effective as of June 1) and requesting the Ministry to check exclusive distributor certificates granted by manufacturers to importers before granting automatic import permits.
According to Phap Luat Viet Nam (Vietnamese Law) newspaper, Official Letter No. 6318 of the Industry and Trade Ministry enumerates 11 cases of importation which will be exempt from stringent import procedures, including cell phones, cosmetics and liquors in transit or border-gate transfer, brought into Vietnam for duty-free sale or for use for defense or security purposes, and components, spare parts and accessories of cell phones.
Also no longer subject to Notice No. 197 will be personal luggage of persons on entry, assets of repatriating Vietnamese officials, experts, students and laborers and overseas Vietnamese returning to the country for permanent residence, sample goods imported not under commercial contracts, cell phones imported for research and production of software applications, and items imported for warranty, repair and replacement purposes.-