Foreign investment restrictions
In several fields, foreign investment will not be licensed or will only be licensed under special conditions. In accordance with the 2020 Law on Investment, a draft Decree providing the lists of business sectors where market access by foreign investors are not allowed or allowed with certain conditions are being circulated for public comments and will be finalised soon.
All buying, selling, lending, and transfer of foreign currency needs to be made through credit institutions and other financial institutions authorised by the State Bank of Vietnam (SBV).
Outflow of foreign currency by transfer is authorised for certain transactions, such as payments for imports and services abroad, refund of loans contracted abroad and payment of interest accrued thereon, transfer of profits and dividends, and revenues from transfer of technology.
All monetary transactions in Vietnam must be undertaken in Vietnamese dong. Exceptions are applicable to payments for exports made between principals and their agents, and payments for goods and services purchased from institutions authorised to receive foreign currency payments such as for air tickets, shipping and air freight, insurance, and international communications.
Forms of doing business
According to the Law on Enterprises, a foreign-invested enterprise may be established as either a single member limited liability or a limited liability with more than one member, a joint-stock company, or a partnership.
Intellectual property (IP)
IP rights are protected by the Civil Code (1995 and 2005), the Law on Intellectual Property (2005, amended 2009), and a host of subordinate legislation.
Vietnam is signatory to the Paris Convention, the Madrid Agreement on International Trademark Registration, and the Patent Cooperation Treaty, and is a member of the World Intellectual Property Organisation. Vietnam has entered into an agreement on copyrights with the United States (US). According to the Vietnam-US Bilateral Trade Agreement, Vietnam is further under the obligation to adhere to the Berne Convention.
Vietnam’s National Assembly ratified the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CP-TPP) on 12 November 2018. Under the CP-TPP, Vietnam has five years from the effective date of this agreement to update its Law on Intellectual Property to be consistent with the CP-TPP provisions.
On 14 June 2019, the National Assembly ratified Law No. 42/2019/QH14 amending both the Law on Intellectual Property and the Law on Insurance Business.
The IP Law has been amended to reflect Vietnam’s commitments under CP-TPP. Amendments are made to different aspects of IP, including inventions, geographical indications, trademarks, measures against abuse of IP protection procedures and measures to enforce IP rights. The amended IP Law was effective from 1 November 2019, except for certain cases, where the new regulations were retroactively effective from 14 January 2019 (i.e. when the CP-TPP came into effect in Vietnam).
A draft law amending the current IP Law has been in discussion, which aims, inter alia, to improve the efficiency of IP rights protection activities and to ensure the implementation of Vietnam's international commitments on IP protection.
COVID 19 Pandemic
The economic impact of the COVID-19 outbreak has weighed heavily on business sentiment in Viet Nam, with 77% of Viet Nam’s finance leaders expect revenues to most likely fall, faring slightly better than the global average (84%) for the current financial year, according to an Association of Chartered Certified Accountants (ACCA) survey
As a result of successfully containing the COVID-19 outbreak, Viet Nam’s reputation as an attractive and safe investment destination has been cemented and praised.
The government has offered financial assistance for employers and employees affected by the pandemic, with examples given below:
- Resolution 42 consisting of a financial package for those affected by the pandemic and targets six categories of individuals and businesses;
- Decree 41 on five-month delay of deadline for payments of taxes and land rental fees with total estimated amount subject to deferral at VND180trn (US$7.7bn);
- Resolution 84 aimed at further reduction of the pandemic’s impact on businesses;
- Firms and workers allowed to defer their contribution (up to 12 months) to the pension fund;
- A cash handout package of VND36trn (US$1.5bn) to about 20% of the population (low income, unemployed, business owners who have had their businesses suspended);
- A rebate of VND10trn (US$430mn) for electricity prices, at a maximum of 10% for 3 months to support firms and households.