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DATA CENTRES – KEY ISSUES IN VIETNAM

The data centre market in Vietnam is a sector which is attractive for foreign investments. However, it is important to take into consideration certain points, such as data protection, required licences, build vs lease. In case of an M&A there are issues that might have to be considered depending on the type of deal.

24 May 2021

ADMINISTRATIVE VIOLATIONS INVOLVING CULTURAL AND ADVERTISING ACTIVITIES
Decree 38 provides a better scope defining to which entities it applies. It also introduces several more severe penalties for violations related to advertising for certain products, in particular drugs, cosmetics, medical equipment, fertiliser, or healthcare services. Additional penalties, such as revocation of a licence, are introduced as well.

31 May 2021

BUSINESS CONDITIONS ON TRANSPORTATION SERVICES REDEFINED
The long-awaited Decree 10 sets out several business conditions applicable to a transportation business by vehicles. These businesses include the app-based taxi services provided by Grab and Be. The discussion that has been going on for a long time on the type of services they provide has probably come to an end.

30 Mar 2020

FOCUS NEW LAW ON TAX ADMINISTRATION ON GOVERNANCE AND ENFORCEMENT
The law will also impact e-commerce activities of offshore entities; and introduces new definitions. Finally, legal reps need to be aware that they can be prevented from exiting Vietnam when the company has not paid due taxes. Please note that 6 months remain to take measures to remain compliant.

30 Jan 2020

2019 LAW ON SECURITIES EXPECTED TO DEVELOP VIETNAM’S SECURITIES MARKET
The 2019 Law on Securities for the first time ever mentions foreign investors' participation on the securities market. The law also amends and adds definitions, and separates the initial and additional public offering. Furthermore, the conditions for both public and non-public offerings will be tightened, and the maximum fine will be increased.

31 Dec 2019

EASIER TO SWITCH TO CORRECT VISA FOR FOREIGN INVESTORS AND JOB FINDERS
As of 1 July 2020 it will become easier to switch to a different type of visa for foreign investors and job-finders who entered the country on a tourist visa. There will also be more types of visa available for foreign investors and duration depends on investment but can be up to 10 years.

30 Dec 2019

DECISION 26 TO SPEED UP EQUITISATION AND DIVESTMENT
Decision 26 is expected to speed up the equitisation of SOEs and divestment of State capital to create a level playing field for business entities, generate funds for infrastructure projects and comply with international commitments and free trade agreements.

27 Nov 2019

STRICTER SANCTIONS FOR VIOLATING COMPETITION LAW
Decree 75 contains a general framework for administrative penalties such as warnings and fines, additional sanctions and remedial measures such as suspension of operations, confiscation of profits or revocation of enterprise registration are amongst the additional sanctions, and correction of false information, restructuring of dominant entities, removal of illegal terms.

25 Nov 2019

CIRCULAR 6 ON FOREX CONTROL OF FDI ACTIVITIES IN VIETNAM
Circular 6 results in changes on use of foreign exchange related to foreign direct investment in Vietnam. The definition of FDI enterprise, and the scope of when a direct or indirect investment capital account should be used have changed. Guidelines are provided about the use of foreign currencies and VN Dong.

17 Oct 2019

NEW LABOUR CODE MORE IN LINE WITH INTERNATIONAL LAWS
The new Labour Code includes substantial changes to recognise the evolution of labour relationships under the impact of the Industrial Revolution 4.0. Important is also that the draft for the first time contains a definition of sexual harassment, which is already prohibited under the current Labour Code.

15 Jan 2020

IMPACT OF THE FREE TRADE AGREEMENT BETWEEN VIETNAM AND THE EU
The EVFTA has been signed and is expected to enter into force in 2020. It is an ambitious agreement that not only addresses trade issues, but also sustainability (environment/human rights), and covers dispute settlement. There is a separate agreement that will cover the investor's protection. Companies that would like to take advantage of the EVFTA will - amongst others - have to take into consideration the country of origin and SPS requirements.

23 Aug 2019

PROPOSED CHANGES TO IMPROVE INVESTMENT CLIMATE IN VIETNAM
Amendments are expected related to conditional business lines; and clarifications are provided for Business Investment and Market Access Conditions. Notable are also the proposed amendments about M&A approval requirement, investment incentives, IRC, offshore investments, legal representatives and minority shareholders.

22 Aug 2019

DECREE 15 ON FOREIGN-INVESTMENT IN VOCATIONAL TRAINING INSTITUTIONS
Decree 15 offers detailed instructions on the implementation of the Law on Vocational Education and Training. It sets out requirements that need to be met before a project of vocational institution could be launched by a foreign investor. Decree 15 is expected to attract foreign investment in the vocational training.

29 May 2019

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