1. CIRCULAR 17/2018/TT-NHNN
“Simplifying conditions for founding shareholders of joint-stock commercial banks“
Circular 17/2018/TT-NHNN (“Circular 17”) dated 14/8/2018 of the State Bank amending and supplementing several provisions of circulars regulating the licensing, network of operation and foreign exchange activities of credit institutions and foreign bank branches, is effectective as of 01/10/2018.
According to Circular 17, the founding shareholders must jointly own at least 50% of the charter capital when establishing a joint-stock commercial bank, in which the founding shareholders being legal entities are required to own at least 50% of total shares of founding shareholders. This means that the founding shareholders must always maintain this ratio, in stead of only within five (05) years from the issuance of the license as previously stipulated in Circular 14/2011/TT-NHNN.
At the same time, Circular 17 abolishes several conditions to become a founding shareholder stipulated in Circular 14/2011/TT-NHNN, including: (i) must have financial ability to contribute capital; (ii) take full responsibility for the legality of the source of the contributed capital; (iii) pledge to financially support joint-stock commercial banks to resolve difficulties in case of difficulties in capital or solvency; (iv) there are at least 2 founding shareholders being organizations.
In addition, one of the conditions for commercial banks to be permitted to extend other foreign exchange activities in the domestic or international market according to Circular 21/2014/TT-NHNN is that such commercial bank has been permitted to conduct such activities within a time limit by the State Bank. Now, this condition has been abolished.
2. DECREE 142/2018/ND-CP
“Amendments to business conditions of some industries under the management of the Ministry of Culture, Sports and Tourism“
Decree No. 142/2018/ND-CP (“Decree 142”) dated 09/10/2018 of the Government amending the conditions for business investment under the state management of the Ministry of Culture, Sports and Travel is effective from the date of issue.
Decree 142 loosened the conditions for enterprises wishing to participate in the current film production business, whereby the legal capital requirement for film production business has decreased from VND 1,000,000,000 to only VND 200,000,000.
In addition, conditions for karaoke service business have been loosened compared to Decree 103/2009/ND-CP. Specifically, Decree 142 abolished several regulations such as: (i) lighting in rooms must be over 10 Lux, equivalent to one (01) 40W incandescent light for 20m2; (ii) no sales of alcohol or allowing guests to consume alcohol inside; (iii) the door of a karaoke room must be a colorless glass door and the whole room is visible from outside; (iv) sounds coming out of the room must not exceed the limit.
3. CIRCULAR 21/2018/TT-BCT
“Abolishing regulations on the subject of notification of e-commerce website“
Circular 21/2018/TT-BCT (“Circular 21”) dated 20/08/2018 of the Ministry of Industry and Trade amending Circular 47/2014/TT-BCT and Circular 49/2015/TT-BCT on e-commerce management (“e-commerce”) via mobile application, is effective as of 18/10/2018.
Circular 21 abolishes regulations regarding the subject of e-commerce sales website announcement, including: traders; organizations having the function of organizing sales activities, providing services or conducting e-commerce activities; individuals that have been issued personal tax codes and are not subject to business registration in accordance with the law.
In addition, Circular 21 amends the regulation regarding persons registering commercial service websites that are traders or organizations possessing e-commerce websites, on which at least one of the following services is provided: (i) e-commerce exchange platform; (ii) online promotion; or (iii) online auctions. This regulation has expanded the list of persons subject to registration of e-commerce website compared to the previous regulations, specifically for persons being organization, new regulations no longer restrict that organizations having e-commerce websites must operate in the field of trade promotion or business support.
4. DECREE 108/2018/ND-CP
“Several amendments to business registration“
Decree 108/2018/ND-CP (“Decree 108”) dated 23/8/2018 of the Government stipulating the amendments and supplements to a number of articles of Decree 78/2015/ND-CP (“Decree 78”) on business registration, is effective as of 10/10/2018.
For business registration procedures, Decree 108 supplemented the provision that enterprises are not required to stamp: (i) application for business registration; (ii) notice of changes in business registration contents; and (iii) resolutions, decisions, and records in the business registration dossier. For documents authorizing individuals to carry out business registration, such document of authorization is not required to be notarized or authenticated as previously prescribed.
For the case of enterprise transformation, Decree 108 supplements that enterprises may apply for change of the enterprise form and change of the enterprise registration contents or notice of changes to other business registration contents at the same time, except for application for change of legal representative… In addition, Decree 108 also supplements the regulations regarding establishment of enterprises on the basis of conversion from business households. Thus, individuals/organizations may conduct several procedures at the same time, reducing a great mount of time and expenses.
Regarding the establishment of business locations, Decree 108 abolishes the regulations that business locations are only allowed to be established in provinces and cities where the headquarter or branch of the enterprise is located. Compared to the previous regulation, the new regulation reduces barriers, creates the initiative for businesses to establish business locations.
Thus, Decree 108 has amended and supplemented many regulations in order to simplify the aforementioned procedures, bringing efficiency and saving time for enterprises when conducting such business registration procedures.
5. DECREE 147/2018/ND-CP
“Abolishment of Certificate of sea transport business issuance procedure“
Decree No. 147/2018/ND-CP (“Decree 147”) dated 24/10/2018 of the Government amending and supplementing several provisions of the decrees regulating the maritime business conditions, is effective on the same date.
Decree 147 officially abolishes the issuance procedure of the Certificate of eligibility for sea transport business. Enterprises and cooperatives engaged in sea transport business only need to satisfy the general conditions in order to be established in accordance with the law, instead of having to obtain a Certificate of eligibility for sea transport business as previously prescribed in Decree No. 160/2016/ND-CP.
Concurrently, Decree 147 simplified conditions for domestic sea transport business: (i) being a shipping business established in accordance with the law; (ii) having the legal right to use at least one (01) ship of Vietnamese nationality. Previously, in addition to these conditions, enterprises had to meet the conditions on human resources, organizational structure, finance, etc.
6. DECREE 119/2018/ND-CP
“Electronic invoice is mandatory as of 01/11/2020“
Decree No. 119/ND-CP (“Decree 119”) dated 12/09/2018 of the Government prescribing electronic invoice for sales of goods and provision of services, replacing Decree No. 51/2010/ND-CP and Decree No. 04/2014/ND-CP, is effective as of 01/11/2018.
Accordingly, all businesses, economic organizations and other organizations are required to issue electronic invoices with the tax agency’s code upon sales of goods and provision of services..
Regarding the fields of electricity, petroleum, post and telecommunications, transport, insurance, health, finance and credit, e-commerce and supermarkets, such enterprises have the option to use electronic invoices without the tax agency’s code.
Decree 119 requires that electronic invoices must be issued for each single sale of goods or provision of services, regardless of the value of each sale, instead of not having to issue invoices for sale of goods or provision of services under 200,000 dong according to previous regulations.
The use of electronic invoices with or without the tax agency’s code is to be registered on the Web Portal of the General Department of Taxation. Upon implementation of electronic invoices as per the registration, any remaining paper invoices are to be destroyed and not eligible for further use.
However, the conversion from using paper invoices to electronic invoices is carried out according to the schedule until 01/11/2020, and Decree No. 51/2010/ND-CP and Decree No. 04/2014/ND-CP are still valid until 31/10/2020. Therefore, as of 01/11/2020, all enterprises, economic organizations, other organizations, business households and individuals must use electronic invoices.
7. DECREE 130/2018/ND-CP
“Amendments to several conditions for the licensing of digital signature certification service“
Decree 130/2018/ND-CP (“Decree 130”) dated 27/09/2018 of the Government providing guidance on the implementation of the Law on E-Transactions regarding digital signature and digital signature certification service, replacing Decree No. 26/2007/ND-CP (“Decree 26”), Decree No. 116/2016/ND-CP amending Decree 26; and Decree No.107/2013/ND-CP amending Decree 26, is effective as of 15/11/2018.
Decree 130 amends several financial conditions for the licensing of public digital signature certification service providers. Accordingly, enterprises are required to make a deposit of at least 05 billion Dong at a commercial bank operating in Vietnam, in stead of either making deposit or procuring a bank guarantee of at least 05 billion Dong, or undertaking to procure insurance. Concurrently, Decree 130 does not set forth the condition that enterprises must have sufficient financial capability to establish technical system, organize and maintain operation in accordance with the scale of the service provider.
According to Decree 130, the dossier for licensing was also simplified. Enterprises are not required to submit the following: business registration certificate or investment registration certificate, which states the digital signature certification service business line; charter; and business plan.
In addition, Decree 130 has also amended the duration of validity of licenses issued to digital signature certification service providers to be 10 years, in stead of not more than 10 years as previously prescribed.
8. DECREE 143/2018/ND-CP
“Foreign employees are required to pay compulsory social insurance equivalent to 8% of salary“
Decree No. 143/2018/ND-CP (“Decree 143”) dated 15/10/2018 of the Government specifying several regulations of the Law on Social Insurance and the Law on Occupational Safety and Hygiene on compulsory social insurance (“SI”) for foreign employees working in Vietnam, is effective as of 01/12/2018.
For the first time, Decree 143 requires that foreign employees working in Vietnam must comply with the following compulsory SI regimes: sickness, maternity, occupational accident, disease, retirement and death benefits.
As of 01/01/2022, foreign employees pay 8% of monthly salary to retirement and death benefits funds. Employees not working and not receiving salary for more than 14 days in a month are not required to pay SI for such month, and this period of time is not taken into account for the enjoyment of SI.
The payment rate of compulsory SI of the employers for their foreign employees is as follows:
- 3% to sickness and maternity funds;
- 0.5% to occupational accident and disease funds;
- 14% to retirement and death benefits fund as of 01/01/2022.
9. CIRCULAR 39/2018/TT-BCT
“The Ministry of Industry and Commerce provides guidance on the inspection and verification of origin of exported goods“
Circular 39/2018/TT-BCT (“Circular 39”) dated 30/10/2018 of the Ministry of Industry and Commerce providing regulation on the inspection and verification of origin of exported goods, is effective as of 14/12/2018.
The inspection and verification of origin of exported goods are conducted under two (02) methods: (i) inspection of documents and certificates of origin of goods; (ii) on-site inspection and verification of origin of goods.
Circular 39 prescribes the circumstances in which method (i) is applied, namely:
- Competent authority of the importing country requests the inspection of origin of goods;
- Domestic competent authority or organization carries out the inspection, verification, risk management and prevention of fraud related to origin of goods; or
- Other domestic authority requests cooperation if there are grounds for suspicion or signs of fraud.
Method (ii) is applied in the following circumstances:
- Competent authority of importing country requests on-site inspection when the results of method (i) are not sufficient to verify the origin of goods or when there are grounds for suspicion of fraud related to origin of goods.
- Domestic competent authority or organization carries out the inspection, verification, risk management and prevention of fraud related to origin of goods at the following instances: (i) Before issuance of the Certificate of Origin (C/O); (ii) Before issuance of approval or self-verification or verification code of origin of goods; or (iii) After having issued certificate of origin of goods.
- Other domestic authority requests cooperation if there are grounds for suspicion or signs of fraud.
10. DECREE 148/2018/ND-CP
“Amendment to the basis for calculation of severance pay, pay during annual leaves and holidays“
Decree 148/2018/ND-CP (“Decree 148”) dated 24/10/2018 of the Government amending and supplementing several regulations of Decree No. 05/2015/ND-CP (“Decree 05”) dated 12/01/2015 of the Government specifying and providing guidance on severval provisions of the Labor Code, is effective as of 15/12/2018.
What’s noteworthy about Decree 148 is the new regulation on salary as the basis for paying employees on annual leaves, annual leaves in conjunction with seniority, holidays and paid leaves. Specifically, the basis for calculating payment is the salary under the labor contract divided by the number of normal working days in the month prescribed by the employer, instead of the salary stated in the labor contract of the previous month. as previously prescribed in Decree 05.
According to Decree 148, probation, apprenticeship and training periods are no longer considered as actual working time for the calculation of severance and redundancy pay as previously prescribed.
In addition, Decree 148 supplements the provision on salary as the basis for compensation when labor contract is unilaterally terminated illegally. Accordingly, the salary as the compensation basis is the salary stated in the labor contract at the time of illegal unilateral termination.
11. DECREE 150/2018/ND-CP
“Simplifying business conditions and administrative procedures in the field of media“
Decree 150/2018/ND-CP (“Decree 150”) dated 07/11/2018 of the Government amending several decrees related to business investment conditions and administrative procedures in the field of information and media, is effective as of 24/12/2018.
According to Decree 150, regulations on managing agencies and publishers having to ensure the annual budget of at least 05 billion Dong to guarantee the publisher’s operation have been abolished.
In addition, Decree 150 also abolished several conditions on equipment and technology for publishing and releasing electronic publications such as: (i) having servers located in Vietnam, computers and devices for the purpose of publishing and releasing electronic publications on the Internet; (ii) having equipment and software for designing, paging, recording data on electronic means; (iii) having devices for the transmission of electronics publications after being edited, formatted and stored on electronic means; (iv) have equipment, technical solutions for virus prevention, etc.
Also under the new regulations, applicant for the registration of “.vn” domain name and international domain name in Vietnam do not need to apply for domain name services business registration before providing such services.