On May 22, 2018, the Government issued Decree No.82/2018/ND-CP regulating on management of industrial parks and economic zones. This Decree took effect since July 10, 2018.
Accordingly, Decree No.82/2018/ND-CP regulates investment preferences for industrial zones and economic zones as follows:
- Economic zones and industrial parks which are geographical areas entitled to investment preferences shall enjoy preferential policies applicable to geographical areas on the list of geographical areas with difficult or extremely difficult socio-economic conditions according to the law on investment.
- Expenses for investment in the construction, operation or rent of apartment buildings and social infrastructure works for workers working in industrial parks or economic zones shall be deductible reasonable expenses when calculating the taxable incomes of enterprises with investment projects in industrial parks or economic zones.
- Investment projects on the construction of dwelling houses, cultural and sport works and social infrastructure works in service of workers in industrial parks or economic zones shall enjoy preferences according to the provisions of law on the construction of social housing and related legislation.
- Investors and enterprises having investment projects in industrial parks or economic zones assisted by competent agencies shall carry out administrative procedures for investment, enterprises, land, construction and environment, labor, trade under the “One door, one spot” mechanism, support for labor recruitment and other related issues in the project implementation.
With specific and detailed regulations, Decree No.82/2018/ND-CP is expected to facilitate the development of industrial zones and economic zones, thereby encouraging and attracting invest in these areas.
On May 26, 2018, the Standing Committee of the National Assembly promulgated Resolution No.528/2018/UBTVQH14 on expenses for management of social insurance and unemployment insurance for the period of 2019 – 2021. This Resolution took effect since January 01, 2019.
Accordingly, Resolution No.528/2018/UBTVQH14 regulates the level of expenses for management of social insurance and unemployment insurance for the period of 2019 – 2021 as follows:
- Expenditure for management of social insurance in 2019 shall be 2.15%, 2020 shall be 2.0% and 2021 shall be 1,85% of the social insurance revenues and expenditures (except for health insurance premiums paid to social insurance beneficiaries) shall be deducted from the profit earned from investment activities from the social insurance fund;
- Expenditure for management of unemployment insurance in 2019 shall be 2.15%, 2020 shall be 2.0% and 2021 shall be 1,85% of the unemployment insurance revenues and expenditures (except for health insurance premiums paid to unemployment insurance beneficiaries) shall be deducted from the profit earned from investment activities from the unemployment insurance fund;
- If the social insurance premiums and unemployment insurance premiums are not met in the year, the above managerial expenses shall be calculated on the actually collected amounts and actually paid;
- Levels of salary payment for cadres, civil servants and employees working in the dependent units of the Vietnam Social Insurance, the employees working under the regime of labor contracts in the insurance organization the Ministry of Public Security and the Ministry of Ministry of Defence, the employees will be implemented the unemployment insurance policy of the labor, war invalids and social affairs with 1.8 times higher than the salary regime for cadres, civil servants and employees regulated by the State.
Thus, Resolution No.528/2018/UBTVQH14 has specified the expenses for management of social insurance and unemployment insurance for each period, which plays an important role in the management of the State, thereby contributing to the use of budget savings and efficiency.
On May 23, 2018, the Party Central Committee issued Resolution No.28-NQ/TW on reforming social insurance policy. This Resolution took effect from the date of its promulgation.
Accordingly, Resolution No.28-NQ/TW regulates the following important reforms:
- Expanding the subjects participating in compulsory social insurance for groups of heads of business household, managers of enterprises, managers and administrators of cooperatives without salaries or laborers working on flexible regimes;
- Amending the regulations on the minimum period of social insurance participation in order to enjoy the retirement regime in the direction of gradually reducing the minimum social insurance contribution from 20 years to 15 years, towards 10 years with the level of benefit is calculated appropriately in order to create conditions for elderly workers with low social insurance contributions to receive benefits.
- Reviewing, amending and improving the calculation of pensions, ensuring equality between men and women and between the state and non-state sectors.
- Harmonizing the principles of pay and share between high-wage earners and low-wage earners to narrow the income gap in pensioners.
Therefore, Resolution No.28-NQ/TW regulates the important reform of social insurance policy, thereby contributing to improving the quality and effectiveness of social insurance policies in Viet Nam.
On May 22, the Government issued Decree No.81/2018/ND-CP detailing the Commercial Law regarding trade promotion activities, including sales promotion, fairs and exhibitions. This Decree took effect since July 15, 2018.
Accordingly, Decree No.81/2018/ND-CP regulates the maximum discount rate for promoted goods and services as follows:
- Sales promotion limit and price discount limit must not exceed 50% of the price of one unit of promoted goods and services before sales promotion.
- For the promotions in form of price discount in case of centralized promotions mentioned above (hour, day, week, moth, promotion season), the maximum price discount for promoted goods or services is 100%. This maximum price discount shall be applied with the promotion activities within the framework of trade promotion activities, programs decided by the Prime Minister.
With specific regulations, Decree No.81/2018/ND-CP aims at minimizing unfair promotion programs and competition, thus causing negative impacts on the market economy recently.
On May 24, 2018, the Ministry of Industry and Trade issued Circular No.10/2018/TT-BCT detailing some articles of the Government’s Decree No.40/2018/ND-CP dated March 12,2018 on management of business activities by multi-level mode. This Circular took effect since July 15, 2018.
Accordingly, the Circular No.10/2018/TT-BCT regulates the framework for the training program on legal knowledge on multi-level mode and the procedure for organizing the examination of legal knowledge on multi-level mode as follows: :
- The framework for the training program on legal knowledge on multi-level mode must ensure the following contents:
– Training duration: at least 08 hours;
– Program content: Overview of multi-level sales; the law on management of business activities in a multi-level mode; code of professional ethics of multi-level sales; the law on protection of Consumers’ Rights; the law of advertising.
- The procedure for organizing the examination of legal knowledge on multi-level mode
– Checking the completeness and validity of registration dossiers on examination and certification of legal knowledge on multi-level mode according to regulations;
– Planning time, place, mode of examination;
– Notification on examination plan;
– Organizing the examination;
– Evaluation of the test results;
– Notification on examination results.
Therefore, it can be seen that Circular No.10/2018/TT-BCT specifies the content on propaganda to improve legal knowledge on multi-level mode set by the Government in Decree No.40/2018/ND-CP, thereby ensuring that individuals and organizations after attending training courses have the basic legal knowledge to carry out multi-level business activities in accordance with law.
On May 04, 2018, the Ministry of Finance issued Circular No.41/2018/TT-BTC guiding some contents on financial handling and valuation of enterprises when transferring state-owned enterprises and single-member limited liability company whose 100% charter capital is invested by a State into a joint stock company. This Circular took effect since June 18, 2018.
Accordingly, Circular No.41/2018/TT-BTC regulates the inventory and classification of assets before equitization state-owned enterprises as follows:
- At the time of valuation of the enterprise, the enterprise must draw up a list of the actual quantity and actual conditions, quality and value of the assets currently managed and used; check cash balance, reconcile bank deposit balance; determine assets, cash surplus or deficit as compared to accounting books, analyze the cause of excess and the liability of the concerned persons and determine the level of compensation as prescribed by law.
- Assets already inventories are classified into the following groups:
– Assets used in production and business activities.
– Assets do not need to use, assets are stagnant, slow rotation, property awaiting liquidation.
– Assets formed from reward and welfare funds (if any).
– Assets leased or borrowed, supplies and goods kept for preservation, processing, agency, consigned, joint venture assets and other assets don’t belong to the enterprises.
– Assets attached to land which must be handled according to the plan on re-arrangement of house and land establishments under decisions approving by competent agencies in accordance with the law on rearrangement of state-owned houses and land.
– Assets of non-business units with revenues (land and housing establishments of non-business units with revenues under the law on reorganization and treatment of state-owned land and houses), non-business operating assets .
– Assets awaiting settlement decisions of competent agencies.
– Financial investments (contributing capital to joint ventures, contributing capital to establishing limited liability companies and other capital contribution activities) equal to the value of land use rights.
– Other assets (if any).
With detailed and specific regulations, Circular No.41/2018/TT-BTC is expected to provide a solid legal basis for the process of valuation of state-owned enterprises before equitization, thereby ensuring the transparency of this activity, avoid causing loss of state property.
On May 29, 2018, the State Bank of Vietnam issued Decision No.1158/QD-NHNN on mandatory reserve ratio applicable to credit institutions and branches of foreign banks. This Decision took effect since the maintenance period for the mandatory reserves in June 2018.
Accordingly, Decision No.1158/QD-NHNN regulates on mandatory reserve ratio applicable to credit institutions and branches of foreign banks as follows:
- People’s credit funds and microfinance institutions: The mandatory reserve ratio for Vietnam dong deposits and deposits in foreign currency is 0%;
- Policy Bank: Mandatory Reservation Level According to Government Provisions.
- Vietnam Agricultural and Rural Development Bank and Co-operative Bank apply mandatory reservation quotas corresponding to each type and deposits are as follows:
– Demand payment in Vietnam dong and maturity of 12 months is 3% of total deposit balances subject to mandatory reserve;
– VND deposits with a maturity of 12 months and over are 1% of the total deposit balances covered by mandatory reserve;
– Deposits in foreign currencies of credit institutions abroad are 1% of the total deposit balances covered by mandatory reserve;
– Deposits in foreign currency subject to other mandatory reserves than demand deposits and less than twelve months shall represent 7% of the total deposit balances covered by mandatory reserve;
– Deposits in foreign currency subject to mandatory reserves for other terms of 12 months or more shall be equal to 5% of the total deposit balances covered by mandatory reserve calculation.
- Other Credit institutions shall apply the mandatory reserve ratio corresponding to each type of deposit as follows:
– To submit Vietnam dong for demand deposits and on terms less than 12 months shall be 3% of the total deposit balances covered by mandatory reserve calculation;
– VND deposits with a maturity of 12 months and over are 1% of the total deposit balances covered by mandatory reserve;
– Deposits in foreign currencies of credit institutions abroad are 1% of the total deposit balances covered by mandatory reserve;
– For deposits in foreign currency, the mandatory reserve for demand payments and maturities of less than 12 months shall be 8% of the total deposit balances covered by mandatory reserve;
– Deposits in foreign currency subject to mandatory reserves with another maturity of 12 months or more shall correspond to 6% of the total deposit balances covered by mandatory reserves.
Therefore, as compared with the previous documents, Decision No.1158/QD-NHNN has adjusted to increase the mandatory reserves for credit institutions to ensure credit security, risk management better in the financial market.
On May 29, 2018, the State Bank issued Circular No.14/2018/TT-NHNN guiding the implementation of several measures of the monetary policy management in order to support the credit institutions, the foreign bank branches to provide loans for agricultural and rural development. This Circular took effect since July 13, 2018.
Accordingly, Circular No.14/2018/TT-NHNN stipulates measures to support credit institutions to provide loans for agricultural and rural development as follows:
1. Credit institutions that provide loans for agricultural and rural development will receive refinancing support in line with applicable regulations on refinancing credit institutions.
2. Those credit institutions will receive support in terms of reserve requirement ratios, particularly:
– Lower reserve requirement ratios applied to the deposits in Vietnamdong as compared to the reserve requirements regulated by the State Bank in relation to each category of credit institutions in different periods:
– For credit institutions with the average credit ratios for agricultural and rural areas of 40% or higher, but without the need to apply the reserve requirement ratio support, the regulations of reserve requirements in this Circular should not apply.
With clear and specific regulations, Circular No.14/2018 / TT-NHNN has created favorable conditions for credit institutions to well implement the policies of the Party and the State, thereby supporting the development of agriculture, ensuring the livelihood of farmers.
On May 18, 2018, the State Bank of Vietnam issued Circular No.13/2018/TT-NHNN regulating on the internal control system of commercial banks and branches of foreign banks. This Circular took effect since January 1, 2019.
Accordingly, Circular No.13/2018/TT-NHNN regulates the standards for internal auditors working at the bank as follows:
- Standards of internal auditors working at commercial bank:
– Having university or higher degree in economics, business administration, law, accounting, auditing; having a university or higher degree in information technology or specialized majors suitable to technology auditors;
– Having worked directly in the banking, finance, accounting, auditing sector for at least 2 years for internal auditors and 03 years for Chief internal auditors; having at least 2 years working experience in the information technology field for technology auditors.
- Standards of internal auditors working at branch of foreign bank shall comply with regulations of parent bank.
Therefore, it can be seen that Circular No.13/2018/TT-NHNN plays an important role in improving the quality of internal audit and risk management in financial institutions, thus ensuring credit security and reduce risks for individuals and organizations when using banking services.
On May 28, 2018, the Ministry of Transport issued Official Dispatch No.5559/BGTVT-QLDN reporting on the status of disclosure information to support small and medium-sized enterprises under the Law on support for small and medium-sized enterprises. This Official Letter takes effect from the date of its promulgation.
Accordingly, Official Dispatch No.5559/BGTVT-QLDN provides measures to support for small and medium-sized enterprises in the transportation sector as follows:
- The Information Technology Center of the Ministry of Transport shall have the responsibility to guide agencies and units in providing information and receiving information on support for small and medium-sized enterprises, setting up a separate category on supporting information for small and medium-sized enterprises to publicize relevant information on the Portal of the Ministry of Transport.
- Dependent units of the Ministry shall have to review and gather information on plans, programs, projects and activities to support for small and medium-sized enterprises, including information such as business instructions, information on credit, markets, products, technology, business incubation and other information according to the needs of the enterprises.
Through the Official Dispatch No.5559/BGTVT-QLDN, the Ministry of Transport has expressed interest in small and medium-sized enterprises, allowing them to have access to a wide range of information resources in the transportation sector to quickly grasp opportunities for business development and expansion.