8 February, 2016
Decree 118/2015/ND-CP dated 12 November 2015 issued by Government providing detailed regulations and guidance on the implementation of some Articles of the Law on Investment
Highlight points:
1. Replacing Investment Certificate (IC), Enterprise Registration Certificate:
- Enterprises operating under Investment License, IC or any other equivalent legal documents issued before the day from which the Law on Investment came into effective are allowable to replace their current licenses with the new Enterprise Registration Certificate (“ERC”).
- Enterprises with the newly issued ERC shall inherit all rights, and obligations indicated in the Investment License, IC and ERC.
- Branches and Representative Offices operating under IC, Investment License issued before the day from which the Law on Investment came into effective are allowed to operate under the Certificate of Registration of Branch and Representative Office in compliance with the Law on Enterprises. Dossiers and procedures for those replacements are instructed in Decree No.118/2015/ND-CP.
- Enterprise are responsible for updating, supplementing information on corporate registration and not required to perform the registration procedures for issuance and replacement of the Investment License, IC (also known as ERC) or equivalent legal documents to new ERC upon the performance the procedures of liquidation, suspension of business, notification of seal; establishment, amendment of the registered operation activities, dissolution of branch representative offices.
Please contact Grant Thornton Vietnam’s professional advisors if you need our assistance in changing the Investment Certificate, Enterprise Registration Certificate or any other amendments on capital, operation activities of the Enterprises.
2. Implementation:
This Decree takes effect on 27 December 2015 and replaces Decree No.108/2006/ND-CP dated 22 September 2006 issued by the Government providing detailed regulations and guidance on the implementation of some Articles of the Law on Investment.
3. Contents superseded by this Decree:
- List of areas that are entitled to the Corporate Income Tax (CIT) incentives as per Decree No.218/2013/ND-CP dated 26 December 2013 of the Government providing detailed regulations and guidance on the implementation of the Law on CIT;
- List of operating fields that are entitled to Import Tax incentives as per Decree No.87/2010/ND-CP dated 13 August 2010 of Government providing detailed regulations and guidance on implementation of the Law on Export and Import Taxes;
- Point 4, Article 19 and the regulation that “List of areas that are entitled to land rental incentives is only applied for areas with specific boundaries” as per Point 3, Article 19, Decree No. 46/2014/ND-CP dated 15 May 2014 of Government guiding on land and water surface rental.
Schedule of the removal of restrictions on market entry for foreign service providers on logistics services
Grant Thornton Vietnam summarises the guidance of the Ministry of Industry and Trade on the schedule of the removal of restrictions on market entry for foreign service providers on logistic services as follows:
- Warehouse services (CPC 742), conveyance services (CPC 748): Restriction on access of foreign investors to those services is eliminated after 7 years counting from the day that Vietnam participated in WTO. At present, Enterprises with 100% foreign capital are permitted to be established in these areas.
- Other auxiliary services (as parts of CPC 749): Restriction on equity proportion of foreign investors in the joint-venture companies of these services is eliminated after 7 years counting from the day that Vietnam participated in WTO, however, establishment conditions of a join-venture are still applicable.
Notes: The content of other auxiliary services in the detailed Commitments on services of Vietnam in WTO and those in Decree No.140/2007/ND-CP are different.
The following services are still caught under the restrictions on market entry for foreign investors i.e. requirement to establish a joint-venture company, including:
- Maritime conveyance services: including maritime conveyance services for passengers but exclusive of domestic ones (CPC 7211), maritime conveyance services for commodities but exclusive of domestic ones(CPC 7212).
- Customs clearance services.
- Domestic waterways conveyance services : including domestic waterways conveyance services for passengers (CPC 7221), and for commodities (CPC 7222).
- Railway conveyance services : including railway conveyance services for passengers (CPC 7111) and for commodities (CPC 7112).
- Conveyance services on road: including conveyance services on road for passengers(CPC 7121 and 7122); and for commodities (CPC 7123).
- Other services (some parts of CPC 749).
Restrictions on entry to other conveyance services (Section 11, Part II of detailed Commitment on Vietnam services in WTO) is completely eliminated. According to Vietnamese Laws, foreign service providers are permitted to establish enterprises with 100% foreign invested capital to engage in logistics fields provided that these providers comply with Vietnamese Laws on logistics.
Grant Thornton Vietnam will be pleased to support foreign investors in establishing the enterprises with 100% foreign invested capital and ventures engaging in logistics fields.
Importing used machines, equipments and production lines applicable from 01 July 2016 onwards
Ministry of Science and Technology issued Circular No.23/2015/TT-BKHCN on 13 November 2015 to provide guidance on the import of used machines, equipments and production lines applicable from 1 July 2016:
1. Requirements for used equipments to be imported to Vietnam:
- The equipment must not be in use for more than 10 years;
- It was manufactured under National Technical Regulations (NTR), National Standards (NS) of Vietnam or under the Safety Standards, Energy-saving and Environmental Conservation of G7 countries.
2. Used equipments in initial investment projects and expansion investment projects:
- The used equipments listed in the application dossiers of the investment project that were already approved by competent authorities deciding the investment of the project, and the Licensing Authority has granted the Investment Certificate in compliance with the Investment Law are not required to follow the aforementioned regulations.
- However, in some necessary situations, the competent authorities, the Licensing authority can obtain the technological evaluation assessments on these used equipments from professional authorities before accepting the investment project or issuing the Investment Certificate.
3. Notes:
- Enterprises are only allowable to import the used facilities, devices and spare parts when there is a demand to repair or replace the existing equipments being in operation in the enterprises.
- Dossiers for importing the used facilities, devices, accessories and spare parts are attached in Circular No.23/2015/TT BKHCN.
4. Implementation:
Circular 23/2015/TT-BKHCN:
- Effective from 01 July 2016.
- Supersedes the Circular No. 20/2014/TT-BKHCN dated 15 July 2014 of the Ministry of Science and Technology guiding on the importation of used machines, equipment and production lines. Notice No. 2527/TB-BKHCN dated 06 September 2012 of the Ministry of Science and Technology on suspending the import of the used machines, equipment and production lines.
