RESTRICTED
WORLD TRADE WT/ACC/VNM/2
24September 1996
ORGANIZATION(96-3765)
Original: English
ACCESSION OFVIETNAM
Memorandum ontheForeign Trade Régime
Inacommunication dated 12January 1995(WT/L/1), theGovernment oftheSocialist Republic
ofVietnam applied foraccession under Article XIIoftheAgreement Establishing theWorld Trade
Organization (WTO).
Atitsmeeting on31January 1995, theGeneral Council established aWorking Party withthe
following terms ofreference: "Toexamine theapplication oftheGovernment ofVietnam toaccede
totheWTO Agreement under Article XII,andtosubmit totheGeneral Council recommendations
which mayinclude adraftProtocol ofAccession." Themembership isopentoallWTO Members
indicating theirwishtoserve ontheWorking Party.
Inaccordance withtheestablished procedures (WT/ACC/1), theSecretariat iscirculating the
attached Memorandum ontheForeign Trade Régime received fromtheGovernment ofVietnam. WTO
Members wishing tosubmit questions ontheMemorandum areinvited todosoby1November 1996
fortransmission totheauthorities oftheSocialist Republic ofVietnam.WT/ACC/VNM/2
Pageii
TABLE OFCONTENTS
Page
PREAMBLE 1
I INTRODUCTION 1
II THE ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE
1. Current Economic Situation 2
2. Economic Policies
(a) Main features
(i) Major directions 5
(ii) Strategic andtactical objectives oftheon-going economic policies 7
(iii) Price policies 7
(iv) Economic development programmes andregional priorities 9
(v) Privatization plans 11
(b) Fiscal andmonetary policies 11
(i) Monetary, credit andforeign exchange policies 12
(ii) Taxpolicies 13
(iii) Orientations oftaxreform totheyear2000 19
(c) Foreign exchange andbalance ofpayment policy 22
(d) Investment Policy 23
(e) Competition Policy 24
III. BASIS FOR MAKING AND IMPLEMENTING THE POLICIES
RELATING TOTRADING COMMODITIES AND SERVICES
1. Powers oftheExecutive, Legislative andJuridical Bodies
(a) National Assembly 24
(b) TheState President 25
(c) TheGovernment 25
(d) TheSupreme People 'sCourt andtheSupreme People 's
Office forSupervision andControl 26
2. TheGovernmental Organs Responsible forDrafting andImplementing
Foreign Trade-Relevant Policies 27
3. Powers oftheGovernment andLocal Administrative Committees 29
4. Regulations onPolicy Planning, Approval andRatification 29
5. Laws andBy-Law Documents oftheNational Assembly,
theState andtheGovernment 31
6. Procedures forResolving Economic Cases andDisputes 31
(a) Procedures forsettlement ofeconomic cases 31
(b) Procedure forsettlement ofeconomic disputes byeconomic arbitration 32
IV. POLICIES AFFECTING GOODS
1. Import Regulation
(a) Registration requirements forengaging inexport-import 33
(b) Characteristics ofthenational taxation system (andtaxholidays) 34
(c) Tariff quota 36WT/ACC/VNM/2
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(d) Other taxes andcharges 36
(e) Quantitative import restriction including prohibition, import quota,
andlicensing system 36
(f) Import licensing procedures 38
(g) Restrictions onborder trade imports 40
(h) Customs valuation 40
(i) Other customs formalities 41
(j) Pre-shipment inspection 41
(k) Domestic taxes levied onimported goods 41
(l) Rules oforigin 41
(m) Anti-dumping 42
(n) Countervailing duty 42
(o) Safeguard measures 42
2. Regulation onExport
(a) Registration requirements forengaging inexports 42
(b) Export tariff 42
(c) Quantitative export restriction including prohibition, quota andlicensing systems 43
(d) Export licensing procedures 43
(e) Other measures 44
(f) Export financing, subsidy andpromotion policies 44
(g) Export performances requirements 44
(h) Import duties drawback schemes 44
3. Domestic Policies Relating toForeign Trade
(a) Industrial policies andsubsidies 45
(b) Technical specifications andstandards 45
(c) Sanitary andPhytosanitary 46
(d) Trade related investment measures 46
(e) State-owned enterprises 47
(f+g) Freeareas andfreeeconomic areas 47
(h) Trade related environment policies 48
(i) Barter trade under governmental agreements 48
(k) Governmental agreements resulting intheallocation ofquota
foreachparticular country 48
(l) Government procurement 48
(m) Regulations oftrade intransit 48
4. Foreign Trade Policies onAgricultural Produce
(a) Imports 49
(b) Exports 49
(c) Restrictions andexport prohibition 49
(d) Export credits, export credit guarantee andexport insurance programmes 49
(e) Domestic policies 49
5. Trade Policies inOther Sectors 50
V. TRADE RELATED INTELLECTUAL PROPERTY PROTECTION REGIME
1. General
(a) Intellectual Property policy 50
(b) Responsible agencies forpolicy formulation andimplementation 51WT/ACC/VNM/2
Pageiv
(c) Membership international Intellectual Property rights conventions,
regional andbilateral agreements 52
(d) Application ofthenational treatment andthe
Most Favoured Nations treatment toforeign nationals 52
(e) Feesandtaxes 52
2. Substantive Standards ofProtection, Including Procedures forAcquisition
andMaintenance ofIntellectual Property Rights
(a) Copyright andrelated rights, including therights oftheperformers,
theproducers ofphonograms andbroadcasting organizations 53
(b) Trademark including service marks 55
(c) Geographical indication including appellation oforigin 56
(d) Industrial designs 57
(e) Patents/invention 58
(f) Protection ofplant varieties 59
(g) Layout designs ofintegrated circuits 60
(h) Requirements onundisclosed information including trade secrets
andtestdata, trade name 60
(i) Measure tocontrol unfair competition 60
3. Measures toControl Abuse ofIndustrial Property Rights 60
4. Enforcement
(a) Civil judicial procedures andremedies 60
(b) Provisional measures 61
(c) Administrative procedures andremedies 62
(d) Border measures 62
(e) Prosecution forcriminal liability 62
5. Legal Documents Related toIntellectual Property Rights 63
VI. TRADE RELATED SERVICES POLICIES
1. General 63
2. Policies onTrade inServices
(a) Governmental agencies, professional associations orothers bodies withauthority
orarolerelevant totheconduct ofservice activities 64
(b) Judicial tribunals oradministrative tribunals andprocedures inarbitration,
legalaction onappealing andamendment ofadministrative decision
affecting trade inservices 65
(c) Provisions (including those ininternational agreements) concerning
qualifications requirements andprocedures forcapacity, technicality,
andrequirements forregistration and/or licensing requirements for
supply ofservices 66
(d) Regulations concerning international payment andtransfer for
current transaction inservices 67
(e) Particular regulation oncapital contribution sharing insome
services supply businesses 67
(f) Regulations ontheprocurement bygovernmental agencies ofservices 67
(g) Regulations concerning anyforms ofaid,domestic subsidy, taxincentives,
orpromotion scheme affecting trade inservices 67WT/ACC/VNM/2
Pagev
3. Market Access andNational Treatment 67
4. Most Favoured Nation Treatment 68
VII. INSTITUTIONAL BASE FOR TRADE AND ECONOMIC RELATIONS
WITH THIRD COUNTRIES
1. Bilateral andMultilateral Agreements 68
2. Economic Integration 68
3. Labour Market Integration Agreements 69
4. Accession toMultilateral Economic Organization 69
***
LIST OFAPPENDICES
Page
1. LEGAL DOCUMENTS RELATED TOCUSTOMS OPERATION 70
2. EXPORT/IMPORT COMMODITY CONTROL 74
3. SANITARY REGULATIONS 81
4. SHARES OFOWNERSHIP TYPES AND INDUSTRIAL SECTORS INGDP 82
5. LIST OFA-CATEGORY (NATIONAL) CORPORATIONS 83
6. TREATIES 84
7. OTHER ECONOMIC STATISTICS 85WT/ACC/VNM/2
Page1
PREAMBLE
TheSocialist Republic ofVietnam islocated inSoutheast Asia, thePacific Ocean toitsEast
andSouth, bordering China intheNorth, withLaos andCambodia intheWest. Vietnam looks, on
themap, S-shaped withtheinland areaof331,114 km2andlarge water areas covering islands,
archipelago, continental shell, special economic zones.
Vietnam isdivided into50provinces and3centrally-administered major cities directly under
thecentral administration, made upof479urban andruraldistricts and9557precincts andcommunes.
In1995, Vietnam hadanpopulation of74million people (Source: theGeneral Statistical Office).
Thecapital cityisHanoi.
Since 1986, Vietnam hasembarked onitssocio-economic renewal reform (known as"doimoi")
aimingatdismantlingtheoldcentrally-plannedeconomicmechanismandshiftingprogressivelytherefrom
toamarket-oriented mechanism, inwhich theruleoflawisperformed bytheState. Oneofthekey
parts oftheeconomic reform isthere-organization andstructural adjustment ofVietnam 'sforeign
trade.
Thesuccess oftheeconomic reform inVietnam ismuch dependent ontrade development and
thesuccessful integration ofthelatter intointernational trade.
ThisMemorandum describes Vietnam 'son-going trade system, effective legal documents,
by-laws, anditsmanagement system, theirimplementation andadministration. ThisMemorandum
alsoprovides basic information onmajor economic issues andeconomic reform process inVietnam.
Economic reform ingeneral andtradereform inparticular havebeenandmustbeacontinuous
andconsistent course. Information onVietnam 'stradepolicies provided inthisMemorandum isbased
onthatavailable asof31December 1994, unless otherwise stated. TheGovernment ofVietnam always
stands prepared toprovide WTO Member countries withinformation onanynewdevelopment of
economic andtrade policies afterthesubmission ofthepresent Memorandum.
Through itsdemand ofaccession toWTO, theGovernment ofVietnam undertakes tofully
comply withtheobligations andrights intheWTO agreement andother agreements thereof.
I. INTRODUCTION
Theoverwhelming feature ofVietnam 'seconomy isitsrenewal renovation, acomprehensive
reform lying upon which theeconomic reform isthefoundation.
In1986, theeconomic reform wasinitiated toshiftfrom acentrally-planned mechanism (in
which production, salesanddistribution andconsumption ofgoods wereallsubject tolegally binding
directives orStateplans fromthecentral government authorities) toamarket mechanism, recognizing
alleconomic sectors andtoencouraging thesocio-economic construction anddevelopment byevery
individual andorganization. TheState hasemployed useseconomic leverage andlegal instruments
toadminister allactivities insocio-economic life;togradually integrate intheprocess ofgradual
integration intotheworld economy.
TheGovernment ofVietnam hasdefined thethree following major economic programmes:
- export production;
- foodproduction;WT/ACC/VNM/2
Page2
- consumer goods production.
Theafore-mentioned major programmes arealltargeted tomake radical changes intheeconomy
fortheobjectives below:
- maintaining thesocio-economic stability fordevelopment purpose;
- continued andsustainable economic growth forwithaviewtogenerating jobs,social income
andassuring anever-higher living standard;
- contribution tointernational cooperation through diversification andmultilateralization ofour
economic relations, promotion ofVietnam economic integration intotheregional andtheworld
economy;
- building upastable socio-economic environment favourable forbusiness activities, encouraging
thedevelopment ofbusiness inalleconomic (ownership) sectors;
- constructing ademocratic andcivilized society bylaws.
Foreign trade hasbeen considered oneofthedriving forces forthesuccess oftheabove
programmes.
Fortheafore-mentioned objectives, theGovernment ofVietnam hasobserved fundamental
principles andpractices oftheinternational trading system andrequested accession totheWTO and
prepared toaccept theprovisions inArticle VIIoftheWTO agreement signed inMarrakesh on
15April 1994.
TheGovernment ofVietnam appreciates rolesoftheworld tradesystem inpromoting reforms
inVietnam. TheGovernment ofVietnam, however, would liketonotesome shortcomings inunilateral
liberalization.
Thefinalaccession Protocol ofAccession ofVietnam totheWTO shallrequire ratification
byoneofthefollowing legislative bodies (dependent onthefinalcontent):
- National Assembly; or
- TheStanding Committee oftheNational Assembly.
II. THE ECONOMY, ECONOMIC POLICIES AND FOREIGN TRADE
1. Current Economic Situation
Thetablebelow depicts some major economic indicators ofVietnam:
Table 1-major economic indicators for1991 -1995
Indicator/year Unit 1991 1992 1993 1994 1995
1.Population (000) 67,774 69,495 71,025 72,509 73,959
2.Work-force (000) 33,298 34,230 35,194 36,167 37,300
3.Employment (000) 30,970 31,815 32,718 33,663 34,680
4.Population growth %/year 2.33 2.41 2.33 2.09 2.00
5.GDP, atcurrent prices billion
VND*76,707 110,535 136,571 170,258 222,840
6.GDP Growth % 6 8.6 8.1 8.8 9,5
7.GDP percapita US$ 118 142 182 211 273WT/ACC/VNM/2
Page3
Indicator/year Unit 1991 1992 1993 1994 1995
8.Price indices 1989=100 % 280 329 346 396 446
9.Exchange rate(Q1) VND/US$ 9,628 11,176 10,583 11,125 11,012
10.Foreign investment
(registered )billion US$ 1,323 2,167 3,169 3,768 7,450
11.Export billion US$ 2,087 2,581 2,985 4,054 5,200
12.Import billion US$ 2,338 2,541 3,924 5,826 7,500
* Dong isthebasic unitofVietnamese currency, which hastheexchange rateagainst USdollar
of1US$=10,980 VND in1996 (Source: General Statistical Office).
From 1986 to1990, theVietnam economy fellintostagnation anddissatisfaction. The
traditionally-established export andimport markets, namely theformer Soviet Union andtheEast
European countries, werecollapsed; sources ofgrants werediminished andexhausted; GDP growth
ratewaspositive butatlowlevel. Though modest, fromalowstarting point, since 1991theeconomy
hasshown continuous butmodest some growth, anyhow itreaffirmed therightorientation ofthe"doi
moi" process, reflected theinitial stage ofdevelopment outofbackwardness andlowlevel of
development.
TheGDP growth ratesof1986-1990 were recorded asbelow:
1986 6.5%
1987 3.4%
1988 4.6%
1989 2.7%
1990 2.3%
Intheearly1990s, themarket mechanism hasgradually taken much clearer shape inVietnam,
resulting insome economic recovery andstable socio-economic situation. Intheperiod, though the
income percapita wasstilllow(US$ 118in1991), inflation wasreduced andbrought under control,
production haswitnessed some development andencouraging growth rates.
GDP growth ratesin1991 -1995
1991 6.0%
1992 8.6%
1993 8.1%
1994 8.8%
1995 9.5%
Labour-intensive services andproduction industries, which arenon-capital intensive industries
withshort pay-back period, havebeenthekeyfactors fortheafore-mentioned achievements.WT/ACC/VNM/2
Page4
Annual GDPgrowth ratesbroken down intoproduction andservices industries areasfollows
(inpercentage overprevious year):
1991 1992 1993 1994 1995
Total: 106.0 108.0 108.1 108.8 109.5
Commodities production 104.6 109.5 107.5 108.0 109.0
Service industries: 108.3 107.0 109.8 110.2 111.5
Source: General Statistical Office
Before the"doimoi", inspite ofadopting policies todevelop heavy industries, many
industries ofthemwerenotabletotakeforms duetocapital intensive requirement andlongpay-back
period, andasfortheformed ones, allfellintosevere recession, difficulties andclosure, inparticular
themechanical manufacturing. Those difficulties allstemmed alsofrom inappropriate technologies,
poormanagement, andnon-competitive products.
Implementing thethree major economic programmes ofthe"doimoi", theState decided to
shiftitspriorities fromheavy industries towards developing agro-aqua-forestry industries byfocusing
ontheprocessing industry, attaching theutmost importance tofoodproduction forthepurpose of
socio-economic stability. Despite itslarge population, Vietnam hasonlyabout 10million hectares of
arable land,ofwhich 7.7million hectares aredestined forfoodgrowing (6.5million hectares forrice,
1.2million hectares forother agricultural produces likecorn, potato, cassavas, andbean), 2.3million
hectares forother crops (ofwhich 1.51hectares forlongandshort termcashcrops).
Despite many years ofpractical experience, collective production (agricultural cooperatives)
hasshown lowreturn oncapital andlowproductivity. Since thelate1980s, theState hasgradually
transferred land-use rights tofarmers onlongtermbasis andsubject toagricultural tax.TheStateis
responsible forinvestment incapital construction. Now, agricultural production onlydepends onthe
rapport between supply anddemand inthemarket. Since theearly1990s, agricultural sector hasshown
stableoutputandproductivity.Thoughnotsohigh,achievementmadeinagriculturehasbeensignificant.
Before 1990Vietnam wasanetfoodimporter, butsince 1990Vietnam hasbeenablenotonlytomeet
consumption demand butalsotospare some surplus forreserves andexports. However, agricultural
production hasshown agrowth rateofjustover4percentperannum, reflecting adiminishing portion
inGDP(Seeattached statistics inEconomic Policies). Itshould alsobenoted thattheagricultural sector
ofVietnam isoften affected bynatural catastrophes liketyphoons, floods, droughts; production isof
small scale andwidely dispersed resulting inaverylowaverage landareaperheadascompared to
otheragriculture-based countries. Main crops arerice,corn, rubber, coffee, tea.Husbandry production
isalsosmall scale andwidely dispersed, concentrating oncowandbuffaloes, pigs, poultry raising,
andaqua-culture.
Since thepromulgation oftheLawonForeign Investment inVietnam in1987andtheafterward
amendmentsandadditionsmadethereof,aproperandadequateinvestmentenvironmenthasbeencreated.
Asof31March 1996, theGovernment ofVietnam hasalready granted investment licences withthe
totalregistered capital ofUS$19,740 billion. AsumtotalofUS$6.5billion isestimated inexecution.
Foreign investment hasbecame oneofthedriving-forces behind theeconomic development ofVietnam.
Theeconomic reform inVietnam, which hasbeenfurther accelerated bytheadministrative
reform initiated in1990, brought inmoreimpressive results: higheconomic growth, inflation reduction,
sustained rateoftransfer fromGDPtoStateBudget atabout 20.2percent,22.2percent,22.6percentWT/ACC/VNM/2
Page5
in1993, 1994, 1995respectively. However, theabove rateoftransfer toStatebudget doesnotmatch
upwithrequirements. Thus State budget hasshown amanageable deficit. State-owned enterprises
were re-evaluated andaudited anddirected towards observing theLawonState-owned Enterprises,
tobetreated equally onequal footing asanyenterprises fromother economic sectors. TheStatestopped
Subsidies toState-owned enterprises intheforms ofloss-subsidization, pricing-subsidization havebeen
stopped. Instead ofstoring intheforms ofcashorquasi-cash, asignificant partofidlecapital and
people'ssavingshasbeendrawnoutintothemoneycirculation,productionanddevelopmentinvestment.
Inaddition toforeign direct investment, loans todevelopment investment areimportant sources for
development itself. (SeeAppendix 4)
2. Economic Policies
(a) Main features
(i) Major directions
TheState ofVietnam departed thecentrally planned economic system toshifttowards a
market-based one,inwhich recognition andencouragement havebeengiven toalleconomic sectors
withaviewtodeveloping andimproving itslegal, socio-economic environments, which inturnwould
serveasanimpetustoinvolvealleconomicsectorsandeverycitizenintothesocio-economicconstruction
anddevelopment.
Enterprises, beitState-owned, private, partnership, orforeign-owned, operating legally in
theterritory ofVietnam and/or under thelawsofVietnam areallgiven recognition andprotection
under laws. Non-nationalization isgranted bylaws.
Enterprises aregiven fullautonomy, equal obligations andrights, andtreated equally onthe
same footing before thelaws. TheState ofVietnam hascreated every possible condition sothat
enterprises canhaveequal opportunities todobusiness inrelation togovernmental treatment and
competition equally.
TheState-owned economic sector hasbeen restructured andre-organized towards market
operation. State-owned enterprises 'assets werere-evaluated, audited. They havebeentreated equally
toonthesame footing asanyothers. They havebeengiven autonomy andheldresponsible fortheir
business, andmustexecute theirrights anddischarge oftheirobligations provided bylaws. TheState
hasbeen abolishing theso-called "line administration" mechanism, meaning toremove thedirect
monitoring andadministration ofacertain governmental agencies imposed onenterprises andthe
distinction between central andlocaleconomic units. Inthepast,enterprises wereassigned through
legalplans directives from higher levels bytheState hierarchy withspecified duties andtasks ofby
which production anddistribution goods hadbeen produced asperplans anddelivered tonamed
destinations atcontrolled prices; profits made byenterprises, ifany,hadtoweretransferred toState
budget,be enterprises suffered losses, ifany,theStatewould becovered bysubsidies fromtheState.
Atpresent, State-owned enterprises havebeenrestructured under theLawonState-owned Enterprises.
Should aState-owned enterprises gobankrupt, itwould behandled under theLawonBankruptcy as
anyother enterprises. TheState doesnotprovide anyprivilege tothose enterprises.
PrivatebusinessesarerecognizedandprotectedundertheLawonPrivateBusinesses,andtreated
equally onthesame footing asother economic sectors. Business relations between oneormore
State-owned enterprises withoneormore non-State enterprises areregulated under theLawon
Companies.
Theco-operative economic sector isrecognized andprotected under theLawonCooperatives.
Under particular circumstances, co-operatives canassign landandcapital goods toco-operative member
households. During thepresent economic transitional period, inorder torestrict massive changes inWT/ACC/VNM/2
Page6
ownership andmanagement, theStatehasextended guidance andassistance forthestable development
ofthiskindofeconomic sector.
Proprietorship andhousehold arealsoconsidered notonlyequal butimportant actors inthe
small-scale production economy ofVietnam, anditsdevelopment hasbeenencouraged.
Capitalist sector, beitofnational orforeign ownership, arerecognized, protected andwould
notbenationalized asprovided forintheLawonForeign Investment inVietnam andtheLawon
Domestic Investment Encouragement.
TheStateofVietnam isinthecourse ofconstructing acomplete management system, further
shifting towards themarket-based system andstrengthening theefficiency ofState management.
Targetsunderlyingeconomicpoliciesfor1996-2000andexpectedonesfor2010willbepresented
bellow:
- encouraging theindustrialization andmodernization course;
- reducing therelative ratioofagricultural production inthenational economic structure;
- encouraging inshort andmedium-term thedevelopment ofshort andmedium-term labour
intensive industries; processing industry, construction industry, andservices;
- encouraging thedevelopment ofcapital intensive andtechnology intensive industries ona
selective basis;
- focusing ontheconstruction ofsocio-economic infrastructure byState investment;
- expanding foreign economic relations, aiming atanexport-oriented economy;
- encouraging themobilization ofdomestic capital andidlesavings forinvestment. Encouraging
foreign investment inVietnam;
- securing proper protection todomestic production;
- during economic transformation, focusing onthebuilding upoftheleading roleofState-owned
economic sector;
- combining development policies withenvironmental protection.
Thepresent breakdowns ofindustries shares inGDP:
1990 1991 1992 1993 1994 1995
(estimated)
Total (%) 100.0 100.0 100.0 100.0 100.0 100.0
Industry andConstruction 22.6 23.8 27.3 28.9 29.7 30.3
Agro-forestry production 37.5 40.5 39.9 29.8 28.7 28.7
Services 38.6 35.7 38.8 41.2 41.6 42.5
Taking theeconomy asawhole, theeconomic policies havecreated astable environment
andconditions forthedevelopment ofalleconomic sectors. During 1980s, thenon-State economic
sectors played averyvague roleintheeconomy. Butin1994, thenon-State sector accounted for
59percentinGDP. TheState-owned sector accounted fortherest.
TheState hasbeenmaking plans, constructing infrastructures, mapping outblue-prints for
thedevelopment ofcoreeconomic zones, making preferential economic andtaxation policies toattract
investment andencourage economic development, inparticular those indifficult areas (mountainous
andoffshore).WT/ACC/VNM/2
Page7
TheStatehasbeenexperimenting andconsidering policies andregulations onequitization of
State enterprises inconnection withtheestablishment ofcapital, financial andlabour markets.
Itisrequired toconstruct thecommon andcompatible regime giving equitable treatment to
bothforeign anddomestic investment, withaviewtooffsetting thecurrently available privileges offered
toforeign investors.
Financial policies playakeyroleintheeconomic policies panoply.
(ii) Strategic andtactical objectives oftheon-going economic policies
Shifting fromasubsidized economic system bound torigidlegalplanning anddirect control
ofStateagencies towards amarket economy with Statemonitoring atmacro-level, inwhich business
autonomy isgiven toenterprises.
Shifting from aautarkic economy toanopen one,inwhich incentives havebeengiven to
stimulate bothforeign anddomestic economic forces.
Planning hasbeenrenovated which reflects ashiftfromthecentralized andsubjective planning
toamacro-planning fordevelopment strategy inthefollowing directions:
- creating astable andfavourable macro-environment foreconomic activities, making fulluse
ofdevelopment resources from alleconomic sectors;
- creating equitable economic andlegalenvironments, building upamanagement mechanism
withaviewtosecuring fullautonomy ofandfairtreatment toevery enterprise;
- formulating strategic economic development orientation, onwhich thegeneral development
strategy, prospects anddevelopment planning arebased toallocate development resources
foreconomic objectives;
- conducting economic information consolidation andelaborating orientations foralleconomic
sectors development;
- forecasting market development trends andprice movement.
(iii) Price policies
Price setting mechanism andtheexistence oftwo-tier price system, inwhich subsidized and
market prices co-exist, wereremoved. Atpresent, goods andservices pricing isdetermined bysupply
anddemand forces inthemarket. However, inorder tomaintain thestability ofthesocio-economic
environment, safeguard from tentatives ofmonopoly, dumping, andhoarding, andtosecure the
equilibrium fortheeconomy, theStatemaintains some priceintervention modalities applicable tosome
veryselective items which areconsidered sensitive andvulnerable toprice shocks andfluctuation in
themarket andmaycause undesired effects toproduction andsocial life,particularly living standards
ofthelowsocial strata, driving inflation backintovicious spiral.
TheState hasgradually minimized intervention onproducts pricing andmovements witha
view toensuring autonomy ofenterprises therein (indeed, almost allgoods areuptopricing by
enterprises).TheStatehasbeenonlyregulatingthemarketatmacro-leveltoreconcilethesupply-demand
relationship, tosecure pricestability, andtoprotect interests ofproducers andconsumers. Thefollowing
measures andmodalities maybeusedinprice control policies:WT/ACC/VNM/2
Page8
- regulations ontheuseofland, natural resources, andState'sproperty;
- minimum prices oncertain export products andmaximum prices onselected import products,
based onprices prevailing ininternational aswellasdomestic one;controlled prices applied
forsome goods andservices being supplied byauthorized monopolies;
- control onprice movements ofsome major andkeyitems which might havegreat impacts on
production andsocial life.
With regards tothegoods under control mentioned above, prices shallbesetfrom timeto
timeandimposed onevery enterprise operating inVietnam.
Scope ofapplication
Some items thatcanhavegreat impacts onthelifeofpeople andtheentire economy suchas
rice,petroleum, ureafertilizer, cement andsugar andsome other monopolistic goods andservices
mentioned above. Those items aresubject toastrict mechanism ofprice supervision andcontrol. In
cases ofbeing endangered bypricefluctuations andupheavals, theStatemight takesome intervention
measures topegazoneofprice fluctuations.
Possible modalities ofintervention
Establishment ofprice stabilization funds from charges onexport/import prices withaview
topartly balancing thedifferences between international anddomestic prices during price fluctuation
period. TheFund areusedtocover interests ofbankloans ortosubsidize prices. Topresent, thishas
justbeenapplied tocoffee.
TheGovernment adopts pricesubsidies fromStatebudget toencourage business activities under
mountainous andethnic minority development policies (production andsupply ofsalt,kerosene, and
papers forpupils toandinfavour ofethnic minorities andmountainous areas).
Modalities ofprice setting:
- setting fixed prices formonopolistic goods andservices likeelectricity, postage and
telecommunications charges etc.;
- setting theceiling prices, indomestic market, ofsome essential goods likepetroleum, urea
fertilizers, papers, cement, steeletc.,determination ofoperational prices isuptobusiness
autonomy.
Determining theindicative price forfoods during unexpected fluctuation time, applicable in
connection withother economic measures inorder tokeepmarket price around thesaidlevel.
Prices andcontractual terms ofgoods andservices paidfrom budget allowances aresubject
tobechecked andapproved byauthorized State agency.
Specific measures:
- price stabilization surcharge collected toprice stabilization Fund forprice contingency;
- setting, onaperiodical basis, ceiling andfloor prices, being centred oninternational market
prices;WT/ACC/VNM/2
Page9
- offeraccess toseasonal credit atpreferential terms forpurchasing riceandother agricultural
produces (ifnecessary) inharvest;
- building upState reserves ofcommodity.
(iv) Economic development programmes andregional priorities
Thecomprehensive objectives inthesocio-economic development strategy totheyear2000
aretomove ahead outofrecession andthesituation ofapoorandlessdeveloped country, tostabilize
thesocio-economic situation, toimprove living standard, andtoconsolidate national defense andsecurity
withaview tocreating necessary conditions forasustainable higher growth atthethreshold ofthe
21stcentury; accelerating theachievement ofthesocio-economic strategic objectives andimproving
theeffective capacities andefficiency oftheeconomy inorder toclose thegapinlevelofdevelopment
withother countries intheregion.
Structural adjustments inagricultural andruraleconomy areorientated toward industrialization
andmodernization inproduction andprocessing ofselective agro-produces. TheStatehasconcentrated
onrehabilitation, upgrading andconstruction ofinfrastructures inkeysectors: electricity andwater
supply systems, road, airports, sea-ports, postandtelecommunications facilities which areessential
andmayhavedirect andsubstantial effects ontheeconomic, cultural anddailylifeofallsocial strata.
Keyeconomic development indicators for1996-2000: by2000 GDP percapita todouble that
of1990; average annual growth inindustries: 14-15 percent,inagro-aqua-forestry economic sector:
about 4.5-5 percent, inservices industries: 12-13 percent; inexport value: 28percentandshare
ofinvestment: about 30percentofGDP.
Economic programmes oftheGovernment
Agriculture:
- restructuringtheagriculturaleconomy,changingfromthepresentpureagriculturetoaneffective
agro-industry-service, from thepresent economic structure of29percent, 29percentand
42percentrespectively andto12-20 percent,34-35 percentand45-46 percentbytheyear
2000. Multi-crops landuseandcrops diversification areencouraged;
- bringing theagriculture-horticulture structure of75percent-25 percent in1995 to
65percent-35 percentin2000;
- changing thefoodcrops -cashcrops -fruitcrops -others structure of65percent-17percent
-18percentin1995'sproduction to55percent-23percent-22percentbytheyear2000;
- foodcrops aretoremain theprime importance inagriculture toensure foodsecurity inany
circumstances.Investmentsaretopromoteintensivefarming,cropsrestructuring,andapplication
ofnewtechnologies. Stimulate substantially cashcrops andfruitcrops andcertain mono-crops
using advanced technologies;
- developing comprehensive, market oriented husbandry farming focusing onpig,cow, milk
cow, andpoultry;
- developing aqua-culture, particularly specialties; making more in-depth investment incatching
andprocessing facilities; combining catching withenvironmental protection;WT/ACC/VNM/2
Page10
- assuring aproper protection oftheexisting forest, localizing woodlands andforests forgrowing
purpose, working outplans andpolicies forafforestation ofbarelandandhillsincollaboration
withplanned exploitation; attaching population settlement toforestry;
- developing industrial basisandservices inruralareas, firstandforemost manufacturing sectors,
importancebeinggiventosmall-scaleindustriesandhandicrafts;restoringandexpandingvillages
oftraditional trades, particularly labour intensive andexport-worthy ones; diversifying various
kinds ofservices inrural areas suchrawandtechnical material supplies, credit services,
technology transfer, consultancy, information, transportation, processing, salesdistribution,
public health andother social services etc.
Industry:
Development ofindustries arebedirected towards industrialization andmodernization. Priority
willbegiventomanufacturing,consumergoodsandexportproductionindustries.Developmentplanning
ofthemechanic industry istobereformulated toupgrade itscapacity inproducing machinery and
equipment ofhighquality andmodern technology. Further exploration andextraction ofoilandgas
reserves andconclusion ofmore contracts arenecessary. Construction ofmajor power plants must
becompleted foroperation toraisesource power capacity upto6,500 mwwith30billion kwhenabling
thepower network tocover of80percentmountainous communes. Itisrequired torehabilitate and
construct newsteelrefining androlling mills andcement project onaselective basis.
Foreign economic relation promotion
Vietnam advocated anopenandexport oriented economy withaviewtomaking fulladvantage
offavourable international environment andtomobilizing funds foreconomic development.
Infrastructure development andservices
Itisrequired tostopdegradation oftheexisting traffic system andstepbystepupgrading
bridges andportsandkeytransport lines. Pan-national transport highways aretobeupgraded; building
andopening newroads andlinesconnecting keyeconomic zones topopulation andeconomic areas
inCentral Highland, northern mountainous areas andMekong river deltaaswellasnewhighways
connecting withChina, Laos, Thailand andCambodia alsomustbebuilt. Efforts willbemade tosolve
traffic bottlenecks inurban cities. Bytheyear2000, 100percentofprecincts andcommunes shall
haveaccess totelephone network. Tourism industry istobebetter prospected withemphasis laidon
thequality ofservice.
Restructuring regional development
Regional economic structure must berationalized stepbysteptomeet industrialization and
modernization onthebasis oftaking fulluseofregional available resources andcreating regional
motive economic areas, prioritizing coreurban cities, keyeconomic zones andcoastal hubs. Support
andassistance mustbegiven tolessdeveloped regions enabling ahigher growth inthose regions to
catch upcloser tothelevelofother regions.
Development ofscientific, technological andenvironmental industries
Researchactivitiesandapplicationofscientificandtechnologicalachievementsforsocio-economic
management policy-making, development planning andprojects, andmobilization andutilization of
resources mustbepromoted foraneffective andefficient valorization ofnatural andhuman resources,WT/ACC/VNM/2
Page11
andtheexisting production capacity, serving theeconomic structural adjustment andthedevelopment
ofruralandmountainous areas, raising thecompetitiveness ofproducts indomestic andforeign markets.
High-tech development
Concentrating oninformatics, bio-technologies, automation, electronics, precise mechanics
andnewmaterial development industries. Twohigh-tech parks areplanned tobesetupinHanoi and
HoChiMinh city.
Environmental protection
Monitoring environmental changes inevery locality onthebasisoflawsofnatural development
andspecific evolution todeploy appropriate measures ofenvironment preservation andprotection for
sustainable development.
(v) Privatization plans
Since 1988, theState officially recognized thelong-term landuserightoffarmers including
thetransfer ofland-use rights asprovided bylaws. ThelawsofVietnam hasnotyetrecognized private
ownership ofland,forest, seabutonlyrecognized therighttousetheseproperties, namely land,forest,
watersurface,foronceassignedbytheStateforvalorizationonthelong-termbasis;theabove-mentioned
rightistransferable.
TheVietnam 's1992Constitution officially recognized theequality before thelawsamong the
following forms ofownership: State-owned economic sector, collective sector, private capitalist sector,
State capitalist sector andfarmer households. Legal capital andproperties ofalltheabove economic
sectors areprotected bytheState. TheStateofVietnam alsorecognizes theownership tofixed assets
(except landownership) ofnon-resident foreigners inVietnam.
TheState hasbeen taking measures toaccelerate theprivatization ofcertain State-owned
enterprises. Theywillturnintoindependent, self-accounting entities, self-responsible fortheirexistence
anddevelopment. Asaresult, theadaptability tothemarket economy ofState-owned enterprises will
beraised. TheStatealsohasplans todissolve loss-making enterprises ormerge themintoothers. The
State advocates toconstruct some large national corporations specializing incertain important lines
ofactivities.
(b) Fiscal andmonetary policies
FiscalandMonetaryPoliciesareconsideredasoneofthekeyinstrumentsinthemacro-economic
regulating bytheGovernment.
Withaviewtolimiting andstepbystepuprooting budget deficit -themaincause ofinflation,
theGovernment hassetthetarget ofputting acapof3percentofGDP ontotalbudget deficit from
nowto2000 ascompared totheaverage budget deficit toGDP ratioofcirca8percentinthe1980s
andmaintaining asurplus ofcurrent revenue overcurrent expenditure at4.5percentofGDP. Steps
toward theachievement ofthesaidtarget include:
- TaxReform Programme Phase 1hasestablished acomplete taxlegislation which helps raise
thetotaltaxcollected toGDP ratiofrom 13.1percentin1991 to22.6percentin1995;
- theTaxReform Programme Phase 2shallcontinue theobjective ofraising thetaxrevenue
totheState Budget;WT/ACC/VNM/2
Page12
- theGovernment hasbeenformulating TheTaxReform Programme Phase 2forsubmission
totheNational Assembly. Intheprogramme, following guidelines would beobserved:
streamlining taxratestructure, non-discrimination, broadening ofthetaxbase, improving tax
administration, andthereplacement ofthecurrent turnover taxbythevalue-added tax(VAT);
- strengthening management ofbudget expenditure through application ofstringent provisions
ofthenewBudget Law(promulgated bytheNational Assembly ofVietnam inMarch, 1996)
which focuses onthesystemising budget expenditure management, budget planformulation,
andthere-partition ofresponsibilities between thecentral andlocal level, andState budget
audit.
(i) Monetary, credit andforeign exchange policies
Themajor objective ofmonetary policy isthestabilization oftheVietnam currency ’svalue;
tightcontrol oftotalpayment facilities (M2) oftheeconomy atlarge; directing funds tosectors where
production andservice activities bring inhighreturn, generate more employment, andcontribute better
toeconomic growth andtorestraining inflation atsound level. Tothisend,theGovernment hasbeen
formulating policies ontheflexible, synchronous andeffective useofinstruments formonetary policies
suchas:obligatory reserve ratios, interest rates, foreign exchange rates, openmarket operations and
other supplementary instruments which ensures thesound issuance ofmoney intoandwithdrawal of
money fromcirculation. Inparticular, interest ratestructure shallbefurther adjusted applicable within
oneuniform zonewhich setcontrol onlyontheceiling lending rate.Step-by-step, theState Bank of
Vietnam shallcontrol onesingle category ofrediscount ratetobeapplied byallcommercial banks.
Theestablishment ofthecapital market should beaccelerated, money market inthefirstplace
including foreign exchange market, T-bill market. Thecurrent inter-bank market shallbeimproved
which helps laytheground forthelong-term capital market tobesetupshortly. Control shallbethen
exerted, through these markets, byopen market operations andother indirect monetary control
instruments.
Inorder toachieve theobjectives ofmonetary policies, theStateBank ofVietnam has,sofar,
implemented anumber ofpolicies andmeasures suchas:
Credit policy
Atightened credit policy hasbeenimplemented. Credit structure shallbeadjusted giving more
weight tofunding non-State sector especially tofarmer households; raising theportion ofmid-term
andlong-term borrowing:
- maximum limitshallbeputonrefinancing bytheStateBankofVietnam byraising thediscount
ratefrom 85percentto100percent;
- credit limits shallbeimposed oncommercial banks;
- lending activities ofcommercial banks shallbedirected towards efficient projects bymeans
ofsound interest ratestructure. Notleast, fortheStatesector, lending shallonlybeextended
toprofit-making enterprises.WT/ACC/VNM/2
Page13
Interest ratepolicy
Interest ratestructure shallbeadjusted withaviewtoreducing thedifference between local
currency rateandforeign currency rate,andraising longtermandmid-term ratehigher thanshort-term
rate.
Foreign exchange rateandforeign exchange control policies
Theaimofforeign exchange control policy forthecoming years isstrengthening management
andcontrol capacity oftheGovernment, reducing thescope oftheblack-market operations, stabilizing
monetary system andfurther meeting theforeign exchange requirements forimports andexerting active
market intervention incasewhere needed. TheGovernment hasreleased Decision No.386TTgdated
4August1994aimingatcentralizedmanagementofallforeigncurrencysourcesbymeansofthebanking
system.
Concurrently, withaviewtostabilizing thevalue ofVietnam ’scurrency andimplementing
thenewforeign exchange control policy, in1989, Vietnam replaced thefixed exchange ratesystem
byaflexible exchange ratemechanism which ismore appropriate with theforeign exchange
supply-demand relationship. Thispolicy shallprovide guidelines andserve asregulatory instrument
tostabilize Vietnamese Dong andencourage export.
Monetary instruments
Aiming atimproving theeffectiveness oftheobligatory reserve ratio, thus, creating thebasis
forindirect monetary control, TheStateBank ofVietnam hasapplied universally thisratiotoallcredit
organizations, andstricter penalty shallbeimposed oncases ofnon-compliance.
Compliment toandconsolidation ofthepanoply ofFunds mobilizing policies
Creating newcapital raising instruments andimproving payment transaction through banking
system andother financial products.
Enterprisesinvolvedinexternaleconomicrelationsareallowedtoopenforeigncurrencyaccount
inbanks operating intheterritory ofVietnam.
Foreign exchange bureaux opens daily inmain cities. Transaction ratesshallbedetermined
onthebasis ofthemarket rates. TheState Bank ofVietnam shalldetermine thedirective exchange
rateandfluctuation margins within which specific operational ratesmaybeadjusted bythecommercial
bank.
Except foreign invested enterprises governed bytheLawonForeign Investment inVietnam,
enterprises involved inexternal economic relations inVietnam areallowed totrade foreign currency
inexchange bureaux fortheiroperations. Money transfers under signed contracts are,ingeneral,
facilitated under Vietnam ’scurrent foreign exchange control system.
Under theLawonforeign investment inVietnam, inprinciples, foreign invested enterprises
mustbeself-sufficient ontheirforeign currency needs. TheGovernment considers some deregulation
inorder tofurther facilitate theiroperations.
(ii) Taxpolicies
Following isthecurrent system oftaxpolicies:WT/ACC/VNM/2
Page14
Inorder toconform withthetransition oftheeconomic management mechanism from the
centrally planning tothemarket one,since 1990, theNational Assembly oftheSocialist Republic of
Vietnam hasgradually enacted taxlawsandtaxordinances toform asystem oftaxpolicies applied
toalleconomic sectors. Inthisprocess, thetaxsystem hasbeenimproved gradually through the
amendment ofandaddition totheexisting taxlaws, taxordinances andthepromulgation ofnewtax
laws. Thecurrent taxsystem ofVietnam consists ofthefollowing taxes:
- Turnover tax;
- Special Consumption tax(Excise tax);
- Profit tax;
- Import andExport duties;
- Agricultural Land Usetax;
- TaxonTransfer ofLand UseRight;
- theNatural Resources tax(Loyalties);
- Land andHousing tax;
- (Personal) Income tax.
Apart from theabove-mentioned taxes, there aresome charges innature oftaxes suchas:
- landrent;
- Government-owned capital usefee;
- slaughtering tax;
- business licensing tax;
- property registration fee;
- transportation fee.
Below arethemain provisions oftheexisting taxes:
Turnover tax
Theturnover taxisgoverned bytheLawonTurnover Taxwhich wasenacted on30June1990,
came intoeffect on1October 1990 andhasbeenamended andadded under theLawonAmendments
ofandAdditions toaNumber ofArticles oftheLawonTurnover Taxwhich wasissued on5July1993
and28October 1995.
Theturnover taxislevied oneachstage oftheproduction andbusiness process, from the
production totheretail stages.
Theturnovertaxpayersareallentities,individualscarryingout,inVietnam,production,business
activities andderiving turnover from which. Theturnover taxisneither applied totheagricultural
production which issubject totheagricultural landusedtax;nortotheproduction ofthose goods which
arealready subject totheexcise tax;nortotheproduction ofexported goods.
Theturnover taxiscalculated onthebasisoftaxable turnover andtaxrate.Thetaxable turnover
iscalculated specifically foreachproduction andbusiness activity. Theturnover taxratesasregulated
intheturnover taxtablecomprises 11taxratesranging from 0percentto30percentaccording to
the6groups ofbusiness asfollows:
- Production: taxratesrange from 0%-20%
- Construction: taxrate4%
- Transportation: taxratesrange from 0.5%-4%
- Trading: taxratesrange from 0.5%-20%WT/ACC/VNM/2
Page15
- Catering: taxratesrange from 6%-10%
- Service: taxratesrange from 0%-30%
TheLawonTurnover Taxspecifies some cases oftaxexemption andreduction. Forexample,
taxexemption orreduction maybeaccorded toenterprises which facedifficulties arising fromnatural
disasters, warandother contingencies; toenterprises using newtechnology; toenterprises operating
inmountainous areas, offshore islands, ortotheonesnewly established (from 1993 andbeyond).
Inrespect oftheturnover tax,Vietnam isintheprocess ofstudying thevalue added taxto
replace theturnover taxinorder toovercome disadvantages ofthecurrent turnover taxsystem. Since
1September 1993, Vietnam applies thevalue added taxonatrialbasis totheproduction ofsome
kinds ofgoods, specifically, sugar, textile andcement attherespective ratesof5percent,10percent,
15percent.
Excise tax(special consumption tax)
Theexcise taxisgoverned bytheLawonExcise Taxwhich wasissued on30June1990, came
intoeffect on1October 1990 andhasbeenamended andadded under theLaws onAmendment of
andAddition toanumber ofarticles oftheLawonExcise Taxdated 5July1993and28October 1995.
Theexcise taxpayers areentities, individuals ofalleconomic sectors producing orimporting
those goods which aresubject totheexcise tax.
Theexcise taxiscalculated onthebasisofquantity ofgoods, unittaxable value andtaxrate.
Thetaxable value, forgoods locally produced, istheex-work selling price excluding excise tax;and
forimported goods, isthedutiable value including import duty. Theexcise taxrateisspecified for
eachitemofgoods asfollows:
Items TaxRate
Tobacco: from 32-70%
Alcohol: from 15-90%
Beer: from 75-90%
Fireworks, signalling rocket, signalling flares andother
pyrotechnic articles (except firecrackers):100%
CarinCBU orinCKD forms: from 30-100%
Petrol ofdifferent kinds, naphtha, reformed component andother
preparation forconcoction ofpetrol:15%
TheLawonExcise Taxspecifies cases where taxreduction canbeconsidered, wherein
production enterprises which facedifficulties arising fromnatural disasters, wars, other contingencies,
expansion ofproduction capacity, maybeeligible fortaxreduction butlimited bytheceiling of
30percentoftheexcise taxtobepaidwithin ayearandforaperiod ofnotmore than2years.
Profit tax
TheLawonProfit Taxwasenacted on30June1990, came intoeffect on1October 1990
andhasbeenamended andadded under theLawonAmendments ofandAdditions toanumber of
articles oftheLawonExcise Taxwhich wasissued on5July1993.WT/ACC/VNM/2
Page16
Theprofit taxpayers areallentities, individuals deriving profit frombusiness activities inthe
territory ofVietnam.
Theprofit taxiscalculated bymultiplying thetaxable profit arising inthetaxable period and
thetaxrate.Thetaxable profit includes profit earned from production andbusiness activities, from
leasing orliquidating fixed asset, fromtransferring assets, shares, fromfinancial dealings, fromlocal
jointventure operation orbusiness cooperation.
Theprofit taxratesapplicable tovarious types ofbusiness areprovided for3flatratesasbellow:
- 25percentrateapplied toheavy industry, exploitation, construction andtransportation
industries;
- 35percent rateapplied tolightindustries;
- 45percentrateapplied tocommercial, service andcatering activities.
Apart fromtheabove-mentioned profit taxrates, if,taxable profit exceeds aspecified ceiling,
itwillbesubject toadditional profit tax.
Taxexemption andreduction regimes apply tobusinesses ormanufacturing entities which are
ownedbyoldorhandicappedindividuals;toscientificresearchactivities;tonewlyestablishedproduction
entities since1993; andtothose entities which move theirbusiness establishments tothemountainous
orisland areas.
Theprofit taxapplied toenterprises withforeign invested capital isprovided intheLawon
Foreign Investment inVietnam andissubject tothestandard rateof25percent(except inthecase
ofexploiting scarce, precious natural resources andoilexploitation higher taxrateisapplicable). The
LawonForeign Investment alsoprovides cases where projects canenjoy preferential taxrates of
20percent,15percentand10percentforadetermined period withaviewtoencouraging investment.
Repatriationofprofitbyforeigninvestorsisalsosubjecttotheprofitremittancetax(withholding
tax)attheratesof5percent,7percentand10percent,depending onthecapital contribution volume
oftheproject.
Import andExport duties
TheLawonImport, Export duties wasissued on29December 1987 andcame intoeffect
on1January 1988andhasbeenamended andadded under theLawonAmendments ofandAdditions
toanumber ofarticles oftheLawonImport, Export Duties dated 5July1993.
Detailed regulations ontheimport, export duties shallbecovered inPartIV.
Agricultural Land Usetax
TheLawonAgricultural Land Used Taxwasissued on10July1993 andcame intoeffect
on1January 1994.
Theagricultural landusedtaxpayers areallentities, individuals whouselandforthepurpose
ofagricultural production. Enterprises operating under theLawonForeign Investment inVietnam
while using agricultural landarenottaxpayers governed bythatlaw,paylandrentsaccording tothe
LawonForeign Investment inVietnam instead of.WT/ACC/VNM/2
Page17
Land, object ofthatlawconsists ofthearable land,landwithwater surface toraiseaqua-culture,
landforafforestation inassigned forusebythetaxpayers. Land covered bynatural forest, pasture,
residential land, andlandforspecialized usearenotsubject totheagricultural landusedtax.
Thetaxation isbased onthesizeoflandarea,landcategory andtaxrateinterms ofspecified
quantities ofpaddy perunitofareavarying aspercategory ofland. Thelandcategory isdetermined
onthebasis ofgeography, geology, location, climate, weather andirrigation conditions andisfixed
for10years.
Besides, those households whouseagricultural landinexcess ofthespecified standard area
aresubject totheadditional taxontheexcess area. Theamount ofadditional taxequals 20percent
ofthebasic rate(which istheaverage amount oftaxforhousehold undertaking theuseoftheland).
Thelawonagricultural landusetaxalsospecifies cases oftaxexemption andreduction.
TaxonTransfer ofLand UseRight
TheLawonLand useright transfer taxwasissued on25June1994 andintoeffect on
1July1994.
Thelandusedrighttransfer taxpayers: allentities, households, individuals whohavetheright
touselandincluding thearchitectural objects builtonthelandareliable, uponthetransfer oftheright
touseland, topaythelanduserighttransfer tax.TheLawonLand UseRight transfer taxspecifies
6cases oftaxexemption.
Taxislevied onthelandofwhich theuserightistransferred regardless thevalue ofhouse
ofwhich theownership istransferred.
Thelanduserighttransfer taxisdetermined onthebasisoftheareaoflandofwhich theused
rightistransferred, thepriceoflandfortaxpurposes andthetaxrate.Thelandvaluation isdetermined
bythePeople Committee oftheprovinces orcities within therelated zonespecified bytheGovernment.
Therates ofthelanduseright transfer taxare0percent, 5percent, 10percent, 20percent,
30percent, 40percentdepending onwhether thetransfer oflanduserightresults inchanging the
usage purpose ofland, thelanduserighttransfer taxhasbeenpaidupon theassignment ofland, and
whether therighttouselandischanged ortransferred.
TheLawonLand UseRight Transfer Taxalsospecifies cases oftaxexemption andreduction.
Natural Resources tax
Natural resources taxation isgoverned bytheOrdinance onNatural Resource Taxwhich was
issued andcame intoeffect on30March 1990.
Thenatural resource taxpayers areallentities, individuals whoexploit natural resource inall
forms. Thenatural resource taxable objects areallkinds ofnatural resources belonging tothesovereignty
ofVietnam including minerals, natural forestry products, fishandother kindofaquatic produces. The
taxiscalculated onthebasis ofthequantity ofnatural resources exploited, thetaxable unitprice and
thetaxrate.Thetaxable value istheactual selling price ofthatnatural resource intheperiod. The
taxrateapplied toeachkindofnatural resources depends ontheexploiting andtransporting conditions
andthequality obtained. Theratesrange from 1percentto40percent, detailed asfollows:WT/ACC/VNM/2
Page18
- Metals: 2%to10%
(except goldfrom 2%to15%)
- Coal: 1%to5%
- Oil,gas: 6%to20%
- Non-metal minerals: 10%to40%
- Natural aquatic produces: 1%to10%
TheOrdinance onNatural Resource Taxalsospecifies cases oftaxexemption andreduction.
Land andHousing tax
Thelandandhousing taxisgoverned intheOrdinance onLand AndHousing Taxwhich was
issued on31July1992, andcame intoeffect on1October 1992, amended on19May1994.
Thelandandhousing taxisthetaxlevied onhouses andresidential land, landforproject
construction. Atthetimethepresent Memorandum isdrafted, thelawhasnospecification onhousing
taxthatistemporarily notyetshaped. Thelandtaxpayers areallentities, individuals whohavethe
righttouseresidential land, landforproject construction. Thetaxislevied onallresidential lands,
lands forproject construction intheterritory ofVietnam.
Thelandtaxiscalculated onthebasisofthelandarea,landcategory andrateperunitofarea.
Forresidential land, landforproject construction located incities, towns, thetaxratetobepaidis
3-32times ofthehighest rateoftheagricultural landusetaxinthearea.Fortheresidential land, land
forproject construction neartheurban areas, nearhighways, thelandtaxrateis1.5-2.5 times ofthe
highest rateoftheagricultural landusedtaxinthearea. Fortheresidential land, landforproject
construction indelta, midland andhighland, thelandtaxrateequals theaverage agricultural landuse
taxrateinthearea. TheOrdinance onlandtaxalsospecifies cases oftaxexemption andreduction.
Income tax
Theincome taxisgoverned bytheOrdinance onIncome Taxwhich wasissued on
27December 1990, andcame intoeffect on1April 1991, amended on1June1994.
Theincome taxpayers arealltheVietnamese individuals andforeigners whohaveincome arising
inVietnam.
Thetaxable objects areitems ofregular andirregular income. Theregular income istaxed
onthebasis ofaverage monthly income which exceeds specified thresholds which aredifferently
applicable toVietnamese andforeign residents inVietnam (andVietnamese citizens working abroad).
Theirregular income istaxed when anindividual derives anirregular income exceeding 2million Dong.
Theincome taxiscalculated onthebasisoftaxable income andtaxrate.Inrespect ofregular
income, theincome taxispartially progressive. ForVietnamese individuals, therates range from
0percentto60percentandaredivided into7levels andthestarting threshold isat1.2million Dong.
Forforeigners andVietnamese citizens whoworkabroad, theratesrange from0percentto50percent
andaredivided into6levels andthethreshold is5million Dong.
Forforeign non-residents, theflatrateof10percentisapplied ongross income.
Inrespect ofirregular income, theincome taxispartially progressive andiscalculated for
individual income. Theratesrange from 0percentto30percentandaredivided into6levels, the
threshold is2million Dong peroneindividual income. Specifically, individual income fromtechnologyWT/ACC/VNM/2
Page19
transfer from2million Dong upistaxed ataflatrateof5percentandindividual gainfrom lottery
winning from12.5million Dong upistaxed ataflatrateof10percent.Income intheformofgifts,
presents remitted from abroad which exceeds 2million Dong peronepayment istaxed ataflatrate
of5percentofthegross income. TheOrdinance onIncome Taxalsospecifies cases oftaxexemption
andreduction.
(iii) Orientations oftaxreform totheyear2000
Turnover tax
Itisintended toreplace theturnover taxbythevalue added tax(VAT) toavoid thecascading
effects. Astheschedule ofthesecond stage oftaxreform, thevalue added taxshallbeenacted on
1January 1998 withthemain content asfollows:
Scope ofapplication:
Allproduction anddistribution ofgoods andservices mostly bymanufacturing, commercial
andinternational trading enterprises shallfallintothescope ofapplication. Thepresumptive turnover
taxisstillapplied tosmall households ortheindividual income taxmaybeapplied instead. For
enterprises recording regular andstable turnover, theturnover taxiscalculated ontheactual basis.
Thevalue added taxshallbetemporarily notapplied tothefollowing activities:
- financial activities such asissuance ofbonds, debentures, dividends attributable toState
contribution ofcapital etc.;
- medical care, children rearing, education;
- goods auctioned bycharity funds, forcharity purpose;
- professional insurance;
- advertising publication, television programmes editions bytheState, bytheauthorized editorial
offices, television stations;
- research services provided bytheresearching institutes;
- small households withlowaverage turnover.
Methods oftaxcalculation:
Oneofthefollowing methods orbothalternatives areapplicable:
- thecredit method: thetaxed amount iscalculated bydeducting thepaidamount ofthematerials,
goods, services inprevious stages fromthenominal taxcalculated ontheturnover ofthesale
ofgoods orprovision ofservices (mostly applied toproduction activities);
- thesecond method isbased onthetaxratemultiplied (x)bycommercial mark-up asperinvoices
(mostly applied totrading andservices activities).WT/ACC/VNM/2
Page20
Taxrates:
There maybe3or4ratesranging from5percentto20percent.They aredesigned toensure
thattherevenue from thevalue added taxisnotlower thantherevenue from existing turnover tax.
Toencourage exports, thevalue added taxpaidontheactually exported goods shallberefunded.
Inthecasethevalue added taxtobecollected islower thanthevalue added taxpreviously paid, the
difference shallberefunded.
Special Excise tax
Theexisting lawonspecial excise taxisproposed tobeamended asfollows:
Taxable objects:
Thespecialexcisetaxshallbeappliedtobothdomesticorimportednon-essentialgoods:tobacco,
alcohol, beer, cracker, car,petrol, oil,electronic appliances andsome special services withhigh
accumulation. Those goods andservices shallbesubject notonlytothevalue added taxbutalsoto
thespecial excise tax.
Methods oftaxcalculation:
Thetaxratesshallrange from20percentto140percentoftheex-factory price (applicable
todomestic products) andofthecustoms-duty-clear price (applicable toimported products).
Thespecific taxmaybeapplied toproducts under onetariff line,calculated onthebasis of
unitofproducts.
Taxexemption, reduction:
TheLawonspecial excise taxwould notprovide taxexemption andreduction.
Import andExport duties
Inorder toencourage foreign trade, theLawOnImport, Export Duties hasbeenamended
recently.
Inrespect oftheexport duty, thedutyshallbelevied onlyonsome veryimportant products
suchasnon-renewable minerals ornatural resources which areexported intherawnature. Other export
items arefreeofdutyforthepurpose ofpromoting export.
Inrespect oftheimport duty:
- ingeneral thenumber oftaxratesshallbeshortened, therange oftariff linesbenefiting from
therateat0percentshallbenarrowed andapplied tocomplete capital equipment, some
essential materials usedforagricultural production (fertilizer, insecticide);
- oneuniform import tariffs regime shallbeapplied tobothinternational trade andtheborder
trade;
- therateofdutyapplied toimports shallnotexceed 60percentofthec.i.f.priceatthecustoms
clearance point.WT/ACC/VNM/2
Page21
Theimport dutyamendment shallaimatthereduction oftariff barrier toliberalize trade as
committed byVietnam when joining regional arrangements andtointegrate intotheglobal tradesystem.
Turnover taxandexcise taxshallbeapplied forimported goods.
Tobeinconformity with theinternational practice, inthecoming years, therates of
import-export duties shallbedivided into3categories: standard rate, MFN rateandpreferential rate
sothattheMFN regime canbegranted tothose countries which grant theequivalent treatment to
Vietnam.
Fordetailed information please refertoitems IV.1(b) andIV.2(b).
Profit tax
Thecorporate income taxshall bepromulgated toreplace theexisting profit taxwiththe
following main content:
Scope andobjects ofapplication:
Thecorporate income taxshall beapplied toallenterprises, manufacturing andbusiness
corporations fromalleconomic sectors, including enterprises withforeign invested capital ifderiving
taxable income.
Determining expenses:
Expensesofrawmaterials,wagesandsalariesshallbedeterminedclearly,depreciationexpenses
shallbesimplified andother kinds ofexpenses shallbefixed oncontractual basis inpercentage of
thetotaltaxable profit.
Itissuggested toapply onlyonetaxratetoallkinds ofbusiness. Besides, incertain areaof
business, apreferential ratemaybeapplied withtimelimit.
Individual Income tax
Theexisting income taxforhighincome earners maybereplaced byindividual income tax
which intends tobroaden thetaxbaseincomparison withtheexisting income tax.Thisreform shall
aimatreducing thedifference among classes inthesociety, andatthesame timeatgradually making
from income taxanimportant source ofrevenue inthetaxsystem.
Scope ofapplication:
AllVietnamese citizens (including theemployees, farmers, small businessmen andthose who
work abroad) andforeigners inVietnam (including residents ornon-residents, i.e.staying inVietnam
lessthan183days) ifderiving income shallbeliable toincome tax.
Taxable income:
- Income fromsalaries, wages, allowances andbonuses which hasthenature ofwages, salaries.
Forfarmers, income from agriculture istaxable;
- Income frominvestment andother kinds oftaxable income: dividends, income deriving from
bonds, debentures, bankdeposits, contribution ofcapital injointventures, business cooperation,WT/ACC/VNM/2
Page22
royalties, gains from transferring shares, transferring orleasing assets, gifts, presents, from
transfer oftechnology, from lottery winnings, inheritance income.
Taxrates:
Forbusiness andemployment income: theincome taxshallbeprogressive with3taxrates
andthetotaleffective income taxrateshallbelimited to35percentofthetotaltaxable annual income.
Forincome frominvestment andother income: aflatrateshallbeapplied toindividual actual
income.
Natural Resource tax(Royalties)
TheOrdinance OnNatural Resource Taxshallbeimproved andbecome theLawonNatural
resource tax.
Thetaxrates shall bestreamlining to8rates applicable to8respective groups ofnatural
resources.
Thetaxable objects shallcover some additional items suchaswater usedforeveryday life,
forproduction, mineral water usedforcommercial purposes.
Price forthepurpose taxcalculation shallbeestablished within arange. Detailed regulation
onapplicable priceshallbedetermined bylocalauthorities inconformity withthelocalpriceplatform
butitcannotbelower thantheminimum price.
Other kinds oftaxes
Thelandandhousing tax:there shallbeachange inthemethod oftaxcalculation. Taxshall
bedetermined onthebasis oflandprice.
Theagricultural landusetax,thelanduserighttransfer taxtemporarily remain thesame as
theyhavejustbeenenacted andamended.
(c) Foreign exchange andbalance ofpayment policy
Foreign reserves, theinternational balance ofpayment andexchange ratearedirectly managed
andsupervised bytheState Bank.
In1989, theGovernment ofVietnam abolished thefixed exchange ratesystem andadopted
aflexible onedriven bythesupply -demand relation onthemarket, especially ontheforeign currencies
transaction centres. TheGovernment makes interventions tothemarket ifnecessary. Theexchange
rateofVietnamese Dong against foreign currencies hasbeenstable since 1993.
TheState Bank ofVietnam haslaidspecial emphasis onforeign reserve management.
Nevertheless, thesizeofforeign exchange reserve which isatalowlevelhasincreased steadily over
thepast5years. Itamounted equivalent totenweeks ofimport in1994 fromsixweeks in1993. The
foreign exchange transaction centres wereopened attheendof1991. Thelocalcurrency inter-bank
market forcommercial banks wassetupin1993.WT/ACC/VNM/2
Page23
Prior to1988, Vietnam 'sbalance ofpayments wasinchronic andsubstantial deficit. In1989,
itsbalance ofpayments position wassignificantly improved owing toopeneconomy andexport oriented
policy, debtrestructuring andsubstantial increase offoreign direct investments.
AsofNovember 1993when theDonors Conference onVietnam inParis washeld, Vietnam 's
totaldebts toforeign donors amounted toUS$3.4billion excluding overdue debts of10.7billion in
convertible ruble (anunitofcurrency usedinpayments among theformer Eastern European countries).
InOctober 1993, Vietnam normalized itsfinancial relations withtheInternational Monetary
Fund (IMF), theWorld Bank Group (WB, IDA, IFC)andtheAsian Development Bank (ADB). As
ofendof1995, Vietnam hasborrowed US$1billion fromthesefinancial institutions forinfrastructure
projects andeconomic structural adjustment programmes. There havebeenconsultations between the
GovernmentofVietnamandIMF,WBonfinancial,monetaryandforeignexchangepoliciesinparticular
andexternal sector policy ingeneral. Such acooperation isdeemed positive andefficient.
(d) Investment policy
TheLawonForeign Investment of29December 1987together withitsamendments andother
guiding documents mentioned herein create afundamental legal framework forforeign investment
activities inVietnam.
TheMinistry ofPlanning andInvestment isthegovernment authority regulating investment
activities.
Vietnam iscurrently inlowdevelopment economic stage, therefore itisapplying awiderange
ofincentives andattractive policies tostimulate economic development andresolve fundamental
impediments suchasunemployment, andlowincome andliving standards. Vietnam encourages foreign
investment intoalmost alleconomic areas. Thispolicy hasthefollowing characteristics:
- wide-ranging andopeninterms ofinvestment areas;
- widerange ofinvestment forms, noceiling tocapital holding byforeign investors;
- priority given toinvestments matching development programmes (agriculture, consumer goods
andexports production);
- encouraging investments generating employment andpromoting exports, re-investment, and
large scale investments;
- special incentives forinvestment intodisadvantageous regions such asregions with
under-developed infrastructure, remote andmountainous regions;
- import dutyexemption toimported machinery andequipment, means oftransportation, and
materials forthepurpose ofcapital construction ofjointventure enterprises;
- importdutyreductionandexemptiontoimportedmaterialsforthepurposeofexportsproduction;
- profit taxholidays. Currently, profit taxrateat25percentisapplied toinvestment projects.
Theratecould belower forprojects under thepriority listsetbytheGovernment, butnot
below 10percent;WT/ACC/VNM/2
Page24
- lowtaxonprofit repatriation, ranging between 5to10percent.Exemption forsome special
cases.
Foreign investment projects aresubject totheregulation onminimum wages forVietnamese
labour. Minimum wages varyindifferent regions andaresubject tochanges. Ingeneral, theminimum
wages arehigher thanlegallevels applied toVietnamese enterprises.
ByJanuary 1996Vietnam hasissued licences fortheestablishment offive(5)export processing
zones andeight (8)industrial areas.
(e) Competition policy
Upuntilthepresent, Vietnam hasnotissued anyspecific lawoncompetition. However,
competition isregulated under various lawsandunder-law documents. Ingeneral, faircompetition
isprotected andencouraged:
- thelistofprohibited exports andeconomic areasunder sectoral management hasbeengradually
narrowed;
- thenumber ofState-owned aswellasprivate domestic andforeign enterprises allowed tooperate
insectorally managed areas, suchasproducts affecting major equilibrium ofthenational
economy, maritime transportation, aviation, telecommunications, etc.,isincreasing;
- counterfeits production isstrictly prohibited;
- intellectual property rights areprotected bylaw.
Vietnam hasnotissued lawsoncountervailing andanti-dumping.
Vietnam reserves therightofissuing andapplying legislation oncompetition inobservance
ofWTO disciplines andinternational practices.
III. BASIS FORMAKING AND IMPLEMENTING THEPOLICIES RELATING TOTRADING
COMMODITIES AND SERVICES
1. Powers oftheExecutive, Legislative andJuridical Bodies
(a) National Assembly
The1992ConstitutionoftheSocialistRepublicofVietnamprovidesthattheNationalAssembly
isthehighest organ ofState power, exercising theLegislative Power, supervising thewhole State
Organ. TheStateofVietnam istheunitary one.TheGovernment exercises theall-sided leadership
fromthecentral down tothegrassroots basis through a4-tier administration system i.e.Central level,
Provinces andcities directly under thecentral government, district level, precinct andwardcommune.
TheNational Assembly decides thefundamental domestic andforeign policies, the
socio-economic tasks, thenational defense andsecurity issues, etc.
TheNational Assembly elects andrelieves theStatePresident andVice-President, theChairman
oftheNational Assembly, theVice-Chairman andmembers oftheStanding Committee oftheNational
Assembly, thePrime Minister, thePresident oftheSupreme People ’sCourt, theHead oftheSupreme
People ’sOffice ofSupervision andControl.WT/ACC/VNM/2
Page25
Theduration ofeachNational Assembly legislature isfiveyears. Each year, theNational
Assembly holds tworegular sessions, whenever necessary, itmayconvene extraordinary sessions.
TheStanding Committee oftheNational Assembly isitspermanent body. Itiscomposed of
theChairman, Vice-Chairman oftheNational Assembly anditsmembers. TheStanding Committee
oftheNational Assembly isentitled toenact ordinances, resolutions, tosupervise theimplementation
oftheConstitution, resolutions oftheNational Assembly, theordinances andresolutions oftheStanding
Committee oftheNational Assembly, tosupervise theactivities oftheExecutive, Juridical organs
andthelocal elected bodies; theStanding Committee oftheNational Assembly isauthorized to
interpret theConstitution, thelawandordinances, solves theeveryday work oftheNational Assembly
during theintervals between theNational Assembly 'ssessions.
(b) TheState President
TheStatePresidentistheHeadofStaterepresentingtheSocialistRepublicofVietnaminternally
andexternally. TheStatePresident iselected bytheNational Assembly fromamong itsDeputies. He
isresponsible totheNational Assembly andreports toit.HistermofOffice issimilar tothatofthe
National Assembly. Attheendofthelatter’stenure heshallcontinue tobeinoffice untilanew
President ofthecountry iselected bythenewLegislature. TheStatePresident hasthefollowing duties
andpowers:
- topromulgate theConstitution, lawsandordinances;
- toappoint andrecall Vietnam ’sExtraordinary andPlenipotentiary Ambassadors; toreceive
theExtraordinary andPlenipotentiary Ambassadors offoreign countries; tonegotiate andsign
international agreements onbehalf oftheSocialist Republic ofVietnam withtheHeads of
other States; toratify oraccede tointernational agreements, except forcases thatrequire the
National Assembly 'sratification;
- tograntVietnamese Nationality, release fromVietnamese Nationality ordeprive ofVietnamese
Nationality;
- topropose totheNational Assembly toelect, release fromduty, remove fromoffice theState
Vice-President, thePrime Minister, thePresident oftheSupreme People ’sCourt, theHead
oftheSupreme People ’sOffice ofSupervision andControl; toappoint andrelieve fromduty
ordismiss other senior members oftheGovernment, theSupreme People ’sCourt andthe
Supreme People ’sOffice ofSupervision andControl;
- onthebasis ofresolutions oftheNational Assembly orofitsStanding Committee, theState
President hasalsoother Extraordinary powers suchastoproclaim astateofwar,astateof
emergency, toorder general mobilization, togrant pardons, togrant amnesty.
(c) TheGovernment
TheGovernment isthehighest Executive organ, responsible forcarrying outandmanaging
thefulfilment ofthepolitical, economic, cultural, social, national defense, security andexternal
duties ofthecountry. Itisresponsible totheNational Assembly toensure alllegalperformances and
reports totheNational Assembly, theStanding Committee oftheNational Assembly andtheState
President about those above-mentioned issues.
Intermsofeconomicandadministrativeaffairs,theGovernmenthasthefollowingmainfunctions
andpowers:WT/ACC/VNM/2
Page26
- todirect thework ofministries, ofministerial levelagencies andtheother agencies under
theGovernment, thePeople ’sCommittees atalllevels inorder toensure theuniform
implementation ofthelegalsystem which havebeenpromulgated inthewhole country and
exercise management ofaunified system oftheapparatus oftheStateadministration fromthe
centre tothegrassroots;
- toensure theimplementation oftheConstitution andthelaws, toprepare billsanddraftlaw
amendments tobesubmitted totheNational Assembly forapproval; toissue by-laws (decrees,
regulations); tointerpret thelawsandguide theimplementation ofthelawsandordinances;
- toensure theoverall management ofthebuilding anddevelopment ofthenational economy;
tocarry outnational financial andmonetary policies, topromote thedevelopment ofculture,
education, health-care, science andtechnology,etc.;
- toensure theoverall management oftheState’sexternal relations; tosign,approve international
agreements, todirect theimplementation oftheinternational agreements towhich theSocialist
Republic ofVietnam isaparty asprovided bythelaws.
ThePrime Minister istheHead oftheGovernment, directing thework oftheGovernment
andPeoples ’Committees (Executive Organs) atdifferent levels. OnthebasisofthePrime Minister ’s
proposals, theNational Assembly ratify theappointment, release fromdutythevice-Prime Ministers,
theMinisters andother members oftheCabinet. ThePrime Minister approves theelection orremoval
fromoffice ofthechairmen, vice-chairmen ofthePeople ’sCommittees oftheprovinces orcitiesdirectly
under thecentral government rule.ThePrime Minister makes thedecisions anddirectives toimplement
thelaws, law-decrees andsupervises theimplementation ofthelawsandordinances.
TheGovernment isthesoleorgan tosubmit totheNational Assembly thelawsoneconomy
andoveralleconomic planonsocio-economic development.
(d) TheSupreme People 'sCourt andtheSupreme People 'sOffice forSupervision andControl
TheSupreme People ’sCourt, thelocal People ’scourts, military tribunals, economic and
administrative courts arethejudicial organs. Inthespecial situation, theNational Assembly candecide
theestablishment ofthespecial tribunals.
TheSupreme People ’sCourt isthehighest judicial organ. Itsupervises anddirects thejudicial
work ofmilitary, administrative, economic andlocalPeople ’scourts. ThePresident oftheSupreme
People ’sCourt isresponsible toreport totheNational Assembly andwhen thelatter isnotinsession,
toitsStanding Committee andtotheState President.
During atrial, thejudges andjurors areindependent andarebound onlytocomplying with
thelaw.ThePeople ’sCourts shallholdtheirhearings inpublic, except incases determined bythe
law.Therightofthedefendant tobedefended isguaranteed. Thedefendant hasrighttoeither conduct
hisowndefense ortobedefended byanother.
TheSupreme People ’sOffice ofSupervision andControl supervises andcontrols observance
ofthelawbyministries,organsofministeriallevel,otherorgansundertheGovernment,localauthorities,
economic institutions, social organizations, people ’sarmed forces 'units, andcitizens, itexercises
theright toinitiate public prosecution, ensures aserious anduniform implementation ofthelaw.
Thelocal Office ofSupervision andControl andthemilitary Offices ofSupervision andControl
supervise andcontrol observance ofthelawandexercise theright toinitiate public prosecution within
thebounds oftheirrespective responsibilities asprescribed bylaw.WT/ACC/VNM/2
Page27
ThePeople ’sOffice ofSupervision andControl isdirected byitsHead. TheHeads ofLocal
People ’sOffice ofSupervision andControl, theHeads ofMilitary Offices ofSupervision andControl
aresubject totheunified leadership oftheHead oftheSupreme People ’sOffice ofSupervision and
Control. TheHead oftheSupreme People ’sOffice ofSupervision andControl isresponsible tothe
National Assembly andreports totheNational Assembly, when theLatter isnotinsession, toits
Standing Committee andtheState President.
2. TheGovernmental Organs Responsible forDrafting andImplementing Foreign Trade-Relevant
Policies
Vietnam isintheprocess ofcompleting theorganizational machinery andcomprehensive
administrative reforms, streamlining theStateorgans, thusmaking them more effective, andfurther
enablingdomesticandforeignbusinessmentopromotetheirinvestment,tradingactivitiesandeconomic
cooperation inVietnam. Themain organs which have major relations withforeign activities inthe
areas oftrade andinvestment aretheMinistry ofTrade, theMinistry ofPlanning andInvestment, the
Ministry ofFinance, TheCustoms General Department, theMinistry ofForeign Affairs, TheOffice
oftheGovernment, thePeople ’sCommittees ofProvinces andCities directly under theCentral
Government rule.
TheMinistry ofPlanning andInvestment
TheMinistry ofPlanning andInvestment hasthefollowing tasks:
- toanalyze andtoconsolidate theresources ofthewhole country, including theresources
from foreign countries formaking andsubmitting totheGovernment theshort-term,
medium-term andlong-term plans ofsocio-economic development forthewhole country
andkeeping theoverall balances ofthenational economy;
- tomake bills, draftlegaldocuments relating topolicies andmechanism interms ofeconomic
management, promote domestic andforeign investment, guide andcontrol theimplementation
ofprojects, plans forsocio-economic development, theState programmes andpolicies on
foreign investment intoVietnam andVietnamese investment abroad;
- toserve asafocal point incoordinating, managing andusing ODA sources, tomanage the
business registration, issueinvestment licences forcooperation, joint-venture andalignment
projects offoreign countries intoVietnam andfrom Vietnam toother countries.
TheMinistry ofTrade
TheMinistry ofTrade istheGovernmental organ which exercises theState management of
thetrading activities ofalleconomic sectors inthewhole country; including thetrading activities of
foreign organizations andindividuals whoarepermitted todobusiness inVietnam andofVietnamese
entities abroad.
TheMinistry ofTrade carries outtheduties, powers andresponsibilities ofStatemanagement
according totheprovisions prescribed intheDecree No.15/CP dated 2March 1993bytheGovernment
andthefollowing concrete duties andpowers:
- tocarry outresearches inorder tomake long-term policies andstrategies fortheorientation
offoreign trade development, make thestrategies fordeveloping markets, customers and
commodities.WT/ACC/VNM/2
Page28
Tothisend,theMinistry ofTrade hasthedutytoassist theGovernment inthenegotiations,
acceding toandtaking partintheactivities oftheregional andinternational economic
organizations.
- toconstruct andsubmit tothePrime Minister, theGovernment topromulgate orpromulgate
within itsauthorities mechanisms interms ofmanagement ofexport andimport activities:
- tomanageexportandimportquotas,awardandwithdrawlicencesforexportandimport
business activities oftheeconomic organizations according tothedevolution bythe
Government;
- toissue export andimport licence tothejoint-venture organizations withforeign
countries inlinewiththeinvestment law;
- toexercise State management ofbrokering activities, consultancy, trade fairsand
commercial advertisement andother commercial promotion inVietnam andabroad;
- tocoordinate withother institutions concerned inapproving theindirect commercial
investment programmes andprojects;
- toconsider andallow Vietnamese economic organizations tosendrepresentatives, to
setupcompanies,branchesabroadoraccedetotheinternationaleconomicorganizations;
- toconsider andpermit setting upoftheoffices inVietnam byforeign economic
organizations;
- tomanage, giveprofessional guidance toVietnam ’seconomic andtraderepresentative
offices abroad.
- todraftandsubmit totheGovernment topromulgate orpromulgate within theMinistry ’s
authoritiestheregulationsonmanagementofdomesticcommercialactivitiesandservices,plans,
policies todevelop economy andtrade inthemountainous areas, thehighlands andinthe
areas ofethnic minorities;
- toorganize, guide theimplementation oftheplans ofscientific researches, application of
scientific andtechnological progresses inthetrading activities;
- toorganize thereception of,process andsupply domestic andworld economic andcommercial
information inservice oftheGovernment ’smanagement andtheorientation ofactivities of
theeconomic organizations;
- toexercise theState management ofthemeasurement andqualities ofgoods incommercial
activities intheareas forwhich theMinistry ofTrade isresponsible within thewhole country
market;
- togiveprofessional guidance instruction tothelocalState'strade management agencies.
TheMinistry ofForeign Affairs
TheMinistry ofForeign Affairs istheGovernmental organ which stages thefunction ofState
management inthediplomacy withfieldaimed atexpanding thefriendship andcooperation ofmutual
benefits withother countries. TheMinistry ofForeign Affairs, incooperation withother central andWT/ACC/VNM/2
Page29
local bodies andorganizations, tocarry outtheForeign Policy oftheSocialist Republic ofVietnam,
contributing tobuilding andimplementing theexternal economic policy inparticular.
TheGeneral Customs Department
TheGeneral Custom Department isanagency under theGovernment which functions State
management ofthecustoms areaandorganizes theStatemanagement ofcustoms activities inthewhole
country. Oneoftheimportant tasks oftheGeneral Customs Department istoguide, instruct and
examine theimplementation ofcustoms professional duties, collect export andimport tax,andother
collections according totheGovernment ’sregulations, carry outanti-smuggling control andcustoms
statistics.
Vietnam ’sCustoms isorganized asasystem comprising, composed oftheGeneral Customs
Department (Central), localCustoms Departments under theGeneral Customs Department inlocalities.
TheGeneral Statistical Office
TheGeneral Statistical Office isthebodywhich collects, consolidates andmakes public statistics
ofVietnam ’seconomy andtrade.
3. Powers oftheGovernment andLocal Administrative Committees
TheCentral Government hasbeenmentioned inpart(c)TheGovernment
TheLocal administrations inVietnam havethree levels:
- administrations atthelevelofprovince, citydirectly under Centre Authority (herein referred
toasprovincial administrations);
- administrations atthelevelofdistrict andtown(herein referred toasdistrict administrations);
- administrations atthelevelofcommune, ward andtownlet.
Among thethree administrative levels, provincial administrations arethemost important.
Provincial administrations areauthorized byMinistries andorgans ofministerial rankoftheGovernment
tocarry outState management andcontrol overforeign economic activities within theprovinces.
4. Regulations onPolicy Planning, Approval andRatification
Stateadministrative functions ofMinisterial Authorities havebeenstipulated intheArticle 116
oftheConstitution andelaborated intheChapter 4oftheLawontheOrganization oftheGovernment.
Toimplement the1992 Constitution andtheLaw ontheOrganization oftheGovernment, the
Government issued thedecree 15/CP of12March 1993onStateadministrative tasks, authorities and
responsibilities ofMinisterial Authorities regarding law-making andimplementation, master-planning,
planning,financing,government'sorganizationandstaff,internationalrelations,investigation,inspection,
andworking regulations andworking relations atMinisterial levels.
State administrative functions ofMinisterial Authorities shallfocus onsuchmain fields as:
- working outdevelopment master-plans, plans andstrategies oftheindustries;
- drafting legalprojects anddocuments;WT/ACC/VNM/2
Page30
- issuing standards, procedures, andguidelines forimplementing Government 'sand
Prime Minister 'sstatutes;
- master-planning forstafftraining, recruiting andmanaging government officials;
- organizing international cooperation oftheindustries, including evaluating foreign anddomestic
investment projects within thescope oftheMinistries 'management;
- organizing investigations andinspections within theindustries.
Negotiation, conclusion andapproval/ratification ofinternational treaties arestated inthe
Ordinance ontheConclusion andImplementation ofInternational Treaties enacted on25October 1989,
including thefollowing provisions:
- thenames oftheSocialist Republic ofVietnam (SRVN) ininternational treaties:
- theState ofSRVN;
- theGovernment ofSRVN;
- Ministerial Authorities.
- guiding principles fortheconclusion ofaninternational treaty:
- mutual respect forindependence, sovereignty andterritorial integrity, non-interference
ineach other'sinternal affairs, equality andmutual benefit, inaccordance with
international lawsandpractices.
- procedures fortheconclusion ofinternational treaties:
- theinternationaltreatiesthatcoverquestionsofpeaceandsecurity,nationalsovereignty,
territorial borders andjurisdiction; andofrights andduties ofcitizens aretobe
submitted byMinistry ofForeign Affairs totheCouncil ofMinisters (theGovernment
now) inconsultation withMinistries orMinisterial Authorities concerned;
- theinternational treaties thatrelate toeconomic, cultural, scientific andtechnical
cooperation aretobeprepared andsubmitted totheGovernment bytheMinisterial
Authorities concerned, inconsultation withtheMinistry ofForeign Affairs;
- drafttreaties which contain provisions atvariance withthelawsoftheSRVN aresubject
toconsultation withtheMinistry ofJustice before submission totheGovernment.
- competence withregard totheconclusion ofinternational treaties:
- adecision ontheconclusion ofaninternational treaty onbehalf oftheStateofSRVN
andatreaty which contains provisions contradicting totheexisting lawsoftheSRVN
shallcome within thejurisdiction oftheStateCouncil (currently thePresident ofState);
- adecision ontheconclusion ofaninternational treaty inthename oftheStateofSRVN
shallfallwithin thecompetence oftheGovernment;
- theHead ofaMinisterial Authority shalldecide theconclusion ofaninternational treaty
onbehalf ofsuchauthority afterbeing authorized bythePresident oftheStateorthe
Government;
- theaccredited headofadiplomatic representative oftheSRVN toaforeign country
oraninternational organization isvested withthepower tonegotiate onthetextofWT/ACC/VNM/2
Page31
international treaties withorganizations concerned; however hecanonlysignthe
negotiated treaties when entrusted withfullpowers provided forbyabove- mentioned
provisions.
Thetreaties concluded onbehalf oftheStateofSRVN which contain aprovision onratification
must beratified toputintoeffect.
TheStateCouncil (thePresident oftheStateatpresent) shallexercise itscompetence toratify
international treaties, except forthecasethattheCouncil deems itsappropriate tosubmit them tothe
National Assembly forratification.
Submission ofaninternational treaty forratification shall beproposed bythefunctional
Ministerial Authority thatprepared fortheconclusion ofsuchtreaty, inco-ordination withtheMinistry
ofForeign Affairs andmade byorinthename oftheGovernment.
Approval ofatreaty concluded onbehalf oftheGovernment oraMinisterial Authority which
contains aclause ofapproval fallswithin thecompetence oftheGovernment, withthesubmission being
made bytheMinisterial Authority thatprepared andproposed fortheconclusion ofsuchtreaty.
Accession toamultilateral treaty which requires anactofratification orcontains provisions
atvariance withthelawsoftheSRVN shallbedecided bytheState Council (thePresident ofState
atpresent). TheCouncil ofMinisters (theGovernment now) shalldecide ontheaccession toother
multilateral treaties.
5. Laws andBy-Law Documents oftheNational Assembly, theState andtheGovernment
(Refer toAnnex II)
6. Procedures forResolving Economic Cases andDisputes
Toprotect economic interests andlegitimate rights ofallparties participating inforeign and
domesticeconomicrelations,Vietnamhasformulatedandenactedasetoflegaldocumentsonprocedures
forresolving cases intheadministrative andeconomic fields:
(a) Procedures forsettlement ofeconomic cases
Theprocedures arestated intheOrdinance onProcedures forSettlement ofEconomic Cases
adopted bytheStanding Committee oftheNational Assembly on29March 1994.
1. Allparties toaneconomic dispute havetherighttobring theircasetoPeople 'scourts toresolve
thedispute iftheycannot reconcile.
2. ThePeople 'scourts atprovince anddistrict levels shallhavepowers tosolve economic cases
according totheprinciple ofcasevalue andofprinciple ofchoice asspecified bylaw,depending on
eachcase.
Adispute involving aforeign party shallbesolved bythePeople 'scourt atprovince levelin
accordance withthefirstinstance procedures.
3. Iftheparties toaneconomic dispute areunable toreconcile theirdifferences, theycanfile
apetition forrequesting thePeople 'scourt tosolve thedispute within 6months fromthedateonwhichWT/ACC/VNM/2
Page32
thedispute arises. Theplaintiff ofthecasehastoadvance legalfeeaccording totheprovisions of
thelaw.
4. Before thefirstinstance hearing, thecourt shallconduct amicable settlement. Thefirstinstance
hearing shallbeconducted byacouncil oftrialcomprising of1judge and2jurors, which works in
accordance withtheprinciple ofthepublic majority voting, debate ataroom-court andrespect for
objective facts.
5. Allparties areentitled toappeal against thecourt'sjudgment/decision made inthefirstinstance
trialtorequest thePeople 'scourt atahigher leveltoconduct thesecond instance trialofthecasewithin
10daysfromthedateofdeclaration ofthecourt'sjudgment. After thistime-limit ifthereisnoappeal,
thecourt'sjudgment ofthefirstinstance trialshallbelegally effective.
Except forcomplex cases, ingeneral thecourt ofappeal shallopenanappeal hearing within
onemonth since thedateofreceipt ofalldocuments submitted bythecourt ofthefirstinstance trial.
Thejudgment/decision ofthecourt ofappeal shallbelegally effective.
6. Court'sjudgments/decisionswhichhavecomeintolegalforcecanbeprotestedunderthecassation
(Supreme Court ofAppeal 's)procedure. ThePresident oftheSupreme People 'sCourt andtheHead
oftheSupreme People 'sOffice ofSupervision andControl havetheright toprotest against every
judgment ofthePeople 'sCourts. TheVicePresident oftheSupreme People 'sCourt andtheDeputy
Head oftheSupreme People 'sOffice ofSupervision andControl havetheright toprotest against
judgments ofthelocalPeople 'sCourts. Thetrialpanel inthecassation procedure isentitled toreject
aprotest, andtoretryacaseunder thefirstinstance orappeal procedures, ortomodify thesettlement
ofthecase.
7. Judgments/decisions ofthecourt may, forbeing legally effective, besettled, onthebasis of
protest ofthePresident ofthePeople 'sCourt andtheHead ofthePeople 'sOffice ofSupervision and
Control atalllevels, byandinaccordance withtherevision procedures.
8. Judgments/decisions ofthePeople 'scourtoneconomic disputes shallbecompulsorily executed
inaccordance withtheOrdinance onimplementation ofciviljudgments.
(b) Procedure forsettlement ofeconomic disputes byeconomic arbitration
1. TheprocedureforsettlementofdomesticeconomicdisputesisprovidedintheDecreeNo116/CP
dated5September1994oftheGovernmentoftheSRVNontheOrganizationandActivitiesofEconomic
Arbitration:
- iftheparties toadispute donotwanttofileapetition tothePeople 'scourt, theyareentitled
tochoose, byconsensus, anyeconomic arbitration centre toresolve thedispute inaccordance
withthearbitration procedures;
- apetition submitted toaneconomic arbitration centre mustbeattached byawritten agreement
onchoosing arbitrators andother thereto related documents;
- thecourse ofresolving adispute shallbeconducted inmeetings, except forcases inwhich
allparties otherwise agree, oroneparty/parties fails/fail toattend thehearing without reasonable
excuse;
- decisions ofthearbitration arefinalandbinding, which cannot beappealed byanyparties;WT/ACC/VNM/2
Page33
- allparties areresponsible forabiding byandecision ofthearbitration. However, ifthedecision
isnotaccepted byoneparty, theother party hastherighttorequest anauthorized People 's
court totrythecaseinaccordance withprocedure onsettlement ofeconomic cases.
2. Theprocedure forsettlement ofinternational disputes isstated inthedecision No204/TTg
dated 28February 1993 ofthePrime Minister oftheGovernment ofSRVN:
- theVietnam International Arbitration centre, aninstitution attheChamber ofCommerce and
Industry ofVietnam, shallfunction itsjurisdiction overdisputes arising fromeconomic relations
involving oneormore foreign parties whohaveanagreement toreferthedisputes totheCentre
orarebound byaninternational treaty todoso;
- oneorallparties toadispute aretofiletotheCentre apetition attached byother necessary
documents (onesetoforiginals andsamesetofcopies) andtopay,atthesametime, inadvance
arbitration feeaccording tothelegalprovisions;
- allparties areentitled tochoose bymutual consent asingle arbitrator, orindefault ofconsensus,
eachtochoose anarbitrator. Thetwochosen arbitrators shallappoint thethirdarbitrator as
thechairman ofthecouncil ofarbitrators consisting ofthose 3arbitrators. Inthecasethat
theparties failtochoose anarbitrator orachairman ofcouncil ofarbitrators, arbitrators shall
beappointed bythePresident oftheCentre;
- decisions ofacouncil ofarbitrators shallbetaken bymajority. Decisions ofthearbitrator are
final, which assuch, cannot beappealed toanyPeople 'scourt orinstitution;
Allparties havetoabide byadecision ofthearbitrator inastated duration. Ifthedecision
isnotexecuted, compulsory measures inaccordance withthelawsofacountry where thedecision
istobeimplemented, and/or based oncurrently international treaties thatcover suchacaseshallbe
applied.
Thelistoflegaldocuments isenclosed inAnnex II.
IV. POLICIES AFFECTING GOODS
1. Import Regulation
(a) Registration requirements forengaging inexport-import
Onlybusinesses licensed bytheMinistry ofTrade toconduct export andimport activities are
thenallowed toconcluded foreign tradesalesandpurchase contracts directly. Export -Import business
licences aregranted inaccordance withtheRegulation No.296/TMDL/XNK dated 9April 1992 by
theMinistry ofTrade andTourism (Ministry ofTrade atpresent). BythisRegulation, businesses can
beclassified intotwocategories:
- production enterprises;
- non-production enterprises, including onesspecialized intrading, services suppliers (namely
tourism,transportation,andforwardingetc.),and/ordoing,atthesametime,trading,production
andservices.
Production enterprises arerequired tomeet thefollowing qualifications togetlicensed:
established inconformity withlawsandregulations (Corporate law,private enterprise law,State-owned
enterprise law,Cooperatives law), operating inbusiness linesregistered initially, undertaking todoWT/ACC/VNM/2
Page34
business inlinewithVietnam lawsandinternational conventions towhich Vietnam isaparty, and
international trade practices.
Enterprise inmere trading isrequired todispose ofminimum amount ofitsowned working
capital, stated intheprescribed capital, inVietnamese Dong orother currencies equivalent to
US$200,000 atthepoint ofregistration forexport -import business.
Oncelicensed,productionenterprisehasrighttoexportitsproducts,regardlessofexportvolume,
andimport materials required foritsownproduction. Trading enterprises areallowed toconduct
import-export business asprovided forinthelicence.
Applicants forexport-import business licence mustsubmit totheMinistry ofTrade (Department
ofImport -Export Management) asetofapplication comprising of:
- application forexport-import licence (form issued bytheMinistry ofTrade);
- copyofCertificate ofestablishment (required tohavecertification byPublic Notary);
- copyofCertificate ofBusiness Registration (copy certified byPublic Notary);
- certification onworking capital fortrading enterprises, asprovided bylawsandvalidforcertain
specific categories ofbusiness.
Within 30daysfrom submission ofafullsetofapplication, theMinistry ofTrade shallbe
responsible togrant licence, otherwise reasons forrejection mustbegiven inwriting. Aregistration
feeforexport-import business licence ofVND. onemillion, equivalent tosome US$90ispayable.
Asof31December 1994, there were3,257 enterprises inVietnam registered in55business
lineswithStateEconomicArbitrationCouncil,ofwhich1,244enterpriseshadbeengrantedexport-import
business licences forwhich thenon-State enterprises accounted 13percent. Inaddition, there were
also1,372 foreign invested joint-ventures, entitled toexport products ofthejoint-ventures andimport
materials forproduction needs ofthejoint-ventures.
(b) Characteristics ofthenational taxation system (andtaxholidays)
Thenomenclature forexport andimport goods ofVietnam (8digits) wasconstructed onthe
Harmonized System Code bytheWorld Customs Council andwasmaintained inconsistency withthe
H.Snomenclature upto6-digits; 2-digit extension concretized asperparticularities ofVietnam imports
andexports reflecting Vietnam 'spolicies onimport-export duties. The2-digit extension havebeen
arereviewed andadjusted asadopted toVietnam 'sexports andimports nomenclature.
Import-export tariff nomenclature hasbeenconstructed ontheVietnam 'snomenclature for
exports andimports commodities (8-digit code).
Imports intoVietnam areallsubject tothesame import tariff commonly applicable (except
forimports under Article 9oftheLawonexport -import duties andlistofconcessions forASEAN
countries). Thecurrently effective import tariff ofVietnam wasissued under Decision No.280/TTg
dated 25April 1994 byPrime Minister oftheGovernment, under which some adjustment and
modification havebeenmade tocertain headings inresponse tochanges ininternational anddomestic
markets withaviewtogiving guidance onconsumption anddeveloping faircompetition. Thetariff
nomenclature hasbeendivided into97Chapters consisting of3,500 tarifflines, Tariff ratesrange fromWT/ACC/VNM/2
Page35
60percent to0percent (thelatter applicable toheadings ofproduction materials, machinery and
equipment etc.).
Tariff rateselaboration wasbased onthefollowing principles:
- tomobilize anappropriate contribution toState budget;
- togiveguidance ondomestic consumption.
Import tariffs consists of26ratesasfollows:
+from 0%to10%:12specific rates, viz.
0% 3% 7%
0.5% 4% 8%
1% 5% 9%
2% 6% 10%
+From 10%to20%: 4specific ratesnamely
12% 15% 17% 20%
+From 20%to50%: 8specific ratesnamely
22% 25% 30% 35%
38% 40% 45% 50%
+From 50%to60%: 2ratesnamely
55% 60%
Theaverage rateslevied onsome major imports asfollows:
+Automobile, motorbike 55%
+Alcohol 60%
+Beverage 50%
+Petroleum 55%
+Air-conditioner, Refrigerator 40%
+Home electric appliance 30%
+Cement 5%
+Plastics, rubber, paper 30%
+Steel 10%
Theaverage taxrateoftheabove major imports is33.5percent.There areabout 52percent
oftariff linesat0percentto5percentrates(seetheattached national tariff nomenclature).
Theaverage tariffratecollected onimported goods wasabout 19percentin1995andestimated
at15-16 percentfor1996.
Application ofpreferential treatment forimport duties
Vietnam hasbeenelaborating thetariff nomenclature tocomply withinternational practices.WT/ACC/VNM/2
Page36
Under Article 4oftheLawonimport -export duties, ifimports andexports under any
international conventions towhich Vietnam isapartyorhasacceded aresubject toprovisions atvariance
oftheLawonimport -export duties, provisions under international conventions shallprevail. Under
Article 9oftheLawthereof, theGovernment ofVietnam isentitled toapply preferential ratestocertain
countries withthemargin ofpreference uptoonehalfofthenormal rates. Atpresent, inaddition to
tariff concessions provided inthebilateral agreement withtheEU,Vietnam hasundertaken togrant
preferential tariff toASEAN member countries within theframework oftheagreement onCommon
Effective Preferential Treatment (CEPT) soastosetuptheAsean FreeTrade Area (AFTA).
Imports subject totaxexemptions areprovided forunder Article 10intheLawonimport -export
duties asfollows:
- non-refundable aid,grants;
- temporary admission imports fortrade fairs, exhibitions tobeheldinVietnam;
- imports byinternational organizations enjoying diplomatic status andimmunity;
- materials imported forexport processing under contracts withforeign partners andforexport
production.
Under Article 11oftheLawonimport -export duties, there aresome imports which might
benefit from taxexemption orreduction, subject toconsideration ofthecases which include:
- imports forthepurpose ofnational security anddefense, scientific research, educational and
training work ofuniversities andinstitutes;
- imports byforeign invested enterprises inVietnam benefiting from investment promotion
incentives incertain specific cases.
(c) Tariff quota
UptonowVietnam hasnotyetadopted thetariff quota, butreserves itsrighttoimpose the
tariff quota when itisdeemed necessary andpossible.
(d) Other taxes andcharges
Inaddition toimport duties, imports intoVietnam might besubject tosome other surcharges.
Inorder tomonitor prices ofsome essential items namely urea,cement etc.,theGovernment ofVietnam
establishedthePriceStabilizationFund.SourcestransferredintotheFundarenon-taxsurchargesimposed
onsome veryselective imports andexports inaparticular period. Therefore, depending onitsneeds
andprice fluctuation inaparticular period, inaddition toimport duties importers arealsorequired
topayasurcharge ofabout 5-10percentoverc.i.f. price value totheFund.
(e) Quantitative import restriction including prohibition, import quota andlicensing system
Imports under prohibition: Listofprohibited imports wasissued inattachment oftheDecision
No.864dated 30December 1995byPrime Minister forthepurpose ofsecuring social security, people 's
health, floraandfauna system, environmental protection. Theimportation ofgoods under thislist
must beapproved byPrime Minister onthecasebycasebasis.
Listofprohibited imports: SeeAppendix 2
Imports relevant tothegeneral equilibrium ofthenational economy: There aresome items
ofgreat demand, which canbeconsidered asathermometer andapsychological factor sensitive toWT/ACC/VNM/2
Page37
cause pricefluctuation, havebeenreferred toasitems relating tothegeneral equilibrium ofthenational
economy.
Atpresent, thefollowing 5items havebeenlisted under thisgroup:
- petroleum (excluding lubricants);
- ureafertilizer;
- sugar;
- construction steel;
- cement.
Limitation onimports ofconsumers goods
Being acountry ataverylowstage ofeconomic development, withtheaverage export value
percapita atUS$70/year in1995, thegovernment ofVietnam maintains apolicy tosaveforeign
exchange spent onconsumption andtoregulate consumption imports (finished products) notexceeding
20percentofthetotalexport value.
Details ofthisshallbepresented inpart(f)thereunder.
Limitation onimports oftransportation vehicles
Thesocio-economic infrastructure inVietnam isverypoor. Atpresent, Vietnam hasabout
110,000 kmsofroadincluding national highway, inter-provincial andintra-provincial roads, ofwhich
theintra-provincial roadmake upthemajor part.Only lessthan10percentofthetotallength were
asphalted. Theroadsystem including theasphalted andnon-asphalted onesarenarrow andhavebeen
rapidly degraded anddependent onnature. Booming demand fortransportation andtravel vehicles
hascaused threat todeteriorating environment andtheroadsystem aswellasbridges andfareshave
beenoverloaded andincreasingly deteriorated. Limitation onimports oftransportation vehicles isaiming
atobjectives inthefollowing order ofpriorities:
- tolimitthedeterioration oftheenvironment andthetraffic system;
- tocontrolthepressureofboomingdemandfortransportationvehicleondevelopmentinvestment;
- foreign exchange savings.
(Details inpart(f))
Since July1995, Vietnam became fullmember oftheASEAN, thereby committed herself to
several agreements inforce within member countries including theestablishment ofAFTA. Atpresent
Vietnam hasacceded totheCEPT agreement forAFTA, ASEAN agreement oncooperation inservices,
Agreement onASEAN industrial cooperative schemes (AICO), andmany other trade andeconomic
cooperation agreements. Under suchlegalumbrella, themajority ofgoods intrade between Vietnam
andotherASEAN member countries willbeaccorded preferential treatment regarding tariff, formalities
andproceduresandotherfavourableconditions.ThesestatusallconformwithprovisionsinArticleXXIV
oftheGeneral Agreement onTrade andTariff (GATT).WT/ACC/VNM/2
Page38
(f) Import licensing procedures
(i) Background
Import licensing reflects thenecessity toadminister andregulate flows ofgoods andtheireffects
tothedomestic market bytheGovernment ofVietnam through itsfunctional bodies andtosecure
objectives oftrade policies aspresented inChapter V.Import licensing isapplicable equally togoods
ofanyorigins. Import licensing regulation isbased onDecision No.864/TTg dated 30December 1995
byPrime Minister.
Alllegal andadministrative documents relating toimport licensing andprocedures areall
published onPublic Gazette, periodic trade publications suchastheTrade Review, Trade Weekly,
andother periodic publications namely Vietnam Economic Times, Vietnam News, Foreign Investment
Review etc.andbeing made available atanyVietnamese economic -traderepresentative offices abroad.
Requirements forimporters:
- being licensed withimport -export business permit;
- doing business within registered andlicensed business lines.
Specific regulations inforce in1996:
ProvisionsforimportshipmentlicensingunderRegulation297/TMDL/XNKdated9April1992
bytheMinistry ofTrade andTourism (Ministry ofTrade atpresent) arebriefly presented bellows:
Since 1February 1996, Vietnam hasremoved shipment licence foralmost allimports. Details
willbepresented inthefollowing parts.
Asfortherest,import shipment licences arestillrequired which willbegranted asprovided
forintheRegulation 297/TM-DL/XNK bytheMinistry ofTrade andTourism -Ministry ofTrade
atpresent. Application forimport shipment licence hasbeenprovided toconsist ofthefollowing
documents:
- filled-in application form;
- contract orevidence ofcontract;
- letter ofcredit (ifprovided incontract);
- quota allocation (ifgoods being subject toquota restriction);
- other supporting documents (ifdeemed necessary anddependent onforms ofimport).
TheGeneralDepartmentofCustomsisresponsiblefornon-commercialimport-exportlicensing
andadministration ofthose licences inaccordance with Circular 190TCHQ-GSQL dated
2November 1995andtheOfficial Note. 769/TCHQ-GSQL dated 12April 1995issued bytheGeneral
Department ofCustoms.
(ii) Objectives, scopes andimport licensing procedure
Prohibited imports:
Ifanimporter hasjustified reason toimport goods under prohibited list,heisrequired toprepare
anapplication andgetsupporting documents issued byMinistries orprovincial governments tosubmit
toPrime Minister forapproval.WT/ACC/VNM/2
Page39
Annually, listofprohibited imports shallbemade accessible ontheGazettes andother public
media,firstandforemostthetradeinformationagencies.Actually,thelisthasbeenmaintainedunchanged
formany years.
Listofimports relating tothegeneral equilibrium oftheEconomy
Detailed list import Breakdown
quota
million tonsspecialized
importer (%)other importers
(%)
Petroleum (ex.lubricant)
Urea * *
Black cement * *
Sugar AttheMinistry of
Trade 'sdiscretion* *
Steel ditto * *
* Inorder toregulate imports, thathavegreateffects tothegeneral equilibrium oftheeconomy,
andinaccordance withprinciple Decision ofPrime Minister, theMinistry ofTrade sought consultation
withotherlineMinistries (Ministry ofAgriculture andRural Development forureaandsugar; Ministry
ofIndustries forsteel; Ministry ofConstruction forcement, Ministry ofTransportation and
Communication forautomobile) toprepare guidance forimplementation:
Announcingtheyearlyquantityunderimportquotaregulation:thisquantityisadjustedaccording
tothesupply -demand planonthenational economy scale oftheyear.
Approving andannouncing thelistofenterprises allowed toimport theseproducts: theselection
ofthese enterprises isbased mainly onpastperformance. Newcomers canbeconsidered onthebasis
ofcapital andregistered business.
TheMinistry ofTrade shallannounce andgrant import quota forthewhole yeartoselected
enterprises-applicants. Twomonths before thetimebar,ifenterprises havenotyetconcluded contracts
thentheallocated quota might berevoked. Non-executed quantity willbeallocated toothers onthe
list.
ImportsofsecondhandmachineryandequipmentaresubjecttoregulationsissuedbytheMinistry
ofScience, Technology andEnvironment.
Imports ofcomplete equipment, equipment financed byStateBudget shallbepresented under
thesection related toGovernment Procurement.
Inorder tosaveforeign exchanges forinvestment development demands andother pressing
needsarisingoutofpre-stagedevelopmenteconomy,toprotectsmallscaleandinfantdomesticindustries,
imports ofconsumer goods aresubject toaseparate Regulations. Regulations inforce onconsumer
imports were issued under Circular 03/TM-XNK dated 25January 1996 bytheMinistry ofTrade.
TheRegulation covers onlyfinished consumer goods, anddoesnotinclude imports ofmaterials,
spare-parts andcomponents forproduction ofconsumer goods.
Listandcodes ofconsumer goods arepublicly promulgated, include foods, personal and
household utensil, electronics, electric appliances, optical instruments, personal vehicles. Importers
mustsubmit application forimporting theabove mentioned goods totheMinistry ofTrade. TheMinistryWT/ACC/VNM/2
Page40
ofTrade shallgrant import licence onthebasisofcontrolling imports ofconsumer goods notexceeding
20percentoftotalexport volume during thepresent year.
CertainitemswhichmayrelatetoArticleXX(GATT1994)requiresapprovalfromlineMinistry
before importation. Theeffective listfor1996 included:
- chemicals anddrugs;
- special aquatic products orbreeds;
- radio transmitting andreceiving equipment, switchboard andexchanges;
- cultural,artisticandcinematographyproducts,showsandperformancesandprintingequipment;
- banking facilities;
- chemicals andchemical related equipment requiring safety inspection;
- Lubricants;
- mother 'smilksimulation, precious metal andstone.
(g) Restrictions onborder trade imports
Border trade imports arealsosubject totheabove mentioned regulations. Ifduties payable
areunder 5percent, thentherateof5percentshallbeimposed. Asformerchandise notcovered
inthelistofminimum prices inforce, issued bytheMinistry ofFinance, provincial people 'scommittees
andprovincial Customs authority shallberesponsible forsetting theminimum prices.
(h) Customs valuation
TheLawOnImport -Export Duties passed on26December 1991 bytheNational Assembly
oftheS.R. ofVietnam ontheVIIILegislation andDecree 54/CP dated 28August 1993 bythe
Government ofVietnam haveprovided general principles fortaxvaluation: export andimport duty
valuation shallbased onprices written oncontracts (contracted price) andauthentic commercial invoice
inrelation toother relevant documents.
- price forexport dutyvaluation shallbetheactual selling price atexporting port(f.o.b. or
equivalent);
- price forimport dutyvaluation shallbetheactual buying price atimporting port(c.i.f. or
equivalent).
However, inorder tolimittaxevasion byfraudulent pricing practice between buyer andseller
which might leadtounfair competition andmarket failure, lossoftaxrevenue, during necessary periods,
theStateshallissueregulations tosupervise prices ofcertain groups ofmerchandises. Regulations shall
alsocover some major imports andexports, which areoften traded ofhighvalue andgreat volume.
Atpresent, Decision No.1187/TC-QD/TCT dated 20November 1995 oftheMinistry ofFinance,
defining minimum prices forimport dutyvaluation for34headings, isinforce.
TheMinistry ofFinance isresponsible toissue thelistofminimum prices forimport duty
valuation forperiodical application (oneyearorshorter). Minimum prices shallbeconstructed on
average c.i.f. prices ofimports.
Asformerchandise notcovered intheabove stated list,iftheentry customs authorities have
reason todoubt onthedeclared contract price, provincial Department ofcustoms shallbeauthorized
tore-evaluate theminimum prices following theabove principles. TheDepartment shallhavetoreport
totheGeneral Department ofCustoms andtheMinistry ofFinance. Upon approval, thesaidminimum
prices shallbeapplicable overtheentire country.WT/ACC/VNM/2
Page41
(i) Other customs formalities
Though Vietnam isafullmember ofWorld Customs Organization (WCO), ithasnotyetbeen
aparty totheAgreement onCustoms valuation within WTO framework. Inaddition tothe
afore-mentioned regulations oncustoms valuation, Vietnam customs services hasthefollowing features:
- there isnospecific provision ruling inter-company prices;
- there isnospecific provision forsalesbetween related persons;
Ifimporter orexporter requires anyinformation thereof, hecanwrite letter ofrequest tothe
General Department orLocal customs offices.
Losses incurred during transportation, warehousing, andhandling would beexempt fromimport
duties, beitproperly certified byanauthorized inspection agency.
Ifthereisandisagreement ondutyratepayable, taxpayer mustpaydutyasofficially informed,
butatthesame timehehasrighttomake claims totheGeneral Department ofCustoms forsettlement.
Ifhefound theresponse therefrom unreasonable, claims canbesubmitted toMinister ofFinance.
Decision byMinister ofFinance shallbefinal.
Foreign exchange rateserving asbasis fortaxevaluation shallbethebuying rateoffered by
theStateBankofVietnam ondateofloading orunloading (forexport orimport respectively) ascertified
byCustoms onthedeclaration form.
Undisclosed information isprotected byLaws. ButGovernmental agencies ofVietnam are
empowered toorder enterprises toprovide withinformation onpersonal andbusiness transaction for
Customs clearance (andaudit) purposes.
(j) Pre-shipment inspection
Atpresent, Vietnam hasnospecific provisions onpre-shipment inspection. Vietnam avails
itself toreserve therighttoimpose thisrequirement when Vietnam finditnecessary onthebasis of
WTO principles.
(k) Domestic taxes levied onimported goods
Special salestax:being effective since1January 1996provided forintheLawonamendment
ofandadditions tosome provisions intheLawonspecial salestaxpassed bytheNational Assembly
on28October 1995. Thiskindoftaxisonlyimposed on6imported groups ofitems namely: tobacco;
beverage; fire-cracker (various kindoffireworks andcracker except explosive-cracker); automobile
(including SKD); Petrol ofdifferent kinds, naphtha, reformed component andother preparation for
concoction ofpetrol. Thehighest rateis100percentlevied onautomobile andcracker andthelowest
of15percentlevied ontobacco, beverage, andpetrol.
Turnover taxlevied onsalesofimported goods havedifferent ratesat4percent-10 percent,
asprovided forinLawonturnover tax.
(l) Rules oforigin
Certificate oforigin isoneofthebasisforCustoms taxcalculation andanecessary document
forCustoms clearance.WT/ACC/VNM/2
Page42
Asforgoods imported under CEPT forAFTA, importers arerequired tosubmit certificates
oforigin specifically inform D,proving 40percentASEAN cumulative origin.
Asforotherimports, importers mustproduce certificates oforigin issued byrelevant authorities
inaccordance withinternational practices (orasprovided inthecontract).
Atpresent, thereisnolegaldocuments orspecific regulations onruleoforigin, theGovernment
ofVietnam reserves toissue regulations onthismatter withreference tothose inforce within WTO
framework.
(m) Anti-dumping
Vietnam hasnoprovisions onanti-dumping.
(n) Countervailing duty
Vietnam hasnoprovisions oncountervailing duty.
(o) Safeguard measures
Vietnam hasnoanyprovisions onsafeguard measures.
Atpresent Vietnam hasnotyetmade anylegal provisions fortheabove three issues. The
Government ofVietnam reserves rights toissueregulations, ifdeemed necessary, ontheabove matters
inaccordance withWTO provisions.
2. Regulation onExport
(a) Registration requirements forengaging inexports
Onlylicensed businesses areallowed toconduct export activities. Regulations ofexport-import
business registration areproduced inIV.1(a).
(b) Export tariff
Thecurrent export tariffwasissued inattachment toDecision No.280/TTg dated 28May1994
byPrime Minister, towhich theMinistry ofFinance hasperiodically made amendments andadditions
forsome headings butinobservance offrame export tariffs approved bytheStanding Committee of
theNational Assembly. One-column export tariffhasbeenapplied toalltaxable exports (58headings).
Thehighest export dutyis45percent(metal scraps), andthelowest rateof0percent(processed
products).
Rates provided inexport tariff are:
0% 1% 2% 3%,
4% 5% 10% 15%
20% 25% 35% 45%
Themajority fallsintotherange of0%-5%.
Theweighted average is14%.WT/ACC/VNM/2
Page43
Export tariffhasbeenlevied onsome items likescareresources, which doesnotfallintoexport
priority category (forest resources, minerals), export ofmaterials oflowvalue oninternational market,
andinsome instance thegovernment takesuseofexport tarifftorestrict exports ofstrategic importance
toVietnam.
Fundamental principles inexport tariff elaboration:
- toprotect scare natural resources which arenotencouraged forexport likeforest resources,
minerals intheforms ofrawmaterials;
- toregulate andreconcile revenue toStateBudget when prices ofsome exports ofrawmaterials
aremuch lower thanthatofintheinternational markets;
- tolimitexports ofstrategic goods.
Other charges andtaxes: Atpresent, theGovernment ofVietnam hasimposed surcharge on
exports ofcashew-nuts andcoffee.
(c) Quantitative export restrictions including prohibition, quota andlicensing systems
(i) Listofprohibited exports
Based onprinciples conforming toArticle XXofGATT (1994), theGovernment ofVietnam
hasmade alistofprohibited exports. Thelistinforce in1996 appeared inAppendix 2.
(ii) Export quota
In1996, Vietnam imposes quota requirements ontwocategories:
- rice:about 2million tons;
- textile andgarment: exports toEU,Norway andCanada aresubject toprovisions inthe
agreements onvoluntary export restriction between EU,Norway andCanada withVietnam.
(iii) Listofgoods under line-management
TheGovernment isresponsible forgeneral policies (tobemade public onannual basis) and
lineMinistries areresponsible forissuing list(very limited) ofgoods thatrequires approval fromline
Ministries. Theeffective listfor1995 includes mainly some minerals, wood, wood products, flora
andfauna offorest andocean origin, andspecialized banking facilities.
(d) Export licensing procedures
With regards toitems aforementioned inIV.2(c)(i), exporters firstmustgetagreement from
provincial governments orlineMinistries insupporting theirrequest forexport tobesubmitted to
Prime Minister forpermit.
Withregards toitems aforementioned inIV.2(c)(ii) andIV.2(c)(iii), exporters mustgetapproval
from lineministries orministry oftrade inwriting. Approval might bevalid fortheentire yearor
foreachshipment.
Exports other thanthose mentioned inIV.2(c), licensed exporters havetofilloutdeclaration
atCustoms offices forclearance.WT/ACC/VNM/2
Page44
(e) Other measures
Asdomestic market isnewly established, Vietnam hasnospecific lawsoncompetition and
while facing various forms ofunfair competition andmalpractice thatcancause market failure, the
Government ofVietnam hasbeensetting theminimum export prices ofsome crucial goods likerice
andcrude oil.
Atpresent, Vietnam hasonlysinged agreements onvoluntary export restriction withCanada,
EUandNorway.
(f) Export financing, subsidy andpromotion policies
Producers andexport-import businessmen aregranted withpriority access tofinancing.
Requirements onloans arethesame asother economic activities.
Forthetimebeing, Vietnam hasnotyetadopted export subsidy. Thegovernment ofVietnam,
however, reserves itsrighttoapply within theframework ofWTO onthismatter andproposes togrant
Vietnam withtreatment andstatus asacountry inAppendix 7oftheAgreement onSubsidy.
Because ofitspooreconomy andsmall budget, inorder toboost upexports thegovernment
ofVietnam hasgranted tariffconcessions andexemption toimports ofequipment, materials, spare-parts,
components forexport production andprocessing.
Goods fortrade promotion canenjoy preferential treatment ontaxandcustoms procedures.
(g) Export performances requirements
Vietnam hasnotyetimposed anyrequirements onexport performances andarewilling toinform
WTO member countries ofanyrelevant measures, ifimposed.
(h) Import duties drawback schemes
Refund ofexport -import duties hasbeenprovided inArticle 14,Lawonexport- import duties
andArticle 16,Decree 54/CP dated 28August 1993bytheGovernment tocover thefollowing cases:
- duties collected onimports which arestillbeing stocked inwarehouse atentry ports andgoing
tobere-exported shallberefunded;
- duty-paidexports butnotexported;
- duty-paid merchandise, butdeclared quantity notfullyexported and/or imported;
- importsofmaterialsforexportprocessingorexportmanufacturearenon-dutiablewithin90days
from importing date, andbecome dutiable after 90days thereafter, butrefundable upon
exportation;
- merchandise temporarily imported forre-export ortemporarily exported forre-import shall
notbesubject toimport duties;
- imports bysomeVietnamese enterprises licensed asdistribution andsalesagent offoreign goods
willberefunded onthebasisofactual sold(exported) goods, beitregistered withtheMinistry
ofFinance.WT/ACC/VNM/2
Page45
3. Domestic Policies Relating toForeign Trade
(a) Industrial policies andsubsidies
Having regards totheeconomic features ingeneral andtheindustrial features inparticular
asstated inpartI,thegovernment ofVietnam advocates todevote certain priorities, during certain
periods, tosupport theexistence andencourage thedevelopment oftheindustry. Prioritized industries
aregiven favourable access tofinancing, andsubject tominim taxrate(industrial protection isembodied
inthetaxsystem presented inpartII).Through thebuilding ofmacro-economic environment together
withtheprocess ofintegration intotheworld economy, thegovernment ofVietnam advocates to
gradually introduce faircompetition inthedomestic market andstimulate thedevelopment oftheformer
asawaytochallengeindustrialcompetitiveness.However,duetotheoverallweaknessoftheVietnamese
industry, thegovernment ofVietnam requests WTO member countries takeaspecial viewoneconomic
development requirements andsocio-political sensitive industrial policies inVietnam atpresent and
inthecoming time.
Inprinciple, atpresent Vietnam grants nosubsidy toitsindustrial production foreconomic
purpose.
(b) Technical specifications andstandards
TheState hasissued Ordinance onstandard ofmerchandise dated 6July1990.
TheGovernment hasissued Decrees 327/HDBT dated 19October 1991and115/HDBT dated
13April 1991 toimplement theabove twoOrdinances.
TheMinistry ofScience, Technology andEnvironment isagovernmental body responsible
forStatemanagement oftechnical andquality standard. General Department forStandard, Measurement
andQuality control under theMinistry isresponsible forandspecializing inmanagement ofstandard,
measurement andquality.
Minister ofScience, technology andenvironment hasmade public thefollowing decisions:
- Decision 397-QD dated 10June1992byChairman oftheStateScientific Committee toissue
"Regulations onState inspection onquality ofexports andimports";
- Regulations onState inspection onquality ofexports andimports (issued inattachment to
Decision 397-QD dated 10June1992 byChairman ofState Scientific Committee);
- Decision 398-QD dated 10June1992 byChairman oftheStateScientific Committee issuing
the"List ofexports andimports subject toState inspection onquality";
- Decision 99-TDC/QD dated 11June1992bytheGeneral Director oftheGeneral Department
forStandard, Measurement andQuality control issuing "Regulations onAuthorization ofState
Inspection onQuality ofExports andImports".
UptonowVietnam hasissued more than5,000 effective standards. Atthesametime, Vietnam
hasbeenconducting thesystemization oftechnical measures, aprocess ofstandardization closely linked
withISO(International Standard Organization).
Product certification, system certification andlaboratory certification hasallbeenimplemented
inlinewithinternational practices andbased onISOstandards andguidance.WT/ACC/VNM/2
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TheGeneral Department publishes monthly bulletins inwhich professional information is
available promptly afterissuance.
WhileVietnamisnotafullmembershipofWTO,theGeneralDepartmentcanserveastemporary
contacting point onprofessional matters, andtheMinistry ofTrade shallserve ascoordinating agency
inmultilateral economic cooperation.
Listofthemajor legaldocuments isasabove.
(c) Sanitary andPhytosanitary
(i) Phytosanitary
Phytosanitary isprovided inOrdinance onphyto-sanitary promulgated on15February 1993
andinRegulations onPhyto-sanitary issued under Decree 92CPdated 27November 1993. Under
these regulations, transportation vehicles, plant-based derivatives andbio-actors which might carry
danger totheecological system when imported intoVietnam aresubject tophyto-sanitary inspection.
Before thearrival oftheobjects atVietnam 'sentry port,importers arebound toregister with
responsible agencies oftheMinistry ofAgriculture andRural Development. Upon itsarrival, the
importers submit adeclaration attheabove-mentioned agencies andproduce thephytosanitary certificate
issued byauthorities oftheexporting country. Goods andtransportation vehicles areallowed toproceed
customs formality onlyafterbeing dulycertified bysanitary agencies.
(ii) Sanitary
Decree 93/CP dated 27November 1993 issuing regulations onanimal sanitary ofVietnam.
Thelistofcases subject toanimal sanitary andDecision 607NN-TY/QD dated 9June1994 serve
astheregulations onanimal sanitary ofVietnam. Thelistofcases subject toanimal sanitary appears
inAppendix 3.Importers andowners oftransportation vehicles arerequired toregister inadvance.
Clearance proceedings must bemade aftercompletion ofsanitary inspection andcertification.
(d) Trade related investment measures
Investment inVietnam hasbeenregulated under Lawonforeign investment inVietnam adopted
bytheNational Assembly on29December 1987, andlawsandadditions thereto andamendment thereof
andDecrees andCirculars forimplementation.
TheLawreflects Vietnam 'spolicy onforeign investment. Thelawsonforeign investment has
some provision ontrade related investment measures:
Foreign invested enterprises manufacturing export products orimport substitution products
areexempted from profit taxfornotmore than2years, andgranted reduction notover50percent
ofprofit taxinthenexttwoyears. Taxreduction andexemption commence fromprofit-making year.
Enterprises intheabove paragraph canbeoffered recession onwith-holdings tax.(Profit
repatriation tax).
Annually, Ministry ofPlanning andInvestment andMinistry ofFinance announce thelist
oftaxreduction onmaterials andequipment fortheproduction oftheenterprises.
TheGovernment ofVietnam isconsidering toadjust thein-force regulations providing that
these enterprises beself-responsible tocover theirneeds inforeign currencies fortheiroperation.WT/ACC/VNM/2
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Inthatlight, theabove mentioned enterprises shallbeallowed tobuyforeign currencies atVietnamese
commercial banks tomeet, partly orfully, theirneeds forforeign currencies during theiroperation.
(e) State-owned enterprises
State-owned enterprises areeconomic entities capitalized bytheState, established andrununder
theLawonState-owned enterprises, involving inprofit-seeking business orpublic welfare.
TheStateadministers State-owned enterprises doing business independently andmonitors its
capital contribution inenterprises.
TheGeneralDepartmentofState-ownedEnterprisesundertheMinistryofFinanceisresponsible
foradministering andmonitoring these enterprises.
InVietnam there are6264 State-owned enterprises asof1April 1994.
Except those enterprises selected asfocalpoint orthose specializing insome line-management
items mentioned inIII.1(e) and2(c)(iii) andthose mentioned inthenextparagraph, State-owned
enterprises areassigned withresponsibility andobjectives tomaintain andenlarge theirmarket share,
toreinforce theirfoothold onthemarket while operating onanequal footing withothers andobserving,
atthesame time, thelawonState-owned enterprises.
Uptonow,19nationalcorporationshavebeenestablished.Eachoperatesasagroup,comprising
ofvarious member enterprises whoarelegal distinct entities andmust observe regulations onthe
establishment ofthecorporation. (listofcorporations areattached).
Inkeyindustries closely linked tonational security likepost&telecommunication, aviation,
petroleum, power supply, goldandgemstones business, foodsupply, corporations areempowered
appropriately tofulfil itsduties assigned bytheState.
Asprovided bylaws, theState shalladminister those enterprises bylawsandrepresent the
ownership ofcapital contribution totheenterprises.
State-owned enterprises must register itsbusiness linesasprovided bylawsandaretreated
equally atlaws. those conducting export/import activities must belicensed forthelinesofproducts
andscope ofactivities.
Except forfields stated inpartIV.1(e), IV.2(c) andAppendix 2,private enterprises aretreated
onanequal basiswithState-owned enterprises, operating inobservance ofthelawsandfollowing the
market mechanism.
Portion ofState-owned sector inGDP during 1992 -1995: seetableinAppendix 4.
(f)(g) Freeareas andfreeeconomic areas
Atpresent, Vietnam hasestablished 5export processing zones and8industrial parks operating
under theLaws onforeign investment anddomestic investment, Regulations issued under
Decree 332/HDBT dated 18October 1991 and192/CP date28December 1994 andtheirCharters
approved bytheMinistry ofPlanning andInvestment.WT/ACC/VNM/2
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(h) Trade related environment policies
Vietnam isatalowstage ofeconomic development, itsbudget issmall andtrade related
environment policies havenotyetdeveloped. TheMinistry ofScience, Technology andEnvironment
istheStatemanagement agency inthisfieldandtheauthorities onenvironmental matters. Equipment,
machinery vehicle andapparatus operating inservice oftheproduction andconsumption maybesubject
tocontrol andiftheyresult inenvironmental damages andpollution beyond certain international
tolerance (ornational tolerance ifany), theiroperation might bebanned, suspended ortheowner be
obliged toeliminate thedefault. Imports ofmachinery andequipment might besubject toinspection
andmonitoring forenvironmental protection purposes. Thegovernment ofVietnam reserves itsrights
toissue lawsandregulations inlinewithWTO provisions.
(i) Barter trade under governmental agreements
Vietnam hasnothadnosuchanagreement.
(k) Governmental agreements resulting intheallocation ofquota foreachparticular country
Except foragreements ontextile andgarments concluded between Vietnam andtheEU,Norway
andCanada torestrict exports ofgarment andtextile fromVietnam, Vietnam hasnotyetentered into
anyagreement likethose appeared above.
(l) Government procurement
ThetermofGovernment procurement isunderstood herein as:
- purchase ofmachinery andequipment byfinancing fromtheStatebudget: Decision QD91/TTg
dated 13November byPrime Minister toissue regulations onmanagement ofimports of
machinery andequipment byBudget financing;
- method ofprocurement: Tender orcomparing price offers;
- agency forquality inspection: Decided bytheMinistry ofTrade upon proposal from
lineministries, provincial people 'scommittees.
- procurement byofficial loans (ODA): oftenmade byopentender. Employer andlineministries
orprovincial people 'scommittees (investment recipient) shallofferopentender inaccordance
withinternational practices.
(m) Regulations oftrade intransit
TheMinistry ofTrade isthegovernmental agency empower tohandle transit agreements with
countries concerned. UptonowVietnam hasconcluded transit agreements withChina, Laos and
Cambodia.
TheGeneral Department ofCustoms isresponsible forcontrolling monitoring goods intransit.
Goods intransit needprevious permit bytheMinistry ofTrade. Vietnamese organizations orowners
ofgoods intransit (from China, LaosandCambodia) maybeaccepted ascarriers. Theselection of
Vietnamese carriers shallbebased onpastperformance. ACustoms feeischargeable oncarriers.
Vietnam hasnospecific regulation onthetransit ofgoods from athirdcountry sofar.WT/ACC/VNM/2
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Goods intransit must meetthefollowing requirements:
- approval byaVietnamese competent authority given upon application ofgoods owner;
- complying withlawsandregulation onCustoms ofVietnam;
- theoutbound goods mustmatch withtheinbound goods. Incases ofdiscrepancies, certification
byCustoms authority isrequired;
- goods intransit mustbetransported bytherightway,rightports andduring allowed timeand
keptunder Customs supervision.
Warehousing ofgoods intransit must beapproved byCustoms authority.
Consumption oftransitted goods interritory ofVietnam isforbidden.
4. Foreign Trade Policies onAgricultural Produce
(a) Imports
Imports ofagricultural produce aresubject toLawonimport export duties aspresented in
partIV.1(b).
Imports ofagricultural produce aresubject toregulations onphyto-sanitary aspresented in
partIV.3(c).
Within theframework ofASEAN, themajority ofagricultural produces arelocated intariff
concession schedules. Some agricultural produces arelisted assensitive. Sensitive products areunder
negotiation andnotyetfinalizes.
(b) Exports
During cultivation, ricebusinesses shallbegiven priority ingetting loans atmarket interest
topurchase riceforstabilizing themarket price.
During peak-prices ininternational coffee market, thegovernment mayimpose asurcharge
toestablish price stabilizing fundforcoffee. When theworld prices fall,theFund maybedisbursed
tosupport coffee export price.
Ontopofthat,thegovernment ofVietnam doesnotmaintain anysubsidy fromStateBudget
toagricultural produces. However thegovernment ofVietnam reserves itsrights tointroduce subsidies
inlinewithWTO provisions andpractices.
(c) Restrictions andexport prohibition
(seepartIV2(c))
(d) Export credits, export credit guarantee andexport insurance programmes
InVietnam, sofar,theexport credit system andexport credit guarantee donotexist. The
government ofVietnam reserves itsrights toemploy suchasystem, ifrequired bytheneeds of
development, inaccordance withWTO provisions andinternational practices.WT/ACC/VNM/2
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(e) Domestic policies
Thegovernment hasprepared programme foragricultural infrastructure development like
irrigationsystem,transportation,electricitysupplynetwork,watersupply.Thegovernmentalsomonitors
andgiveguidance commercial banks onadopting loans policy prioritizing agricultural production
development atmarket interest.
Regions which suffered natural disasters might beaccorded taxreduction orexemption.
5. Trade Policies inOther Sectors
(a) Textile andgarment
Textileandgarmentexportproductionisanewlydevelopedbusinessandhasshownhighgrowth
rate.However, exports oftextile andgarment from Vietnam isstillmodest incomparison toother
countries withcomparable population.
Duetoitslabour intensive andnon-capital intensive features, thissector hasfound sufficient
room forgrowth inthenext5to10years inVietnam.
Textile andgarment making industry ishighly protected inrelation toimport duties of
25percent-30percentleviedonfinishedproductsandlowimportduties(0percent-20percent)levied
onimports ofmaterials andaccessories. Imported equipment andmachinery forgarment andtextile
export production enjoy dutyat0percentorverylow.
Import duties areexempted formaterials imported foruseasinputs ofgarment andtextile export
production orrefunded afterexportation basing onclearance quantity andthatofprovided inexport
contracts. Anyquantity consumed locally would bedutiable (meaning theimported butnotre-exported).
V. TRADE RELATED INTELLECTUAL PROPERTY PROTECTION REGIME
1. General
(a) Intellectual Property Policy
TheState ofVietnam recognizes andprotects inVietnam theIntellectual Property rights of
Vietnamese andforeign organizations, individuals through asystem ofstatutes andmeasures oftheir
enforcement.
TheState ofVietnam recognizes private ownership totheobjects ofIntellectual Property,
considers theright totheobjects ofIntellectual Property asanasset subject toprivate ownership
(Constitution 1992). TheIntellectual Property rights aretheobjects subject toprotection bytheCivil
Code 1995.
TheState ofVietnam respects policy andlawonprotection ofIntellectual Property rights
regarding itasanimportant policy ineconomic, social, scientific andtechnological development strategy
ofthecountry, bothshort-term andlong-term. Efficient protection ofIntellectual Property rights is
vitalforsafeguarding theinterests ofbusinesses andindividual traders, andisoneinthepanoply of
investment guaranties encouraging domestic andforeign investment.
TheState ofVietnam iscurrently upgrading thelegal system forprotection ofIntellectual
Property rights andenhancing effective enforcement measures ofthose rights. Those measures mean
tosafeguard theinterests ofmanufactures, consumers andmaintain themanagement andcontrol of
domestic market, guarantee thequality ofgoods andcurbthecounterfeiting andsmuggling.WT/ACC/VNM/2
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Protection ofIntellectual Property rights isanefficient means toencourage transfer ofadvanced
technology inthecountry, promote production aswellasforeign trade andcontrol overandprevent
counterfeiting inimport/export activities.
Acceding tointernational conventions andregional agreements onprotection ofIntellectual
Property isessential conditions intheprocess ofregional andglobal economic integration andof
enhancing international trade forabetter contribution torealize theopened-door economic policy in
theprocess ofrenovation, modernization andindustrialization ofVietnam 'sEconomy.
(b) Responsible agencies forpolicy formulation andimplementation
TheNational Assembly isthehighest organ ofStatepower exercising thecompetence inmaking
policy andregime onprotection ofI.P.R inVietnam through itslegislation, suchratifying Constitution,
Codes andLaws andother legaltexts. Thehighest legaldocuments whereby theStaterecognizes the
protection ofIntellectual Property rights asproprietary assetofthecitizens istheConstitution (1992),
followed bytheCivil Code (1995) which include chapters onprotection ofIndustrial Property rights
andCopyrights.
TheStandingCommitteeoftheNationalAssembly(formerlyTheStateCouncil)hastheauthority
ofratifying Ordinances regulating theregime forprotection ofIntellectual Property objects. Atthe
present there areOrdinances regulating theregime forprotection ofIntellectual Property rights as
follows: Ordinance onProtection ofIndustrial Property rights, 1989; Ordinance onCopyright, 1994
andOrdinance onTransfer ofTechnology intoVietnam, 1988. However these legaldocuments will
besuperseded onthedatetheCivil Code takes effect 1July1996.
TheGovernment (formerly theCouncil ofMinisters) hastheauthority toconcretize, guide
theorganization ofimplementation ofregulations onprotection ofIntellectual Property rights provided
forbysuchlegaldocuments asCivil Code, Law, Ordinance bypromulgating theguiding documents:
Decrees, Decisions. Atpresent there areseveral Decrees guiding theimplementation ofregulations
onprotection ofIntellectual Property objects: Industrial Property objects, copyrights, Technology
Transfer. These Decrees willlapse atthesame timewiththeOrdinances asmentioned above andthe
newDecrees which guide theimplementation oftheCivil Code willalsobepromulgated astheCode
comes intoforce.
TheGovernmental Agencies having theauthority ofState management inthefields related
toIntellectual Property areresponsible fororganization ofenforcement ofIntellectual Property rights
through promulgating regulations guiding theimplementation ofprocedures, measures toensure the
enforcement ofIntellectual Property rights ineachrelated fieldandhavetheauthority topromulgate
suchlegaldocuments asCirculars, Regulation, Regime, which concretize theprovisions oftheDecree
oftheGovernment. These areMinistries ofScience, Technology andEnvironment; Culture and
Information; Justice; Finance; Trade; andGeneral Customs Department.
Thefollowing agencies areresponsible forandauthorized tomanage andundertake the
procedures inrelation toestablishment andprotection ofIndustrial Property rights andCopyrights:
theNational Office ofIndustrial Property under theMinistry ofScience, Technology andEnvironment
andtheCopyright Department under theMinistry ofCulture andInformation.
Thefollowingagenciesareresponsibleforandauthorizedtoundertakeadministrativeprocedures
forthepurpose ofenforcing theIntellectual Property rights intrading, production andbusiness
import/export activities: theCustoms Offices belonging toGeneral Customs Department; TheMarket
Control Organizations under Ministry ofTrade andTheeconomic police under theMinistry ofInterior.WT/ACC/VNM/2
Page52
People 'sCommittee ofalllevels (Province, District, Village) aretheadministrative Statebodies
inthelocalities having theresponsibility andtheauthorization forState management ofIntellectual
Property therein.
Beside thesystem oftheabove mentioned authorized administrative bodies thereisalsoasystem
ofjuridical bodies (theCourts) playing animportant roleinenforcing Intellectual Property rights through
jurisdiction activities: Supreme Court, People 'sCourts ofProvincial levelaretheCourts having the
authority ofjurisdiction overdisputes, violation ofIntellectual Property rights. Thebody having the
authority toorganize andundertake theforcing measures forthepurpose ofenforcing thejudgments
oftheCourts isJudgment Implementation Department under Ministry ofJustice.
(c) Membership international Intellectual Property rights conventions, regional andbilateral
agreements
Vietnam isparty to:
- Paris Convention onProtection ofIndustrial Property Rights (accession inMarch 1949);
- Convention establishing theWorld International Property Organization (accession inJuly1976);
- Madrid Agreement onInternational Registration ofMarks (accession inMarch 1949);
- Patent Cooperation Treaty (accession inMarch 1993);
- Bilateral Agreements onIntellectual Property withThailand, Australia, France andJapan; and
ispreparing toparticipate intheAgreement onTrade Related Intellectual Property Aspects including
Agreement onCounterfeiting (TRIPS) andtheBernConvention ontheCopyrights.
(d) Application ofthenational treatment andtheMost Favoured Nations treatment toforeign
nationals
- (Vietnam adopts) national treatment principle inthefieldofIntellectual Property inaccordance
withParis Convention onprotection ofIndustrial Property Rights.
- (Vietnam adopts) Most Favoured Nations treatment inrelation tointernational application for
patent inaccordance withPatent Cooperation Treaty (PCT), andregistration oftrademarks
inaccordance with Madrid Agreement onInternational Registration ofMarks.
- Vietnam adopts principle ofreciprocity inother cases.
(e) Feesandtaxes
Thecurrent regulations specify 18kinds offeesrelated toadministrative procedures in
establishing, maintaining andprotecting Industrial Property rights. Mostofthefeesrelated tooneobject
ofIndustrial Property areatthelevels of10,15,20,25,30,35,40,45,50,55and60US$. Fees
related toestablishing right inrespect ofinvention, itsvalidity arehigher (establishment ofright:
US$100,viz.maintenance feesfrom thefirstto15thyear: 50toUS$280).
There isataximposed onincome derived from royalty, i.e.income from assignment of
ownership right, licensing ofIndustrial Property object, transfer; purchase andsaleoftechnology,
copyright (inrespect ofartistic, cinematographic, video works, broadcasting andtelevision show).WT/ACC/VNM/2
Page53
Foranindividual 'sincome fromroyalty over1,800,000 VNDong (equivalent 165US$) thetaxrate
is5percent,foralegalperson twotaxratesareapplicable: 10percentforlicensing agreement with
duration under 5years and15percentforthatfrom5years up.However theroyalty originating from
technology transfer byaforeign partyascapital contribution toaJointVenture orBusiness Cooperation
Contract inaccordance withLawonForeign Investment inVietnam isexempt from tax.
2. Substantive Standards ofProtection, Including Procedures forAcquisition andMaintenance
ofIntellectual Property Rights
(a) Copyrightandrelatedrights,includingtherightsoftheperformers,theproducersofphonograms
andbroadcasting organizations
(i) Objects ofcopyright protection
(Article 747,Civil Code 1995)
Theforms ofprotected works:
- Protection isgranted tocultural, artistic, scientific works including:
- written works;
- lectures, speeches;
- theatrical works andother forms ofartistic performance;
- cinematographic andvideo works;
- radio andtelevision works;
- press works;
- musical works;
- architectural works;
- plastic artwork andapplied fineartworks;
- photographic works;
- scientific works, textbooks, teaching materials;
- graphics, drawings, sketches andmaps related totopography, architecture orscientific
projects;
- translated, adapted, rewritten, transformed, compiled, annotated, selected and
anthological work;
- computer software;
- other works prescribed bylaws.
- Awork under copyright protection must betheoriginal;
TheStateshallprotect copyright ofworks provided forinClause 1ofthisArticle irrespective
oftheforms, language usedforexpression andquality oftheworks.
(ii) Themoment atwhich thecopyright arises
Copyright shallariseasfrom themoment when awork iscreated inanidentifiable form.
(iii) Registering andapplying fortheprotection ofauthor 'srightandtherighttoownership ofa
work
Article 762ofCivil Code provides thattheauthor andowner ofawork havethefollowing
rights:
- toregister his/her ownership ofthework atthecompetent State agency;WT/ACC/VNM/2
Page54
- tofileanapplication torequest thecompetent State agency toprotect theauthor 'srights and
rights ofowners ofworks when suchrights areinfringed upon.
Anauthor orowner ofawork whohasregistered fortheprotection oftheworkatthecompetent
State agency shallnotbeobliged tojustify his/her ownership right overregistered work incaseof
dispute.
(iv) Rights oftheauthor, owner ofwork andtime-limit forauthor 'srightprotection
(Article 751,752,766,Civil Code)
Toname thework withhis/her realname orpseudonym, toputhis/her name ontheedition,
dissemination orvalorization ofthework, toprotect theintegrity ofhis/her work, topermit ornot
permit other persons toalterthecontent ofwork protected without time-limit.
Topublish, todisseminate, topermit other persons topublish ordisseminate his/her work,
toreceive remuneration when his/her work isused; toreceive material benefits from allowing other
persons tousehis/her work (informs ofpublishing republishing, displaying, exhibiting, performing,
broadcasting, televising, audio andvisual recording, photographing, translating adopting, transforming,
re-writing, leasing) andreceive awards forawork ofwhich he/she istheauthor andwhich isprotected
bytheState forthelifetime oftheauthor andforanother fiftyyears afterhisdecease (incaseofa
work ofco-authors -fiftyyears after thedeath ofthelastsurviving author). With regard toa
cinematographic work, aradio television orvideo work andawork published posthumously, therights
shallbeprotected foraperiod offiftyyears commencing from thedatesuchwork ispublished for
thefirsttime.
Restriction totheauthor 'srights (Articles 760,761CivilCode): Anindividual ororganization
isentitled touseawork ofanother person which hasbeenpublished ordisseminated ifsuchwork
isnotprohibited frombeing copied andsuchcaseisnotforcommercial purposes anddoesnotaffect
thenormal exploitation ofthework andisnotdetrimental toother interests oftheauthor orowner
ofthework; anindividual ororganization using suchwork shallnothavetoobtain permission from
andpayremuneration totheauthor orowner, butmustacknowledge ormention thename oftheauthor
andtheorigin ofthework.
Theuseofworks freefromprevious permission andremuneration shallinclude thefollowing
forms: duplicating thework forpersonal use,forarchives andfortheuseinlibraries; quoting from
thework without falsifying theintent oftheauthor inorder tomake commentaries orillustrations in
other works inorder towrite reports orforuseinperiodical publications, documentary films,
broadcasting ortelevision programmes orforthepurposes ofteaching orexaminations inschools;
performing theatrical works andothertypesofartistic performance incultural andpropaganda activities
atpublic places; Making direct audio andvisual recording ofperformances forreporting ontopical
events orteaching purposes; Taking photograph, televising andintroducing works ofsculpture,
architecture, photography andapplied artsdisplayed atpublic places inorder tointroduce suchworks;
Translating anddisseminating works fromVietnamese intolanguages ofethnic minorities inVietnam
andviceversa; Converting aprinted work intoBraille characters fortheblind. However the
above-mentioned provisions shallnotapply totheduplication ofarchitectural works, sculptural works
andcomputer software.WT/ACC/VNM/2
Page55
(v) Rights oftheperformer, individual ororganization producing audio tapes anddisks andvideo
tapes anddisks andbroadcasting organizations
(Article 775,777,779,Civil Code)
Performers shallinclude individuals andorganizations conducting performances, producers
anddirectors ofsong, dance andmusic programmes, radio andtelevision programmes, stage directors
andactors andactresses andother formofartistic performance. Aperformer hasthefollowing rights:
- tohavehis/her name introduced upon theperformance;
- tohavehis/her performance protected from anydistortion;
- topermit ornottopermit other persons broadcast livehis/her performance programme on
theradio orthetelevision attheplace where he/she isperforming, except incasewhere such
radio ortelevision broadcast areofthenature ofreporting current affairs forteaching purposes.
- topermitornottopermitotherpersonstomakeaudioorvisualrecordingofhis/herperformance
programme andmake copies fordissemination;
- toreceive remuneration;
- torequest theindividuals andorganizations infringing upon therights oftheperformers to
stoptheir infringements, make apublic apology andrectification andcompensate forthe
damages.
Rights oforganizations producing audio tapes anddisks andvideo tapes anddisks:
- topermit ornottopermit theduplication ordistribution oftheirproducts;
- tobeentitled tobenefit from theuseofthese products;
- therights shallbeprotected foraperiod offiftyyears commencing from thedatewhen the
audio tapes anddisks andvideo tapes anddisks ismade public forthefirsttime.
Rights ofradio andtelevision broadcasting organizations:
- topermit ornottopermit re-broadcasting oftheirprogrammes;
- topermit ornottopermit theduplication oftheirprogrammes forcommercial purposes;
- therights shallbeprotected foraperiod offiftyyears commencing from thedatewhen the
radio ortelevision programme isbroadcast forthefirsttime.
(b) Trademark including service marks
(Article 785,Civil Code)
Protection oftrademark shallbebased upon distinguishing capability ofthesignforwhich
registration asatrademark isrequested. Thesigns capable ofdistinguishing thegoods orservices of
thesame kindofdifferent production andbusiness entities; andnotbeing objects excluded from
protection inaccordance withprovisions ofIndustrial Property lawcanberegistered forprotection
astrademarks. Trademark maybeaword, animage oracombination ofsuchelements represented
inoneormany colours.
Trademark shallbeprotected ontheground offiling anapplication forregistration ofmark
atthecompetent State authority andgranted protection certificate (Certificate forRegistration of
Trademark). Useofatrademark shallnotbecondition forentitlement tofileapplication forregistration
oftrademark.
Incaseasignforwhich registration isrequested doesnotposses distinctive characteristic it
maybeprotected ifsuchsignhasbeenusedwidely andhasagoodreputation inVietnam. Well-known
marks shallbeprotected inaccordance withtheParis Convention.WT/ACC/VNM/2
Page56
Priority rights shallbedetermined bypriority date.Priority dateisfiling dateofapplication
forregistration oftrademark, except forregistration oftrademark inaccordance withMadrid Agreement
orpriority isinaccordance withParis Convention.
Shall notberecognized asmarks thesigns specified asfollows: thesigns thatdonotpossess
distinctive characteristics; thesigns thatdescribe goods interms ofquality, property, utility etc.,of
thegoods; thesigns thatmaymislead thepublic; thesigns thatrepresent Stateflags, armorial bearings
oremblems ofVietnam orother countries; names oremblems ofinternational organizations; thesigns
thatarecontrary tothelaw,public order andmorality; thesigns thatareidentical orsimilar tomarks
previously registered inVietnam orprotected byaninternational convention towhich Vietnam isparty
inrespect ofthesame kindofgoods.
Examination ofmarks ismandatory, including examination astoformandexamination asto
substance.
Theowner ofatrademark shallhavetheexclusive righttouse,transfer, licence thetrademark
toother persons; therighttorequest athirdparty tostopinfringement: inusing identical orsimilar
mark tosuchextent astoconfuse withaprotected mark forthesame kindofgoods andservices in
production, business, import/export, advertising activities, orrequest competent authority tohandle
suchinfringements.
Theowner ofatrademark shallhavetheobligation tousesuchregistered mark. Failing to
usesuchtrademark for5consecutive years from filing datewithout plausible reason willresult in
nullification oftheprotection certificate. Thelicensing oftheright tousetrademark shall notbe
considered asrealizing owner 'sobligation ofeffective use,buttheuseofthetrademark bythelicence
holder shallbeconsidered asactofuse.
Duration forprotection ofatrademark is10years tobecounted from priority dateand
renewable from periods of10years without limit.
(c) Geographical indication including appellation oforigin
Article786ofCivilCodestipulatesthatAppellationofOriginisobjectforprotectionofIndustrial
Property rightinVietnam.
Appellation ofOrigin isageographical name ofthecountry orlocality usedtoindicate the
origin ofgoods ofsuchcountry orlocality providing suchgoods possess property, quality being
characterizedbyoriginalandadvantageousgeographicalconditionsincludingnaturalorhumanconditions
orcombination thereof.
Aperson having therighttouseappellation oforigin hastherighttousesuchappellation of
origin forhis/her goods andtorequest competent State authorities tocompel unlawful users ofsuch
appellation oforigin tostop unlawful useandcompensate thedamage caused.
TheStateapplies various measures toprotect therightonappellation oforigin andgeographical
indication. TheLawonTrademarks provides forthesigns thatmaymislead thepublic inrespect of
origin ofgoods, i.e.confused place ofmanufacturing, shallnotbeprotected astrademark.
Atpresent adraftofdetailed regulations onprocedures forandcontent ofprotection inrespect
ofappellation oforigin andgeographical indication isbeing elaborated.WT/ACC/VNM/2
Page57
Restriction ofright toAppellation oforigin: Aperson having theright toanappellation of
origin shallnothavetheexclusive righttosuchappellation oforigin andshallnothavetherightto
transfer userighttoother persons.
(d) Industrial designs
Article 784ofCivilCode provides thatIndustrial Design isanobject forprotection ofIndustrial
Property rightinVietnam. Industrial Design isaspecific appearance ofaproduct embodied bylines,
three-dimensional forms, colours oracombination thereof which hasworldwide novelty andiscapable
toserve asapattern foraproduct ofindustry orhandicraft.
Anindustrial design shallberecognized asnewif,priortothepriority dateoftheapplication
foritsregistration, thatindustrial design issubstantially distinguished from other industrial designs
ofthesame kindthatareknown inthecountry orabroad andhasnotbeendisclosed anywhere inform
ofpublication, utilization oranyother forms.
Anindustrial design being determined merely bythefunction ofproduct ordesignated tosolve
atechnical taskorhaving onlyanaesthetic value orbeing design ofindustrial orcivilbuildings or
being designs invisible intheprocess ofutilization, orbeing contrary topublic order ormorality shall
beexcluded from protection asindustrial design.
Thepriority shall determined bythepriority date. Thepriority dateisfiling dateofdue
submission oftheapplication withcompetent State authority except where priority isapplied in
accordance withParis Convention.
Theright toanindustrial design isestablished ontheground offiling anapplication for
registration ofsuchindustrial design withcompetent Stateauthority andgranted protection certificate
(Certificate forRegistration ofIndustrial Design) except where prior userightisapplied.
Examination ofapplication forregistration ofindustrial design shallbecarried outinform
ofpublic examination. Adulyformulated application shallbepublished topublic forthepurpose of
opposition toregistration ofindustrial design within 3months. Incaseofneedtheexaminer shall
simultaneously search forindustrial design notsubstantially distinguished from industrial design for
which protection isrequested inaccordance with application. Inabsence ofopposition andtheresult
ofsearch shows thattheindustrial design possess novelty andsatisfies suchcriteria astobeapattern
foraproduct ofindustry orhandicraft thenaprotection certificate shallbegranted.
Theowner ofprotected industrial design shallhavetheexclusive righttouse,transfer orlicence
therighttousesuchindustrial design toother persons andrequest competent Stateauthority tocompel
other persons tostopsuchinfringements overtherights ofIndustrial Property asmanufacturing,
importing, selling, advertising orusing forbusiness purposes product manufactured withprotected
industrial design; theowner ofprotected industrial design shallhavetherighttoclaim forcompensation
ofdamage caused byactofinfringement.
Therightoftheowner ofindustrial design shallberestricted where provision onprior user
orcompulsory licensing isapplied. Anyindividuals ororganizations which haveusedorhaveprepared
necessary conditions forusing anindustrial design identical toanindustrial design protected,
independentlywithapplicantofregistrationofsuchindustrialdesign,thensuchindividuals,organizations
shallhavetherighttocontinue theuseofsuchindustrial design butshallnotbeallowed toextend
thevolume andscope oftheuse.Adecision tocompel theowner toacompulsory licensing shallonly
beapplied incaseofneeds fornational defense andsecurity, prevention andtreatment ofdiseases of
population orother needs ofthesociety orincasetheowner doesnotuseoruses, butnotinsuchWT/ACC/VNM/2
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manner astocomply withrequirements ofsocio-economic development ofthecountry without plausible
reason; incaseaperson having theneedtouseindustrial design hastriedbyvarious ways andmeans,
having offered reasonable price, butfailed toreach anagreement withtheowner. Thetransferee of
anindustrial design bycompulsory licensing shallhavetopayaroyalty totheowner.
Thefollowing usesofprotected industrial design shallnotbeconsidered asinfringements:
theuseofindustrial design isnotforcommercial purposes; thecirculation anduseofproducts which
havebeenmarketed bytheowners, thepersons entitled tousethem firstorthepersons towhom the
righttouseistransferred; theuseofindustrial design onaforeign means oftransport which arein
transit ortemporarily staying ontheterritory ofVietnam andsuchuseisaimed onlyatmaintaining
thenormal operation ofthese means.
Theauthorofanindustrialdesignshallhavetherighttoputhis/hernameinprotectioncertificate,
receive theremuneration when theindustrial design isusediftheauthor isnotthesame asowner of
suchindustrial design; request tostoptheactofinfringement overtherightofauthor; receive awards
forindustrial design.
Thetime-limit forprotection ofonindustrial design is5years counted frompriority dateand
mayberenewed fortwoperiods of5years each.
(e) Patents/invention
(Article 782,Civil Code)
Aninvention isatechnical solution which isnewincomparison tothecurrent technical level
oftheworld, which isofacreative character (which involves aninventive step)andisapplicable in
various social andeconomic fields.
Protection criteria ofaninvention are:novelty, inventive stepandindustrial applicability.
Protected objects canbedevice, method orsubstance aswellastheuseofaknown device,
method orsubstance inanewfunction.
There are10objects excluded from protection: Scientific principles; economic management
methodsandsystems;educational,teaching,trainingmethodandsystem;computerprograms;integrated
circuit; plant andanimal varieties, microorganisms; methods forprevention, diagnoses, treatment of
diseases inhuman beings, animals orplants.
Therightofpriority shallbedetermined inaccordance withpriority date.Priority dateshall
bethefiling dateofanapplication forpatent orinvention except where priority dateisdetermined
inaccordance withtheParis Convention.
Therighttoaninvention shallbeestablished onthebasis offiling application forprotection
andongrantedprotectioncertificate(PatentforInvention),exceptwheretherightofprioruserisapplied.
Examinations ofanapplication which include examinations astoformandastosubstance are
mandatory. Ifaninvention forwhich protection isrequested satisfies thecriteria asstipulated then
theprotection certificate shallbegranted andshallbepublished inorder forthepublic tohavethe
opportunity toclaim forannulment ofprotection certificate.
Atpresentisintendedaregimeofpublicexaminationincombinationwithsubstantiveexamination
atrequest oftheapplicant, whereas adulyformulated (accepted) application shallbepublished inorder
forthepublic toclaim theobjection tothegrant ofprotection certificate. Unless thereisanoppositionWT/ACC/VNM/2
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oriftheopposition isillegitimate andtheapplicant hasrequested forsubstantive examination whereby
allprotection criteria aresatisfied thenprotection certificate shallbegranted andpublished inorder
togivethepublic anopportunity toclaim forannulment ofprotection certificate.
Theowner oftheinvention (patent) hastheexclusive righttouse,transfer, licensing theright
touseinvention toother persons, andtheright todemand theother persons tostopinfringements.
Actsofinfringement aredeemed theactsofmanufacturing theproduct bymeans ofusing protected
invention; using, importing, advertising, distributing theproductions thataremanufactured bymeans
ofusing protected invention; applying methods being protected invention. Theowner ofprotected
invention hastherighttodemand thecompensation fordamage caused byactofinfringement.
Therights toapatent (invention) shall berestricted byprovisions onprior useright and
compulsory licensing. Article 801ofCivilCode stipulates thattheperson whousedtheinvention prior
tothedatetheowner ofinvention filesanapplication forprotection shallhavetherighttocontinue
theusetheinvention butneither shallextend thevolume andscope ofapplication ofinvention nor
transfer userighttoother persons. Article 802ofCivil Code stipulates thattheowner oftheinvention
shallbecompelled totransfer therighttousetheinvention, uponadecision ofcompetent Stateauthority,
toother person whohasaneedtouseinthefollowing cases: theowner doesnotuseinvention oruses
itbutnotinconformity withtherequirements ofsocio-economic development ofthecountry without
anyplausible reason; aperson whohastheneedtousehastriedbyvarious wayandmeans toreach
anagreement withtheowner, having offered areasonable price, buttheowner refuses tosignacontract
onthetransfer oftheright tousetheinvention; theuseoftheinvention aimstomeettheneeds of
national defense andsecurity, prevention andtreatment ofdiseases forpeople andother urgent needs
ofthesociety. Thetransferee ofaninvention bycompulsory licensing shallhavetopayaroyalty to
theowner.
There areexceptional cases where theuseofaprotected invention shallnotbeconsidered
infringement andtheusershallnothavetopayremuneration totheowner asfollows: using ofthe
invention butnotforcommercial purposes; thedistribution, circulation anduseofproducts which have
beenmarketed bytheowners, theprior users orthepersons towhom therighttouseistransferred;
theuseoftheinvention takes place onaforeign means oftransport which areintransit ortemporarily
stating ontheterritory ofVietnam andsuchuseisaimed onlyatmaintaining theoperation ofthese
means.
Theowner oftheinvention hastheobligation tousetheinvention (thetransfer ofuseright
shallalsobeconsidered asause)inconformity withrequirements ofsocio-economic development
ofthecountry andpayremuneration totheauthor oftheinvention iftheowner isnotthesame asthe
author.
Anauthor ofaninvention shallhavetherighttohavehis/her name ontheprotection certificate
forinvention; being remunerated when theinvention isused, iftheauthor isnottheowner; demand
tostopinfringement ontherightofauthor; andreceive awards fortheinvention.
Theduration forprotection ofaninvention is20years from priority date.
(f) Protection ofplant varieties
Only thecreator ofplant variety shallbeentitled totheregistration withMinistry ofScience
Technology andEnvironment fortherightofauthor.
Anauthorofplantvarietyhastherighttoputhis/hernameonthecreation;receiveremuneration,
awards.WT/ACC/VNM/2
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Legitimate interests ofdomestic andforeign organizations, individuals carrying outactivities
inresearching,selecting,creating,importing,producingandtradingplantvarietiesinterritoryofVietnam
shallbeencouraged andprotected bytheState.
(g) Layout designs ofintegrated circuit
(h) Requirements onundisclosed information including trade secrets andtestdata, trade name
(i) Measure tocontrol unfair competition
Legal documents inrelation totheabove objects areinformulation process forthepurpose
ofestablishing aprotection regime thereof.
3. Measures toControl Abuse ofIndustrial Property Rights
Violations oftheregulations onapplication right, right oftheauthor, protection criteria,
procedures establishing therightinrelation toanobject ofIndustrial Property mayresult inannulment
ofthegranted protection certificate.
Actofnon-performance oftheobligations oftheowner ofprotection certificate suchasfailure
topaymaintenance fees,failure topayremuneration totheauthor; using ortransferring anobject which
hasalready beenprotected mayresult inannulment ofprotection certificate oradecision ofcompetent
authority tocompel theowner oftheprotection certificate tofulfil obligations asstipulated bylaw.
Actofviolating theowner 'srights onanobject ofIndustrial Property andthecopyright may
beprosecutedbyadministrativeproceduressuchas:warning,monetaryfine,compellingtostopviolation
act,confiscation ofproducts, articles, facilities ofinfringement, compelling tocompensate thedamage,
destruction ofgoods andarticles ofinfringement ormaybeindicted byacivilcourt tostopinfringement
act,compensate thedamage atrequest oftheinjured party; andinserious cases, maybeprosecuted
forcriminal liability.
Discovery andhandling oftheabove-mentioned infringements shall bebased onclaims,
denunciation byinjured party andthepublic through thesystem ofStatemanagement andinspection
bodies.
Discovery andhandling ofinfringement onIndustrial Property rights inthefieldofproduction,
business, service, advertising, importing/exporting activities come within theresponsibility ofbranch
management bodies (Market Controls, Customs Offices, Culture andInformation Inspections, Science
TechnologyandEnvironmentInspections,NationalOfficeofIndustrialProperty,CopyrightDepartment)
inconjunction withStateadministration bodies inlocalities (People 'sCommittees ofvarious levels).
4. Enforcement
(a) Civil judicial procedures andremedies
Authority ofjurisdiction overdispute, infringement onIndustrial Property rights belong to
People 'sCourts ofprovincial levelandhigher. ThePeople 'sCourt (Civil Court) hastheauthority of
jurisdiction inthefollowing cases:
- claim onabuse ofIndustrial Property rights;
- dispute onroyalty, remuneration;
- claim onapplication rightandtherightofauthor;WT/ACC/VNM/2
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- dispute inrelation toacontract ontransfer ofownership right, licensing contract ontheuse
righttoobjects ofIndustrial Property.
Theplaintiff, owner ofprotection certificate, organization andindividuals injured maylodge
aclaim withorbring asuitbefore thecourt orthough lawyer his/her lawful representative asstipulated
bylaw.Theplaintiff must provide evidence toprove his/her Industrial Property right protected by
theState aswellasevidence oninfringement oftherights.
Thedefendant shallhavetheright toproduce evidence, argument before thecourt inorder
tosubstantiate his/her actsoastooppose theevidence, argument oftheplaintiff, tohavelawyer to
represent anddefend his/her interests.
People 'sCourts shallhavetherighttodemand concerned parties tosubstantiate theirevidence,
argument andprovide orproduce further evidences, documents. Where necessary theCourt mayrequest
forexamination.
People 'sCourts shallhavetheauthority tomake anorder toapply provisional measures such
asorder aninfringing party todesist from infringement, seizure ofinfringing goods ordetention of
property inorder toensure proper compensation.
People 'sCourt shallundertake before theCourt theprocedures ofamicable settlement between
theconcerned parties incaseofdispute overroyalty, remuneration anddisputes inrelation tocontract
ontransfer ofownership rights, licensing contract.
Theinjured party shallhavetherighttorequest thePeople 'sCourt tocompel theinfringing
party tocompensate him/her fordamage. Amount ofcompensation issubject toactual damage orprofit
illegally obtained byinfringing party.
Thecourt shallhaveauthority todecide onorder tostoptheactofinfringement, recognize
legitimate rights toobjects ofIndustrial Property andrequest competent State authorities undertake
procedures forthepurpose ofacquisition ofrights, request infringing party tocompensate damage
totheinjured party.
Theconcerned parties shallhavetherighttoappeal against adecision ofthefirstinstance civil
judgment andrequest forhearing athigher instance inaccordance withappeal procedure.
Theplaintiff shallhavetopaycourt feesandtheCourt shalldecide upon liability tothefee
payable upon completion ofhearing based ontherightandfaultofconcerned parties.
(b) Provisional measures
Competent Statebodies having theauthority toimpose byadministrative measures toresolve
theactofabuse andtheCourts having theauthority ofjurisdiction overviolations, disputes inrelation
toIndustrial Property rights shallhavetheauthority todeliver adecision onapplication ofprovisional
measures withaview topreventing infringement andinjuries andguaranteeing proper handling of
violations,implementationofindictmentsubjecttoeachparticularcase.Theprovisionalmeasuresinclude:
- detention ofmaterial evidence, facilities ofinfringement;
- searching transportation means andcontent therein;
- searching concealment ofmaterial evidence, facilities ofinfringement;
- compelling theinfringing party tostoptheinfringement;
- confiscation ofinfringed goods;WT/ACC/VNM/2
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- temporary seizure ofgoods forthepurpose ofensuring proper compensation.
Onthegroundsthattheprovisionalmeasuresceasetobenecessarytheauthorityhavingdelivered
decision ofprovisional measures shalldecide ontheirlifting.
(c) Administrative procedures andremedies
Thefollowing administrative measures maybeapplied inremedy oftheabuse:
- warning;
- monetary fineupto100millions dong, equivalent 9,000 US;
- seizure ofmaterial evidence, facilities ofinfringement;
- destruction ofinfringement articles, counterfeits being detrimental tothehuman health, culture
andsociety:
- revocation ofbusiness licence andprofessional licence withorwithout time-limit;
- imposition compensation tothedamage caused byactofinfringement upto1million dong.
Thefollowing arecompetent bodies toapply provisional measures inrelation toadministrative
violation onIntellectual Property are:
- market control branches (under theMinistry ofTrade);
- customs offices;
- specializedinspectionauthoritiessuchasCultureandInformationInspection,ScienceTechnology
andEnvironment Inspection etc.
- economic Police, Border Security;
- People 'sCommittee (administrations)of various levels.
(d) Border measures
Customs Departments havetheauthority totemporarily detain imported/exported goods ifthey
havereasonable doubt about infringement onIndustrial Property rights orbeing requested byIndustrial
Property rights holder.
Theowner ofimported/exported goods areallowed foradetermined timetoprovide evidence,
justification onmatters concerning theIndustrial Property righttothedetained goods.
Theowner ofconcerned objects ofIndustrial Property, theparty requesting fortemporary
detention ofgoods shallhavetoprovide evidence tosubstantiate lawful ownership right, anduseright
toobjects ofIndustrial Property related tothegoods under temporary detention andevidence testifying
theinfringement.
After thetime-limit Customs office willdeliver, onthebasisofevidence provided bytheparties
inconsultation with State management body forIndustrial Property (National Office ofIndustrial
Property andCopyright Department) forexpertise, adecision onrelease orforfeiture ofgoods orcompel
tore-export ornotallow toexport thegoods.
(e) Prosecution forcriminal liability
Criminal Code ofSocialist Republic ofVietnam stipulates thattheactofinfringement over
Intellectual Property rights shallbeprosecuted forcriminal liability inaccordance withthefollowing
Articles:WT/ACC/VNM/2
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Article 126:
Anyperson whomisappropriates orhasother actofinfringing therightofauthor toscientific,
cultural, orartistic works, orinnovation totechnical improvement orinvention andproduction
rationalization, orinvention, scientific discovery, shall bepenalizes bywarning orfined upto
5million Dong, beliable tore-education without imprisonment upto1yearorbeliable toimprisonment
from 3months to1year.
Article 167:
Shall beliable toimprisonment from 1to7years those whoproduce orareinvolved in
distribution ofcounterfeit.
Shall beliable toimprisonment from 5to15years those involved inthefollowing cases:
- thecounterfeits arefoodstuffs, medicine, construction material, fertilizer, pesticide;
- commitment isoforganized character orprofessional nature;
- abuse ofposition, power andauthority orabuse ofStateorgans orsocial organizations 'name;
- thecounterfeit isinlarge quantity orresulting inlarge amount ofillegal income;
- grave recidivism.
Commitment inexceptionally serious cases shallbesubject toimprisonment upto20years,
lifesentence ordeath sentence.
Article 211:
AnypersonwhofalsifiesorfabricatescertificateofStateorganizationandutilizessuchdocument
tocommit illegal action shall bepenalized tore-education without imprisonment upto1yearor
imprisonment from 3months tothree (03)years. Violations withorganized character orgrave
consequence shallbesubject toimprisonment from two(02)toseven (07)years.
5. Legal Documents Related toIntellectual Property Rights
- Civil Code, 1995;
- Criminal Code, 1985;
- Ordinance onHandling Administrative Violations, 1995;
- Circular 99/TC-KHCNMT, 1993 guiding financial transactions inInnovation andIndustrial
Property activities;
- Circular 08/TC-TCT, 1994 guiding taxation onincome from royalty;
- Circular01/NN-KCM,1994guidingthepaymentofremunerationtoauthorsofplantandanimal
varieties;
- Decree 07/CP 1996 onmanagement ofplant varieties;
- Decree 140/HDBT 1991 oncounterfeits production andtrafficking administration;
- Regulation 1254-TT/LB ontheimplementation ofthedecree 140/HDBT;
- Customs Ordinance, 1990;
VI. TRADE RELATED SERVICES POLICIES
1. General
Services business hasnotyetdeveloped farandwide inVietnamese economy, information
onthiskindofbusiness isnotmuch andnotfullyreported; Number ofpolicies which should haveWT/ACC/VNM/2
Page64
beenissued orothers areinforce butstillfarfrombeing comprehensive. Thefollowing information
basedmainlyonthecurrentlegaldocumentswhichmightkeepontobeamendedasVietnam'slegislation
system isstillonthewaytocompletion. Vietnam willkeepWTO member countries informed ofany
changes oramendments induecourse.
Source oftheGeneral Statistical Office for1995, thetotalturnover ofthisservices reached
93,317 billion VND (equivalent to8.4billion US$; accounted for42.5percentGDP).
Asclassified byDecree 75CPofVietnamese Government dated 27October 1993, inVietnam,
services include trade, insurance, transportation, health care,culture, sports andgymnastics, investment,
tourism, hotel, restaurant, telecommunication, post,water andelectricity supply, education andtraining,
banking andfinance, environment technological science, television andbroadcasting.
Forthetimebeing, current legislation documents governing services areissued bylegislative
agencies inorder tosetupgeneral andparticular legislation foreachtypeofservices suchastrade
(import andexport), foreign investment, banking andfinance, legal consultancy, maritime, airline,
health-care, education andtraining, architecture andconstruction, labour, water supply, press, television
andbroadcasting. These documents areofState administrative management andserve astechnical
guidance fromMinistries andindustries under supervision oftheSupreme People 'sProsecutorate for
theirlegitimacy.
2. Policies onTrade inServices
(a) Governmental agencies, professional associations orothers bodies withauthority orarole
relevant totheconduct ofservice activities
TheGovernment ofVietnam assumes theresponsibility ofmanagement andadministration
oftradeinservices. Inorder toimplement itsfunctions andduties, thegovernment delegate itsauthority
related tosectoral lineministries. Relevant lineministries areincharge ofsetting outpolicies, submitting
billstoGovernment forthepurpose ofissuing lawsandother oflegaldocuments needed tosecure
lineorsectoral administration andcorrect implementation ofthese policies. Onacasebycasebasis,
ministerialauthoritiesareempoweredbythegovernmenttosignandimplementinternationalagreements.
Atthelocallevel,governmentagents(Department,Bureau,Office)willtakeStatemanagementauthority
atcorresponding level within thescope authorized bylineministries andlocal Administration.
Government 'sagencies withauthority inconducting services activities include:
- Ministry OfAgriculture AndRural Development;
- Ministry OfTrade;
- Ministry OfPlanning AndInvestment;
- Ministry OfCommunication AndTransportation;
- Ministry OfInformation AndCulture;
- Ministry OfFinance;
- Ministry OfConstruction;
- Ministry OfScience, Technology AndEnvironment;
- Ministry OfLabour, WarInvalids AndSocial Affairs;
- Ministry OfIndustry;
- State Bank;
- General Department OfPostAndTelecommunication;
- General Department OfTourism;
- Civil Aviation Administration;
- Navigation Administration;
- Railway Administration, Road Administration;
- General Statistical Office;WT/ACC/VNM/2
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- Department OfQuality, Measurement AndStandards;
- Broadcasting AndTelevision Authorities;
- Cinematography office.
Besides governmental agencies, provincial level people 'scommittees arealsogiven the
authorization toadminister localservices industries inconformity withthenational legalsystem. Local
authorities aresetupunder names ofdepartment suchasTrade Department, Finance Department,
Education Department etc.toassist chairmen ofprovincial people 'scommittees insectoral issues. Local
departments alsohavetofollow guidance from lineministries. Departments alsoareresponsible for
reporting tochairpersons ofpeople 'scommittees ontheirsuchactivities asissuance ofbusiness licences,
establishment ordissolution oflocalcompanies, andproposing toauthorities concerned sanction against
infringements oflawsandregulations.
Provincialauthoritiesassigndutiesanddelegatepowertodistrictauthoritiesandsectoralagencies
toadminister activities within thedistrict.
Legal documents concerning trade inservices arelisted incorresponding appendix hereof.
People sharing thesame profession areallowed tosetupsocial organization andoperate under
itscharter andprogrammes. These organization isgiven recognition bytheStateandallowed tooperate
inconformity withlawsandconstitution. Vietnam lawyer barassociation, solicitor association, Vietnam
traditional therapy andmedicine association, andVietnam Journalist association etc.areexamples.
Financial services aregoverned bytheordinance onState Bank, theordinance onBanking
activities, theordinance oncredit cooperatives andfinancial companies andother by-law documents.
Transportation services areregulated byAviation LawandMaritime Law.
(b) Judicial tribunals oradministrative tribunals andprocedures inarbitration, legal action on
appealing andamendment ofadministrative decision affecting trade inservices
Prosecution, arbitration and/or administration procedures concerning administrative decisions
ontrade andservices.
Disputes arose outofcontracts canbesettled inthefollowing ways:
- amicable settlement bythetwoparties;
- referring toEconomic Arbitration Centre;
- referring toEconomic Court.
Administrative authorities canimpose thefollowing sanctions against illegal commercial acts:
- Administrative sanction;
- criminal prosecution (ifcriminal elements arefound).
Governmental agencies involved inadministrative sanctions include:
- Chairperson ofpeople 'scommittees atalllevel;
- Inspectors from theState, ministries andgovernmental agencies;
- Taxation offices, Customs offices, Market-management forces, Border soldiers, andpolice.WT/ACC/VNM/2
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(c) Provisions (including thoseininternational agreements) concerning qualifications requirements
andprocedures forcapacity, technicality, andrequirements forregistration and/or licensing
requirements forsupply ofservices
Qualifications requirements forregistration/licensing varyaccording totypes oftrades, but
ingeneral qualifications required inservices are:
- minimum registered capital required fortheconduct ofbusiness;
- availability ofoffice andnecessary equipment 's;
- professional qualifications.
Registration tobeproceeded intwosteps:
- first,applicationsubmittedtocompetentauthorities-people'scommitteesofdistrictorprovince,
orlineministries orevenPrime Minister depending onitsscope ofactivities orthesizeof
thebusiness;
- second, registering atPlanning Committees ofcorresponding level(after 1July1994), formerly
registered withState Economic Court.
Asapractice,Stateenterprisesarelicensedbylineministriesandprivateenterprisesarelicensed
bypeople 'scommittees afterseeking consultation from ministries andagencies concerned.
Registration ofsome (following) kinds ofservices required approvals from Prime Minister:
- dangerous andtoxic chemicals business;
- precious minerals trading;
- power and/or water supply;
- telecommunication, post, broadcasting andpublishing;
- aviation andmarine transportation;
- export andimport;
- international travel.
Asforforeigncompaniesandindividualssupplyingservicesunderthelawonforeigninvestment
inVietnam, there areprovisions more preferential thenthose applied todomestic suppliers suchas
lower profit tax,taxholiday during theearly-stage ofoperation, some exemptions ofimport dutyin
favour ofjoint-ventures.
Under thepresent regulations ofVietnam, foreign companies areallowed tosetuptheir
representative offices forliaison, market research andbusiness facilitation purpose.
Though representative offices arenotallowed toconduct business operations inVietnam, they
areallowed tosignandconclude contracts under authorization fromparent companies. Except forcertain
cases, there arenorestrictive regulations onstaffrecruitment andbanking account ofthese offices.
Atpresent, Vietnam isstudying andgoing toissue regulation onestablishment ofbranches
offoreign companies inVietnam andsome experimental stepshadbeenthrough thelicensing ofafew
branches nowalready operating inVietnam.
Uptonow, establishment ofjoint-ventures isoneofthemajor ways ofacceding intoVietnam
market byforeign companies. Thisformgives themimport dutyreduction andexemption, profit taxWT/ACC/VNM/2
Page67
reduction which areprivileges todomestic counterparts. Itisexpected tolevelofftheseprivileges during
thecoming taxreform programme (seechapter IV).
(d) Regulations concerning international payment andtransfer forcurrent transaction inservices
UnderDecision396/TTgdate4August1994byPrimeMinisteronadditionstoandamendments
ofsome points inforeign exchange regulation inthenewcontext, international payment fortransaction
ofservices andother businesses mustbemade through banks licensed bytheState bankfordealing
withforeignexchange.Revenuesinforeigncurrencies,frominsideandoutsidethecountry,ofindividuals
andorganizations must bedeposited intheirownaccounts atoneofthose authorized banks except
forsome specific regulations applicable tocertain organizations inmaritime industry, aviation, post
offices, insurance, foreign invested enterprises andsome particular economic establishments authorized
byPrime Minister. However, there arelimitontheavailable amount offoreign currencies intheir
accounts, theexceeding amounts mustbesoldtobanks andcredit institutions. Foreign exchange, when
needed, tocover operational expenditures isaccessible inthese banks andinstitutions.
(e) Particular regulation oncapital contribution sharing insome services supply businesses
Forservice supply businesses suchasnavigation, postoffice, aviation etc.thegovernment
shallstipulate themaximum portion ofcapital contribution bytheforeign partner inajointventure.
(f) Regulations ontheprocurement bygovernmental agencies ofservices
Regulations onservice supply togovernmental agencies arethesame asthose applied to
government procurement ofgoods).
(g) Regulationsconcerninganyformsofaid,domesticsubsidy,taxincentives,orpromotionscheme
affecting trade inservices
Toencourage andsupport some services industries being inthepre-stage ofdevelopment and
non-lucrative ones, theStateadopted incentives policies suchasimport dutyreduction andexemption,
profit taxandturnover taxholiday. Now themechanism oftaxexemption andreduction isapplied
astotrade ingoods.
3. Market Access andNational Treatment
Inprinciple, Vietnam doesnotsetlimits onthenumber ofservice suppliers, onthetotalservice
values, number ofemployees inaservice industry andthetotalvolume ofservices etc.
Foreign individuals andorganizations areencouraged toinvest insupplying services inVietnam
inaccordance withlawsonforeign investment inVietnam andother by-law documents. However,
inconsideration ofnational security andsocial order, thegovernment ofVietnam shallgrant priorities
andprivileges todomestic enterprises inthefollowing special fields:
- inland transportation;
- broadcasting, television, maintenance andrepair ofequipment forbroadcasting andtelevision
operation;
- consultancy onVietnamese laws; and
- water andelectricity supply.
Foreign companies withinvestment projects shallbeconsidered tobelicensed onapproval
bylineministries.WT/ACC/VNM/2
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4. Most Favoured Nation Treatment
Fortradeinservices Vietnam apply onlythemostfavour nation treatment toASEAN member
countries andothers asprovided forinbilateral agreements. However, inessence, Vietnam hasnot
adopteddiscriminatorytreatmenttoanyspecificcountryorregioninimplementinggovernmentalpolicies
ontariff andnon-tariff measures.
VII. INSTITUTIONAL BASE FOR TRADE AND ECONOMIC RELATIONS WITH THIRD
COUNTRIES
1. Bilateral andMultilateral Agreements
Asofdate,Vietnam hasconcluded economic, tradeandcultural agreements with67countries
ofwhich 50havetrade andeconomic components.
Provisions forgiving favourable conditions totrade andservices canbefound inthose trade
andeconomic agreements. Inother words, tradeandeconomic agreements entered byVietnam contain
provisions onpromotion offoreign traderelations andthatonmostfavoured nation treatment between
Vietnam andother countries.
Uptonow, Vietnam hasnotimposed discrimination measures (both tariff andnon-tariff) on
imports from anycountries.
Vietnam ismaking great efforts topromote trade liberalization andgradually eliminate
quantitative restrictions onimports.
2. Economic Integration
On28July1995, Vietnam acceded totheAssociation ofSouth-East Asian Nations (ASEAN).
Vietnam hassigned withother ASEAN members many economic agreements including:
(i) ASEAN Framework Agreement OnEconomic Cooperation, under which ASEAN countries
undertakes topromote economic cooperation through theformation ofASEAN FreeTrade
Area(AFTA), withaviewtoeliminating tariff andnon-tariff barriers andfurther promoting
trade andeconomic cooperation inother fields.
(ii) CEPT Agreement: defining tariff concession schemes andtoeliminate non-tariff barriers to
establish AFTA by2003 (2006 asapplicable toVietnam), under which Vietnam hasbound
itstariff bindings for857lines from 1996 andshall have introduced 2000 lines intotax
preferential schemes, gradually phased inupto2006.
(iii) Framework Agreement onCooperation inIntellectual Property: tostrengthen thecooperation
andimprove theeffectiveness ofprotection system ofandenhancing thevalorization of
intellectual property rights ineachASEAN member andinthewhole Association.
(iv) Framework Agreement onCooperation forTrade inServices, under which ASEAN countries
havecommitted tocontinue negotiation onmarket access, topromote cooperation andtrade
between member countries inthisfield.
Theagreements towhich Vietnam isasignatory shallbenotified byASEAN Secretariat to
WTO Secretariat.WT/ACC/VNM/2
Page69
These agreements areconsistent withtheobjectives andprinciples oftheWTO.
3. Labour Market Integration Agreements
Uptopresent, Vietnam hasnotentered anylabour market integration agreements. However
Vietnam hasratified 12conventions oftheInternational Labour Organization (ILO) codified within
ILOasNo.5,6,14,27,45,80,81,116,120,123,124,155.Vietnam hadsigned some bilateral
agreements withtheformer Soviet Union, Eastern Germany, Czech- andSlovak, Bulgaria, Iraq,Libya,
Republic ofKorea, Ukraine.
4. Accession toMultilateral Economic Organization
AsofApril 1995, Vietnam hadacceded to73multilateral agreements andtreaties (see
Appendix 6)invarious fields. Intheeconomic field, Vietnam hasacceded tothefollowing multilateral
organizations:
- General Agreement OnTariffs AndTrade (GATT -fullobserver status given in1994), then
fullobserver ofWTO since January 1995andofficial demand ofWTO membership received
byWTO Secretariat on4January 1995;
- International BankforDevelopment andReconstruction (IBRD -taking overmembership since
1976);
- International Monetary Fund (IMF -taking overmembership since 1976);
- International Financial Corporation (IFC- taking overmembership since 1976);
- International Development Agreement (IDA taking overmembership since 1976);
- Multilateral Insurance Guarantee Agency (MIGA -membership since September 1993);
- United Nations Development Programme (UNDP-membership since 1978);
- United Nations Conference onTrade andDevelopment (UNCTAD- membership since 1976);
- Generalized System OfTrade Preferences (GSPT -membership since 1988);
- United Nations Industrial Development Organization (UNIDO- membership since 1978);
- World Food Programme (WFP -membership since 1977);
- Food andAgriculture Organization (FAO-membership since 1975);
- International Fund forAgriculture Development (IFAD- membership since 1977);
- International Aviation Organization (ICAO -membership since 1980);
Alltheabove mentioned international organizations havebeengiving assistance toVietnam
reforming itseconomic structure andpolicy formulation byfinancing certain development projects
inVietnam.WT/ACC/VNM/2
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Appendix 1
LEGAL DOCUMENTS RELATED TOCUSTOMS OPERATION
PartI:Administration ofexport -import, immigration, transit andforeign investment inVietnam
I. Export -Import
- Interministerial Circular 01-TTLB, dated 22December 1995byMinistry ofAgriculture and
Rural Development -Ministry ofTrade -General Department ofCustoms forimplementation
ofDecision 664-TTg;
- Interministerial Circular 06-TT/HQ/BD dated 20June1995 bytheGeneral Department of
Customs andtheGeneral Department ofPostandTelecommunication forexports andimports
bypost;
- Legal document Note2673-TCHQ/GSQL date30October 1995 bytheGeneral Department
ofCustoms ontemporary guidance fortheimplementation ofDecree 65/CP;
- Legal document Note472-TCHQ/GSQL date18March 1995 bytheGeneral Department of
Customs toprovide regulations onexhibition andtrade fairs;
- Interministerial Circular 01-TTLB/TM/HQ date20January 1996 bytheMinistry ofTrade
andtheGeneral Department ofCustoms onimplementation ofDecree 89/CP;
- Interministerial Circular 01-TTLB/TM-TC-UBNNHTDT-HQ onimports andexports of
equipment byforeign investment enterprises andjoint-ventures;
- Legal document Note 190/TCHQ-GSQL dated 7October 1994 bytheGeneral Department
ofCustoms onissuance ofandcontrol onimports andexports licensing bytheGeneral
Department ofCustoms;
- Legal Document Note 1852/TCHQ-GSQL dated 12April 1995 bytheGeneral Department
ofCustoms onimports ofgiftsanddonated goods;
- Legal Document Note1952/TCHQ-GSQL dated 15August 1995bytheGeneral Department
ofCustoms providing rules oncertificate oforigin andinspection ofexports andimports;
- Legal Document Note731/TCHQ-GSQL dated 11April 1995onimportation ofproduct marks
andlabels.
II. Customs Control Related toImmigration
- Interministerial Circular 63/TCHQ-GSQL dated 20February 1995bytheGeneral Department
ofCustoms giving guidance onimplementation ofDecree 17/CP;
- Legal Document Note420/TCHQ-GSQL date11March 1995 bytheGeneral Department of
Customs oninterpretation oftheCircular 63/TCHQ-GSQL;
- Legal Document Note 99/TCHQ-GSQL dated 11January 1996 bytheGeneral Department
ofCustoms issuing regulation onimport bywayofimmigrants 'luggage.WT/ACC/VNM/2
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III. Transit Through Vietnam
- Legal Document Note1886/TCHQ-GSQL date28December 1994bytheGeneral Department
ofCustoms ontransit ofwood andimports ofwood from Cambodia;
- Legal Document Note 953/TCHQ-GSQL dated 5May 1995 onCustoms procedures and
formalities applicable toCambodian goods intransit ofVietnam.
IV. Foreign Investment inVietnam
A. Export processing zone
- Legal document 17/TCHQ dated 15March 1993bytheGeneral Department ofCustoms issuing
temporary Customs regulations forEPZs;
B. Customs bonded warehouse
- Circular 533/TCHQ on26May1995 bytheGeneral Department ofCustoms related tothe
implementation ofCustoms bonded warehouse regulation;
- Legal document 242/TCHQ-GSQL dated 13February 1995 bytheGeneral Department of
Customs giving supplementary provisions totheCustoms bonded warehouse regulation;
C. Representative Office
- Circular 235/TCHQ-GSQL dated 21November 1994bytheGeneral Department ofCustoms
giving guidance onimplementation ofDecree 82/CPdated 2August 1994ontheestablishment
andoperation offoreign representative offices.
Part2:Customs Procedures onExports andImports
I. Exports andimports (under commercial contracts)
- Decision 258/TCHQ-GSQL dated 16December 1994byGeneral Director ofCustoms issuing
Customs procedure forcommercial imports andexports;
- Decision287/TCHQ-THTKdated19December1995byGeneralDepartmentofCustomsissuing
thenewExport -Import Declaration Form;
- Decision 318/TCHQ-THTK dated 15December 1995byGeneral Director ofCustoms issuing
forimporters andexporters coding system;
- Decision 189/TCHQ-GSQL dated 7October 1994bytheGeneral Director ofCustoms issuing
regulations oncustoms inspection ofexports andimports;
- Directive 224/TCHQ-GSQL dated 11October 1994 bytheGeneral Director ofCustoms on
custom inspection procedures applicable toexport andimport;
- Directive 223/TCHQ-GSQL dated 18November 1994 bytheGeneral Director ofCustoms
onusing security machines andcamera forinspection andsupervision purpose atinternational
NoiBaiandTanSonNhat airports;WT/ACC/VNM/2
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- Document 254/TCHQ-GSQL dated 13December 1994 byGeneral Department ofCustoms
ontheinspection andsupervision ofcontainerized cargoes;
- Document 1406/TCHQ-GSQL dated 29October 1994byGeneral Department ofCustoms on
procedures forcustoms clearance forimported goods destined tooilandgasindustries;
- Decision 120/TCHQ-GSQL dated 3April 1995 bytheGeneral Director ofCustoms issuing
regulations onsupervision andmanagement ofpetroleum temporarily imported forre-export;
- Document 1783/TCHQ dated 27July1995 byGeneral Department ofCustoms oncustoms
procedures applicable topetroleum imported ontemporary basis forre-export;
- Decision 126/TCHQ-GSQL dated 8April 1995 bytheGeneral Director ofCustoms issuing
regulation onimports andexports forprocessing purpose andimported materials forexport
production;
- Decision 199/TCHQ-GSQL dated 26May1995 bytheGeneral Director ofCustoms issuing
monitoring ledgers ofimports andexports forprocessing andimported materials forexport
production;
- Decision 109/TCHQ dated 9March 1995bytheGeneral Director ofCustoms issuing regulation
oncheck-in andcheck-out points outside customs regular areas;
- Decision89/TCHQ-GSQLdated2August1995bytheGeneralDirectorofCustomsonissuance
ofregulations oncustoms procedures forimported goods under authorization oftransit;
- Decision 268/TCHQ-GSQL dated 11October 1995bytheGeneral Director ofCustoms issuing
regulations onluggage, exported andimported gifts, donation intransit byair;
- Legal document note2386/TCHQ-GSQL on11October 1993 bytheGeneral Department of
Customs ontheaccounted dates ofactual exporting andimporting fortaxation purpose;
- Document 875/TCHQ-GSQL dated 26April 1994byGeneral Department ofCustoms onthe
issuance ofCustoms procedures border trade;
- Decision 79/TCHQ-GSQL dated 14June1994byDirector General ofCustoms ontheissuance
ofregulation forborder trade;
- Legal document Note 953/TCHQ-GSQL dated 5May1995 bytheGeneral Department of
Customs onCustoms clearance forCambodia 'sgoods intransit;
- Interministerial circular 07/TTLN byMinistry ofagriculture andfoodindustries (atpresent,
Ministry ofAgriculture andRural Development) andtheGeneral Department ofCustoms
onre-partition andresponsibilities andrelationship status between thetwoagencies ininspection
andmonitoring sanitary inspection before exporting from, importing toandtransit through
Vietnam;
- Decision 192/TCHQ-KTTT dated 15May1995 bytheGeneral Director ofCustoms issuing
regulations oncustoms valuation;
- Interministerial circular 04/TTLB/TM-NG-TC-TCHQ dated 14February onpurchasing by
foreign organizations located inVietnam.WT/ACC/VNM/2
Page73
II. Non-Commercial Imports andExports andSpecial Status
- Decision 127/TCHS-GSQL dated 10April 1995byGeneral Director ofCustoms oftheissuance
ofprocedures anddemonstrative layout forCustoms clearance ofnon-commercial imports and
exports;
- Directive275/TCHQ-GSQLdated18October1995byGeneralDirectorofCustomsonCustoms
clearance forbelongings under diplomatiC;
- Decision188/TCHQ-SQLdated17August1994byGeneralDirectorofCustomsontheissuance
ofprocedures forCustoms clearance applicable totransfer ofautomobile, motorbikes ownership
byforeign individuals andorganizations inVietnam;
- Decision 197/CHQ-GSQL dated 23May1995byGeneral Director ofCustoms ontheissuance
ofregulations onCustoms supervision andmanagement ofduty-free outlets operations at
international anddomestic airports andseaports.WT/ACC/VNM/2
Page74
Appendix 2
EXPORT/IMPORT COMMODITY CONTROL
A2.1. Prohibited Exports andImports
(Stipulated intheDecision 864/TTg dated 30December 1995 ofthePrime Minister)
I. Prohibited Exports
- Weapons, ammunition, explosives, military technical equipment anddevices;
- Antiques;
- Drugs ofallkinds;
- Toxic chemicals;
- Timber logs,sawn wood, charcoal,products made ofwood ofgroup IAandprocessed plates
madeofwoodofgroupIIAlistedintheDegree18/H§BTdated17January1992,semi-processed
wooden products, rawrattan;
- Rareandprecious wildanimals andplants.
II. Prohibited Imports
- Weapons, ammunition, explosives, military technical equipment anddevices;
- Antiques;
- Drugs ofallkinds;
- Depraved cultural andreactionary products;
- Firecrackers, morally pernicious child toys;
- Cigarettes (except forpersonal useinrationed quantities);
- Used consumer goods (except under-12-seat automobiles, two-wheel motor vehicles, personal
effects inrationed quantities);
- Automobiles andother motor vehicles withleft-handed steering (including inCKD form);
- Used spare parts ofautomobiles, two-wheel andthree-wheel motor vehicles.
Notes:
1. Theexportation/importation oftheabove listed commodities forpurposes ofnational defence
andsecurity orother purposes isapproved bythePrime Minister.
2. Theexport prohibition ofwildanimals andplants fortherequirement ofecological protection
isinstructed bytheMinistry ofScience, Technology andEnvironment inaseparate document.
3. TheGeneralDepartmentofCustoms,incooperationwiththeMinistryofTradeandtheMinistry
ofForeign Affairs, enacts instructions fortheimportation of"personal effects" provided inII.above.
Theimport prohibition ofother usedequipment (including spare partsandcomponents) isimplemented
byinstructions oftheMinistry ofScience, Technology andEnvironment.WT/ACC/VNM/2
Page75
A2.2. Quota-Controlled Commodities in1996
(Stipulated intheDecision 864/TTg dated 30December 1995 ofthePrime Minister)
Exports:
-Rice
-Textiles andcloths exported intotheEU,Canada andNorwayWT/ACC/VNM/2
Page76
A2.3. Exports andImports Under Line-Management
ListofImported Addictive, Psychotropic Substances andPre-substances
withRequirement ofApproval oftheMinistry ofHealth
(Attached toDecree 89/CP, 12December 1995 oftheGovernment)
A. ADDICTIVE SUBSTANCES
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
B. PSYCHOTROPIC SUBSTANCES
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
C. PRE-SUBSTANCES
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
D. HUMAN MEDICINES
Medicines notregistered fordistribution bytheMinistry ofHealthWT/ACC/VNM/2
Page77
ListofImported Medical Equipment withRequirement ofApproval ofTheMinistry ofHealth
(Asattached toDecree 89/CP, 12December 1995 oftheGovernment)
1. CT-Scanner
2. Gamma scanner andtomography
3. Cobalt andaccelerator
4. Stimulator
5. Digital angiograph andintervenor
6. Magnetic resonator
7. Lithotripter
8. Artificial kidneys
9. Colour Ultrasound Doppler
10. Radiotherapy equipment
11. Breast Radiogram cameras
12. Radiogram ScintigraphiesWT/ACC/VNM/2
Page78
ListofExported/Imported Aqua-cultural Breeds, Feeds andMedicines
withRequirement ofApproval oftheMinistry ofAqua-culture
(Asattached toDecree 89/CP, 15December 1995 oftheGovernment)
1. Aqua-cultural breeds
2. Aqua-cultural medicines, vaccines, activating substances andfeeds (including finalproducts,
semi-products andrawmaterials).WT/ACC/VNM/2
Page79
ListofExported Precious Aquatic Creatures withRequirement
ofApproval oftheMinistry ofAqua-culture
(Asattached toDecree 89/CP, 15December 1995 oftheGovernment)
Names Scientific Names
Redcoral Carallium Japonieus
Konojci redcoral Carallium Konojci
Leaf-shaped earth-worms Phylum Spp.
Round earth-worms Bibis Spp.
Grown batrachian Ranidae
Lobsters Panulirus Spp.
SeaCods ofvarious kinds Ephinephelus Spp.
Seriola Spp.
Awa Chanos ChanosWT/ACC/VNM/2
Page80
ListofImported Postal andTelecommunication Machinery andEquipment
withRequirement ofApproval oftheGeneral Department
ofPosts andTelecommunications
(Asattached toDecree 89/CP, 15December 1995 oftheGovernment)
1. Radio-transmitters, telecommunication equipment
2. Central telephone operating stations ofvarious kindsWT/ACC/VNM/2
Page81
Appendix 3
SANITARY REGULATIONS
Veterinary Quarantine andInspection Subjects List
Attached totheDecision No.607NN-TY/QD of9June1994
bytheMinistry ofAgriculture andFood Industry
(today Ministry ofAgriculture andRural Development)
A. Animal
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
B. Products ofAnimal Origin
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
C. Equipment, Tools forAnimal Keeping andSlaughtering; Wrapping andPacking Material and
Containing Devices forAnimal products
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
D. Transport Means forAnimals andTheir Products
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]WT/ACC/VNM/2
Page82
Appendix 4
Shares ofOwnership Types andIndustrial Sectors inGDP
1990 1991 1992 1993 1994
Total GDP 100 100 100 100 100
State-owned 32.5 33.3 36.2 39.2 40.2
Non-State 67.5 66.7 63.8 60.8 59.8
ByIndustrial Sectors
1.Agriculture 38.7 40.5 33.9 29.9 28.7
State-owned 2.9 2.9 2.8 2.8 2.9
Non-State 97.1 97.1 97.2 97.2 97.1
2.Industry 22.7 23.8 27.3 26.9 29.6
State-owned 62.8 63.5 64.7 65.7 65.2
Non-State 37.2 36.5 35.3 34.3 34.8
3.Service 38.6 35.7 38.8 41.2 41.6
State-owned 44.2 47.5 45.5 46.9 48.1
Non-State 55.8 52.5 54.5 53.1 51.9
GDP Growth Index ByTypes ofOwnership andIndustrial Sectors
1991 1992 1993 1994
Total GDP 106.0 108.6 108.1 108.8
State-owned 108.6 112.4 111.6 112.8
Non-State 104.7 106.8 106.2 106.7
ByIndustrial Sectors
1.Agriculture 102.2 107.1 103.8 103.9
State-owned 102.3 102.2 107.1 107.0
Non-State 102.2 107.2 103.7 103.8
2.Industry 109.0 114.0 113.1 114.0
State-owned 110.4 118.6 114.7 114.5
Non-State 106.6 105.4 109.8 112.8
3.Service 108.3 107.0 109.2 110.2
State-owned 107.4 107.5 108.8 111.4
Non-State 108.9 106.6 109.6 109.2
Source: General Statistical Office, Statistical Yearbook 1994WT/ACC/VNM/2
Page83
Appendix 5
LIST OFA-CATEGORY (NATIONAL) CORPORATIONS
- Electricity ofVietnam
- Vietnam CoalCorporation
- Vietnam OilandGasCorporation
- Vietnam National Cement Corporation
- Vietnam National Shipping Lines Corporation
- Vietnam Aviation Corporation
- Vietnam Posts andTelecommunications Corporation
- Vietnam National Rubber Export-Import Corporation
- Vietnam National Steel Corporation
- Vietnam National Coffee Export-Import Corporation
- Vietnam National Tobacco Corporation
- Vietnam National Paper Corporation
- Vietnam National Textiles andGarments Corporation
- Vietnam Southern Food Corporation
- Vietnam Northern Food Corporation
- Vietnam National Chemical Corporation
- Vietnam National Jewel andGold Corporation
- Vietnam National Railway CorporationWT/ACC/VNM/2
Page84
Appendix 6
TREATIES
- GENERAL
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- AVIATION AGREEMENTS
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- INVESTMENT PROTECTION
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- JUDICIAL ASSISTANCE
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- MARITIME
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- TAX TREATIES
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- TRADE
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
- TRANSPORT
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]WT/ACC/VNM/2
Page85
Appendix 7
OTHER ECONOMIC STATISTICS
Gross Domestic Product byKind ofEconomic Activities
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Structure ofGross Domestic Product byKind ofEconomic Activities
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Structure ofOwnership Form andThree Sectors inGross Domestic Product
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Index ofGross Domestic Product byOwnership Form andSectors
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Balance ofGross Domestic Product bySources andUses
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Balance oftheState Budget
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Domestic Revenues oftheState Budget byKind ofEconomic Activities
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Structure ofDomestic Revenues oftheState Budget byKind ofEconomic Activities
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Expenditure ofState Budget byKind ofEconomic Activities
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Structure ofState Budget Expenditure byKind ofEconomic Activities
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]WT/ACC/VNM/2
Page86
Number ofState Enterprises byLabour Size
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Number ofState Enterprises byCapital Size
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Number ofLicensed Businesses byBusiness Kind
[Available forconsultation intheSecretariat (Accessions Division, Room 1126)]
Foreign trade turnover
Year Total Millr-US$ ofwhich:
export import
millr-US$ ofwhich :
millUS$millr-US$ ofwhich:
millUS$
1989 4,511.8 1,946.0 1,138.2 2,565.8 879.4
1990 5,156.4 2,404.0 1,352.2 2,752.4 1,372.5
1991 4,425.2 2,087.1 2,009.8 2,338.1 2,049.0
1992 5,121.4 2,580.7 2,552.4 2,540.7 2,540.3
1993 6,909.2 2,985.2 2,952.0 (a)3,924.0 3,924.0
1994 4,054.3 5,825.8
1995 5,200.0 7,500.0
(a) Incl.importation offoreign direct investment project.
Exports bycommodity groups
Year Total ofwhich:
heavy industrial
products and
mineralslightindustrial
andhandicraft
goodsagri-cultural
productsforest
productsaquatic
products
Mill. US$
1989 1,946.0 336.0 584.2 706.6 111.0 206.2
1990 2,404.0 617.0 635.8 783.2 126.5 239.1
1991 2,087.1 697.1 300.1 628.0 175.5 285.4
1992 2,580.7 954.8 349.5 827.6 140.8 307.7
1993 2,985.2 1,014.0 526.5 919.7 97.5 427.2
1994 4,054.3 1,157.0 831.1 1,252.6 101.0 551.2
1995 est. 5,200.0WT/ACC/VNM/2
Page87
Year Total ofwhich:
heavy industrial
products and
mineralslightindustrial
andhandicraft
goodsagri-cultural
productsforest
productsaquatic
products
Structure (%)
1989 100 17.3 30.0 36.3 5.7 10.6
1990 100 25.7 26.4 32.6 5.3 9.9
1991 100 33.4 14.4 30.1 78.4 13.7
1992 100 37.0 13.5 32.1 5.5 11.9
1993 100 34.0 17.6 30.8 3.3 14.3
1994 100 28.5 20.5 30.9 2.5 13.6
Source: Statistical yearbook-1995
Statistical publishing house
Main goods forexportation
Items Unit 1990 1991 1992 1993 1994
Crude oil Thous.tons 2,617 3,917 5,446 6,153 6,949
Coal Thous.tons 780 1,173 1,623 1,432 2,068
Chromium Ton 1,986 2,030 1,489 9,783 11,527
Tin Ton 1,808 3,440 4,537 2,969 3,182
Cement Thous.tons 9.6 0.2 22.7 35.8 11.4
Shoes Mill.US$ 14.4 8.4 16.5 68.0 122.1
hosiery Ton 9,486 391 601 971 5513
Textile fabrics Mill.m 10.2 6.5 12.4 7.8 11.2
coconut, maize and
seagrass productsMill.US$ 12.1 0.7 1.9 1.6 4.0
Rattan andbamboo
productsMill.US$ 44.0 10.8 14.8 21.6 17.7
Fineartsproducts Mill.US$ 23.9 6.8 14.3 20.5 20.7
Embroidery products Mill.US$ 50.9 10.6 4.6 22.1 18.2
Woollen carpet Thous.m2163 158 160 284 216
Ready made garments Mill.US$ 223.2 133.9 202.0 238.8 475.6
Jutecarpet Thous.m24,246 1,198 135 253 224
Rice Thous.tons 1,624 1,033 1,946 1,722 1,983
Shelled ground nut Thous.tons 70.7 78.9 62.8 105.4 119.1
Coffee Thous.tons 89.6 93.5 116.2 122.7 176.4
Rubber Thous.tons 75.9 62.9 81.9 96.7 13.5
Cashew nut Thous.tons 24.7 30.7 51.7 47.7 81.3WT/ACC/VNM/2
Page88
Items Unit 1990 1991 1992 1993 1994
fresh processed fruitand
vegetableMill.US$ 52.3 33.2 32.3 23.6 20.8
Pepper Thous.tons 9.0 16.3 22.3 14.9 16.0
Tea Thous.tons 16.1 8.0 13.0 21.2 23.5
Processed meat Thous.tons 16.2 25.0 12.1 19.7 12.6
pharmaceutical material Mill.US$ 2.5 4.3 3.9 7.4 3.5
Anise flower Ton 690 415 607 462 377
Cinnamon Ton 2,097 2,885 2,075 2,537 2,622
Aquatic product Mill.US$ 239.1 285.4 307.7 427.2 551.2
Source: Statistical yearbook-1995
Statistical publishing house
Imports bycommodity groups
Million US$
Year Total ofwhich:
Means ofproduction Consumer
goods
Total means
ofproductionComplete
equipmentInstrument
and
accessoriesFuels, raw
material
1986 2,155.1 1,867.0 426.2 322.7 1,118.1 288.1
1987 2,455.1 2,104.2 576.1 322.6 1,205.5 350.9
1988 2,756.7 2,335.8 576.2 382.8 1,376.8 420.9
1989 2,565.8 2,237.5 509,5 350.8 1,377.2 328.8
1990 2,752.4 2,342.6 439.0 314.0 1,589.6 409.8
1991 2,338.4 2,012.9 318.6 190.6 1,503.7 352.2
1992 2,540.7 2,119.8 175.0 372.1 1,572.7 420.9
1993 3,294.0 3,311.2 287.7 634.6 2,388.9 612.8
1994 5,825.8(1) 4,221.0 261.8 1,222.9 2,736.3 1,004.2
(1) Incl.600,5 million US$ofimportation offoreign direct investment project
Source: Statistical yearbook-1995
Statistical publishing houseWT/ACC/VNM/2
Page89
Main goods forimportation
Items Unit 1990 1991 1992 1993 1994
Tractor Piece 1,604 148 49
Motor trucks Piece 3,726 808 281 956 8,413
Motor car Piece 2,042 599 3,201 6,869 7,380
Inner tubeandtyre Thous, sets 229.3 209.4 170.8 311.2 326
Motor accessory Mill. US$ 20.0 2.3 0.5 3.9 13.2
Ironandsteel Thous.tons 324.3 113.0 343.0 686.3 754.0
Petroleum oil Thous.tons 2,860.8 2,572.5 3,142.0 4,094.7 4,531.0
Lubricating oils Thous.tons 28.7 27.3 82.0 59.0 42.5
Nitrogenous fertilizers Thous.tons 2,085.2 2,662.6 2,420.0 3,018.0 4,134.0
-urea Thous.tons 785.6 1,079.7 423.8 1,250.0 1,542.9
-potassic fertilizers Thous.tons 36.8 1.0 34.7 9.8 67.8
Insecticides Mill. US$ 9.0 22.5 24.1 33.4 58.9
Plastic Thous.tons 20.6 35.6 79.6 138.9 223.7
Caustic soda Thous.tons 4.5 3.7 2.3 3.3 3.9
Asphalt Thous.tons 35.8 27.6 32.0 73.5 70.5
Cotton Thous.tons 58.8 32.5 8.3 16.3 19.9
Textile fibres Thous.tons 17.2 19.1 25.0 35.3 64.9
Malt Thous.tons 1.3 8.4 6.9 29.6 33.3
Auxiliary materials for
manufacturing cigarettesMill. US$ 7.2 39.6 53.3 59.0 79.0
Auxiliary forsewing Mill. US$ 69.0 17.7 55.0 96.2 152.4
Cement Thous.tons 221 7 43.4 134.4 571.3
Clinker Thous.tons 12.3 5.1 176.3 749.5
Wheat flour Thous.tons 141.2 197.0 252.2 250.8 260.3
Sodium glutamate Thous.tons 24.5 30.0 42.8 56.2 43.6
medicaments Mill. US$ 25.7 29.5 61.0 86.0 121.7
cloth Mill. m 30.7 19.8 28.0 27.5 54.1
Television sets Thous.pieces 172.3 142.0 224.9 368.2 340.9
Motorcycle Thous.pieces 36.4 55.2 374.0 283.0
Source: Statistical yearbook-1995
Statistical publishing houseWT/ACC/VNM/2
Page90
Exports ByDestination, 1990-1994
Mill. R-US$
1990 1991 1992 1993 1994
TOTAL 2404 2087.1 2580.7 2985.2 4054.3
ASIA 1040.7 1605.6 1902.7 2167.5 2918.7
South-East Asia 348.6 524.4 576.0 642.8 892.9
Cambodia 9.1 6.3 6.4 96.2 77.3
Indonesia 14.6 16.5 10.9 22.9 35.3
Laos 16.0 3.6 16.0 14.4 20.9
Malaysia 5.0 14.5 68.4 55.8 64.8
Philippines 57.0 0.7 1.0 1.6 3.6
Singapore 194.5 425.0 401.7 380.3 593.5
Thailand 52.3 57.7 71.5 71.8
Other Asian Countries 692.1 1081.2 1326.7 1524.7 2025.8
India 20.3 5.5 19.4 18.9 14.1
Korea, PDR of 0.6 0.3 0.1 0.03 0.03
Taiwan 28.7 58.3 67.3 141.9 220.0
Hongkong 243.2 223.3 201.7 169.0 196.8
Iraq 4.0 0.7 14.2 12.5 21.3
Mongolia 0.6 0.1 ... ... 0.7
Korea, Rep.of 26.7 51.3 93.5 99.4 86.4
Japan 340.3 719.3 833.9 936.9 1179.3
China 7.8 19.3 95.6 135.8 295.7
EUROPE 1215.1 355.9 374.6 409.1 563.0
Albania 4.0 ... 0.2 ... -
Poland 10.6 4.2 6.1 9.7 10.4
Bulgaria 20.2 3.1 1.2 3.3 4.3
Hungary 16.6 5.0 6.2 8.7 12.3
USSR (Former) 919.7 214.5 - - -
Russia 104.8 135.4 90.2
Belarus 0.1 0.4 0.4
Ukraine 0.8 0.9 4.3
Czech andSlovakia 48.8 4.2 2.1 2.9 0.8
United Kingdom 1.9 2.4 27.5 23 55.7
Austria 0.9 5.9 10.7 10.0 7.5
Belgium 0.2 0.1 6.4 11.8 15.1WT/ACC/VNM/2
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1990 1991 1992 1993 1994
Germany 41.3 6.7 34.4 50.1 115.2
Netherlands 6.4 16.1 20.1 28.1 60.6
Italy 3.4 3.8 7.2 8.1 20.4
Yugoslavia 2.0 2.3 0.4 - 0.08
Norway 0.7 0.1 1.4
France 115.7 83.1 132.3 95.0 116.8
Sweden 1.3 1.2 1.2 3.7 2.4
AMERICA 15.7 5.3 26.2 41.7 139.8
Cuba 11.5 4.7 18.7 31.6 30.9
Canada 3.5 0.4 2.6 5.9 5.8
United States 0.01 0.01 0.1 0.1 94.9
AFRICA 4.2 13.3 24.4 11.3 19.9
Algeria 4.1 13.3 10.0 6.1 10.6
Libya - - 13.0 0.2 9.0
AUSTRALIA AND OCEANIA 7.7 5.2 21.5 54.9 49.8
Australia 7.7 5.2 21.4 54.7 46.0
OTHERS 120.6 101.8 231.3 289.6 363.1
Source: General Statistical Office, Statistical Yearbook 1994
Ministry ofTradeWT/ACC/VNM/2
Page92
Imports ByDestination, 1990-1994
Mill. R-US$
1990 1991 1992 1993 1994
TOTAL 2725.4 2338.1 2540.7 3924.0 5825.8
ASIA 1009.4 1418.7 1662.7 2719.5 3911.0
South-East Asia 539.8 811.1 953.4 1318.5 1689.6
Cambodia 7.7 5.2 6.7 7.6 17.7
Indonesia 9.8 49.4 39.8 84.5 116.3
Laos 3.9 3.3 7.7 41.9 102.9
Philippines 3.6 10.6 5.1 19.5 15.0
Thailand 17.0 14.2 41.2 99.5 225.7
Malaysia 0.8 6.2 35.9 24.8 66.1
Singapore 497.0 722.2 821.6 1058.3 1145.8
Other Asian Countries 469.7 607.6 709.3 1401.0 2221.4
Taiwan 41.0 59.3 72.7 217.9 396.1
Korea, Rep.of 53.1 152.1 211.2 481.5 720.5
Japan 169.0 157.7 239.4 452.3 585.7
China 4.6 18.4 31.8 85.5 144.2
Korea, PDR of 0.05 1.1 2.1 4.5 13.9
Hong Kong 196.9 194.8 142.9 145.4 318.6
India 4.3 24.0 9.0 8.1 28.2
Others
EUROPE 1604.4 714.2 420.1 690.9 1019.6
Russia - - 100.1 144.3 288.7
Czech andSlovakia 28.8 18.9 4.3 4.7 4.8
Hungary 54.3 13.7 3.2 4.7 7.8
Poland 20.6 8.4 6.7 15.2 23.8
Rumania 0.6 0.7 - 0.07 0.04
Ukraine - - 0.2 22.2 26.1
USSR (Former) 210.6 358.1 - - -
Finland 0.02 10.0 5.5 5.3 3.8
Sweden 13.3 14.2 12.8 18.5 18.6
Norway 0.08 0.03 - 10.0 26.2
Denmark 1.1 4.1 6.3 8.8 80.2
Switzerland 13.0 5.0 39.5 13.4 26.3WT/ACC/VNM/2
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1990 1991 1992 1993 1994
Austria 1.6 2.5 3.9 13.6 5.4
Germany 20.7 101.2 40.6 72.0 149.1
Netherlands 2.7 8.4 16.2 25.8 25.1
Belgium 2.2 6.8 5.0 8.1 9.2
France 123.0 147.9 159.9 267.4 239.6
Italy 4.5 1.2 6.0 34.8 34.2
United Kingdom 0.5 9.0 3.7 11.4 19.3
AMERICA 11.8 10.7 24.8 29.7 73.1
United States 0.6 1.1 2.0 3.8 44.3
Canada 4.3 5.8 14.0 18.7 26.7
Cuba 6.9 3.5 8.8 4.5 0.6
AFRICA 2.4 2.2 5.2 - 2.8
AUSTRALIA AND OCEANIA 10.7 11.0 19.8 32.9 62.3
Australia 10.7 9.6 15.8 30.3 63.9
NewZealand - 1.4 4.0 2.7 5.4
OTHERS 113.8 181.3 408.2 451.0 750.0
Source: Ministry ofTradeWT/ACC/VNM/2
Page94
Balance ofpayments, 1986- 1994
Million US$
1990 1991 1992 1993 1994
Export. Total 1731 2042 2475 2850
Convertible area 1305 1855 2475 2850
Nonconvertible area 426 187 .. ..
Import. Total -1772 -2105 -2535 -3505
Convertible area -1208 -1846 .. ..
Nonconvertible area -564 -259 ... ..
Trade balance -41 -63 -60 -655
Convertible area 97 9 .. ..
Nonconvertible -138 -72 .. ..
Services andtransfers -118 -69 51 -217
Interest payments -238 -248 -282 -327
Inputted Interest onareas ... .. .. ..
Private remittances 50 36 .. ..
Freight andinsurance .. ..
Official transfers 88 55 64 194
Others -118 88 .. 330
Current. Account Balance -259 -132 -8 -869
Convertible Area -121 -60 .. ..
NonConvertible Area -126 -72 .. ..
Capital account balance 122 -60 271 -161
Disbursements 233 414 241
Convertible area .. .. ... ..
NonConvertible Area .. .. .. ..
Scheduled Amortizations -297 -256 -435 -644
Convertible Area .. .. .. ..
NonConvertible Area .. .. .. ..
Amortization ofdebtrelief .. .. .. ..
Short termloan(net) 48 -89 -41 -58
Direct foreign investment 120 220 210 300
Errors andomissions -6 142 5 -76
Overall balance -112 -50 268 -1106
Financing 192 50 268 1106
Charge inNFA (excl. IMF) -159 -276 -463 527
IMFcredit (net) .. -6 .. -39
Gold revaluation .. .. .. ..WT/ACC/VNM/2
Page95
1990 1991 1992 1993 1994
Debt rescheduling .. .. .. ..
Changes inareas 34 322 195 617
Transferable rubles perUS$ 2,4 2,4 .. ..
Source: World Bank Report 1994