Asia Counsel Insights gives readers a concise insight into legal and business developments in Vietnam. This edition has news on new rules for corporate governance of public companies; proposed changes to the Law on Competition and administrative sanctions in the oil and gas sector.

1. ASIA COUNSEL INSIGHTS
June 2017
Asia Counsel Insights provide an
overview of the key trending
legal and business issues in
Vietnam and how they may
impact your business. Please
enjoy your read.
Key Dates
• The minimum wage is
increased to VND 1,300,000
/Month starting from 01July
2017.
• HCMC telephone prefixes
have changed and callers
will need to dial 82, 83, 84 or
85 for HCMC area code
depending on the telecoms
service provider.
Oil & Gas
On 25 May 2017, the Government
issued Decree 67/2017/ND-CP on
administrative penalties in the oil & gas
sector which takes effect from 10 July
2017. This Decree sets out the
following:
• A business establishment may be
imposed a fined from VND60 million
to VND100 million if it mixes other
chemicals into petroleum.
• At the downstream level, VND200
million is the highest penalty if a
business establishment is not licensed
to provide LPG bottle gas re-filling,
borrows or leases the license from
another party.
• At the upstream level, the highest
penalty for violation in petroleum
exploration and exploitation is VND2
billion.
• A business establishment which
adjust petroleum price outside the
permitted range shall be fined from
VND 40 million to VND 60 million.
Public Company
Corporate Governance
On 6 June 2017, the Government
issued Decree 71/2017/ND-CP guiding
corporate governance of public
companies. Decree 71 will replace
Circular 121/2012/TT-BTC from 1 August
2017. New provisions include:
• All public companies must have
internal corporate governance rules,
which previously applies to large-
scale public companies only. The
rules are developed by the board
and approved by the general
meeting of shareholders (GMS).
• A public company must notify
shareholders of a GMS at least 20
days in advance of the meeting,
compared to 5 days under Circular
121.
• With effect from 1 August 2020, the
chairman of the board of
management may not be an
executive director of the same
public company.
• With effect from 1 August 2019, a
board member of a public
company may not be a board
member of more than 5 other
companies.
• A public company having its
operational model changed must
notify the State Securities
Commission and the Securities
Exchange, and disclose
information within 24 hours of the
GMS’s resolutions on such change.
• An unlisted company selecting the
model of having an internal
auditing committee under the
board as stipulated under Article
134.1(b) of the Law on Enterprises
must have at least 1/5 of the board
members as independent
members.
• The board of a listed company
must appoint at least one person in
charge of corporate governance,
who may also be the company
secretary.
About Asia Counsel
Asia Counsel is a dynamic international corporate and commercial law firm dedicated to serving clients in Vietnam. Our partners have over eight years of
experience in working on complex and challenging matters in Vietnam. We are committed to helping clients achieve their business strategies and providing
outstanding legal services.
If you have any questions on any of the items discussed above, please do not hesitate to contact us.
Christian Schaefer
Managing Partner
E christian@asia-counsel.com
Minh Duong
Partner
E minh@asia-counsel.com
Asia Counsel Vietnam Law Company Limited, Level 5, 18 HBT Building, 16-18 Hai Ba Trung Street, Ben Nghe Ward, District 1, Ho Chi Minh City

2. ASIA COUNSEL INSIGHTS
June 2017
Competition
Proposed Changes to Competition Law
Ministry of Industry and Trade has
uploaded the proposed changes to
current Competition Law no.
27/2004/QH11 dated 3 December 2004
on its website for public comment. Key
proposed changes include:
• Foreign enterprises established and
operated under foreign laws are
also now regulated by the new
draft.
• The new draft recognizes
determination of market shares of
enterprise on relevant markets
based on quantity of goods and
services beside sales turnover,
purchase turnover as prescribe
under the current Competition Law.
• Notification of economic
concentration is required for the
following: (a) investment in which
one out of two parties has combine
market share over 20% of the
relevant market; or (b) the value of
economic concentration
exceeding 300 billion VND or one
out of the two parties has total
revenues in Vietnam exceeding 500
billion VND.
The National Assembly is expected to
debate the new draft in May 2018.
Business
Draft Decree on automobile
conditions for manufacturing,
assembly and import
The Ministry of Industry and Trade
has proposed a draft decree on
conditions for automobile
manufacturing, assembly and
import. Some notable points are as
follows:
• Automobile manufacturers,
assemblers and importers would
be responsible for recalling
automobiles with technical
problems, regulation violations
at their own costs.
• Automobile importers would no
longer be required to have a
power of attorney for distributing
automobiles in Vietnam.
• Automobile assemblers,
manufacturers and importers
would need to satisfy conditions
on facilities, workforce,
occupational safety and health,
etc. in order to obtain a
certification to conduct business.
• Automobile manufacturers and
assemblers must have testing
roads of at least 500m which
meet other technical
requirements under the draft
decree.
Vietnam Fact Box
Vietnam's GDP for the first quarter
of 2017 was 5.1%, the lowest in
two years. The target rate of
growth for 2017 is still at 6.7%,
which Vietnam hopes to achieve
through macroeconomic
stabilization, controlling inflation,
recovering tax arrears, attracting
more foreign investment,
accelerating administrative
reforms, and boosting tourism
development.
Inflation has also decreased to
3.19% in the past quarter, the
lowest since September of 2016.
Based on findings from
MarketIntello, the inflation rate
may fall below 3%. This is said to
be caused by the falling prices of
fresh produce, oil, and petroleum
products.
Securities
Penalties
On 27 April 2017, Ministry of Finance
issued Circular 36/2017/TT-BTC
amending, supplementing some
articles of Circular 217/2013/TT-BTC
guiding the sanction on
administrative violations in the
securities sector. The main points
are:
(i) For a violation of regulations on
application dossiers for
registration of a public
company (submitting dossier
one month to twelve months
behind the deadline), the
Circular clarifies that the
sanction is calculated from the
date when the minutes on
such violation is issued.
(ii) The violation “Failing to submit
a registration dossier for a
public company” is applicable
after the State Securities
Commission has issued an
official letter to request such
public company to submit the
registration dossier or
supplement the registration
dossier but the requested
company fails to do so.
Gaming
Business of Electronic Prized Gaming for foreigners
On 2 June 2017, the Ministry of Finance issued Circular No. 57/2017/BTC amending
and supplementing Circular No. 11/2014/TT-BCT to align with the new Decree No.
175/2016/ND-CP on business of electronic prized gaming for foreigners.
Additionally, enterprises which have been permitted to duly operate the electronic
prized gaming before 15 February 2017 may continue such business with the gaming
machines they duly purchased at the time, up until they replace them with new
machines.
This Circular takes effective from 17 July 2017.