Asia Counsel Insights gives readers a concise insight into legal and business developments in Vietnam. This edition has news on public private partnerships decree, new decree on industrial and economic zones and new penalties in the agricultural sector.

1. ASIA COUNSEL INSIGHTS
May 2018
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.
We are pleased to announce that
Asia Counsel is now located on
Level 15, Deutsches Haus,
33 Le Duan Boulevard, District 1,
Ho Chi Minh City
Commerce
Foreign Trade Management
Decree 69/2018/NĐ-CP guiding the
Law on foreign trade management
was issued on 15 May 2018 (“Decree
69”).
Decree 69 includes specific
regulations on temporary import for
re-export. In particular, Vietnamese
traders are allowed to conduct
temporary import for re-export
activities regardless of their registered
business lines. However, foreign-
owned traders may only perform
such activities in certain cases, such
as to perform warranty obligations,
for lease of equipment/machinery in
Vietnam, or for use in exhibitions.
Decree 69 also stipulates that goods
temporarily imported for re-export
can only be stored in Vietnam for a
maximum of 60 days from the date of
completion of customs procedures.
Decree 69 took immediate effect on
15 May 2018.
Investment
Public-Private Partnership
Decree 63/2018/NĐ-CP on investment
in Public-Private Partnerships (“Decree
63”) was issued on 4 May 2018 and
replaced Decree 15/2015/NĐ-CP.
Decree 63 regulates the required
capital contribution of the investor.
One of the significant changes under
Decree 63 is the increase in the portion
of the investor’s required equity
capital. Such portion is required to be
at least 20% (an increase of 5% in
comparison with Decree 15) of the
total investment capital for PPPs with
investment capital up to VND1,500
billion. For PPPs with total investment
capital over VND1,500 billion, the
investor must maintain equity capital
of at least 10%.
There is no capital contribution
requirement from the Government
side under Decree 63.
Decree 63 will come into effect on 19
June 2018.
Industry
Industrial and Economic Zones
On 22 May 2018, the Government
issued Decree 82/2018/ND-CP on
management of industrial and
economic zones (“Decree 82”).
Decree 82 regulates the
establishment of industrial and
economic zones and the associated
approval process from the Prime
Minister which is managed by the
Ministry of Planning and Investment.
Decree 82 encourages the
development of residential and
sporting and cultural facilities within
the industrial and economic zones
and also provides that certain
employees can live in separate units
within the enterprise office and
processing areas.
There are incentives provided for
industrial zones developed in low
socio-economic areas and that
adopt high environmental standards.
Decree 82 will take effect on 10 July
2018.
About Asia Counsel
Asia Counsel is a dynamic international corporate and commercial law firm dedicated to serving clients in Vietnam. Our partners have over ten 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 15, Deutsches Haus, 33 Le Duan Boulevard, Ben Nghe Ward, District 1, Ho Chi Minh City

2. ASIA COUNSEL INSIGHTS
May 2018
Vietnam Fact Box
The finance reports for the
first quarter of 2018 of 13
large and medium sized
commercial banks have
shown that bad debts are
increasing again. By 31
March 2018, total debts of
the reviewed banks had
reached VND67.8 trillion,
being an increase of 8%
compared with the
beginning of the year. BIDV
has the highest total bad
debt value with VND14.2
trillion worth of non-
performing loan, followed by
Vietinbank with VND10.3
trillion. Source: VIETNAMNET
Commerce
Promotional activities
On 22 May 2018, the Government
issued Decree 81/2018/ND-CP
replacing Decree No. 37/2006/ND-CP
providing detailed regulations for
commercial law regarding commercial
promotional activities. Below are some
key changes brought in by Decree 81:
• Alcohol is prohibited from being used
in all promotional programs, whether
as the promoted goods or goods
included in the promotion;
• Price reduction for goods or services
can be up to 100% of their value,
instead of the cap of 50% under
Decree 37, in centralised commercial
promotion programs;
• Centralised commercial promotion
programs are defined as sales
promotional programs held by a
governmental authority at central or
provincial level or those that are held
during holiday seasons;
• Lottery results must not be used to
determine the prize winner in
promotional programs.
Decree 81 comes into effect on 15 July
2018.
Technology
Technology Transfer
On 15 May 2018, the Government
issued Decree 76/2018/ND-CP
detailing and guiding the
implementation of some articles of the
Law on Technology Transfer. The key
points include:
Conditions to receive technology
transfer support: the enterprise must:
(a) have projects: with preferential
business lines; or located in areas
marked for investment incentives; and
(b) have technology transfer
contracts, or technology transfer
registration certificate.
Financial support: includes access to
loans at preferential interest rates from
credit institutions and of up to a max
2% interest rate per annum from State
funds, and direct financial support
from such State funds.
Direct support: includes support in
conducting scientific and
technological tasks and other such
forms.
This Decree will take effect on 1 July
2018.
Consumer
Product Quality
The Government recently passed
Decree No. 74/2018/ND-CP
(“Decree 74”). Decree 74 provides
amendments to several articles of
Decree 132/2008/ND-CP guiding
the Law on the quality of products
and goods. Some of the key
amendments include:
• Decree 74 provides stricter
obligations for the importer and
manufacturer of goods and
products in circulating their
products in the market to ensure
such products won’t cause
adverse and unsafe affects for
humans, animals, plants,
property and the environment.
• Decree 74 also sets out more
detailed rights and obligations
of the owner of product codes
and barcodes.
• Provides how each type of
products or goods are
managed in terms of product
safety.
This Decree will take effect on 1 July
2018
Agriculture
Sanctions in livestock breeding and fisheries
On 7 May 2018 the Government issued Decree 64/2018/NĐ-CP on administrative
sanctions in livestock breeds, and livestock feeds including for fisheries (“Decree 64”).
Decree 64 will come into effect on 22 June 2018 and specifies strict penalties against
enterprises for use of banned substances in livestock feeds:
Fine of VND50 million to VND60 million: for use of prohibited chemicals in livestock feeds
but does not amount to a criminal act.
Fine of VND70 million to VND80 million: if the violation is considered criminal but the
investigating authority has decided not to pursue criminal charges.
Decree 64 also provides additional sanctions that may be applied, such as suspending
the breaching enterprise’s operations, and forced recovery/destruction of the livestock
feed.