VIETNAM LEGAL UPDATE December 2008

Transcription

1 VIETNAM LEGAL UPDATE December 2008 Part 1 Selected New Legal Instruments 1.1 A brave new (tax) world Unemployment insurance another new regime for Legislative calendar Draft law on advertising Mineral roundtable 7 Part 2 Feature Vietnam Court Case Commentaries 11 Part 3 Did You Know? 3.1 Recap - Vietnam Business Forum Royalties for music protected by copyright Trading and distribution sector additional documentation hurdles Recognition and enforcement of foreign judgments in Vietnam a leap forward? 18 Part 4 What's New Online? Subject categories and new laws in Vietnam Laws 20 online database Search function for Vietnam Legal Update 20 Hanoi Suite 401, Hanoi Tower 49 Hai Ba Trung Street Hoan Kiem District Hanoi, Vietnam Tel Fax bill.magennis@aar.com.au Ho Chi Minh City Suite 605, Saigon Tower 29 Le Duan Boulevard District 1 Ho Chi Minh City, Vietnam Tel Fax nigel.russell@aar.com.au Allens Arthur Robinson - a leading international law firm with offices in Bangkok Beijing Brisbane Hanoi Ho Chi Minh City Hong Kong Jakarta Melbourne Perth Phnom Penh Port Moresby Shanghai Singapore Sydney Part 5 Get to Know Us Spotlight on Andrew Hilton 21 Visit subscribe to (or take a free tour of) Vietnam Laws online database-searchable database of 3,500 of our English translations of Vietnamese laws regulating investment and business access free translations of a selection of Vietnamese laws read the Vietnam Legal Update from 2008 back to complete with index of contents and search function find out more about our practice in Vietnam Visit to find out more about the Allens Arthur Robinson network and our international practice The material contained in Vietnam Legal Update is intended to inform readers of recent legal developments in Vietnam. It is not intended and should not be relied upon as legal advice. Should readers wish further information in relation to any legal instrument or matter mentioned in this issue, they are encouraged to contact one of our Vietnam offices (details above).

2 Allens Arthur Robinson (Allens) is a leading regional law firm with 14 offices in South East Asia, Greater China, and Australia. With offices in Bangkok, Beijing, Brisbane, Hanoi, Ho Chi Minh City, Hong Kong, Jakarta, Melbourne, Perth, Phnom Penh, Port Moresby, Shanghai, Singapore and Sydney, Allens has the most extensive network of offices and the most lawyers on the ground of any law firm in Asia. Allens' Vietnam practice is led by resident partners Bill Magennis, Nigel Russell and Thomas Miller. The team in Vietnam includes 25 other lawyers from Australia, the United States, Finland and Vietnam. We encourage feedback from our readers regarding the Vietnam Legal Update. Please direct all enquiries, comments and suggestions to Lee Baker in our Ho Chi Minh City office at lee.baker@aar.com.au. For English translations of Vietnam's legislation on banking and finance, property, trade and more, subscribe to Vietnam Laws online database on Chung Le, Thomas Miller and Mai Nguyen from our Ho Chi Minh City office

3 Page 1 Part 1 Selected New Legal Instruments 1.1 A brave new (tax) world Law QH12 on Corporate Income Tax, dated 3 June 2008 (Law on CIT), Law QH12 on Value Added Tax, dated 3 June 2008 (Law on VAT), Law QH12 on Special Sales Tax, dated 14 November 2008 (Law on Special Sales Tax), Decree ND-CP of the Government dated 11 December 2008 making detailed provisions for implementation of the Law on Corporate Income Tax (CIT Decree), Decree ND-CP of the Government making detailed provisions for implementation of the Law on Value Added Tax, dated 8 December 2008 (VAT Decree), and the Law on Personal Income Tax (PIT), PIT Decree, PIT Circular and PIT Decision, discussed in previous VLUs The laws On 1 January 2009 Vietnam's taxation landscape will change dramatically when three major laws take effect: Law on PIT; Law on VAT; and Law on CIT. Further changes will take place on 1 April 2009 when the Law on Special Sales Tax (Law on SST) will also come into effect. CIT highlights As we have discussed in earlier editions of the VLU, the new Law on PIT introduces a substantially broader regime for the calculation and payment of personal income tax. Correspondingly, the new Law on CIT will apply only to corporate taxpayers and will not impose any separate corporate income tax on individuals engaged in business activities (who will be taxed under the Law on PIT). Other key changes introduced by the Law on CIT include: a reduction in the standard CIT rate from 28% to 25%; a narrowing of the types of enterprises which are entitled to tax incentives; a time limit on when applicable tax exemptions or reductions will commence, even if the relevant company has not earned any taxable income ; inclusion of specific provisions on the types of deductible expenses and (importantly) expenses which are not deductible; a cap on the maximum amount of advertising and marketing costs (modelled on the existing CIT Circular TT-BTC of the Ministry of Finance, dated 14 February 2007) and business management expenses which can be deducted; and provisions enabling taxpayers in certain circumstances to establish a before-tax science and technology development fund of up to 10% of taxable income. CIT implementing legislation another last-minute scramble As is typical, each of the new tax laws is quite brief, with detailed provisions left to implementing decrees and circulars. As reported in previous editions, the new decree and circular for the Law on PIT were issued in September and a decision was issued in November. Now, with less than two weeks to go before the effective date of the Laws on PIT, CIT and VAT, we have seen another lastminute flurry of implementing legislation, including the CIT Decree. The CIT Decree provides further clarifying detail on the general provisions in the Law on CIT, including:

4 Page 2 further detail on the determination of taxable income arising from capital transfers, intellectual property transfers and asset leases; further detail on the determination of turnover ; the formula for determining the maximum amount of business management expenses paid to a foreign parent which can be deducted when determining taxable income; further explanation of the (limited) business sectors in which new enterprises are entitled to tax incentives; and detail on the type of expenses relating to the employment of women and ethnic minorities which may entitle certain companies to further tax reductions. VAT, SST also joining the game Also joining this eleventh-hour tax party is the VAT Decree, which was issued on 8 December And, as mentioned previously, the new Law on SST will become effective in April 2009, and discussion is already germinating about its potential effects on business. We will report further on the VAT and SST Laws in subsequent issues of the VLU. As always, the devil s in the detail The real detail of the new CIT and VAT regimes remains unknown because, as at the time of publication, there are still no implementing circulars for either the Law on CIT or the Law on VAT. The tax department has indicated informally that the circulars may be issued before year-end (which would be amazingly quick), but for now things remain a matter of watch this space. Focus on PIT is a delay possible? Despite the last-minute nature of the implementing decrees and the remaining lack of further implementing legislation in the form of circulars, there has been no official indication that parts or all of the new PIT tax regime will be delayed beyond the slated start date of 1 January In particular, securities companies and even the State Securities Commission have urged the Government to postpone the commencement of the new PIT capital gains tax on securities trading, arguing that the tax will have a detrimental effect on the already battered Vietnamese stock market. While initially indicating in November that no delay was being considered, in early December, remarks of the Minister of Finance were interpreted (and reported in media outlets) as hints that a delay may still be being considered. While these hints were well received by the market, no formal announcement has followed. 1.2 Unemployment insurance another new regime for 2009 Decree ND-CP of the Government providing detailed regulations and implementation guidelines on a number of articles of the Law on Social Insurance regarding unemployment insurance, dated 12 December 2008 (Decree 127) On 1 January 2009 a new regime of unemployment insurance will come to life. Although the basic concepts of the new regime were introduced by the Law on Social Insurance No QH11 dated 29 June 2006 (Social Insurance Law), only recently (and a few weeks before the new regime kicks off) has the Government issued Decree 127 providing detailed regulations on the new regime. We now take a closer look at the regime, compare it with the current system and consider the changes it will bring for both employers and employees. New versus old -- what remains? Articles 17 and 42 of the Labour Code provide that when an employment contract is terminated, the employer must (in most cases) pay the employee a severance allowance or, in cases of redundancy, a redundancy allowance. The Social Insurance Law, when issued in 2006, introduced

5 Page 3 a new regime of unemployment insurance, seemingly designed to replace the existing severance and redundancy allowance system. The National Assembly, however, apparently "forgot" to appropriately amend or repeal the severance or redundancy allowance provisions of the Labour Code. The result was confusion as to precisely what effect the new regime would have on the old regime and, in particular, whether entitlements under the old system would be preserved after 1 January To reassure worried employees, the Ministry of Labour, War Invalids and Social Affairs (MOLISA) recently issued several official letters seeking to clarify the murky regulations. According to MOLISA, after 1 January 2009, an employee whose employment is terminated will receive all their entitlements to severance/redundancy allowances accrued in the period up to 1 January 2009 as well as any unemployment allowances to which they are entitled under the new regime for the period commencing 1 January Another interesting question is raised by the fact that the Social Insurance Law (the source of the new regime) applies only to Vietnamese citizen employees while the Labour Code (the source of the current regime) is more broad-reaching. It is unclear whether the current regime will continue to apply, even after 1 January 2009, for employees covered by the Labour Code who are not subject to the Social Insurance Law. When are employees entitled to the new unemployment allowance? In order to receive benefits under the new regime, an employee will need to satisfy numerous conditions and complete various registration formalities. Specifically, to be eligible for the allowance the employee must: have worked for an employer that (i) employs ten or more employees and (ii) participates in the unemployment insurance program; have worked under a labour contract of either an indefinite term or a definite term between 12 and 36 months; have contributed to the unemployment insurance fund for at least 12 months within the 24 months prior to becoming unemployed; have registered their unemployment with the social insurance authority; and have been unemployed for at least 15 days from the date of registering their unemployment. These numerous conditions and registration requirements are in stark contrast to the current system under which an employee is generally entitled to severance or redundancy allowances except where they work for the employer for less than 1 year, they are dismissed for specified labour offences or they unilaterally terminate their labour contract without giving the requisite statutory notice. Moreover, the existing allowances are unaffected by the employee's subsequent employment status they will be paid even when the employee starts a new job straightaway. The new "unemployment allowance" Under the new regime, an eligible employee will receive a monthly unemployment allowance equivalent to 60% of their average monthly salary (being the salary on which social insurance premiums are based) in the 6 months preceding the termination of their employment. The period during which the employee will receive this monthly unemployment allowance will depend on the period during which they contributed to the unemployment insurance fund. The minimum entitlement period is 3 months (applicable where the contribution period ranges from 12 to 36 months) and the maximum entitlement period is 12 months (applicable only where the contribution period is at least 144 months). The payment of the unemployment allowance during the entitlement period will cease in various circumstances, including where the employee finds a new job, the employee refuses 2 jobs

6 Page 4 recommended by the social insurance agency without a "proper reason" or the employee does not make the requisite monthly report to the social insurance agency on their efforts in finding new job for 3 consecutive months. In addition to monetary allowances, the Law on Social Insurance has introduced additional measures to assist the employee to find a new job including assistance in professional training and free consultancy and introduction of new jobs. This new allowance is significantly less generous than the current severance allowance of half of one month's salary for each year of employment or redundancy allowance of one month's salary for each year of employment. Who pays the allowance and who funds it? Under the new regime the social insurance agency will be responsible for paying the monthly unemployment allowances. The social insurance agency will source these payments out of the unemployment insurance fund. In turn, the unemployment insurance fund will be funded by the compulsory contributions from employees, employers and the State budget each of whom is required to contribute, for each employee, 1% of the employee's monthly salary used to determine social insurance contributions. This is in contrast to the current system in which severance or redundancy allowances are paid only by the employer and out of their own funds. Winners and losers On its face, the big winners under the new regime are employers whose labour costs will reduce going forward. From an employee's perspective, however, the new regime is largely bad news they must contribute 1% of their salary to the fund and even if they are entitled to the new allowance (and are able to jump through all the necessary hurdles to claim it) the resulting unemployment allowances will be significantly lower than the allowances under the current scheme. 1.3 Legislative calendar Resolution QH12 on the Legislative Program for Legislature II (Years 2007 to 2011) of the National Assembly dated 15 November 2008 (Resolution 27) On 15 November 2008, Resolution 27 was issued by the National Assembly (NA) outlining the new legislation to be added to the legislative calendar for the NA s consideration during the period To an already-packed and ambitious schedule of law-making, the following new laws and ordinances will be added: 1. Law on Amendment of Article 126 of the Law on Residential Housing 2. Law on Amendment of the Law on Investment in Capital Construction 3. Law on Cost-Saving and Effective Use of Energy 4. Law on Civil Servants 5. Law on Amendment of the Law on Education 6. Law on Unions (amended) 7. Ordinance on Consolidation of Legal Instruments 8. Ordinance on Systemization of Legal Instruments 9. Ordinance on Amendment of the Ordinance on Prosecutors 10. Ordinance on Amendment of the Ordinance on Judges and Councils of Judges

7 Page Ordinance on Amendment of the Ordinance on Criminal Investigations 12. Ordinance on Amendment of Article 10 of the Ordinance on Population Laws already in the pipeline status check The following laws, already on the schedule, will be submitted to the NA for passage at the 5th session of Legislature XII of the NA, tentatively to be held in May 2009: 1. Law on Management of Public Sector Debt 2. Law on Amendment of the Law on Investment in Capital Construction 3. Law on Amendment of the Law on Inspectorates 4. Law on Legal Records 5. Law on Amendment of the Criminal Code 6. Law on Payment of Compensation by the State 7. Law on Amendment of the Law on Cinematography 8. Law on Amendment of the Law on Cultural Relics 9. Law on Urban Zoning 10. Law on Amendment of Article 126 of the Law on Residential Housing 11. Law on Amendment of the Law on Intellectual Property 12. Law on Overseas Representative Bodies of the Socialist Republic of Vietnam 13. Law on Cipher At the subsequent session of Legislature XII of the NA (proposed to be held in October 2009), the following nine laws will be submitted to the NA for passage. They will also be considered and discussed at the May 2009 session. 1. Law on State Budget (amended) 2. Law on Commercial Arbitration 3. Law on Vietnamese Territorial Waters 4. Law on Press (amended) 5. Law on Seniors 6. Law on Disease Prevention and Treatment 7. Law on Telecommunications 8. Law on Radio Frequencies 9. Law on Self-Defence Militia The Law on Royalties and the Law on Amendment of the Law on Education are also expected to be passed at the October 2009 session. Ongoing discussion Meanwhile, the following laws will be submitted to the NA for ongoing discussion and opinion: 1. Law on State Bank of Vietnam (amended) 2. Law on Credit Institutions (amended) 3. Law on Insurance of Savings Deposits 4. Law on Housing and Land Leases

8 Page 6 5. Law on Amendment of the Law on Land 6. Law on Raising Adopted Children 7. Law on Enforcement of Criminal Verdicts 8. Law on Access to Information 9. Law on Cost-Saving and Effective Use of Energy 10. Law on Food Safety 11. Law on Disabled Persons 1.4 Draft law on advertising, undated, but proposed to be submitted to the National Assembly in May 2009 and likely to be passed in October 2009 (Draft Advertising Law) The National Assembly recently released the new Draft Advertising Law which is intended to replace the existing Ordinance No on Advertising of 16 November 2001 (Ordinance on Advertising). The Draft Advertising Law is not intended to come into effect until 10 October 2010, so there's still plenty of time take it into account when planning your advertising activities in Vietnam. Same same but different? In many respects the Draft Advertising Law is similar to the existing Ordinance on Advertising, but there are a few additions and changes to reflect the more electronic age we now live in as well as some other miscellaneous changes (the policy basis for which is not entirely clear in all cases). Bullets A few key proposed additions to the advertising laws in Vietnam include: specific prohibitions on the advertising of tobacco, alcoholic beverages with an alcohol content of 30% or more, gambling or games with prizes in the form of gambling, prescription medicines and drugs for treating mental disorders; in line with the Law on Competition 2005, a prohibition on comparative advertising and advertising with unfair content (which under the Law on Competition broadly includes false or misleading information in advertising about such things as the price, quantity, quality, manner of use etc for products); a requirement to allow an opt-out mechanism when sending advertising on a network environment and a restriction on sending advertising to anyone who has opted out of receiving such advertising. These provisions are similar to the anti-spam legislation found in some other jurisdictions, although are very brief in the draft law and will hopefully be further clarified in accompanying decrees and circulars when the law is passed. One area for clarity will be a definition of what constitutes a network environment and whether the restriction extends to SMS advertising, something which is particularly common (and annoying) in Vietnam; and specific references to, and rules around advertising on internet websites and electronic newspapers. As examples, it is proposed that advertising not exceed 10% of the area of any website page. For electronic newspapers, no advertising can appear on the home page and on other pages, cannot exceed 10% of the area of the page and must only appear on the left hand or right hand side of those other pages.

9 Page 7 Limitations The Draft Advertising Law retains similar restrictions on the maximum permitted time for advertising for broadcasts (eg radio and television), eg no more than 5% of the transmission time on a given day for radio and television and on space within publications, eg no more than 10% of the space within a newspaper. The Vietnamese as prevailing language requirement is now more stringent under the draft law than previously under the Ordinance on Advertising where a foreign language is used in conjunction with Vietnamese in an advertisement, the foreign language will now be required to be 50% smaller than the Vietnamese text in the advertisement. The above gives a flavour of some of the requirements of the Draft Advertising Law. The law will come before the National Assembly late in 2009 so may change to some extent, and there may be additional draft decrees and circulars issued in that time in conjunction with the draft law. If your business advertises in any way in Vietnam or is engaged in advertising and marketing services, these developments are something to keep an eye on over the coming months. 1.5 Mineral roundtable The Law on Minerals passed by the National Assembly, dated 20 March 1996; Law QH11 of the National Assembly on amendments of and additions to a number of articles of the Law on Minerals, dated 14 June 2006 (Law on Minerals); Decree ND-CP of the Government dated 27 December 2005 making detailed provisions and providing guidelines on implementation of the Law on Minerals and the Law on amendments of and additions to a number of articles of the Law on Minerals (Decree 160) In connection with the Vietnam Business Forum (VBF) session held on 9 December 2008 in Hanoi discussed more fully in Part 3 of this VLU issue a specific roundtable was convened to seek recommendations from industry participants on proposed amendments to the Law on Minerals. Participants included representatives from the Legal Department of the Ministry of Natural Resources and Environment (MONRE), the Department of Geology & Minerals (DGMV) and many representatives from various businesses and organisations involved in the mining sector. Issues raised The following were the key issues and points tabled and discussed by the industry participants during this sub-group meeting: Durations for a Prospecting Licence (PL), an Exploration Licence (EL) and a Mining Licence (ML) currently regarded as too short and which should be increased. Licensed area for prospecting is generally too small and airborne geophysics analysis unable to be used the area should generally be doubled. A company holding a PL should also have the exclusive right to apply for an EL, similar to the exclusive right to apply for a ML given to a company already holding an EL for the relevant area. Limitation on the number of ELs a company may hold and the limited area for exploration for each type of mineral are both seen as unreasonable blanket limitations should be removed and assessed on case-by-case basis depending on the financial and other capabilities of companies. A processing licence should not be required for companies holding MLs. There should be a central cadastral register to provide mineral information including bidding information, areas barred from mining, etc. Exploration reserves currently checked by the Mineral Reserve Assessment Council this requirement seen as unreasonable for non-state companies who should not need to defend their reserve assessment.

10 Page 8 Requisite qualifications of engineers and workers in mining companies should not apply to non-state companies. Need for a 'one-stop shop' for investment certificates and mineral licences. The legal and financial standing of a company should be reflected in the Investment Certificate and not separately required by the mineral licensing authorities. The roles and duties of the Mineral Reserve Assessment Council should be clarified. Applications for licences should be date-stamped and priority for issuing licences should be given in accordance with the date order on a first come, first served basis. Royalty rates should be reduced to make them competitive with other countries. Taxation should apply on a profit basis. Incentives should be used instead of imposing tax to direct mining industry (taxes and export tax discourage exploration/development). Process and method for Vietnamese organisations and individuals to contribute capital to enterprises by way of transfer of mineral rights should be clarified. Although successfully applied in the petroleum sector, bidding should not apply in the mineral sector as other countries' experience in this sector shows that bidding does not encourage investment. Where bidding applies to specific, known deposits, a transparent process should be adopted. The Mining Working Group of the VBF made an overall recommendation that a working group to redraft the Law on Minerals be established. Such a group could include representatives from Government bodies like MONRE, Ministry of Planning and Investment, Ministry of Industry and Trade and Ministry of Finance and from the private sector including mining companies, law firms, banks, and other independent experts like the Asian Development Bank and the International Finance Corporation. MONRE Responses MONRE's initial response was that many of the recommendations and comments given were as a result of mistranslation or misunderstanding about the provisions of the Law on Minerals. Ministry representatives, however, went on to respond in detail to many of the matters raised, as follows: Prospecting and Exploration Licences In the 10 years since implementation of the Law on Minerals, MONRE commented that only 10 PLs were issued, two of which were to foreign companies. MONRE and MPI have jointly issued an official letter agreeing that PLs and ELs may be combined into one licence, and it is intended that provision for the PL will be removed in the new law. Exploration MONRE's representative noted that during the exploration period a significant amount of expenditure is required. Therefore, the company engaging in exploration has the exclusive right to apply for an ML and that the company's exploration rights can be transferred or bequeathed. Information on exploration MONRE agreed that if the investor has obtained information as a result of its studies during the exploration phase, that information is the property of the investor and the investor has the right to sell such information. However, MONRE emphasised that the company still had to file a copy of the information with the competent State authorities. Prospecting area In response to the requests by industry participants that the permitted area for prospecting under a PL be enlarged, MONRE noted that the decree preceding Decree 160 in fact allowed a larger area but in practice, companies did not require such large area, and as such under Decree 160 this area

11 Page 9 was reduced. MONRE stated that it is common practice to see many companies not sufficiently experienced and capable to proceed with large mining projects obtain licences, only to assign them later. MONRE also reminded the forum participants that under Decree 160, in special cases the Prime Minister may permit that the period of a PL be extended and allow for a larger area for prospecting. Exploration period MONRE stated that according to their experts the 2 years + 2 years + 2 years exploration period provided for under the Law on Minerals is not unreasonable. However, MONRE agreed to reconsider this issue and indicated that the exploration period is likely to be determined based on the type of mineral under exploration. Investment Certificate MONRE stated that the issues surrounding Investment Certificates were not as big as the participants suggested, as an Investment Certificate is not required during the exploration period. MONRE noted that companies, including foreign invested companies, only need a representative office in Vietnam in order to carry out exploration activities. Processing licence MONRE clarified that Article 44 of the Law on Minerals allows people holding mining licences to process the minerals. Only those who do not have a mining licence, but wish to process minerals in Vietnam, need to obtain a processing licence. MONRE stressed that processing licences for non-miners are necessary to combat illegal mining, as without such a licence, a processing company could source its minerals for processing from illegal sources. Evaluation of reserves and exploration MONRE acknowledged that a mining company has the sole right to decide on the exploitation technology to be employed in such mining company's project. However, MONRE noted that from the State's perspective, the State needs to make sure the available minerals are fully exploited. Therefore, the State requires that the mining companies report to the State on their reserves. Licensing procedures In response to industry participants' concern regarding the delay in the licensing procedures, MONRE reported that the Prime Minister of Vietnam had assigned the local people's committees the task of carrying out zoning of prohibited areas and that this zoning is expected to be completed by the end of this year. MONRE said that it is envisaged that licences will be issued almost automatically (no need to consult ministries) for non-prohibited areas, which will reduce the delays. Provisions on bidding MONRE felt that there was some misunderstanding by industry participants with respect to the proposed bidding provisions. MONRE explained that there have been provisions on mineral contracts entered into between representatives of the Government and mining companies in the Law on Minerals since The proposal under the draft law is that the form of entering into mineral contracts will be diversified and not just provide for bidding. Such forms will also include: auction of exploration rights; and auction of volume of mineral resources (evaluation of the reserves is required). Financial regime It was recognised by both the forum participants and MONRE that discussions on the financial regime applicable to the mining sector are important and likely to be lengthy and as such, not much was discussed during this forum. MONRE agreed to consider the recommendations in relation to

12 Page 10 VAT, CIT, royalties and export duties applicable to mining operations and agreed that taxation should be applied only on a profit basis. The bottom line, and an opportunity to weigh in None of the issues raised at the consultation were finally determined during the forum, nor have any been resolved to date. However, MONRE's representative affirmed that any recommendations or comments from the public in connection with the draft law are welcomed and will be forwarded to the leaders of MONRE for consideration and incorporation into the new law. Please contact us if you would like more information about who to contact to have your views on the content of the new draft law heard.

13 Page 11 Part 2 Feature: Vietnam Court Case Commentaries In the November VLU, we kicked off a new VLU Feature series: court case commentaries dedicated to familiarising our readers with decisions of Vietnamese courts on a number of important legal areas. As noted then, decisions of Vietnamese courts do not create precedent from a constitutional law perspective, nor do they purport to interpret Vietnamese law. Moreover, Vietnamese courts may only apply law as is the case in other civil law jurisdictions. Therefore, the purpose of our case commentary series is to provide readers with a practical insight into how certain Vietnamese legal principles are applied by courts. This month, Hop Dang of our Hanoi office takes a look at a 2006 Hanoi People s Court case which considered the interplay between the domestic court system and arbitration. VALIDITY OF ARBITRATION CLAUSES This case note highlights some issues in the legal reasoning methodology of Vietnamese courts, particularly in relation to arbitration agreements. The case is Dialasie Kidney International Hospital (Dialasie) v. B.Brour Hanoi Pharmaceuticals Company (B.Brour), heard before the People's Court of Hanoi. The judgment was handed down on 15 September The facts and procedure B.Brour was a medical equipment supplier based in Hanoi. Dialasie is an international hospital specialising in kidney treatment, based in Ho Chi Minh City. On 24 April 2002, the parties entered into what appeared to be an equipment lease contract whereby B.Brour agreed to provide Dialasie with some medical equipment and supplies for Dialasie's use for five years. Article 6 of the contract provided that any difficulties arising during the performance of the contract shall be discussed by the parties on the basis of respect for mutual interests, Eurocham or Vietnam International Arbitration Centre (VIAC) shall act as arbitrators. If a solution cannot be reached, either party may refer the dispute to the Courts of Ho Chi Minh City or any Vietnamese Court.". A dispute arose in 2005 when Dialasie failed to make payments for the use of the medical equipment. On 20 December 2005, B.Brour initiated an arbitration proceeding at VIAC to recover from Dialasie the equipment and the allegedly outstanding payments. On 12 January 2006, Dialasie submitted an objection to the jurisdiction of the VIAC arbitral tribunal. On 15 May 2006, the tribunal issued a ruling, apparently confirming its jurisdiction. On 21 June 2006, it issued an award upholding B.Brour's claims. The tribunal ordered Dialasie to (i) return to B.Brour the relevant medical equipment; (ii) pay B.Brour the outstanding amounts with interest and (iii) bear the cost of the arbitration. Application to set aside arbitral award rejected On 7 July 2006, Dialasie submitted an application to the People's Court of Hanoi seeking to have the VIAC arbitral award set aside. The main ground originally relied on in the application was that the arbitration agreement in Article 6 of the contract failed to specify or wrongly specified the name of the arbitration centre. However, it appeared that this ground was not pursued. Instead, counsel for Dialasie argued in the hearing that Article 6 of the contract gave the VIAC arbitral tribunal only the power to mediate the dispute, rather than finally resolve it. It was argued that it was the court that was vested with the jurisdiction finally to resolve the dispute. On this basis, Dialasie argued that the tribunal exceeded its jurisdiction in handing down an award finally disposing of the dispute. This argument was rejected by the court. The court found no express words in Article 6 that gave the VIAC tribunal only the power to mediate the dispute. Instead, in very brief terms and without any analysis, the court held that there was a valid arbitration agreement, reflecting the parties' mutual choice of a VIAC arbitral tribunal finally to resolve their dispute. The application by Dialasie was dismissed with costs and the VIAC arbitral award was upheld. Commentary: Two main points emerge from this judgment. First, one can sense the enthusiasm on the part of the court, as a matter of policy, to uphold arbitration agreements, whenever the contract refers to arbitration. This is a positive attitude. However, unfortunately it appears that this was done in this case at the expense of

14 Page 12 sound legal reasoning. This is the second point, that the court undertook no analysis of Article 6 of the contract in reaching its conclusion that a valid arbitration agreement existed. As explained below, such lack of legal analysis makes the judgment questionable. Poor drafting of dispute resolution clause It is not difficult to see that the dispute resolution clause in this contract is fraught with uncertainties. This clause states: "Any difficulties arising during the performance of the contract shall be discussed by the parties on the basis of respect for mutual interests, Eurocham or Vietnam International Arbitration Centre (VIAC) shall act as arbitrators. If a solution cannot be reached, either party may refer the dispute to the Courts of Ho Chi Minh City or any Vietnamese Court." Needless to say, this is a badly drafted clause. First, it refers to both Eurocham (a business association for European businesses in Vietnam, presumably not having the function to arbitrate) and the VIAC as potential arbitrators. Secondly, the jurisdiction or power of the arbitrator was not made clear. The last sentence of the clause clearly gives some room for the court to exercise jurisdiction, indicating that the award of the arbitrator may not be final. The clause also refers to more than one possible arbitrator and to both arbitration and courts, without specifying their respective functions. Such drafting could easily have led a court to find that no arbitration agreement existed. No legal analysis Unfortunately, the court did not examine the issues with the drafting nor offer any analysis to justify its finding. Its decision was based solely upon the fact that a reference to arbitration existed in the contract. To the court, that was sufficient to found the jurisdiction of the arbitral tribunal. Such approach may be commendable in the interests of supporting arbitration as a means of alternative dispute resolution, but from the perspective of legal reasoning, the judgment is unconvincing and not conducive to the development or clarification of the law in this area. In fairness to the court, the outcome in this case may be said to have been due to the way Dialasie's counsel framed its case. Instead of arguing that the arbitration clause did not exist because it was too uncertain, counsel for Dialasie chose to argue that the arbitral tribunal only had the power to mediate the dispute. As this was in no way clear on the face of the contract, it was no surprise that the court did not accept such argument. While there was clearly a strongly arguable case based on the uncertainty of the arbitration clause, the court was not obliged to examine it because it was not raised by Dialasie's counsel. While this may be a pragmatic approach by the courts, one cannot help wondering whether this is consistent with the courts' constitutional mandate to decide cases 'according to law'. The lesson to be learned The main lesson from this case is that Vietnamese courts may take a highly formalistic approach and make decisions based on one single fact or circumstance, without taking into account the rest of the case or engaging in thorough legal analysis of all the issues. Contract drafters therefore have to be very careful in ensuring that nothing is left in the document which may be relied upon by the court to make decisions inconsistent with the rest of the document or the intentions of the parties

15 Page 13 Part 3 Did You Know? 3.1 Recap - Vietnam Business Forum More than 500 people attended the annual Vietnam Business Forum (VBF) held on 1 December 2008 in Hanoi, to discuss the topic: Meeting the Challenges of the Current Global Economic Environment. Background to the VBF The VBF was established in 1998 to provide an ongoing structured dialogue between the Government, the private sector and the donor community in Vietnam, following an initiative adopted at the Vietnam Consultative Group meeting in Tokyo in The aim of the VBF is to develop a favourable business environment that attracts foreign investment and stimulates domestic economic growth and its key activities include: promoting an effective public-private dialogue to improve the business enabling environment; removing barriers impeding business operations in Vietnam; providing feedback on various Government policies, laws and regulations affecting the private sector; and promoting consistent enforcement and non-discretionary interpretation of laws and regulations. Topics discussed This year's VBF began with a report on the business environment sentiment survey issued by the VBF Secretariat, which greeted the VBF with some sombre statistics about the increasing number of companies with no plans to expand operations in Vietnam over the next three years. This report was followed by a review of Vietnam's investment climate by many of Vietnam's business associations and chambers. These presentations encouraged Vietnam to continue with its proposed development initiatives, including equitisation of State-owned enterprises, implementation of Vietnam's WTO commitments, involvement in infrastructure projects and not to be tempted to delay as a result of the economic downturn. The presenters also stressed that Vietnam should reconsider the timing of changes in the law which will negatively affect the competitiveness of companies operating in Vietnam, including the changes to the personal income tax regime and the increase in minimum wages, which will both come into effect from 1 January Specific industry presentations were also made by participants in banking and capital markets, infrastructure, manufacturing and distribution, mining (discussed in detail in Part 1.5 of this VLU), tourism and property. Main issues and recommendations The results of the report on business sentiment survey were consistent with the general concerns cited throughout all the presentations. In short, the major obstacles that were considered to be impeding business in Vietnam were: lack of infrastructure; failure to enforce intellectual property rights; inefficient and cumbersome court and arbitration systems; discretionary administrative services; and insufficient skilled labour.

16 Page 14 The most urgently needed changes to improve the business environment in Vietnam, according to both survey respondents and the industry specific presentations, were: improvement of infrastructure (in particular roads, electricity and ports); enhancement of legislative instruments to provide clarification and remove impractical and ambiguous provisions; prevention and control of corruption; and removal of unnecessary permits and licences. The industry specific speakers also raised a number of issues affecting their respective industries and made recommendations including: Banking and capital markets: consolidation in the banking sector; establishment of a legislative regime on credit institutions; removal of duplicate reporting requirements; establishment of independent ratings agencies; waiver of withholding tax for long term off-shore lending to encourage borrowers to tap into offshore funding opportunities; removal of interest rate cap especially for consumer lending; creation of a credit bureau to track borrower history; and improved transparency in the capital markets. Infrastructure: the message was clear Vietnam needs more infrastructure and, in order to attract funding for the necessary investment projects, Vietnam needs to ensure it offers a better alternative to funding projects in neighbouring countries. Some recommendations included introduction of new regulations to broaden the scope of bankable investment vehicles and projects; increase in equitisation of infrastructure companies to attract foreign investors; and improved implementation and cross ministry cooperation. Mining: see Part 1.5 of this VLU. Government response The Government's responses to these recommendations showed a willingness to work with the industry participants and try to ease some of the obstacles that companies in Vietnam face. In particular, the Government indicated that there were a number of amending regulations and decrees in the pipeline that would improve transparency and provide clarification in a number of areas, including a legislative regime on credit institutions and a review of the Law on Mining. Regrettably, there was no suggestion from the Government that it would delay the implementation of the new tax regime, nor the increase in the minimum wage. Response from donors during the Consultative Group Meeting As is the case every year following the VBF with industry participants, the Government met with the donor community over the course of two days (5 to 6 December 2008) to discuss how the donors would assist Vietnam's development in the coming year. The donor community is said to take into consideration the views of the business community expressed during the VBF together with the Government's response when it assesses the level of Official Development Assistance (ODA) the donors will provide. According to media sources, while the donor community generally applauded the promising developments that have been made by Vietnam in the last 12 months, particularly in fighting inflationary pressures and the global food and fuel crisis earlier this year, the donors remained critical of Vietnam's corruption situation and urged the Government to continue efforts to combat corruption. Following the two days of discussions, the donor countries showed their support for Vietnam's ongoing development by committing US$5 billion in ODA. Conclusion Many of the VBF participants felt that Vietnam should use the slow down in the economy to its advantage and put in place a framework to ensure Vietnam has a sustainable business environment going forward. It seemed to be the general feeling of industry participants and

17 Page 15 business associations that this was Vietnam's chance to expand its infrastructure and work force capability to a level to meet demand, rather than continually playing catch up. The Government's recently announced proposed US$6 billion stimulus plan together with the US$5 billion of pledged ODA funds suggests that Vietnam may just be able to head in that direction. More details on the VBF and the presentation materials can be found at Royalties for music protected by copyright There is a widely held perception that the recognition and protection of intellectual property rights in Vietnam, especially copyright, either does not exist or is poorly enforced. The Government, however, is visibly increasing its efforts to enforce intellectual property rights in Vietnam. There have been some reports in the press about inspections of office buildings by Government authorities to check companies' use of licensed software as well as various efforts to enforce copyright in relation to playing music in commercial spaces. Using music that is protected by copyright most often requires permission and/or the payment of royalties to the copyright owner or a society representing the copyright owner. Legal background The two major forms of intellectual property rights associated with music in Vietnam are: copyright, which refers to the right of an organisation or individual to literary, artistic and/or scientific works created and/or owned by the organisation or individual. In relation to music, copyright exists separately for the lyrics and the musical composition; and related rights, which refer to the right of an organisation or individual associated with performances, audio and visual fixation (including sound recordings, eg CDs) and broadcasts. The entitlement to, collection and the payment of royalties for using works protected by copyright and subject matter protected by related rights in Vietnam is governed in Vietnam by the Civil Code, the Law on Intellectual Property No QH11 dated 29 November 2005 (IP Law) and Decree No ND-CP providing guidelines for implementation of a number of articles of the Civil Code and IP Law with respect to copyright and related rights dated 21 September 2006 (Decree 100). Vietnam is also party to a number of international treaties in relation to intellectual property including the Berne Convention for the Protection of Literary and Artistic Works and the Rome Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations. Entitlement to royalties Under the IP Law, when any organisation or individual exercises certain rights which belong to the copyright holder of a work (including the right to communicate the work to the public) that organisation or individual must ask permission from the copyright holder and pay royalties, remuneration or other material benefits to the copyright holder. Using a work without permission and without paying royalties may constitute an infringement of copyright. Producers of audio and visual fixations and broadcasters are also entitled under the IP Law to "material benefits" when the recording or broadcast is distributed to the public. Publishing or distributing a performance, audio and visual fixation or a broadcast without permission from the relevant performer or producer may constitute an infringement of related rights. There are some limited cases where permission is not necessary, though royalties must still be paid. Royalty collection societies in Vietnam There are two copyright collection organisations in Vietnam relevant to music, being the Vietnam Centre for the Protection of Music Copyright (VCPMC) and the Recording Industry Association of Vietnam (RIAV).

18 Page 16 VCPMC is a national non-government organisation with branches and representative offices throughout Vietnam supported by the Ministry of Culture, Sports and Tourism and which collectively manages the copyright of its members. This includes collection and distribution of royalties and negotiation of licences. Membership with VCPMC is voluntary and mainly includes authors (of lyrics), composers (of music) and music publishers. VCPMC became a member of the International Confederation of Societies of Authors and Composers (CISAC) on 1 June CISAC is an international collection and management society for copyright protected works and represents author associations in over 100 countries, so VCPMC also collects royalties on behalf of international authors and composers who are members of the associations affiliated with CISAC. RIAV is a non-government body established for the benefit of organisations engaged in the production of recording tapes and discs (including audio and visual products) in Vietnam and which protects the legal interests of producers of audio and visual fixations by negotiating and managing licences of related rights. Membership with RIAV voluntary and is mainly comprised of producers and record companies. RIAV has yet to enter into any international arrangements, so only collects royalties for related rights for Vietnamese sound recordings. Activities requiring the payment of royalties Under the IP law, use of a work without the permission of the copyright holder and without payment of royalties is only permitted in a limited number of circumstances, for example personal, nonpublic or non-commercial use. When music is played from a sound recording or music is performed live at commercial premises, permission must be sought regarding the use of copyright in the lyrics and music in both the sound recording and the performance. Royalties will also be need to be paid. A licence negotiated with VCPMC will generally cover use of copyright for all live performances as well as the playing of sound recordings taking place at a particular venue. Organisations or individuals are not required to seek permission from performers, producers of sound recordings or broadcasters when they use published sound recordings in "business or commercial activities" but royalties must still be paid. Decree 100 defines "business and commercial activities" to mean the direct or indirect use of a published sound recording in a restaurant, hotel, shop, supermarket, in an establishment providing karaoke, postal and telecommunications or digital environment services, or in tourism, aviation, public transportation or other business and commercial activities. As such, when music is played from a sound recording at any of these venues, royalties must be paid for using the related rights in the actual sound recording. We understand that RIAV is the appropriate body to negotiate the required licence in this regard, although will only do so for Vietnamese sound recordings. Amount of royalty fees VCPMC has produced a schedule for which details the basis for calculating the amount of the royalties payable for uses of copyright protected music (eg for playing sound recordings and live music) which has been approved by the Ministry of Culture, Sports and Tourism and is used for local and international music. RIAV is currently reviewing their schedule for royalties for sound recordings, so the extent of any royalties payable at this point in time is not clear. It's better to be safe The website of VCPMC states over the past year it has collected significant royalty fees and news reports indicate that licences have been negotiated with some supermarkets, hotels and restaurants. It seems that the bigger businesses are being targeted by VCPMC but to be safe, it may be prudent to look into the way your business uses copyright protected music and related rights.

19 Page Trading and distribution sector additional documentation hurdles Regulatory backdrop post-wto To implement its commitments on accession to the WTO in relation to trading and distribution services, Vietnam has issued a number of implementing regulations, including: Decree 23/2007/ND-CP of the Government, implementing the Commercial Law regarding trading and distribution activities by enterprises with foreign owned capital in Vietnam, dated 12 February 2007; Decision 10/2007/QD-BTM of the Ministry of Trade announcing the schedule for implementation of trading and distribution activities, dated 21 May 2007; and Circular 09/2007/TT-BTM of the Ministry Of Trade implementing guidelines on Decree 23/2007/ND-CP, dated 17 July 2007, which was later amended by Circular 05/2008/TT- BCT, dated 14 April These regulations establish the framework under which foreign enterprises may seek to establish businesses in the sectors of trading (import / export) and, from 1 January 2009, distribution. In last month's edition of the VLU, we commented on Official Letter No. 6446/BCT-KH of the Ministry of Industry and Trade, dated 25 July 2008 (Official Letter 6446) in the context of 99% foreign owned joint venture companies. Official Letter 6446 also shed some light on the MOIT's proposed approach for licensing authorities when assessing applications for foreign invested enterprises seeking to establish trading (import/export) businesses. This approach includes an assessment of the feasibility of the project, which seems to go beyond what is contemplated under the legislative framework established under the regulations listed above. Feasibility of a project Official Letter 6446 explains that the requisite assessment of the feasibility of a project should include an assessment of the financial capability and experience of the investor. As the letter provides no further detail, in practice, the information that will be required to demonstrate adequate financial capability and experience of an investor is likely to differ on a case-by- case basis. One licensing authority has suggested that project feasibility, financial capability and experience should be addressed in the Explanatory Statement on Satisfaction of Business Conditions document (lodged as part of the application dossier) and include: for financial capability, information about the source and schedule of the charter capital contribution as well as the plan to use the investment capital of the business; and for experience, information about the investor's establishment and operational history as well as the various business lines engaged in by the investor. It has also been suggested that where a company wishes to establish a trading business, it should submit a memorandum of understanding between the investor and the proposed local distributor of the relevant products which means that potential investors would need to complete significant on the ground work before applying to establish their Vietnamese company. Early days still It remains to be seen what additional requirements will be imposed in the context of applications to establish distribution businesses in Vietnam. As noted above, this sector will only open up from 1 January 2009, so no applications can be properly assessed until that time. Informal discussions with the licensing authorities have suggested that even more detailed assessment and analysis might be required for distribution activities over and above financial capability and experience assessment, including going so far as to look at the impact the distribution activities might have on local traffic conditions! 2009 should be interesting for this sector.

20 3.4 Recognition and enforcement of foreign judgments in Vietnam a leap forward? Page 18 In November 2007, the Ho Chi Minh City court recognised a South Korean judgment (Decision 2083/2007/QDST-KDTM dated 19 November 2007). The judgment, made by an appeal court in South Korea in a bankruptcy proceeding, declared invalid a sale of an equity interest in a joint venture in Vietnam between two South Korean companies. The judgment debtor then made an appeal to the Vietnamese Supreme Court to challenge the first instance decision of the Ho Chi Minh City court which had recognised the South Korean judgment. In its hearing in August 2008, the Court of Appeal of the Supreme Court in Ho Chi Minh City upheld the first instance decision (Decision 62/2008/QDKDTM-PT dated 7 August 2008). This case represents a big step forward in the context of recognition and enforcement of foreign judgments in Vietnam, although certain concerns still remain regarding the ability generally to have a foreign judgment reliably recognised in Vietnam. Before discussing these improvements and remaining concerns, we first take a look at the framework for recognition and enforcement of foreign judgments as set forth in Vietnam s Civil Procedure Code. What foreign judgments can be recognised and enforced in Vietnam? Under the Civil Procedure Code, the following foreign judgments can be recognised and enforced in Vietnam: (i) (ii) judgments of a country which is a party to a relevant international treaty of which Vietnam is also a party; and foreign judgments which are permitted by the laws of Vietnam to be recognised and enforced. If there were only these two grounds, the door would be shut for many foreign judgments to be recognised here. In relation to the first ground, Vietnam is not a party to any multilateral treaty specifically dealing with recognition and enforcement of foreign judgments. While Vietnam has signed several bilateral treaties on judicial assistance, which cover among others recognition and enforcement of foreign judgments, other than China and France, all signatories are from the former socialist bloc countries. In relation to the second ground, we are not aware of any provision under Vietnamese law specifically permitting any type of foreign judgments to be recognised and enforced. However, the Civil Procedure Code also provides a more general ground for recognition which is that a foreign judgment may be recognised and enforced in Vietnam on a reciprocal basis without satisfying the condition that Vietnam and the relevant country are parties of a relevant international treaty. It appears that this was the ground relied on in the case of the South Korean judgment. What are non-recognition grounds? The Civil Procedure Code also sets out the following (interestingly, more numerous) grounds for non-recognition of foreign judgments: (i) (ii) (iii) (iv) the foreign judgement is not yet legally enforceable in accordance with the laws of the country where the judgment is made; the judgment debtor, or his/her legal representative, was absent from the trial of the foreign court because such person was not properly summoned; the case falls under the exclusive jurisdiction of the Vietnamese courts; the case has been resolved by a legally enforceable judgment or decision of a Vietnamese court or of a foreign court which has been recognized by the court of Vietnam, or before the foreign tribunal had accepted jurisdiction to resolve the case, the court of Vietnam had already accepted jurisdiction and is resolving such case;

21 (v) (vi) Page 19 the statutory limitation for enforcement of the judgement has expired in accordance with the laws of the country where the judgment was made or in accordance with the laws of Vietnam; and the recognition and enforcement in Vietnam of the judgement would be contrary to the basic principles of the laws of Vietnam. Like the rules applicable to recognition and enforcement of foreign arbitral awards, the grounds for non-recognition of foreign judgments also encompass a broad concept of the basic principles of the laws of Vietnam'. Good precedent The courts in the South Korean judgment case made several strides in the right direction. First, neither the Ho Chi Minh City court nor the Supreme Court reviewed the merits and the facts of the case. This may be one of the biggest concerns about the practice of recognising foreign arbitral awards and foreign judgments by Vietnamese courts. In our August VLU, we analysed the Tyco case in which the Supreme Court reviewed the merits and facts of the case and refused to recognise a foreign arbitral award. That is not what happened in this case. The Ho Chi Minh City court and the Supreme Court only compared the South Korean judgment against the nonrecognition grounds set out in the Civil Procedure Code and did not go into the substance of the case. Secondly, this case may be the first where a foreign judgment was recognised on the reciprocal basis. As such, this could relieve the concern that Vietnamese courts will only recognise judgments made in countries with which Vietnam has signed a relevant treaty on recognition and enforcement of civil judgments. What concerns still remain? Despite the above, whether this case has made a real leap forward in the practice of recognition and enforcement of foreign judgments in Vietnam remains in doubt. Firstly, so long as the broad concept of the basic principles of Vietnamese laws remains in place as a grounds for nonrecognition, uncertainties will remain as to how a Vietnamese court may interpret and apply this concept. Secondly, even with a recognised judgment in hand, a long, and in no way less difficult, road of enforcement still lies ahead. Due to a cumbersome, bureaucratic and inefficient system of enforcement of civil judgments, it often takes one to two years for a domestic judgment to be enforced. The same destiny almost certainly awaits a recognised foreign judgment. Moreover, while both the current Ordinance on Enforcement of Civil Judgments and the new Law on Enforcement of Civil Judgments (effective 1 July 2009) grant a recognised foreign judgment the same legal validity as a domestic judgment, they do not set specific rules for the enforcement of recognised foreign judgments. As such, further guidance and clarification will be needed for issues specific to enforcement of a recognised foreign judgment, such as remittance of money overseas.

22 Page 20 Part 4 What s New Online? Subject categories and new laws in Vietnam Laws online database Vietnam Laws online database on is an online searchable database of English translations of more than 3,500 Vietnamese laws relating to foreign investment and far beyond. Subscribers can search for legislation by subject category, keyword, date, issuing body, official number, legislation type, or advanced option. Translations can be viewed online, and also printed and downloaded (subject to terms and conditions). Laws recently uploaded on the Vietnam Laws online database include the following: Law 27 on Special Sales Tax (effective 1 April 2009), 14 November Resolution 27 with legislative program for year 2009, 15 November Decision 107 amending import duty on Portland cement and various other products, 18 November Decision 108 on trading unlisted public company shares on Hanoi Securities Trading Centre, 20 November Circular 14 on manufacturing and trading tobacco, 25 November Letter on public offerings and private share placements, 26 November Decision 109 fixing 0% export duty on wood and wooden products, 28 November Decision 110 increasing import duty on gasoline, aviation fuel and other oils, 1 December Decree 121 on investment in the post and telecom sector, 3 December Decision 2948 reducing the basic interest rate from 11% to 10%, 3 December Decision 2949 reducing the State Bank refinancing interest rate from 12% to 11%, the discount interest rate from 10% to 9%, and the overnight lending interest rate from 12% to 11%, 3 December Decision 2950 reducing the interest rate from 10% to 9% payable to banks on their compulsory reserves for VND deposits, 3 December Decision 2951 reducing some compulsory reserve ratios of banks, 3 December Draft 4 Law on Advertising, 5 December Circular 16 with import tariff quota volumes for year 2009, 9 December Decision 117 increasing import duty on gasoline, diesel and other fuels from 5% to 40%, 10 December Decree 127 on job loss insurance, 12 December The list above is merely a recent snapshot of the wide range of new legislation now uploaded and available on Vietnam Laws online through December To view all laws uploaded, please visit Search function for Vietnam Legal Update We are pleased to advise that we have completed the merger of the prior Phillips Fox VLU database into the current Allens one. As such, readers may now find all back issues of the VLU from 1997 to the present, at There are two pages to the website's section on the VLU: Monthly VLU (for issues from April 2007) Monthly VLU Archive (for issues prior to April 2007, back to September 1997)

23 Page 21 Part 5 Get To Know Us Allens' in-country Vietnam lawyers hail from Australia, the United States, Finland and of course, Vietnam, with our total number now standing at a strong 25. In this section of the VLU, we spotlight a different lawyer from our Hanoi or our Ho Chi Minh City office each month to enable readers to get to know us a little bit better. This month, our featured lawyer is Andrew Hilton from our Ho Chi Minh City office. Andrew began working with Allens' Ho Chi Minh City office in mid-2007 as a Senior Associate. He formerly managed the practice of another foreign law firm in Vietnam and has had almost ten years experience as a lawyer here. He also worked as a foreign lawyer in Indonesia for more than three years. Andrew has carried out post-graduate study in Japan, lived there for five years and is fluent in Japanese. Andrew specialises in M&A work, company establishment and property development. In addition to transactional work, Andrew provides legal advice and prepares documentation for foreign invested projects in the areas of manufacturing, infrastructure, technology transfer agreements, management and service agreements, trade, foreign exchange and construction. In his spare time Andrew swims, reads and eats tapas. Quote from the source: Change is inevitable except from a vending machine. To all readers: Please note that Vietnam Posts and Telecommunications Group (VNPT) have changed all telephone and fax numbers in Hanoi and Ho Chi Minh City by adding a '3' at the beginning of the current numbers. Please note our new telephone and fax numbers for your records. Hanoi office: Tel: Fax: HCMC office: Tel: Fax: