Vietlaw Weekly Newsletter No. 357
The maximum fine level in the fields of accounting and independent audit shall be increased to VND 100,000,000
Decree No. 41/2018/ND-CP dated March 12th, 2018 of the Government on penalties for administrative violations in the fields of accounting and independent audit
In comparison with the earlier regulations, this Decree increases the maximum fine level in the fields of accounting and independent audit, from VND 30,000,000 to VND 50,000,000 (imposed on an individual) and from VND 60,000,000 to VND 100,000,000 (imposed on an organization).
With regard to specific fine levels, this Decree increases fine levels imposed on violations of misapplication of regulations on letters and numbers in accounting, monetary units, accounting periods from a fine ranging from VND 5,000,000 to VND 10,000.000 to a fine ranging from VND 10,000,000 to VND 20,000,000; Forging financial statements: a fine ranging from VND 20,000,000 to VND 30,000,000 shall be increased to a fine ranging from VND 40,000,000 to VND 50,000,000
In addition, this Decree also adds fines on other violations as follows:
- Misapplication of applicable accounting regulations: A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed.
- Red or faded signatures on accounting records; Using signature stamps on accounting records, Expense records do not have signatures on all copies: A fine ranging from VND 3.000.000 to VND 5,000,000 shall be imposed.
- Failure to translate accounting records in foreign language to Vietnamese: a fine ranging from VND 5,000,000 to VND 10,000,000 shall be imposed.
- The financial statement is not made in accordance with the standard form: A fine ranging from VND 5,000,000 to VND 10,000,000 shall be imposed
This Decree takes effect from May 1st, 2018 and replaces Decree No. 105/2013/ND-CP dated September 16th, 2013.
ND41_12032018CP[ENGLISH].pdf (English translation)
Inquiries about import and export duties
Dispatch No. 7599/TCHQ-TXNK dated November 20th, 2017 of the General Department of Customs on implementing Law on Import and Export Duties, Decree No. 134/2016/ND-CP
Similar to Official letter No. 11567/TCHQ-TXNK dated December 8th, 2016, the document also attaches inquiries about policies on import and export duties as regulated in Law No. 107/2016/QH13 and Decree No. 134/2016/ND-CP. Accordingly, there are some noticeable issues as follows:
- If a material imported for producing goods for export is eligible for import duty exemption, it shall be also eligible for exemption from anti-dumping duty, countervailing duty, and safeguard duty.
- There is not policy on exemption from or refund of environment protection tax on materials imported for processing, manufacturing products for export.
- Imported materials for processing which are transferred between processing agreements shall be also exempt from import duty but it is required to declare procedures for import and export on the spot.
- Refuses, scrap, redundant raw materials and supplies imported for processing which are sold domestically not exceed 3% of the quantity of each type shall be only exempt from import duty and they are still subject to such taxes as value added tax, excise tax and environment protection tax.
- There is not policy on refund of import duty on products processed outside Vietnam upon the re-importation.
- Refuses, scrap and redundant materials, supplies exported to return to the supplier or a third party appointed by the supplier, shall be exempt from export duties.
- Domestic materials and supplies constituting the exported processed products, upon the exportation, shall be subject to export duty according to duty rates applicable to such materials and supplies.
CV7599_20112017TCHQ[ENGLISH].pdf (English translation)
Regarding FDI enterprises’ import and export rights
Official letter No. 1282/GSQL-GQ2 dated May 4th, 2018 of the General Department of Vietnam Customs regarding performance of import and export rights
According to Clause 1 Article 5 of Decree No. 09/2018/ND-CP, from January 15th, 2018, foreign direct investment (FDI) enterprises must not apply for licensing the import and export rights.
However, FDI enterprises are only allowed to exercise the rights to import, export after they register to perform these activities in accordance with the Law on investment, the Law on enterprises.
Accordingly, if in the certificate of registration for investment and related documentation does not have contents about FDI enterprises are allowed to export and import goods, it is required to register to supplement these activities before performance.
CV1282_04052018TCHQ[VLO].pdf (English translation)
New regulations on grant of loans to credit institutions placed under special control
Circular No. 01/2018/TT-NHNN dated January 26th, 2018 of the State Bank on providing for grant of loans to credit institutions placed under special control
One of the new points of this Circular is that banks that are placed under special control shall be additionally allowed to borrow special loans from the Deposit Insurance of Vietnam and The Cooperative Bank of Vietnam. Under the earlier regulations, they were only allowed to borrow special loans from the State Bank of Vietnam (SBV) and other commercial banks.
In addition, according to Article 5 of this Circular, The SBV may grant loans with a preferential interest rate as low as 0% to banks that are placed under special control for the purpose of supporting the recovery of such banks under the recovery plan approved. However, the grant of loans with a preferential interest rate as low as 0% must be approved by the Prime Minister.
Regarding currency unit used in extending special loans, Article 2 of this Circular specifies that currency unit used in extending special loans is only Vietnamese dong (VND).
This Circular takes effect from January 29th, 2018 and replaces Circular No. 06/2012/TT-NHNN dated March 16th, 2012.
TT01_26012018NHNNVN[ENGLISH].pdf (English translation)
Regarding the Government’s regular meeting - February 2018
Resolution No. 13/NQ-CP dated February 8th, 2018 of the Government on the Government’s regular meeting - January 2018
Under this Resolution, the Government shall continue to identify 2018 to be year of business cost reduction, including lowering interest rates and fees, especially freight and logistics fees
Regarding the pilot manpower export, the Government unanimously agreed with the proposal of the Ministry of Labor, Invalids and Social Affairs to allow the pilot manpower export to the Republic of Korea under cooperation agreements between localities of the two countries for a definite term of 02 years from January 1st, 2018.
NQ13_08022018CP[EN].pdf (English translation)
Regarding the Government’s regular meeting in December 2017
Resolution No. 138/NQ-CP dated December 31st, 2017 of the Government on the Government’s regular meeting in December 2017
At the regular meeting in December 2017, the Government requested Ministries, agencies and localities to continue improving the mechanisms and policies on investment and support to small- and medium-sized enterprises.
In which, especially, to focus on the comprehensive reform of specialized inspection activities so as to ensure to cut and simplify by 50% of the list of goods, products and specialized inspection procedures, cut and simplify by 50% of business investment conditions.
NQ138_31122017CP[EN].pdf (English translation)
Certificate of Origin (C/O)
HS code on C/O may be different from that on customs declaration
Official letter No. 540/GSQL-GQ4 dated March 5th, 2018 of the General Department of Vietnam Customs regarding issue relating to certificate of origin (C/O) form E
According to Article 26 of Circular No. 38/2015/TT-BTC , if differences between HS code, name of goods on C/O and those on the customs declaration do not affect nature of the imports, such C/O’s validity may be accepted.
However, if the customs authority has grounds to determine that the imports on the C/O are not the imports as declared, such C/O shall be rejected.
CV540_05032018TCHQ[VLO].pdf (English translation)
Duties on raw materials imported for export production which are transferred to other establishments for processing or destroyed shall be exempt
Official letter No. 4765/VPCP-KSTT dated May 22nd, 2018 of the Government Office regarding removal of troubles, problems with enterprises in tax and customs sectors
Aiming to remove difficulties for enterprises in the tax and customs sectors, the Prime Minister requested the Ministry of Finance to promptly amend or propose amendments to these contents in quarter III 2018:
1. To propose the amendments to Article 12 of Decree No. 134/2016/ND-CP in the manner of exemption from import duty on raw materials which are transferred to other production establishments for processing and goods imported for production of goods for export which are destroyed on the basis of equality between the forms of export production and processing.
2. To promulgate a Circular to amend Circulars regulating charges and fees in the work of animal health, fishing activities and management of foods safety in the manner of reducing costs for enterprises.
3. To complete Vietnam's list of imports and exports 2018 issued together with Circular No. 65/2017/TT-BTC in order to create the uniformity, transparency and limit negative issues in imposition of HS codes.
4. To settle problems with Container Imbalance Charge (CIC), delivery order (DO) fee, and container cleaning charges regulated in Official letter No. 1237/TCHQ-TXNK dated March 8th, 2018 in order to ensure the conformity with competence, legal bases and actual situation.
CV4765_22052018VPCP[VLO].pdf (English translation)
Regarding import duty on charges for issuance of ordinary C/O
Official letter No. 2534/TXNK-TGHQ dated May 18th, 2018 of the General Department of Vietnam Customs regarding customs value
Regarding issue relating to whether charges for issuance of ordinary C/O are added to customs value or not, the General Department of Vietnam Customs requests enterprises to base on actual dossier and compare it with the following regulations to carry out:
- Article 5, Article 6 of Circular No. 39/2015/TT-BTC regulating bases for determination of customs value of imports.
- Clause 1 Article 13 of Circular No. 39/2015/TT-BTC regulating conditions for addition to customs value of imports.
- Clause 2 Article 13 of Circular No. 39/2015/TT-BTC regulating charges which must be added to customs value.
In the case remaining problems, enterprises should contact with customs office where the customs declaration is registered for having guidelines in details.
CV2534_18052018TCHQ[VLO].pdf (English translation)
Regarding goods imported for production of goods for export
Official letter No. 2499/TXNK-CST dated May 17th, 2018 of the General Department of Vietnam Customs regarding goods imported for production of goods for export
In case a company imports raw materials, supplies for production of goods for export but it sells products to other enterprises for further production and export, it fails to meet the conditions for duty exemption, duty refund for raw materials according to Article 12, Article 36 of Decree No. 134/2016/ND-CP.
CV2499_17052018TCHQ[VLO].pdf (English translation)
Goods on which taxes are guaranteed shall be subject to late payment interest
Official letter No. 2175/TXNK-CST dated May 3rd, 2018 of the General Department of Vietnam Customs regarding tax guarantee and VAT cancellation
According to Clause 1 Article 9 of the Law on import and export duties No. 107/2016/QH13, for goods subject to taxes as prescribed by laws on tax, if enterprises fail to pay taxes (including VAT) before customs clearance or release, it is required to have the guarantee of a credit institution. The guarantee period shall not exceed 30 days from the day on which the customs declaration is registered.
As the result, in case enterprises apply tax guarantee when they import goods concurrently re-export the goods within the guarantee period, payable tax arrears is not arisen when the guarantee period expires but late payment interest must be paid as from the date of customs clearance or release to the date on which the goods are re-exported.
CV2175_03052018TCHQ[VLO].pdf (English translation)
Regarding EIT incentives for project of expansion investment
Official letter No. 24758/CT-TTHT dated April 27th, 2018 of the Department of Taxation of Ha Noi city regarding enterprise income tax (EIT) incentives for projects invested in industrials parks
According to opinions of the Department of Taxation of Ha Noi city, in case a company establishes a branch in an industrial park in a locality other than the place where its head office is located in order to perform some phases of the production of semi-products which then will be transferred to the company in order to produce finished products for sale. The branch is a dependent accounting unit and it is impossible to make separate accounting for revenue, the project on establishment of this branch is regarded as the project of expansion investment.
If the project meets one of the criteria for a project of expansion investment as regulated in Clause 4 Article 10 of Circular No. 96/2015/TT-BTC , the company is optional to enjoy EIT incentives according to this Clause.
CV24758_27042018CTHN[VLO].pdf (English translation)
Conditions for receipt of funding for equipment of environmental protection projects
Circular No. 12/2017/TT-BTC dated February 10th, 2017 of the Ministry of Finance guidance on the procedures for provision of funding for equipment of environmental protection projects
This Circular guides the procedures for provision of funding for environmental protection projects that apply inventions under the protection of the government in the form of issuing the Patent for Inventions or Patent for Utility Solution as specified in Clause 3, Article 42 of Decree No. 19/2015/ND-CP .
Accordingly, in order to be eligible to receive funding, the aforesaid projects must fully meet these conditions (Clause 2 Article 2):
- Projects must be run in accordance with provisions in Clause 11 Appendix III, Decree No. 19/2015/ND-CP ;
- Projects must be launched, evaluated, approved or granted the Investment Registration Certificate;
- Projects have completed, commissioned and have a financial statement;
- Project have undergone test run and fulfills all conditions for normal operation;
Level of funding shall be equal to 10% of the total capital invested in equipment of an environmental protection project (Clause 3 Article 2). Funding for a project shall be a lump-sum and non-repayable grant (Article 5).
Funding body is Viet Nam Environmental Protection Fund (VEPF) (affiliated to the Ministry of Natural Resources and Environment (MONRE).
This circular takes effect from March 27th, 2017.
TT12_10022017BTC[ENGLISH].pdf (English translation)
Regarding duties and customs procedures when an FDI enterprise buys goods of an EPE to export
Official letter No. 2765/TCHQ-TXNK dated May 21st, 2018 of the General Department of Vietnam Customs regarding guidelines on laws on duties and customs procedures applicable to export processing enterprises (EPEs)
In case a foreign direct investment (FDI) enterprise buys goods from an EPE to export abroad, the customs declaration and tax policies shall be carried out as follows:
1. If in the contract signed with the EPE has agreement according to which the FDI enterprise will not carry out procedures to receive the goods but it designates the EPE to present the EPE’s name on the custom declaration and directly export the goods to foreign trader under designation.
- Customs procedures: When the EPE carries out procedures to export goods to the foreign trader, it shall declare information entries according to the guidelines in Annex II of Circular No. 38/2015/TT-BTC . In which, at the exporter entry, name of the EPE shall be declared and name of the FDI enterprise designating the export shall be declared at the remark entry.
- Tax policies: Goods exported abroad from an EPE shall not be subject to export duty and entitled to apply 0% VAT.
2. If the FDI enterprise receives the goods from the EPE then directly exports the goods to the foreign trader but it designates the EPE to deliver the goods at exporting checkpoint
- Customs procedures: Upon buying the goods, the FDI enterprise and the EPE shall carry out customs procedures for import, export on the spot according to Clause 3 Article 75 of Circular No. 38/2015/TT-BTC . Upon shelling the goods, the FDI enterprise shall carry out customs procedures similar to procedures for exporting goods for sale
- Tax policies: The FDI enterprise has to pay import duty, value added tax when it buys goods from the EPE and shall be entitled received the refunds when the goods are exported abroad for sale.
CV2765_21052018TCHQ[VLO].pdf (English translation)
Regulations on installation and use of vessel automatic identification information
Circular No. 17/2018/TT-BGTVT dated April 9th, 2018 of the Ministry of Transport on management and use of vessel automatic identification information
This Circular provides for management and use of automatic identification information about vessels that are required to be fitted with AIS equipment and operate within seaport waters, coastal transport routes, waterway routes from shore to island, port waters, landing stages and inland waterways that are located within the AIS base station coverage area.
“AIS” stands for Automatic Identification System. The system includes the following basic components:
- AIS equipment, a technical component that is fitted on vessels and has the ability to receive and transmit AIS messages;
- AIS base station, a shore-based technical component that has the ability to receive AIS messages from AIS equipment; process, temporarily store and transmit such messages to AIS data center; transmit information to AIS equipment (if any);
- AIS data center, a shore-based technical component that has the ability to receive AIS messages from AIS base stations; store, process and provide AIS information for users over the Internet.
In which, AIS message means the encrypted information provided by AIS equipment. An AIS message includes vessel identification code, vessel name, IMO number (if any), call sign (if any), vessel type, vessel dimensions (length, width), position, speed and course.
AIS information is used to serve safety assurance, accident investigation, search and rescue, penalties for administrative violations of regulations on sea and inland waterway.
AIS equipment shall be operated on a 24/7 basis.
This Circular takes effect from July 1st, 2018.
TT17_09042018BGTVT[ENGLISH].pdf (English translation)
Regarding the Government’s regular meeting in November 2017
Resolution No. 131/NQ-CP dated December 6th, 2017 of the Government on the Government’s regular meeting in November 2017
At the regular meeting in November 2017, the Government requested Ministries, agencies and localities to continue effective implementation of the tasks and solutions to improve the business environment in the spirit of the Government's Resolution No. 19/NQ-CP and 35/NQ-CP and the Prime Minister's Directive No. 26/CT-TTg. Especially, to accelerate provision of e-services in business registration.
With regard to medical sector, the Government agreed to postpone the time for issuance and enforcement of circulation number of medical devices Categories B, C and D until January 1st, 2019.
NQ131_06122017CP[EN].pdf (English translation)
Pharmaceutical - Cosmetics
New regulations on certifying drugstores meeting GPP standards
Circular No. 02/2018/TT-BYT dated January 22nd, 2018 of the Ministry of Health on good pharmacy practices
“Good Pharmacy Practice” standards (GPP standards) issued together with this Circular shall replace the GPP standards issued together with Circular No. 46/2011/TT-BYT .
In comparison with the earlier GPP standards, these standards also apply to dispensaries and drug dispensing counters instead of only apply to drugstores.
In which, GPP standards for drugstores are specified in Annex I – 1a; GPP standards for dispensaries are specified in Annex I – 1b and GPP standards for drug dispensing counters are specified in Annex I – 1c.
A pharmacy may apply for both GPP Certificate and Certificate of eligibility for pharmacy business at the same time.
This Circular takes effect from March 8th, 2018 and replaces Circular No. 46/2011/TT-BYT dated December 21st, 2011.
TT02_22012018BYT[ENGLISH].pdf (English translation)
New regulations on online securities transaction
Circular No. 134/2017/TT-BTC dated December 19th, 2017 of the Ministry of Finance on providing guidelines for e-transactions on securities market
This Circular regulates requirements for securities companies to provide online securities transaction services
Accordingly, one of the new points of this Circular is the supplementation of securities companies that are banned from providing online securities transaction: companies that are under dissolution or bankruptcy process, terminated brokerage operation, terminated operation.
Regarding requirements for provision of online securities transaction services, there are some changes such as: Online securities transaction system shall be equipped with a dedicated server. Personal computer shall not be used as a server and it is not allowed to share other units or companies’ servers, etc.
Regarding online securities transaction software system, cyberinformation security risk to online securities transaction system shall be assessed once a year.
This Circular takes effect from March 1st, 2018 and replaces Circular No. 87/2013/TT-BTC dated June 28th, 2013.
TT134_19122017BTC[ENGLISH].pdf (English translation)
State Capital Investment
New regulations on investment in the form of PPP
Decree No. 63/2018/ND-CP dated May 4th, 2018 of the Government on the investment in the form of Public-Private Partnerships
This Decree sets forth sectors, requirements, and procedures for investment in form of Public-Private Partnerships (PPP).
“PPP” (Public-Private Partnerships) means any form of investment on the basis of a contract between a regulatory agency and an investor, a special purpose entity to build, innovate, operate and manage infrastructure and public service project.
This Decree takes effect from June 19th, 2018 and replaces Decree No. 15/2015/ND-CP dated February 14th, 2015.
The regulations on project investment proposal in PPP projects in Articles 10, 17, 19, 24, and 33 of Decree No. 136/2015/ND-CP dated December 25, 2015 shall be annulled
ND63_04052018CP[ENGLISH].pdf (English translation)
From May 1st, 2018: Interconnection charges for voice calls from local network to mobile network shall be reduced
Circular No. 48/2017/TT-BTTTT dated December 29th, 2017 of the Ministry of Information and Communications on interconnection charges for voice calls from local terrestrial stationary telecommunications network to national terrestrial mobile network and interconnection charges for voice calls between two national terrestrial mobile networks
From May 1st, 2018, interconnection charges for voice calls between two mobile networks shall be reduced from VND 500 - 550 per minute to VND 400 - 440 per minute
Interconnection charge for a voice call from a local network to a terminating mobile network is also reduced from VND 415 per minute to VND 320 per minute.
This Circular takes effect from May 1st, 2018 and replaces Circular No. 29/2009/TT-BTTTT dated November 19th, 2009 and Circular No. 33/2009/TT-BTTTT dated November 19th, 2009.
TT48_29122017BTTTT[ENGLISH].pdf (English translation)
Promulgation of National technical regulation on Electromagnetic Compatibility for fixed radio links and ancillary equipment
Circular No. 28/2017/TT-BTTTT dated November 7th, 2017 of the Ministry of Information and Communications on promulgating the "National technical regulation on Electromagnetic Compatibility (EMC) for fixed radio links and ancillary equipment”
This Circular is to promulgate National technical regulation on Electromagnetic Compatibility for fixed radio links and ancillary equipment, QCVN 114:2017/BTTTT.
This Circular takes effect from July 1st, 2018.
TT28_07112017BTTTT[EN].pdf (English translation)
National technical regulation on Electromagnetic Compatibility for fixed radio links and ancillary equipment
National technical regulation QCVN 114:2017/BTTTT dated November 7th, 2017 of the Ministry of Information and Communications on electromagnetic compatibility (EMC) for fixed radio links and ancillary equipment
This standard specifies the requirements for electromagnetic compatibility (EMC) for fixed radio links and ancillary equipment in fixed profession.
Technical specifications related to the antenna port of the radio device are not covered by this regulation. Technical specifications are specified in the respective product standards for effective use of frequency spectrum.
This regulation specifies test conditions, specification evaluation, quality criteria for fixed radio transmission equipment and ancillary equipment in the similar fixed profession and digital profession as the system of point-to-point, point-to-fixed multipoint.
This regulation is promulgated together with Circular No. 28/2017/TT-BTTTT dated November 7th, 2017, which takes effect from July 1st, 2018.
QCVN114_07112017BTTTT[EN].pdf (English translation)
Promulgation of National Technical regulation on Mobile Satellite Earth Station operating in the Ku band
Circular No. 29/2017/TT-BTTTT dated November 7th, 2017 of the Ministry of Information and Communications on promulgating the "National Technical regulation on Mobile Satellite Earth Station (MES) operating in the Ku band"
This Circular is to promulgate the National Technical regulation on Mobile Satellite Earth Station operating in the Ku band, QCVN 116:2017/BTTTT
This Circular takes effect from July 1st, 2018.
TT29_07112017BTTTT[EN].pdf (English translation)
National Technical regulation on Mobile Satellite Earth Station operating in the Ku band
National Technical regulation QCVN 116:2017/BTTTT dated November 7th, 2017 of the Ministry of Information and Communications on Mobile Satellite Earth Station (MES) operating in the Ku band
This regulation specifies the radio spectrum requirements for mobile satellite earth station (mobile earth station) (MES), except for air mobile earth stations operating in the Ku band.
This regulation is promulgated together with Circular No. 29/2017/TT-BTTTT dated November 7th, 2017, which takes effect from July 1st, 2018.
QCVN116_07112017BTTTT[EN].pdf (English translation)
New regulations on tourism business
Decree No. 168/2017/ND-CP dated December 31st, 2017 of the Government on elaboration of some articles of the Law on Tourism
This Decree regulates in details categorization of tourism resources; measures for keeping tourists safe; recognition of a tourist attraction or tourism area; deposit payment by travel service providers; issuance, replacement, reissuance and revocation of badges for means of tourist transport and mandatory requirements of a tourist accommodation establishment.
One of the new points of this Decree is the supplementation of business conditions for tourism products that may threaten tourists’ health and life (Chapter III).
Accordingly, upon providing one of these services: paragliding, ballooning; parachuting; high ropes course, mountain climbing, rock climbing; waterfall rope swing, etc. traders of tourism products must send written notice to the Department of Tourism or the Department of Culture, Sports and Tourism in order to organize the inspection of conditions for assurance of safety of tourists as regulated in Article 9.
In addition, according the new regulations, domestic travel service providers have to deposit VND 100,000,000. Under the earlier regulations, only international travel service PROVIDERS are subject to the deposit payment
This Decree takes effect from January 1st, 2018 and replaces Decree No. 92/2007/ND-CP dated June 1st, 2007; Decree No. 180/2013/ND-CP dated November 14th, 2013; Clause 4 Article 2 of Decree No. 01/2012/ND-CP dated January 4th, 2012.
ND168_31122017CP[ENGLISH].pdf (English translation)
Regulations on vocational education accreditation
Decree No. 49/2018/ND-CP dated March 30th, 2018 of the Government on vocational education accreditation
This Decree provides for vocational education accreditation, including:
- Conditions and procedures for issuance, reissuance and revocation of the certificate of eligibility for vocational education; suspension of vocational education accreditation; functions, tasks, responsibilities and entitlements of vocational education accreditation organizations.
- Standards applied to, tasks and entitlements of vocational education accreditors; issuance, reissuance and revocation of the vocational education accreditor card;
- Issuance and revocation of the certificate of conformity with vocational education accreditation standards;
Accordingly, an applicant for the certificate of eligibility for vocational education accreditation may be a domestic organization, enterprise or a foreign one.
However, it is required to meet the conditions specified in Article 4 of this Decree such as: having a stable office for at least 2 years; having at least 10 accreditors, having its own website. For foreign organization, it have engaged in education, vocational education, education accreditation or vocational education accreditation for at least 5 consecutive years.
This Decree takes effect from May 15th, 2018.