Vietlaw Weekly Newsletter No. 377
Regarding handling of administrative violations in management of construction solid waste
Official letter No. 12/BXD-TTr dated July 17th, 2018 of the Ministry of Construction regarding guidelines on handling administrative violations in management of construction solid waste
According to opinions of the Ministry of Construction, the sanction on administrative violations against regulations on management of construction solid waste in general and the act of dumping of construction solid waste not at prescribed places in particular have been regulated, as the result, there are full legal grounds to impose sanction, in particular at these provisions:
- Article 20 of Decree No. 155/2016/ND-CP on penalties for administrative violations against regulations on environmental protection;
- Article 27 of Decree No. 46/2016/ND-CP on penalties for administrative violations against regulations on transport of waste and vehicles transporting waste;
- Clause 1 Article 15; Clause 1 Article 30; Point c Clause 1, point c Clause 2 Article 41; Clause 1 Article 42; Clause 1 Article 44; Clause 1 Article 46, of Decree No. 139/2017/ND-CP on penalties for some violations against regulations on dumping of construction waste.
Regarding cases in which capital contribution, purchase of shares are required to be registered
Official letter No. 5507/BKHDT-PC dated August 13th, 2018 of the Ministry of Planning and Investment regarding guidelines on some issues relating to the Law on investment and the Law on enterprises
According to Article 26 of Law on Investment No. 67/2014/QH13 , investors have to carry out procedures for registration of the capital contribution to, or purchase of shares/capital contributions of, business organizations with regard to the cases mentioned in Clause 1 of this Article.
With regard to other cases, investors shall only follow procedures for changing shareholders/members as prescribed by laws. However, investors are still allowed to register the capital contribution or purchase of shares/capital contributions, depending on their demand.
CV5507_13082018BKHDT[VLO].pdf (English translation)
New regulations on banks’ obligations to protect confidentiality of client information
Decree No. 117/2018/ND-CP dated September 11th, 2018 of the Government on protection of confidentiality and provision of client information of credit institutions and foreign banks’ branches
“client information” regulated in this Decree includes client identification information, account information (full name, date of birth, job, etc.) account information, deposit information, property information, transaction information and information about organizations and individuals that are guarantors and other relevant information.
Accordingly, Article 4 of this Decree prohibits banks from providing client’s authentication information upon access to banking services, including client’s secret key, biometric data, access password and client’s authentication information to any entity, organization or individual unless such provision is authorized in writing by that client or in any other form as agreed upon.
Client information must be protected confidentially. The provision of client information for other state agencies, organizations or individuals is only allowed with regard to cases regulated in details by regulations of laws or having the written authorizations of such client.
Every bank must promulgate its internal regulation on protection of confidentiality, storage and provision of client information in accordance with the regulations of this Decree.
This Decree takes effect from November 1st, 2018 and replaces Decree No. 70/2000/ND-CP dated November 21st, 2000.
ND117_11092018CP[ENGLISH].pdf (English translation)
New procedures for approval of managing personnel of banks
Circular No. 22/2018/TT-NHNN dated September 5th, 2018 of the State Bank on guidelines for procedures and application for approval for provisional lists of personnel of commercial banks, non-bank credit institutions and foreign banks’ branches
This Circular provides for procedures and application for approval for provisional lists of elected or appointed members of the Board of Directors, members of Board of Members, members of Board of Controllers or Director General (Director) at banks, foreign banks’ branches.
Accordingly, personnel expected to be appointed to become a member of the Board of Directors, member of Board of Members, member of Board of Controllers or Director General (Director) at banks must obtain the written approval of the State Bank of Vietnam’s Governor.
Each written approval of the State Bank of Vietnam’s Governor shall remain valid within 06 months from the date on which it is signed. After the effective period, if the election or appointment of personnel of banks fails to be completed, the written approval will become automatically null and void.
This Circular takes effect from November 1st, 2018
These regulations shall be abolished:
a) Section 3 Chapter II; Article 21; Clause 1, Clause 2 Article 43; Article 44; the regulations on approval for personnel specified in Articles 16, 46, 47, 48, 49, 50 and 51 of Circular No. 06/2010/TT-NHNN dated February 26th, 2010;
b) The regulations on approval for personnel specified in Section II Part III; Section III Part III of Circular No. 03/2007/TT-NHNN dated June 5th, 2007;
c) Decision No. 516/2003/QD-NHNN dated May 26th, 2003 and Decision No. 14/2006/QD-NHNN dated April 4th, 2006.
TT22_05092018NHNN[ENGLISH].pdf (English translation)
Some issue relating to a bid dossier
Official letter No. 6756/BKHDT-QLDT dated September 26th, 2018 of the Ministry of Planning and Investment regarding guidelines on implementation of bidding - related legislation
According to the guidelines at Circular No. 03/2015/TT-BKHĐT, upon participating in the bidding, the contractor has to declare key personnel and construction equipment in the bid dossier in accordance with requirements of the bidding documents.
If the contractor's bid dossier is not declared enough key personnel, construction equipment in accordance with the requirements of the bidding documents, there is not ground to evaluate such contents.
With regard to the bid solicitor, it should note that, upon offering requirements for key personal and machinery, equipment, it is not allowed to require manual workers or require many types of unnecessary machinery in the bidding documents.
CV6756_26092018BKHDT[VLO].pdf (English translation)
Certificate of Origin (C/O)
Regarding difference between HS code on C/O and that on customs declaration
Official letter No. 2924/GSQL-GQ4 dated September 18th, 2018 of the General Department of Vietnam Customs regarding difference between HS codes
According to Article 26 of Circular No. 38/2015/TT-BTC , customs authorities shall base on declared information about name of goods, HS code, goods description declared on the customs declaration, C/O, documents included in the customs documentation, results of physical inspection of goods (if any) in order to determine the C/O’s validity.
In case HS code on the C/O is different from that on the customs declaration, according to point h Clause 6 Article 15 of Circular No. 38/2018/TT-BTC, if such difference does not change the origin of goods and goods actually imported are consistent with the description of goods declared on the C/O, the C/O shall be still accepted.
"The origin of goods" mentioned at the aforesaid point means that the goods must meet the rules of origin as prescribed.
CV2924_18092018TCHQ[VLO].pdf (English translation)
Culture - Sports
Conditions for doing business in hotels, dancing-halls, karaoke bars and film production shall be reduced
Decree No. 142/2018/ND-CP dated October 9th, 2018 of the Government on amendments to a number of regulations on business and investment conditions under the scope of management of the Ministry of Culture, Sports and Tourism
This Decree is to remove some business conditions regulated in the following Decrees:
1. Decree No. 98/2010/ND-CP on operation of shops of vestiges, antiques.
2. Decree No. 61/2016/ND-CP on operation of antique examination and practice of relic repair.
3. Decree No. 54/2010/ND-CP on film production business.
4. Decree No. 106/2016/ND-CP on sports business.
5. Decree No. 168/2017/ND-CP on business of hotels and tourist accommodation establishments.
6. Decree No. 79/2012/ND-CP (which has been amended at Decree No. 15/2016/ND-CP) on performances; production of audio and video recordings of art performances.
7. Decree No. 103/2009/ND-CP on dancing - hall and karaoke bar activities, electronic games
Accordingly, with regard to film production business, the legal capital shall be reduced from VND 1 billion (Article 11 of Decree No. 54/2010/ND-CP ) to VND 200 million (Article 3).
With the business of hotels and tourist accommodation establishments, some conditions are also removed such as having electricity and clean water supply system; having manager and staff that must be provided with training in tourism, etc.(Article 5).
With regard to dancing-hall and karaoke bar activities, some conditions relating to planning, light, volume of sound, business location, etc. are removed (Article 7).
This Decree takes effect from the date of its signing.
ND142_09102018CP[VLO].pdf (English translation)
Regulations on management and organization of festivals
Decree No. 110/2018/ND-CP dated August 29th, 2018 of the Government on management and organization of festivals
This Decree provides for requirements and procedures for organization of festivals within the territory of Vietnam, including traditional festival, cultural festival and industry festival.
Accordingly, festivals (including industry festival) organized for the first time at district - level, commune-level or festivals organized by multiple communes must be registered with the People’s Committee of the district before the organization (Clause 3 Article 9).
If festivals are organized for the first time at a province or organized by multiple districts, it is required to register with the People’s Committee of the province before the organization (Clause 2 Article 9)
If festivals are organized by central government authorities for the first time; festivals are organized by at least 02 provinces or festival of foreign origin organized for the first time, it is required to register with the Ministry of Culture, Sports and Tourism (Clause 1 Article 9).
Provincial, district or commune-level traditional festivals, cultural festivals and industry festivals that are annually organized shall be notified to the People’s Committee at the same level before the organization. National or regional cultural festivals and industry festivals and festivals of foreign origin that are annually organized shall be notified to the Ministry of Culture, Sports and Tourism before the organization (Article 14)
This Decree comes into force from October 15th, 2018.
The regulations on festival organization specified in Section 3 Chapter 2 of the Regulation on adoption of civilized lifestyle during weddings, funerals and festivals promulgated with Decision No. 308/2005/QD-TTg dated November 25, 2005; Chapter V of the Regulation on cultural activities and provision of public cultural services promulgated together with Decree No. 103/2009/ND-CP dated November 6th, 2008 are null and void from the effective date of this Decree.
ND110_29082018CP[ENGLISH].pdf (English translation)
Education - Training
Regarding 0% VAT applicable to foreign language overseas study service
Official letter No. 3813/TCT-CS dated October 8th, 2018 of the General Department of Taxation regarding value added tax (VAT) policy
According to opinions of the General Department of Taxation, if service of organization of foreign language overseas study programs meets the conditions on consumption outside Vietnam according to Article 8 of the Law on VAT, it shall be entitled to apply 0% VAT.
CV3813_08102018TCT[VLO].pdf (English translation)
Export processing enterprises
Regarding taxes on goods imported for construction of factories for EPEs
Official letter No. 6010/TCHQ-TXNK dated October 12th, 2018 of the General Department of Vietnam Customs regarding procedures for, and tax policies applicable to, goods used for construction of factories for export processing enterprises (EPEs)
In case a contractor directly imports goods and directly transports them to an EPE for construction of workshops, offices, etc. customs documents shall follow the regulations at Clause 5 Article 1 of Circular No. 39/2018/TT-BTC.
Customs procedures shall be carried out according to Clause 51 Article 1 of Circular No. 39/2018/TT-BTC. In which, it should note that, customs procedures must be carried out at the customs branch managing the EPE and right after the goods are granted the customs clearance, they must be immediately transported to the EPE. In addition, after 30 days from the day on which the contract is completed, the EPE and the contractor have to send a report on quantity of imports to the EPE’s supervisory customs authority.
Goods imported for construction of factories, offices of the EPE shall be exempt from import duty according to Clause 4 Article 2 of Law No. 107/2016/QH13 and shall be also exempt from VAT if the contractor also belongs to a non-tariff zone (Clause 20 Article 4 of Circular No. 219/2013/TT-BTC).
In case the contractor is a domestic enterprise, it is required to declare and pay VAT upon the importation. Upon the exportation, it is entitled to apply 0% VAT and entitled to declare for tax deduction, tax refund according to Article 2 of Circular No. 25/2018/TT-BTC.
CV6010_12102018TCHQ[VLO].pdf (English translation)
Regarding tax upon transfer of dividends from abroad to Vietnam
Official letter No. 3849/TCT-HTQT dated October 10th, 2018 General Department of Taxation regarding tax upon transfer of dividends from abroad to Vietnam
According to Article 2 Article 10 of Circular No. 111/2013/TT-BTC , in case an individual being a resident in Vietnam participates in contributing capital to establish a company outside Vietnam, such individual shall be subject to tax on capital investment at the tax rate of 5%.
In case the individual has paid tax on the dividends at the foreign country and is entitled to deduct the already – paid tax from tax payable in Vietnam, the amount of tax to be deducted must not exceed the tax payable in Vietnam.
CV3849_10102018TCT[VLO].pdf (English translation)
Regarding VAT on revenue collected on behalf of a foreign forwarder
Official letter No. 3685/TCT-CS dated September 28th, 2018 of the General Department of Taxation regarding value added tax (VAT) policy
According to the regulations at point b.1 Clause 1 Article 12 of Circular No. 103/2014/TT-BTC, when agents in Vietnam collect revenue on behalf of a foreign forwarder, VAT- liable revenue is determined as follows: VAT- liable revenue = VAT-exclusive revenue: (1 -Percentage (%) for calculation of VAT upon revenue).
In which, the percentage (%) for calculation of VAT upon revenue with regard to the foreign forwarder shall be determined according to Clause 2 Article 12 of Circular No. 103/2014/TT-BTC.
The making of invoices shall be carried out according to the guidelines in Official letter No. 3479/TCT-CS dated September 25th, 2009.
CV3685_28092018TCT[VLO].pdf (English translation)
Regarding regulation conformity announcement with regard to goods with high risk
Official letter No. 2607/TDC-HCHQ dated September 17th, 2018 of the Ministry of Science and Technology regarding regulation conformity certification and announcement
According to the regulations at Circular No. 02/2017/TT-BKHCN, the requirements for regulation conformity announcement with regard to group - 2 goods and products depends on risky level of each types of goods, product and are regulated in national technical regulations or corresponding legal normative documents, in particular:
- With regard to goods, products with low risky level, the regulation conformity announcement shall be carried out based on results of self-assessment of conformity of organizations, individuals.
- With regard to goods, products with high risky level, the regulation conformity announcement shall be carried out based on results of certification of designated certifying organizations.
- With regard to goods, products other than the 2 cases mentioned above, the regulation conformity announcement shall be carried out based on results of certification of certifying organizations that have registered or have been recognized in accordance with legislation.
CV2607_17092018BKHCN[VLO].pdf (English translation)
Regarding declaration of PIT incurred by residents who earn incomes from 2 places
Official letter No. 3744/TCT-TNCN dated October 3rd, 2018 of the General Department of Taxation regarding declaration of personal income tax (PIT)
According to Clause 3 Article 21 of Circular No. 92/2015/TT-BTC , only employees who earn incomes from a sole place are entitled to authorize the tax accounting.
Accordingly, with regard to employees who are residents in Vietnam but additionally earn incomes outside Vietnam (incomes earned from two places), such employees are not allowed to authorize the tax accounting (they have to themselves make tax accounting by using form No. 02/QTT-TNCN).
If tax on the incomes earned outside Vietnam has been withheld, such amount of tax shall be subtracted from tax payable in Vietnam according to Clause 2 Article 26 of Circular No. 111/2013/TT-BTC .
On the tax accounting declaration form “deductible tax already paid outside Vietnam” shall be declared at entry 39.
CV3744_03102018TCT[VLO].pdf (English translation)
Tax of Personal Income
From 2015: After – tax profit of one member limited liability companies shall be exempt from tax on capital investment
Official letter No. 3387/TCT-CS dated September 4th, 2018 of the General Department of Taxation regarding enterprise income tax (EIT) and personal income tax (PIT) policies
According to Clause 4 Article 2 of Decree No. 12/2015/ND-CP , from January 1st, 2015, incomes after fulfillment of EIT payment of a one member limited liability company owned by an individual shall be exempt from tax on capital investment.
Accordingly, from January 1st, 2015, after-tax profits of a one member limited liability company shall not be subject to the declaration and payment of PIT.
CV3387_04092018TCT[VLO].pdf (English translation)
Permissible level of lighting in the workplace
National technical regulation QCVN 22:2016/BYT dated June 30th, 2016 of the Ministry of Health on lighting - Permissible level of lighting in the workplace
This Regulation provides for permissible levels of lighting in indoor workplaces.
This Regulation is issued together with Circular No. 22/2016/TT-BYT dated June 30th, 2016 which takes effect from December 1st, 2016.
QCVN22_30062016BYT[ENGLISH].pdf (English translation)
Regarding conditions for participating in medical equipment bidding
Official letter No. 7214/BKHDT-QLDT dated October 11th, 2018 of Ministry of Planning and Investment regarding conditions for participating in bidding
According to the Ministry of Planning and Investment’s opinions, with regard to a medical equipment procurement bidding package in the course of evaluation of the proposal dossier and the contractor is evaluated meeting the conditions on eligibility, capacity, experience, technique, etc. but has not been granted the certificate of eligibility for sale and purchase, the bid solicitor needs to further consider such contractor’s dossier in order to increase the competitiveness of the bid package.
However, in case of winning the bid, the contractor must ensure that he/she has obtained the certificate of eligibility for sale and purchase before concluding a contract.
CV7214_11102018BKHDT[VLO].pdf (English translation)
Regarding business registration of public non-business units
Official letter No. 7103/BKHĐT-DKKD dated October 8th, 2018 of the Ministry of Planning and Investment regarding business registration of public non-business units
The document is to reply to the question about whether an investment and construction project management Board under a Department of Construction is subject to the business registration or not.
According to the Ministry of Planning and Investment’s opinions, currently the Law on enterprises and Decree No. 78/2015/ND-CP on business registration (which has been amended at Decree No. 108/2018/ND-CP) do not regulate the business registration of public non-business public units.
CV7103_08102018BKHDT[VLO].pdf (English translation)
Electricity - Energy
Amendments to regulations on methods for determination of electricity price
Circular No. 13/2017/TT-BCT dated August 3rd, 2017 of the Ministry of Industry and Trade on amendments to certain articles of the Circular No. 56/2014/TT-BCT dated December 19, 2014 by the Minister of Industry and Trade on electricity pricing and procedures for inspection of power purchase agreements (PPAs); Circular No. 30/2014/TT-BCT dated October 02, 2014 by the Minister of Industry and Trade on operation of competitive electricity generation market and Circular No. 57/2014/TT-BCT dated December 19, 2014 by the Minister of Industry and Trade on methods and procedures for development and issuance of electricity price bracket
This Circular takes effect from September 19th, 2017. To abolish Clauses 7, 9, and 19 Article 1 Circular No. 51/2015/TT-BCT dated December 29th, 2015.