Nghiên cứu Luật Doanh nghiệp
Like most of
the world, Vietnam
is actively competing for foreign investment (FDI). Recently, there is a bad news/good news story
on
this in Vietnam. Whether the story is good or bad depends on
which side of the table you are sitting on. First,
any fair observer has to admit that Vietnam
has done much over the last several years to improve itself as an
attractive location for someone to relocate a factory, open a company
or in general invest. When President
Clinton lifted the Trade Embargo with Vietnam in 1994, Vietnam was in
many ways like the American
Wild West in terms of infrastructure, law, regulation and many other
factors
– that is to say there wasn’t much infrastructure and there wasn’t much
meaningful law on business. What law and
regulation there was usually turned out to be more applicable to
Socialist operations and highly costly and time consuming to investors. Because of the hype on Vietnam as being the
next “Asian Tiger”, investors were oftentimes too quick to reach for
their wallets and the net result was that a lot of money, time and
goodwill was lost by most if not all investors.
By 2003,
many of the negative factors are changing. First,
internationally,
every nation in Asia is competing for foreign
investment
and this is good news for people considering moving a factory, opening
an
office or sourcing products. In Vietnam,
the quality of infrastructure in major cities today such as Hanoi
and Ho Chi Minh City is
vastly improved. Power outages still occur
but the
privations of life ten years ago are largely gone.
Good restaurants, well stocked supermarkets, cheap household
help, strong international schools and a reduced bureaucracy all are
making Vietnam
more interesting as a site to start a business. These
changes aren’t yet countrywide. In the
countryside, infrastructure still has much to be improved and investors
need to fully be aware of this. Power
outages are common. Water stoppages
frequent and all of this can effect your bottom line.
Industrial parks are, however, now more widely dispersed and
although many of these are more visible on paper than based on their
completed infrastructure admittedly the choice is
much broader now throughout the country than before.
Recently
in a move to further entice foreigners to bring their money to Vietnam
and invest in factories, Vietnam
loosened central control of approval of investment licenses. Now new factories need not solely pass through
the Ministry of Planning and Industry (MPI) in Hanoi
but investors may go directly to the local level and file the forms to
start a business and invest there. Additionally,
the central government is talking about further reforms such as
possibly
opening up the stock market to 100 percent foreign owned companies,
further
freeing up hiring of engineering and senior managers and possibly even
giving
foreign firms the right to mortgage their assets. The
Ministry knows that competition for foreign investment is intense
throughout the region and has even discussed possibly lowering land
rental
fees for foreign companies (currently land rental fees for local
investors
are 40 percent less than those for foreigners).
The above
is all good news for investors. Although
many of the changes under discussion are still a ways off, the change
to allow investors to by-pass the MPI and go directly to the local
level removes one layer of
bureaucracy, a layer of chance for the diversion of funds and the delay
in
getting a project started. Even with these
changes,
however, much remains to be done and action not words will be what
investors
will be judging Vietnam
on in the long run. To paraphrase Lenin
“foreign investors will be “voting with their feet” to either pass Vietnam
by or to stop and invest if the investment climate is right.
As in China,
Vietnam
recognizes three types of typical business organization for a
foreign company. These are thee
representative office, thee joint venture or thee one hundred percent
(100%) foreign owned enterprise. As in China,
our company has had experience with all three forms.
Based on this experience, we feel that as in China
the time of representative offices is long past. We
also recommend staying away from joint ventures as we believe the lack
of control, problems with the law protecting minority equity
participants, weak rule of law and corruption generally make a joint
venture not worth the
future potential problems. We therefore
recommend
the one hundred per cent (100%) foreign owned enterprise which can be
formed
relatively quickly in Vietnam
by applying for an investment license. Such
an application requires the following:
- a filled-out application form for the investment license
- The charter of the enterprise
- The statements certifying the legal status and financial capacity of the foreign investor
- The economic-technical explanatory statement (similar to a business plan).
- Other files stipulated in the law
Duration
of a
one hundred per cent foreign owned enterprise can be up to 50 years and
this
duration must be set out in the charter. The
government
can grant extensions to this period but these can not exceed 70 years
at
this point.
As
investors looking for a site to locate their investment often look at Vietnam,
Thailand
and China
in making a decision, we have listed all three countries below with our
view of each country’s relative strengths and weaknesses as a site to
locate
a factory or to start and open a new business. For
Thailand,
we have used Thailand’s
Board of Investment, Zone 3, specifically the area around Rayong and
the Eastern Seaboard. Bangkok
and its suburbs are usually not as cost competitive unless an operation
requires highly technical or artistic skills which tend to be found
more
abundantly in Bangkok and
the
area immediately around the city because of Thailand’s
relatively longer experience with foreign investment.
Cost Comparison for Vietnam, Thailand and Chinahttp://www.business-in-asia.com/vn_industrial.html
http://en.wikipedia.org/wiki/Corporate_law_in_Vietnam
