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Investors may be asked to post completion bond
The Ministry of Planning and Investment has submitted to the Government a draft decree on investment which, if adopted, would make significant changes to investment regulations.
It would require the investor's legal representative to register with the investment licensing authority a guarantee that it will implement the project by the date stated in the Investment Certificate. The investor has to then post a bond in the form of a deposit in an escrow account or a bank guaranty. The draft decree would also provide details on the documentation and procedures needed to convert an Investment Certificate into an Enterprise Registration Certificate for a domestic-owned enterprise.
Law bans marketing of cigarettes
The National Assembly passed the Law on Advertising on June 21, which will ban advertisement of cigarettes, alcoholic beverages of stronger than 15-proof, and baby formula products intended to replace mother's milk for children under 24 months. The law will also forbid advertising that makes direct comparisons of price, quality, or effectiveness of products to the same products and services of other individuals or organisations. The use of specific words such as "first", "only", "best", and "number one" or their equivalents without any legal proof in conformity with the regulations of the Ministry of Culture, Sports and Tourism will also be forbidden, as will be the placement of marketing materials on telephone poles, light posts and in public green spaces.
Under the law, foreign individuals and organisations operating in Viet Nam are entitled to advertise their own products and services in accordance with the law. They may co-operate with local marketing firms in the form of joint venture or business co-operation contracts (BCCs) pursuant to the Law on Investment. Foreign marketing enterprises are entitled to establish representative office in Viet Nam but are not directly entitled to offer marketing services.
The Law on Advertising takes effect next January 1, replacing the 2001 Ordinance on Advertising.
New law governs price control measures
The National Assembly passed the Law on Prices on June 20, designating a list of 11 types of goods subject to price stabilisation or subject to prices/rates set by the State, e.g., electricity and petrol and groundwater. Under the law, enterprises shall at their own discretion decide the price list, compete on prices, but still being controlled of the State. In comparison with the 2002 Ordinance on Pricing, the Law on Prices has extended the scope of price assessment. The law takes effect next January 1.
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