A laborer works at a foreign-invested company. The
National Assembly’s Foreign Affairs Committee has identified the main obstacles
affecting foreign investors and State management agencies
The committee has delivered a report on the
deployment of policies and laws on the management of foreigners in Vietnam
to the NA. Accordingly, the 2014 Investment Law has helped create fairer
business conditions for foreign investors.
However, last year, six foreign investors filed
lawsuits against the Vietnamese Government, and some others are completing
procedures for new lawsuits, Thanh Nien Online newspaper reported.
Foreign investors’ disputes with the Government and
State management agencies have negatively affected the local business
environment and wasted time and resources.
In addition, criteria to choose projects matching
the development plans of localities have yet to be worked out.
Procedures involving foreign-invested enterprises’
supplementation of business lines, which must be approved by the Ministry of
Planning and Investment, have yet to be outlined. Prevailing regulations on
investment through share acquisitions have raised costs for foreign
Moreover, procedures for foreign investors to
acquire shares are unclear.
The overlapping regulations in the laws on public
investment, management and use of State capital in production and business
activities for enterprises, land, construction, the real estate business,
housing and environmental protection have caused difficulties in investment
Investment through capital contributions and stake
acquisitions is on the rise, while regulations under the Investment Law are
not tough enough. Accordingly, investors are not required to register their
investment, causing difficulties for State management agencies in managing
enterprises and posing a high risk of trade fraud.
Under the 2013 Land Law, land use rights cannot be
transferred to foreign-invested enterprises; instead, they must lease land
lots from the State. Therefore, their projects outside industrial parks,
export processing zones, hi-tech parks and economic zones cannot be executed
if they are not covered by regulations on land recovery in the Land Law.
Further, some foreign-invested enterprises have
failed to fulfill their tax obligations. Many of them have reported losses
to avoid paying taxes, but these losses may derive from transfer pricing.
Therefore, the NA’s supervisory delegation has
proposed amending and supplementing regulations on conditional business
lines, requirements for foreign investors, the merger and expansion of
projects, investment balance and the appraisal of prices and quality of
imported equipment as fixed assets of foreign-invested enterprises in the
The Foreign Affairs Committee’s report also showed
that from 2016 to October 2019, nearly 11,600 foreign-invested projects with
total registered capital of US$69.29 billion were granted investment
In the period, the disbursed capital increased
annually, from US$15.8 billion in 2016 to US$17.5 billion in 2017 and
US$19.1 billion in 2018.