EuroCham Report Dialogue Meeting on The Mechanism, Policies and Administrative Procedures Related to Business Operation and Activities of European Enterprises in Vietnam


On 22 January, 2018 in Hanoi – Advisory Council for Administrative Procedures Reform (“ACAPR”), together with the European Chamber of Commerce in Vietnam (“EuroCham”) – with the EU-Vietnam Business Network (EVBN) organised a Dialogue on the Mechanism, Policies and Administrative Procedures related to Business Operation and Activities of European enterprises in Vietnam” with the European business community. The conference was chaired by H.E. Mr. Mai Tien Dung, Minister, and Chairman of the Office of the Government cum Chairman of the Advisory Council for Administrative Procedures Reform. Mr. Ngo Hai Phan, General Secretary of ACAPR, joined the Minister at the chairing table alongside two Co-Chairmen of EuroCham, Dr. Gellert Horvath and Mr. Nicolas Audier. The conference was also attended by Vice-Minister Ha Cong Tuan from Ministry of Agriculture and Rural Development and 35 representatives of Ministries, embassies, EuroCham members, other business associations and NGOs.

 
In his opening remarks, H.E. Mai Tien Dung underlined that the Dialogue is part of the action plan of Advisory Council for Administrative Procedures Reform in 2018. It is one of the methods to contribute to the reform of mechanisms, policies and administrative procedures to support businesses and tackle their concerns. It will also help to address challenges in investment and production, cut administrative costs and enhance efficiency. The Government has recently taken strong measures to manage socio-economic development. This has included cutting over 5,000 administrative procedures and creating more favourable conditions for enterprises, including SMEs, to join the market and implement their business activities. The World Bank now ranks Vietnam 68 out of 190 world economies, up 23 places in 2016-17. This year, Vietnam is taking the theme of ‘Compliance, Integrity, Actions, Innovation and Efficiency’ and will further direct the Ministries and authorities to further improve the business environment, enhance labour efficiency, increase competition in each sector and field at the ground level of provinces, and take efforts to bring Vietnam to ASEAN-4; ensuring the reduction and simplification of over 50% of goods and their specialised management procedures and 50% of the business conditions in Vietnam.
 
 
Dr. Gellert Horvath, Co-Chairman, EuroCham said:
 
“This Dialogue with ACAPR is yet another confirmation that European business is respected, that Europe as a whole is an important partner for Vietnam, and that EuroCham is a trusted dialogue partner to the Vietnamese Government. European business matters and its importance goes beyond the fact that EuroCham members are among the largest taxpayers in Vietnam. Europe can be proud of being the cradle of a different kind of private sector; one that typically stands for responsible and sustainable business that wants to work with Vietnam and not simply in Vietnam. The EU-Vietnam Free Trade Agreement (EVFTA), expected to be ratified in 2018, can create an historic trade and investment corridor which will be of great benefit to both sides. EuroCham appreciates the opportunity to be able to voice its issues and recommendations directly to the Government. The EuroCham community will continue to respond to the Government’s requests for dialogue and to employ its best efforts so that conditions are created for more European business to come to the country and contribute to that which we all aim for: the development and advancement of Vietnam.” 

At the conference, the presentations of EuroCham focused mainly on topics that have a definite impact on Vietnam’s business environment – including those covered in the 9th edition of the Whitebook in 2017 and in its upcoming 10th edition (to be published on 15 March, 2018 in Hanoi). Representatives of Sector Committees raised obstacles, reflected on difficulties and made proposals focused on 3 main themes of:
 
1. Legal, Taxation and Transfer Pricing and Intellectual Property Rights;
2. Healthcare (International Quality Generics, Pharma Group, Medical Devices and Diagnostics and);
3. Consumer Choice (Nutritional Food Group, Mobility, Wines and Spirits) as well as other key sectoral matters affecting foreign investment and trade.
 
 

 
Several EuroCham Sector Committees – specialised working groups of EuroCham member companies in various industry sectors – also had the opportunity to address their concerns directly to the participating Government officials. Among these were the Legal Sector Committee, who raised the recognition of foreign arbitral awards and courts’ intervention during arbitration in Vietnam; Tax & Transfer Pricing Sector Committee, who once again highlighted the issue of implementation of international tax treaties and presented the new topic on the use of comparable companies in transfer pricing audits; Pharma Group, who discussed Decree 54 guiding Pharma Law, the legal entity establishment in Vietnam. In the Session on Consumer Choice, the Mobility Sector raised concerns about the VAT rate for vehicle spare parts and accessories, the proposed motorcycle ban and Special Consumption Tax. Meanwhile, the IPR Sector Committee presented on the enforcement of IPRs and copyrights and settlement of appeals.
 

 
Mr. Mai Tien Dung, updating on the progress of resolving certain matters raised by EuroCham Sector Committees in Whitebook 2017, shared that on the same date as the conference, he had chaired a meeting between Ministry of Agriculture and Rural Development (MARD) and other relevant Ministries to discuss a draft Decree to replace Decree 38/2012/ND-CP towards centralisation of management of MARD. The draft, which will allow businesses to self-certify on safety standards, will be submitted to the Government on 2nd February, 2018 for approval and shall take effect immediately. This step should address the current concerns raised by EuroCham Nutritional Food Group, and the group looks forward to following up with the Government on this.
 


 
This first Dialogue of EuroCham, organised with ACAPR, was an important stepping stone towards more frequent and direct contact between European companies and the highest circles of the Vietnamese Government. The issues raised and discussed between businesses and decision-makers are believed to be of crucial importance to improving the business environment in Vietnam. They will be collected and reported directly to Prime Minister Nguyen Xuan Phuc for his further directions.
 
Mr. Nicolas Audier, Co-Chairman, EuroCham, said:
 
“This conference is another victory for constructive dialogue and openness. EuroCham and its Executive Board gladly appreciates the support of the Government and ACAPR for listening to our recommendations, continuing to take efforts to tackle our concerns and making the most informed decisions possible so that Vietnam’s great potential can be the catalyst to turn this country into a top global trade and investment destination. EuroCham looks forward to further working with the Government to contribute to the simplification of administrative reforms which shall lead to a more open and effective legal framework and FDI attraction. This Dialogue comes at a crucial time. The EVFTA is set to be ratified in 2018, so it’s more important than ever that the trade and investment issues our members raised are addressed. This will help us to send a strong and positive message that Vietnam is ready and will become more open for business when the EVFTA goes before the European Parliament later this year.”
 

 

BACKGROUND INFORMATION

 
Advisory Council for Administrative Procedures Reform was established in 2007 and pursuant to Decision 415/QD-TTg on strengthening the Advisory Council for Administrative Procedures Reform to advise, propose strategic direction on policies and regulation in order to keep up with each stage of socio-economic development to the government and the Prime Minister; to propose to the Government and the Prime Minister to amend/supplement regulations, administrative procedures or decide on policies, solutions and initiatives to eliminate/simplify regulations, which brings more favorable conditions for people and enterprises; to gather feedback and recommendations on difficulties and obstacles in complying with administrative regulations related to business activities and people's lives from members of the Council; to give comments on regulation in draft legal normative documents under the responsibility of the Council; to organise and co-ordinate with ministries, branches and localities to evaluate the implementation of regulatory reform and to co-ordinate with relevant agencies/organisations to carry out communication activities on the results of administrative reforms and the impact of these reforms for socio-economic development.
 
EuroCham has been proactively working with ACAPR under Ministry of Justice since 2007 and was again invited to join the Council under the auspice of Office of Government in 2017. The chamber sees the participation in ACAPR as very important task and has attended 2 meetings with ACAPR in 2017 to discuss the Council’s activities and cost-cutting reforms. 

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