Decree 09/2018/ND-CP dated January 15, 2018, detailing the Commercial Law and the Law on Foreign Trade Management.
DECREE
Providing regulations on the Commercial Law and the Law on Management of Foreign Trade regarding trading goods and activities directly related to trading goods [abbreviated as directly related activities] by foreign investors and economic organizations with foreign invested capital [FOC] in Vietnam.
Pursuant to the Law on Organization of the Government dated 19 June 2015; Pursuant to the Commercial Law dated 14 June 2005;
Pursuant to the Law on Management of Foreign Trade dated 12 June 2017; Pursuant to the Law on Investment dated 26 November 2014;
Pursuant to the Law amending article 6 and Appendix 4 with the list of industries and trades in which business investment is conditional as set out in the Law on Investment, dated 22 November 20161;
On the proposal of the Minister of Industry and Trade [MOIT]2;
The Government hereby issues this Decree providing regulations on the Commercial Law and the Law on Management of Foreign Trade regarding trading goods and activities directly related to trading goods [abbreviated as directly related activities] by foreign investors and economic organizations with foreign invested capital [FOC] in Vietnam.
CHAPTER 1
General Provisions
Article 1 Governing scope
This Decree provides regulations on the Commercial Law and the Law on Management of Foreign Trade regarding goods trading and directly related activities [distribution] by foreign investors and economic organizations with FOC in Vietnam.
Article 2 Applicable entities
This Decree applies to foreign investors and to economic organizations with FOC, and to agencies, organizations and individuals involved in goods trading and directly related activities by foreign investors and economic organizations with FOC in Vietnam.
1 Allens footnote: Pursuant to article 2 of this Law, as from 1 July 2017 "goods trading and directly related activities [distribution] by foreign investors and economic organizations with foreign invested capital" became a conditional business line.
2 Allens footnote: Square brackets contain translator's comments only.
Article 3 Definitions
In this Decree the following terms are defined as follows:
1. Activities of goods trading and directly related activities comprise the following activities:
(a) Exercising the right to export;
(b) Exercising the right to import;
(c) Exercising the right to distribute;
(d) Provision of commercial assessment services; (dd) Provision of logistics services;
(e) Goods leasing but excluding financial leasing;
(g) Provision of trade promotion services excluding advertising services;
(h) Provision of trade intermediation services;
(i) Provision of e-commerce services;
(k) Provision of services of arranging tendering/bidding for goods and services.
2. Right to export means the right to purchase goods in Vietnam for export, and includes the right to provide one's name on the goods export declaration in order to conduct procedures relating to export and to bear liability for such conduct. Right to export does not include the right to purchase goods from entities which are not business entities for export, except where the law of Vietnam or an international treaty of which Vietnam is a member contains some other provision.
3. Right to import means the right to import goods from foreign countries into Vietnam for sale to business entities which have the right to distribute such goods in Vietnam, and includes the right to provide one's name on the goods import declaration in order to conduct procedures relating to import and to bear liability for such conduct. Right to import does not include the right to organize or participate in a goods distribution system in Vietnam, unless the law of Vietnam or an international treaty of which Vietnam is a member stipulates otherwise.
4. Distribution means activities of wholesaling, retailing, agency for sale of goods, and franchising.
5. Right to distribute means the right to directly undertake distribution activities.
6. Wholesaling means the activity of selling goods to other wholesaling and retailing business entities and other organizations; and does not include the activity of retailing.
7. Retailing means the activity of selling goods to individuals, family households and other organizations for use for consumption purposes.
8. Retail sales outlet [retail store] means a location [or site] for conducting retailing activities.
9. Retail store other than the first such store means a retail store established in Vietnam by one of the foreign investors/economic organizations with FOC which already have a retail store in Vietnam, or established with the same name and trade mark of at least one retail store which an economic organization with FOC already has in Vietnam.
10. Convenience store means a retail store which sells fast [everyday] consumer goods comprising food, beverages, non-prescription pharmaceutical drugs, functional foods and health products, cosmetics and other products for daily consumption.
11. Mini-supermarket means a retail store of an area less than 500 m2 as part of a supermarket complex as prescribed by law.
12. Trade centre means a place with a number of retail and service stores arranged centrally and continuously in one or more adjacent buildings.
13. Licensing agency means the agency issuing business licences and licences for the establishment of retail stores [retail store licences] as prescribed in clauses 1 and 2 respectively of article 8 of this Decree.
14. E-commerce services means commercial activities whereby an e-commerce service provider establishes an e-commerce website to provide the environment [platform] for business entities and other organizations and individuals to carry out trade promotion activities and to sell goods or provide services.
15. Database system means the database system regarding activities of goods trading and directly related activities by foreign investors and economic organizations with FOC in Vietnam on the website of MOIT at the address http://www.moit.gov.vn.
16. Financial data means one of the following: undertaking to provide financial support from a parent company or financial institution; guarantee of the financial capacity of an investor or of an economic organization with FOC; or other document proving the financial capacity of the foreign investor or organization with FOC.
17. Data on the location for establishing a retail store [retail store location data] means one of the following: memorandum or site lease agreement or document proving that the economic organization with FOC has the right to exploit and use such site or location in order to establish the retail store, enclosing other relevant documents.
Article 4 Application of international treaties and relevant laws
1. Any foreign investor or economic organization with FOC conducting goods trading and directly related activities in Vietnam must comply with the provisions of this Decree; and if an international treaty has provisions different from those in this Decree, then the provisions of such international treaty apply.
2. Any economic organization with FOC conducting goods trading and directly related activities in Vietnam must, in addition to complying with the provisions of this Decree, also comply with provisions of other relevant laws.
Article 5 Issuance of business licences and of licences to establish retail stores [retail store licences]
1. Business licences shall be issued to economic organizations with FOC to conduct the following activities:
(a) Exercise the goods retail distribution right excluding the goods prescribed in article 9.4(c) of this Decree;
(b) Exercise the import right and the goods wholesale distribution right prescribed in article 9.4(b) of this Decree;
(c) Exercise the goods retail distribution right prescribed in article 9.4(c) of this Decree;
(d) Provide logistics services excluding logistic services sub-sectors for which Vietnam has committed to open the market in international treaties of which Vietnam is a member;
(dd) Goods leasing excluding financial leasing; except for the leasing of construction equipment which includes operators;
(e) Provide trade promotion services excluding advertising services;
(g) Provide trade intermediation services;
(h) Provide e-commerce services;
(i) Provide services of arranging tendering/bidding for goods and services.
2. A licence to establish a retail store [retail store licence] shall be issued to an economic organization with FOC in order to establish such store.
3. An economic organization with FOC has the right to request issuance of a retail store licence after it has a business licence and retail store location data.
4. If the location of the first retail store is in the same province or city under central authority [central province or city] as the headquarters of the economic organization with FOC, then such economic organization with FOC has the right to request issuance of a business licence concurrently with issuance of a licence to establish the first retail store. The application file and sequence shall be implemented in accordance with the provisions in article 20 of this Decree.
5. An economic organization with FOC as prescribed in sub-clauses (b) and (c) of article 23.1 of the Law on Investment must satisfy the conditions and implement procedures for issuance of a business licence when conducting activities requiring a business licence; and must conduct procedures for issuance of a retail store licence when establishing such store, as prescribed in this Decree.
6. An economic organization with a retail store in Vietnam, after receiving capital contributions to become an economic organization with FOC or an economic organization in the cases prescribed in sub-clauses (b) and (c) of article 23.1 of the Law on Investment, must conduct procedures for the issuance of a business licence and a retail store licence.
The application file and sequence for issuance of a business licence in these cases shall be implemented in accordance with the provisions in articles 12 and 13 of this Decree.
The application file and sequence for issuance of a retail store licence permitting the retail store to continue its activities shall be implemented in accordance with the provisions in article 38 of this Decree.
Article 6 Cases not requiring a business licence
1. Apart from the activities for which a business licence is required as prescribed in article 5.1 of this Decree, any economic organization with FOC and any economic organization in the cases prescribed in sub-clauses (b) and (c) of article 23.1 of the Law on Investment has the right to conduct goods trading and directly related activities prescribed in article 3.1 of this Decree after registering such activities in relevant data in accordance with the provisions of the Law on Investment and the Law on Enterprises.
2. In the case of a foreign investor not belonging to a country or a territory which is a member of an international treaty of which Vietnam is also a member and which commits to open the market, and [such foreign investor] registers to conduct goods trading and directly related activities prescribed in clause 1 of this article, then the authorized State agency shall obtain an opinion from MOIT prior to issuing or changing registration for conducting such activities in the relevant documents prescribed in the Law on Investment and the Law on Enterprises.
Article 7 Conducting goods trading and directly related activities
1. Any economic organization with FOC which has the right to export is permitted to export: goods purchased in Vietnam; goods which such organization ordered to be processed in Vietnam and goods lawfully imported into Vietnam which are then exported overseas or to discreet customs zones, on the following conditions:
(a) The export goods are not on the list of goods prohibited from export, the list of goods for which export is temporarily suspended, or the list of goods for which there is no export right pursuant to international treaties of which Vietnam is a member;
(b) In the case of export goods on the list of export goods subject to a permit and/or subject to conditions, the economic organization with FOC must have such permit and/or must satisfy all of the conditions stipulated by law.
2. Any economic organization with FOC which has the import right is permitted to import goods from overseas and from separate customs areas into Vietnam, on the following conditions:
(a) The import goods are not on the list of goods prohibited from import, the list of goods for which import is temporarily suspended, or the list of goods without the import right in international treaties of which Vietnam is a member;
(b) In the case of import goods on the list of import goods subject to a permit and/or subject to conditions, the economic organization with FOC must have such permit and/or must satisfy all of the conditions stipulated by law.
3. The procedures for exporting and importing goods in exercise of the export or import right shall be implemented in accordance with the law on management of export and import.
4. Any economic organization with FOC with the wholesale distribution right and/or retail distribution right is permitted to wholesale and/or retail goods produced in Vietnam and goods lawfully imported into Vietnam.
5. In the case of conditional business investment sectors, any economic organization with FOC is permitted to conduct business on satisfaction of all the conditions stipulated by law.
Article 8 Agency issuing business licences and retail store licences
1. The Department of Industry and Trade [DOIT] in the locality where the economic organization with FOC has its headquarters shall issue, reissue, amend or revoke a business licence.
2. The DOIT in the locality where the economic organization with FOC has its retail store shall issue, reissue, amend, extend or revoke a retail store licence.
3. The licensing agency shall obtain opinions from MOIT and the ministry managing the specialized industry [line ministry] in the following cases:
(a) It shall obtain an opinion from MOIT and from the line ministry on issuing or amending a business licence for the activities prescribed in article 5.1(c) of this Decree;
(b) It shall obtain an opinion from MOIT on issuing or amending a business licence for the activities prescribed in clauses (b), (d), (dd), (e), (g), (h) and (i) of article 5.1 of this Decree;
(c) It shall obtain an opinion from MOIT on issuing or amending a retail store licence.
CHAPTER 2
Business Licences Article 9 Conditions for issuance of a business licence
1. If the foreign investor belongs to a country or territory which is a member of an international treaty of which Vietnam is also a member and which commits to open the market for goods trading and directly related activities [then the following conditions must be satisfied]:
(a) The conditions on market access in the international treaty of which Vietnam is a member;
(b) Having a financial plan in order to undertake the activities for which a business licence is requested;
(c) Not having overdue tax debts if it has been established in Vietnam for one year or more.
2. If the foreign investor does not belong to a country or territory which is a member of an international treaty of which Vietnam is also a member [then the following conditions must be satisfied]:
(a) The conditions prescribed in sub-clauses (b) and (c) of clause 1 above;
(b) Satisfying the following criteria:
- Consistency with the provisions of specialized branch law;
- Compatibility with the competitive level of domestic enterprises in the same operational sector;
- Ability to create jobs for domestic workers;
- Ability to contribute and level of contribution to the State budget
3. If there is not yet a commitment to open the market for business services in international treaties of which Vietnam is a member, then the conditions prescribed in clause 2 above apply.
4. If there is not yet a commitment to open the market for business in the following goods in international treaties of which Vietnam is a member, namely: oil and lubricants; rice; sugar, articles with recorded images; and books, newspapers and magazines:
(a) The conditions prescribed in clause 2 of this article;
(b) In the case of goods being oil and lubricants, consideration shall be given to licensing exercise of the right to import and right of wholesale distribution to an economic organization with FOC which conducts one of the following activities:
- Produces oil and lubricants in Vietnam;
- Produces or is permitted to distribute in Vietnam machinery, equipment and goods using special type oil and lubricants.
(c) In the case of goods being rice; sugar, articles with recorded images; and books, newspapers and magazines, consideration shall be given to licensing to exercise the retail distribution right to an economic organization with FOC which already has a retail store in the form of a supermarket, mini-supermarket or convenience store in order to conduct retail at such store.
Article 10 Grounds for [State agencies to] provide consent to issuance of a business licence
MOIT and the line ministry shall rely on the following matters to provide consent to the issuance of a business licence in the cases prescribed in clauses 2, 3 and 4 of article 9 above:
1. Conformity with the regional and national master planning and strategies on development of industries and sectors.
2. Process of negotiations to open the market in Vietnam.
3. The need to open the market in Vietnam.
4. The strategy on cooperation with foreign parties in Vietnam.
5. Diplomatic relations and the issues of national security, social order and safety in a case where the foreign investor does not belong to a country or territory participating in an international treaty of which Vietnam is a member.
Article 11 Contents of a business licence and the business term
1. The contents of a business licence are set out on standard form 113 in the Appendix issued with this Decree [namely]:
(a) Enterprise name and code, headquarters address and legal representative;
(b) Owner and/or capital contributing members and/or founding shareholders;
(c) Goods to be distributed;
(d) The directly related activities; (dd) Other contents.
2. Business term:
(a) The business term in the cases prescribed in clauses 2, 3 and 4 of article 9 of this Decree is five (5) years;
(b) The term of a reissued business [licence] shall equal the residual term of the issued business licence.
Article 12 Application file for issuance of a business licence
An application file comprises:
1. Request for issuance of a business licence on standard form 1 in the Appendix issued with this Decree.
2. Explanatory document containing:
(a) Explanation on the conditions for issuance of the corresponding business licence in accordance with article 9 of this Decree;
(b) Business plan: description of the contents and method of conducting the business activities; presentation of the business plan and market development; the labour demand; and an assessment of the impact and socio-economic efficiency of the business plan;
(c) Financial plan: business operational results on the basis of the audited financial statements for the most recent year if the applicant has been established in Vietnam for one year or more; and an explanation of capital, capital sources and methods for mobilizing capital, enclosing financial data;
(d) Current business status of goods trading and directly related activities; financial status of the economic organization with FOC up until the time of the request for the business licence in the case of the business licence prescribed in article 5.6 of this Decree.
3. Data from the tax office proving that there are no overdue tax debts.
3 Allens footnote: The standard forms have not been translated, but see the List on page 26.
4. Copies of the enterprise registration certificate [ERC] and of the investment registration certificate [IRC] (if any) for the project of goods trading and directly related activities.
Article 13 Sequence for issuance of a business licence
1. An application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency.
2. Number of sets of a file:
- One set in the case of a business licence to undertake the activity [retail distribution] prescribed in article 5.1(a) of this Decree;
- Two sets in the case of a business licence to undertake the activities prescribed in sub-clauses (b), (d), (dd), (e), (g), (h) or (i) of article 5.1 of this Decree;
- Three sets in the case of a business licence to undertake the activity prescribed in article 5.1(c) [also retail distribution] of this Decree.
3. The licensing agency shall, within three (3) business days after receipt of an application file, check the file and request amendment if the file is incomplete or invalid.
4. The licensing agency shall, within ten (10) business days after receipt of a complete and valid application file, check compliance with the relevant conditions prescribed in article 9 of this Decree:
(a) If the conditions are not satisfied, the licensing agency shall provide a written response setting out the reasons;
(b) If the conditions are satisfied:
- The licensing agency shall issue a business licence to undertake the activities prescribed in article 5.1(a) of this Decree [retail distribution], and in the case of refusal shall provide a written response setting out its reasons;
- The licensing agency shall send the file requesting an opinion from MOIT and the line ministry in accordance with the provisions in sub-clause (a) and (b) of article 8.3 of this Decree on standard form 9 in the Appendix issued with this Decree.4
5. MOIT and the line ministry shall, within fifteen (15) days after receiving the application file, rely on the matters prescribed in article 10 of this Decree to provide written consent to issuance of the business licence; and in the case of refusal to provide consent, shall provide written responses setting out their reasons on standard form 10 in the Appendix issued with this Decree.
6. The licensing agency shall issue the business licence within three (3) business days after receipt of written consent from MOIT and the line ministry; but if either MOIT or the line ministry refuse to provide consent, then the licensing agency shall in turn provide a written response [to the applicant] setting out the reasons.
Article 14 Amendment of a business licence
A business licence shall be amended when there is a change of any of the contents prescribed in article 11.1 of this Decree.
Article 15 Application file for amendment of a business licence
An application file comprises:
4 Allens footnote: The meaning of this second paragraph seems to be that licensing for activities other than retail distribution requires an opinion from MOIT.
1. Request for amendment of the business licence on standard form 2 in the Appendix issued with this Decree.
2. If there is a change to any of the contents prescribed in article 11.1(a) of this Decree except for a change of headquarters location as prescribed in article 17.1, then a copy of the ERC recording the amended contents is required.
3. If there is a change to any of the contents prescribed in sub-clauses (b), (c), (d) or (dd) or article 11.1, then the data prescribed in clauses 2, 3 and 4 of article 12 is required.
Article 16 Sequence for amendment of a business licence
1. An application file shall be sent within ten (10) business days after the date on which the ERC records the changed contents prescribed in sub-clause (a) or (b) of article 11.1 of this Decree.
2. The sequence shall be implemented in accordance with the provisions in article 13 of this Decree.
3. The economic organization with FOC is responsible, within five (5) business days after receipt of its amended business licence, to hand in the formerly issued business licence to the licensing agency.
Article 17 Reissuance of a business licence
A business licence shall be reissued in the following cases:
1. Transfer of the headquarters location from one central province or city to another central province or city.
2. The business licence is lost or damaged.
Article 18 Application file for reissuance of a business licence
An application file comprises:
1. Request for reissuance of the business licence on standard form 3 in the Appendix issued with this Decree.
2. Copy of the ERC in the case of reissuance prescribed in article 17.1 above.
Article 19 Sequence for reissuance of a business licence
1. An application file shall be sent within ten (10) business days after the date on which the ERC records the changed contents prescribed article 17.1 of this Decree.
2. An application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency.
3. The licensing agency shall, within three (3) business days after receipt of an application file, check the file and request amendments if the file is incomplete or invalid.
4. The licensing agency shall reissue the business licence within five (5) business days from receipt of a complete and valid application file, and in the case of refusal shall provide a written response setting out its reasons. If the business licence is reissued in the case prescribed in article 17.1, a copy shall be sent to the licensing agency in the new location in order to update the database system.
5. The economic organization with FOC in the case prescribed in article 17.1 is responsible, within five
(5) business days after receipt of its reissued business licence, to hand in the formerly issued business licence to the licensing agency.
Article 20 Sequence and procedures for issuance of a business licence concurrently with a licence to establish a retail store [retail store licence]
1. An application file comprises:
(a) The data prescribed in article 12 and in clauses 1 and 2 of article 27 of this Decree;
(b) The IRC (if any) for the project of establishment of the retail store.
2. The sequence for issuance of a business licence concurrently with a retail store licence shall be implemented in accordance with articles 13 and 28 of this Decree.
Article 21 Refusal to issue a business licence
In addition to a case of failure to satisfy the conditions prescribed in this Decree, the licensing agency shall refuse to issue a business licence in the following cases:
1. On expiry of the operational duration of the project for goods trading and directly related activities.
2. When the economic organization with FOC requests issuance of a business licence within a period of two (2) years from the date on which its [former] business licence was revoked pursuant to article 43.1 of this Decree.
CHAPTER 3
Licence to Establish a Retail Store [Retail Store Licence] Article 22 Conditions for establishment of a retail store
1. Establishment of the first retail store:
(a) Having a financial plan in order to establish the retail store;
(b) Not having any overdue tax debts if the applicant has been established in Vietnam for one (1) or more years;
(c) The location for establishing the retail store complies with the relevant planning in the geographical market area.
2. Establishing a retail store other than the first retail store [second or further retail store]:
(a) In a case where it is not necessary to conduct an economic needs test [ENT]: it must satisfy the conditions prescribed in clause 1 above.
(b) In a case where it is necessary to conduct an ENT:
- It must satisfy the conditions prescribed in clause 1 above;
- It must satisfy the ENT criteria prescribed in article 23.2 of this Decree.
Article 23 Economic Needs Test (ENT)
1. An ENT must be conducted on establishment of a second or further retail store, except where the proposed store has an area less than 500 m2 and is located in a trade centre and it is not a convenience store or mini-supermarket.
2. ENT criteria:
(a) Whether the size of the geographical market area would be affected if the retail store operates;
(b) The number of retail stores currently operating in the geographical market area;
(c) Impact of the [proposed] retail store on market stability and business operations of retail stores and traditional markets in the geographical market area;
(d) Impact of the [proposed] retail store on traffic density, environmental sanitation and fire prevention in the geographical market area;
(dd) Ability of the [proposed] retail store to contribute to socio-economic development of the geographical market area, specifically:
- Job creation for domestic workers;
- Contribution to the development and modernization of the retail sector in the geographical market area;
- Improvement of the environment and living conditions of the population in the geographical market area;
- Ability to contribute and level of contribution to the State budget.
Article 24 Economic Needs Test Committee (ENTC)
1. The provincial people's committee in the locality of the [proposed] retail store shall establish an ENT Committee on the proposal of the licensing agency.
2. An ENT Committee shall comprise a representative of the provincial people's committee or of the agency delegated by the provincial people's committee who shall act as chairman, and other members comprising representatives of the DOIT, of the Department of Planning and Investment and of other relevant committees, industries and organizations. If a retail store is proposed to be established within the locality of a ward, commune or township adjacent to another central province or city, then the ENT Committee must also have a representative of the provincial people's committee of such adjacent central province or city.
3. The ENT Committee must, after evaluating the criteria prescribed in article 23.2, clarify the suitability on non-suitability of the location for establishing the retail store in order for the chairman of the ENT Committee to provide a written conclusion and proposal on permitting or not permitting establishment of such retail store.
Article 25 Grounds for considering consent to issuance of a retail store licence
MOIT shall rely on the following matters to consider providing consent to issuance of a licence to establish a retail store:
1. If the foreign investor belongs to a country or a territory which is a member of an international treaty of which Vietnam is also a member and which commits to open the market for goods trading and directly related activities, then [MOIT shall consider] compliance with the regional and national master planning and strategy on development of industries and sectors.
2. If the foreign investor does not belong to a country or a territory which is a member of an international treaty of which Vietnam is also a member, [then MOIT shall consider]:
(a) Conformity with the regional and national master planning and strategies on development of industries and sectors;
(b) Process of negotiations to open the market in Vietnam;
(c) The need to open the market in Vietnam;
(d) The strategy on cooperation with foreign parties in Vietnam;
(dd) Diplomatic relations and the issues of national security, social order and safety.
Article 26 Contents of and term of a retail store licence
1. The contents of a licence to establish a retail store are set out on standard form 12 in the Appendix issued with this Decree and comprise:
(a) Enterprise name and code number, and headquarters address;
(b) Name and address of the retail store;
(c) Type of the retail store;
(d) Size of the retail store; (dd) Other contents;
(e) The term of the retail store licence.
2. The term of a retail store licence:
(a) The term of a licence to establish a retail store shall correspond to the residual term of the IRC for the project to establish such store. If there is no IRC, then the term of the licence shall correspond to the term recorded in the retail store location data5;
(b) The term of a reissued retail store licence shall equal the residual term of the initially issued licence;
(c) The term of a retail store licence may be extended in accordance with the provision in sub-clause (a) above.
Article 27 Application file for issuance of a retail store licence
An application file comprises:
1. Request for issuance of a retail store licence on standard form 4 in the Appendix issued with this Decree.
2. Explanatory document containing:
(a) Location for establishing the retail store: address of the store; description of the general [common] area, related areas and areas to be used for establishing the store; and an explanation on satisfaction of the conditions prescribed in article 22.1(c) of this Decree, enclosing the retail store location data;
(b) Business plan on trading by the retail store: presentation of the business plan and market development; the labour demand; and an assessment of the impact and socio-economic efficiency of the business plan;
(c) Financial plan for establishment of the retail store: business operational results on the basis of the audited financial statements for the most recent year if the applicant has been established in Vietnam for one (1) year or more; and an explanation of capital, capital sources and methods for mobilizing capital, enclosing financial data.
3. Data from the tax office proving that there are no overdue tax debts.
4. Copies of the ERC and of the IRC (if any) for the project on establishing the retail store, and of the business licence.
5 Allens footnote: See the definition in article 3.17.
Document explaining satisfaction of the ENT criteria prescribed in sub-clauses (c), (d) and (dd) of article 23, if an ENT must be conducted.
Article 28 Sequence for issuance of a licence for establishment of a first retail store and for a second or further retail store if it is not necessary to conduct an ENT
1. Two (2) sets of an application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency.
2. The licensing agency shall, within three (3) business days after receipt of an application file, check the file and request amendments if the file is incomplete or invalid.
3. The licensing agency shall, within ten (10) business days after receipt of a complete and valid application file, check compliance with the conditions prescribed in article 22.1 of this Decree:
(a) If the conditions are not satisfied, the licensing agency shall provide a written response setting out the reasons;
(b) If the conditions are satisfied, the licensing agency shall send the file requesting an opinion from MOIT in accordance with article 8.3(c) of this Decree on standard form 9 in the Appendix issued with this Decree.
4. MOIT shall, within seven (7) business days after receiving the application file, rely on the matters prescribed in article 25 of this Decree to provide written consent to issuance of the retail store licence; and in the case of refusal to provide consent, shall provide a written response setting out its reasons on standard form 10 in the Appendix issued with this Decree.
5. The licensing agency shall issue the retail store licence within three (3) business days after receipt of written consent from MOIT; but if MOIT refuses to provide consent, then the licensing agency shall in turn provide a written response [to the applicant] setting out the reasons.
Article 29 Sequence for issuance of a licence for establishment of a second or further retail store if it is necessary to conduct an ENT
1. Two (2) sets of an application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency.
2. The licensing agency shall, within three (3) business days after receipt of an application file, check the file and request amendments if the file is incomplete or invalid.
3. The licensing agency shall, within five (5) business days after receipt of a complete and valid application file, check compliance with the conditions prescribed in article 22.1 of this Decree:
(a) If the conditions are not satisfied, the licensing agency shall provide a written response setting out the reasons;
(b) If the conditions are satisfied, the licensing agency shall propose establishment of an ENT committee [ENTC] in accordance with clauses 1 and 2 of article 24 of this Decree.
4. The provincial people's committee shall establish an ENTC within seven (7) business days after receipt of the request to do so.
5. The ENTC shall, within thirty (30) days after the date of its establishment, evaluate the ENT criteria prescribed in article 23.2 of this Decree in order for the chairmen of such Committee to provide a written conclusion and proposal.
6. Within three (3) business days after receipt of such written conclusion and proposal from the chairmen of the ENTC:
(a) If the proposal is not to issue a licence, the licensing agency shall provide a written response to the applicant setting out the reasons;
(b) If the proposal is to provide a licence, then the licensing agency shall send a written request to MOIT [to provide its opinion] pursuant to article 8.3(c) on standard form 9 in the Appendix issued with this Decree.
7. MOIT shall, within ten (10) business days after receiving the application file, rely on the matters prescribed in article 25 of this Decree to provide written consent to issuance of the retail store licence; and in the case of refusal to provide consent, shall provide a written response setting out its reasons on standard form 10 in the Appendix issued with this Decree.
8. The licensing agency shall issue the retail store licence within three (3) business days after receipt of written consent from MOIT; but if MOIT refuses to provide consent, then the licensing agency shall in turn provide a written response to the applicant setting out the reasons.
Article 30 Amendment of a retail store licence
A retail store licence shall be amended when there is a change of any of the contents prescribed in sub-clauses (a), (b), (c), (d) and (dd) of article 26.1 of this Decree.
Article 31 Application file for amendment of a retail store licence
1. In the case of a change of any of the contents prescribed in sub-clauses (a), (b) or (c) of article 26.1 of this Decree except for changing the retail store into a convenience store or mini-supermarket as prescribed in clause 4 of this article, and in the case of reducing the area of the retail store, then the application file comprises:
(a) Request for amendment of the retail store licence on standard form 5 in the Appendix issued with this Decree;
(b) If there is a change of name or headquarters address, then a copy of the business licence recording the changed contents is required;
(c) If there is a change of the address of the retail store then a copy of the letter from the competent agency in the ward, commune, or township confirming such change of address is required;
(d) If there is a reduction in the area of the retail store, then relevant documents are required.
2. If there is an increase in the area of the first retail store within a trade centre; or if there is an increase in the area of a second or further retail store situated in a trade centre and not being a convenience store or mini-supermarket to an area below 500 m2, then the application file comprises:
(a) Request for amendment of the retail store licence on standard form 5 in the Appendix issued with this Decree;
(b) Explanatory document containing:
- Location of establishment of the retail store: address of the store; and a description of the common area, related areas and areas used for establishing the store; and an explanation on satisfaction of the conditions prescribed in article 22.1(c) of this Decree, enclosing the retail store location data;
- Report on business operational status of the first retail store.
(c) Data from the tax office proving that there are no overdue tax debts.
3. In a case of an application to increase the area of the first retail store not within a trade centre, then the application file comprises:
(a) The data prescribed in clause 2 above;
(b) An explanatory document on satisfaction of the condition prescribed in article 22.1(c).
4. In the case of increasing the area of another retail store and in a case where the second or further retail store changes its form to or from a convenience store or mini-supermarket, the application file comprises:
- Request for amendment of the retail store licence on standard form 5 in the Appendix issued with this Decree;
- Report on business operational status of the retail store in the most recent year;
- The data prescribed in clauses 2, 3 and 5 of article 27 of this Decree.
Article 32 Sequence for amendment of a retail store licence
1. An application file shall be sent within ten (10) business days after the date of data recording a change to the contents prescribed in sub-clause (a) or (b) of article 26.1.
2. In a case of the changes prescribed in clauses 1 or 2 of article 31:
(a) An application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency;
(b) The licensing agency shall, within three (3) business days after receipt of an application file, check the file and request amendments if the file is incomplete or invalid;
(c) The licensing agency shall amend the retail store licence within five (5) business from receipt of a complete and valid application file, and in the case of refusal shall provide a written response setting out its reasons.
3. In the case of the change prescribed in article 31.3, the sequence shall comply with article 28 of this Decree.
4. In the case of the change prescribed in article 31.4, the sequence shall comply with article 29 of this Decree.
5. The economic organization with FOC is responsible, within five (5) business days after receipt of its amended retail store licence, to hand in the formerly issued licence to the licensing agency.
Article 33 Reissuance of a retail store licence
A retail store licence shall be reissued if such licence is lost or damaged.
Article 34 Application file for reissuance of a retail store licence
An application file for reissuance of a retail store licence shall be made on standard form 6 in the Appendix issued with this Decree.
Article 35 Sequence for reissuance of a retail store licence
1. One (1) set of an application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency.
2. The licensing agency shall reissue the retail store licence within five (5) business days from receipt of a complete and valid application file, and in the case of refusal shall provide a written response setting out its reasons.
Article 36 Application file for extension of a retail store licence
An application file comprises:
1. Request for extension of the retail store licence on standard form 7 in the Appendix issued with this Decree.
2. The data prescribed in clauses 2, 3 and 4 of article 27 of this Decree.
Article 37 Sequence for extension of a retail store licence
1. An application file for extension must be sent at least thirty (30) days prior to expiry of validity of the retail store licence.
2. One (1) set of an application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to the licensing agency.
3. The licensing agency shall, within three (3) business days after receipt of an application file, check the file and request amendments if the file is incomplete or invalid.
4. The licensing agency shall extend the retail store licence if the application file is complete and valid, and in a case of refusal shall provide a written response setting out its reasons.
Article 38 Application file and sequence for issuance of a retail store licence permitting a current store to continue its operation
An application file comprises:
(a) Request for issuance of a retail store licence to permit the current store to continue its operation, on standard form 8 in the Appendix issued with this Decree;
(b) Explanatory documents on the store, containing:
- Location where the store is established: address of the store; description of the common area, related areas and area used to establish the store;
- Explanation on satisfaction of the conditions prescribed in article 22.1(c); explanation of the criteria prescribed in sub-clauses (c), (d) and (dd) of article 23.2 in a case of request for a licence for a retail store prescribed in article 23.1, enclosing the retail store location data;
- Current business status of the store; business plan and market development; the labour demand; and an assessment of the impact and socio-economic efficiency of the business plan of such store;
- Business operational results of the store on the basis of the audited financial statements for the most recent year;
(c) Overall report on the business operational results of the economic organization with FOC on the basis of its audited financial statements for the most recent year; and a financial plan enclosing financial data;
(d) Data from the tax office proving that there are no overdue tax debts;
(dd) Copies of the ERC, of the IRC (if any) for the project establishing the retail store, and of the business licence (if any).
2. Sequence:
(a) Two (2) sets of the application file shall be lodged directly with or sent in the post or sent via the internet (if adequate conditions apply for the latter) to MOIT within thirty (30) days after the date on which there is an ERC recording the changed contents;
(b) The MOIT shall, within three (3) business days after receipt of an application file, check the file and request amendments if the file is incomplete or invalid;
(c) MOIT shall, within fifteen (15) days after receipt of a complete and valid application file, send it to the licensing agency in the locality of the retail store which is requesting continuation of its operation;
(d) The licensing agency shall, within twenty (20) days after receipt of the application file, check such file and assess the location/site and then send a letter to MOIT proposing issuance of the licence on standard form 9 issued with this Decree, or if the licensing agency proposes that a retail store licence should not be issued then it shall provide a written response to MOIT setting out its reasons;
(dd) Within fifteen (15) days after receipt of the letter from the licensing agency, MOIT shall in turn rely on the grounds set out in article 25 to provide written consent to issuance of the licence, but in a case of non-consent shall respond on standard form 10 setting out its reasons;
(e) The licensing agency shall then, within five (5) business days after receipt of official consent from MOIT, issue a retail store licence; and in a case of refusal, shall reply to the applicant setting out its reasons.
Article 39 Refusal to issue or extend a retail store licence
In addition to a case of failure to satisfy the conditions prescribed in this Decree, the licensing agency shall refuse to issue or extend a retail store licence in the following cases:
1. On expiry of the durational term of the project for establishment of the retail store licence.
2. When the economic organization with FOC requests issuance of a retail store licence within a period of two (2) years from the date on which its [former] retail store licence was revoked pursuant to article 43.2 of this Decree.
CHAPTER 4
Reporting Regime, Sending and Archiving Licences, and Information Disclosure Article 40 Reporting regime
1. Reports to be provided by economic organizations with FOC:
(a) Each year, on 31 January of the following year, an economic organization with FOC must report on the status of its goods trading and directly related activities on standard form 13 in the Appendix issued with this Decree;
(b) An economic organization with FOC must report and provide data or an explanation of any issues relevant to the goods trading and directly related activities by its retail store/s on request by a competent State administrative agency.
2. Reports to be made by licensing agencies: Each year, prior to 28 February of the following year, licensing agencies shall report to MOIT and to the relevant line ministry (in the case of issuance of a business licence for any of the goods lines described in article 9.4(c), on the status of issuance, re-issuance, amendment and revocation of business licences; and on the status of issuance, re-issuance, extension and revocation of retail store licences to economic organizations with FOC; and on the status of goods trading and directly related activities by economic organizations with FOC within the managerial scope of such licensing agencies, on standard form 14 in the Appendix issued with this Decree.
Article 41 Sending and archiving licences, and information disclosure
1. A licensing agency must send a copy of any business licence it issues to MOIT, to the relevant line ministry (in the case of a licence for the goods lines prescribed in article 9.4(c), to the tax office, to the statistics office and to any other relevant agencies in the locality where the economic organization with FOC has its headquarters (if necessary).
2. A licensing agency is responsible to send a copy of any retail store licence it issues to MOIT, to the tax office, to the statistics office and to any other relevant agency in the locality of such store.
3. A licensing agency must update information into the database system within 15 days after the date on which it issues, re-issues, amends or revokes a business licence; or issues, re-issues, amends, extends or revokes a retail store licence, or issues a decision terminating an operation; or issues a decision imposing an administrative penalty; or receives a copy of a document temporarily suspending operation or continuing an operation from the agency issuing ERCs.
CHAPTER 5
State Administration and Dealing with Breaches Article 42 Dealing with breaches
Any economic organization with FOC which breaches the regulations on goods trading and directly related activities or which breaches the provisions of this Decree shall, depending on the nature and seriousness of the breach, be dealt with in accordance with the law on imposition of penalties for administrative offences.
Article 43 Revocation of business licences and retail store licences
1. A business licence shall be revoked in the following cases:
(a) The ERC is revoked;
(b) The IRC for the project with the objective of goods trading and directly related activities is revoked;
(c) An application file for issuance, re-issuance or amendment of the business licence contained forged or falsified contents;
(d) The conduct of goods trading and directly related activities was suspended for a period in excess of 12 months without notification to the licensing agency;
(dd) The reporting regime prescribed in article 40.1(a) above was not implemented for a consecutive 24 month period;
(e) A report, data or explanation required by article 40.1(b) above was not sent or provided within three months after expiry of the deadline.
2. A retail store licence shall be revoked in the following cases:
(a) The IRC or document of equivalent validity for the project on establishment of the retail store was revoked, or the business licence was revoked;
(b) An application file for issuance, re-issuance, amendment or extension of the retail store licence contained forged or falsified contents;
(c) Within 12 months after issuance of the retail store licence, the foreign organization with FOC did not have an IRC where an IRC was required by law, and such organization failed to notify the licensing agency;
(d) Within 24 months after the date of the retail store licence, the foreign organization with FOC did not have an IRC where an IRC was required by law;
(dd) The operation of the retail store was suspended for a period in excess of twelve months without notification to the licensing agency;
(e) The periodical reporting regime prescribed in article 40.1(a) above was not implemented for a consecutive 24 month period;
(g) A report, data or explanation as prescribed in article 40.1(b) above was not sent or provided within three months after expiry of the deadline.
3. Sequence for revocation of a business licence or retail store licence:
(a) In the cases prescribed in articles 43.1(a) and 43.2(a): the licensing agency shall issue a decision revoking the business licence or the retail store licence on standard form 15 in the Appendix issued with this Decree;
(b) In the case prescribed in article 43.1(b) [the IRC for the project was revoked]:
Within 30 days after revocation of the IRC or document of equivalent legal validity for the project with the objective of conducting goods trading and directly related activities, the economic organization with FOC shall send a copy of the revocation decision to the licensing agency.
If the objective of the investment project for which the IRC was revoked included the entire contents being goods trading and directly related activities for which a business licence was issued, then the licensing agency shall issue a decision revoking such business licence.
If the objectives of the investment project for which the IRC was revoked were in part goods trading and directly related activities for which a business licence was issued, then the licensing agency shall issue a decision cancelling only those items in the business licence relating to the investment project for which the IRC was revoked, and at the same time shall cancel such items in the business licence.
(c) In a case where there were forged or falsified contents in an application file for issuance or reissuance of a business licence or for issuance, reissuance or extension of a retail store licence:
The licensing agency shall issue a notice of breach and also issue a decision revoking the issued or reissued business licence or the issued, reissued or extended retail store licence.
(d) If there was a fraudulent declaration in an application file for amendment of the business licence or retail store licence:
The licensing agency shall issue a notice of breach and also a decision cancelling the items in the business licence or retail store licence which were amended on the basis of such false information, and shall restore the items licensed previous to such amendment, and also notify the competent agency to deal with the matter in accordance with law.
(dd) In the cases prescribed in sub-clauses (d) and (dd) and (e) of clause 1, and in sub-clauses (c), (d), (dd), (e) and (g) of clause 2 of article 43:
The licensing agency shall send a written request to the legal representative of the economic organization with FOC to attend to provide an explanation. If such representative fails to attend on the expiry of 15 days after the requested date, or attends but fails to provide a satisfactory explanation, then the licensing agency shall issue a decision revoking the business licence or retail store licence.
Article 44 Temporary suspension of goods trading and directly related activities
1. An economic organization with FOC is permitted to temporarily suspend goods trading and directly related activities for a period not exceeding 12 months.
2. An economic organization with FOC is obliged, when temporarily suspending the activities referred to above:
(a) To comply with the provisions of law on temporary suspension of business activities;
(b) If within 10 business days after the date of written confirmation of temporary suspension of activities the organization concerned resumes early conduct of such activities prior to the time [specified] by the agency issuing ERCs, then [the economic organization with FOC] must send a copy of such confirmation and a document on early resumption of activities to the licensing agency for publication on the database system.
Article 45 Termination of goods trading and directly related activities
1. Goods trading and directly related activities shall be terminated in the following cases:
(a) The economic organization with FOC makes its own decision to terminate such activities;
(b) The business term in the business licence expires without a request for new issuance, or the term of the retail store licence expires without a request for extension;
(c) The business term in the business licence expires without there being consent to new issuance; or the term of the retail store licence expires without such licence being extended;
(d) The activities of goods trading and directly related activities are cancelled; or the business licence or retail store licence is revoked pursuant to article 43.
2. Termination of goods trading and directly related activities shall be implemented as follows:
(a) In the cases prescribed in sub-clauses (a) and (b) of clause 1 above:
Within 15 days from the date of a decision terminating the activities, or within 15 days prior to the business term in the business licence expiring or prior to expiry of the effective term of the retail store licence, the economic organization with FOC must notify termination of such activities of its retail store to the licensing agency.
The licensing agency shall, within 10 business days after receipt of notice of termination of the activities, issue a decision terminating same on standard form 16 in the Appendix issued with this Decree.
The economic organization with FOC must, within 5 business days after receipt of the decision on termination, hand in the original of the issued licence to the licensing agency.
(b) In the case prescribed in clause 1(c) above, the activities of goods trading and directly related activities by the foreign organization with FOC shall terminate as from the date of expiry of the business term in the business licence or of expiry of the effective term of the retail store licence.
(c) In the case prescribed in clause 1(d) above, the activities of goods trading and directly related activities by the economic organization with FOC shall terminate as from the date stipulated in the decision revoking the business licence or retail store licence; and within five business days after receipt of the decision, such organization must hand in the original of its issued business licence or retail store licence to the licensing agency.
CHAPTER 6
Organization of Implementation Article 46 Responsibilities of the Ministry of Industry and Trade [MOIT]
1. To announce Vietnam's commitments made in any international treaty on goods trading and directly related activities by foreign organizations with FOC in Vietnam.
2. To preside over coordination with licensing agencies to construct the database system on goods trading and directly related activities by foreign organizations with FOC in Vietnam.
3. To preside over coordination with licensing agencies, ministries, industries and localities to supervise, check, inspect and assess activities being goods trading and directly related activities and establishment of retail stores by foreign investors and economic organizations with FOC in necessary cases or on request from a ministry, line ministry or locality.
Article 47 Responsibilities of Ministry of Planning and Investment
1. To preside over coordination with MOIT in reviewing, collating and registering business investment conditions applicable to foreign investors and to economic organization with FOC in the sector of goods trading and directly related activities, on the national website on enterprise registration and on the national website on foreign investment.
2. To coordinate with MOIT in supervising, checking, inspecting and assessing goods trading and directly related activities and establishment of retail stores.
Article 48 Responsibilities of provincial people's committees
1. To exercise State administration of goods trading and directly related activities by foreign investors and economic organizations with FOC in Vietnam.
2. To direct Departments of Industry and Trade [DOIT] and Departments of Planning and Investment and other local agencies to check and inspect activities being goods trading and directly related activities and establishment of retail stores by foreign investors and economic organizations with FOC in necessary cases, or to arrange an inter-branch check and inspection on request by a competent State agency.
3. To coordinate with other relevant ministries and line ministries in the work of exercising State administration of activities being goods trading and directly related activities and establishment of retail stores by foreign investors and economic organizations with FOC within the locality.
Article 49 Responsibilities of Departments of Industry and Trade
1. To issue, re-issue, amend and revoke business licences; and to issue, re-issue, amend, extend and revoke retail store licences.
2. To register and update on the database system any information relevant to business licences, retail store licences, and activities being goods trading and directly related activities by foreign investors and by economic organizations with FOC; and to deal with breaches of law within their localities.
3. To exercise, in accordance with authority, State administration within the locality of goods trading and directly related activities and establishment of retail stores by economic organizations with FOC.
4. To conduct, in accordance with authority and within the locality, supervision and assessment of activities being goods trading and directly related activities and establishment of retail stores by economic organizations with FOC.
5. To deal in accordance with authority, and within the locality, with breaches of the law during activities being goods trading and directly related activities and establishment of retail stores by economic organizations with FOC.
Article 50 Transitional provision
1. Any economic organization with FOC which, prior to the effective date of this Decree, had an ERC or IRC or document with equivalent legal validity, or a business licence or retail store licence to conduct goods trading and directly related activities, is permitted to continue such activities in accordance with the validity of the issued document without conducting procedures for issuance of a business licence or retail store licence.
2. Any economic organization with FOC which does not yet have a business licence in accordance with the provisions of this Decree but which has an ERC or IRC or document with equivalent legal validity with contents being goods trading and directly related activities within the category for which a business licence is required by this Decree, when making a request to change the contents prescribed in article 11.1 of this Decree in the above-mentioned documents, must conduct procedures to amend a business licence in accordance with articles 15 and 16 of this Decree. The licensing agency shall issue a business licence recording the contents previously licensed and recording the contents for which there is new consent to amendment.
3. Any economic organization with FOC which does not yet have a retail store licence pursuant to the provisions of this Decree but has an ERC or IRC or document with equivalent legal validity with contents being establishment of a retail store for which this Decree would require a licence for establishment, when making a request to change the contents prescribed in sub-clauses (a), (b), (c),
(d) or (dd) of article 26.1 of this Decree in the above-mentioned documents, must conduct procedures to amend the retail store licence in accordance with articles 31 and 32 of this Decree. The licensing agency shall issue a retail store licence recording the contents previously licensed and recording the contents for which there is new consent to amendment.
Article 51 Effectiveness
1. This Decree is of full force and effect as from 15 January 2018.
2. This Decree replaces Decree 23/2007/ND-CP of the Government dated 12 February 2007 providing regulations on the Commercial Law regarding trading goods and activities directly related to trading goods by foreign investors and economic organizations with foreign invested capital in Vietnam.
Article 52 Responsibility for implementation
Ministers, heads of ministerial equivalent and Government agencies, and chairpersons of provincial people's committees are responsible for implementation of this Decree.
