Vietnam business law: a competitive and attractive law for foreign investment

Vietnam business law has experienced several recent reforms to make the country competitive and attractive for foreign investors. These incentives are as much tax law as company law and competition law.

Recent reforms of Vietnam business law

Since 1987 Vietnam has conducted a policy of liberalisation and internationalisation. The countries adopting the Doi Moi policy, has engaged in multiple reforms of its legislation. The respective laws passed between 2010 and 2015 on investment, businesses, taxation, real estate or work reflect Vietnam’s desire to present itself as a competitive and modern law.

Vietnam business law is one of the branches of private law which brings together all the rights relating to corporate affairs such as company law, tax law, competition law, intellectual property, etc. This right has been strongly reformed to make it a competitive and attractive right.

Attractiveness of Vietnam’s tax policy

Vietnam is opening up to foreign investment and is seeking, through its tax policy to attract maximum foreign investors. Tax law is one of the branches of business law in Vietnam. Corporate tax was reduced to 20% in January 2016 except for certain specific industries; income tax is progressive and varies from 5 to 35%; VAT is 10% exceptions and tariffs have generally been declining since Vietnam’s accession to the WTO.

Flexibility of corporate law in Vietnam

The creation of companies by foreign investors has been facilitated through a strong simplification of company law, branch of Vietnam business law. In addition, the registration procedure for domestic companies and foreign companies was unified by the laws of 2014 on investment and businesses. Now all companies must construct the same application files to obtain ERC “enterprise registration certificate” or the registration certificate.

Protection of competition law in Vietnam

Vietnam recognises freedom of trade and prohibits anti-competitive and unfair practices. Vietnam’s accession to the WTO in 2007 has reinforced the effectiveness of this law, which was still struggling to apply. Thus, Vietnam Business Law is perfectly inserted into the global economic system, and Vietnam is an Asian country with the highest economic growth rates.

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