VCCI to publish Report on the conditional business lines and business conditions

With a view to promote business freedom and convey the voice of the business community to policy makers, Vietnam Chamber of Commerce and Industry (VCCI), with the support of the World Bank, has reviewed the lines of conditional business on the list of conditional business lines in the Investment Law 2014 (amended in 2016) and the business conditions of some business fields under the management of 3 ministries namely the Ministry of Industry and Trade, the Ministry of Communications and Transport and the Ministry of Science and Technology to identify the remained problems and propose amendment.

The report is based on the study and evaluation of the research team, business community and the association in the process of contributing to the development of related policies. The structure of the Report consists of two parts.

In part I: Lines of conditional business and investment - Identification and Recommendation, the report reviews and evaluates the conditional business included in Annex IV of the Investment Law 2014 (revised in 2016), then gives recommendations on the suitability of a number of conditional business lines.

- Some lines do not have any significant impact on the public interest.

- Some lines and trades do not clearly distinguish their characteristics with other business lines which are the same types.

- Some conditional business lines in the list determine their control scope inaccurately.

- Some lines in the list are not business lines.

Specifically, the report indicates that the following 16 lines are not suitable:

• Commercial arbitration services (Section 17);

• Debt trading business (Section 36);

• Manufacturing and repairing liquefied petroleum gas (LPG) (Section 43);

• Rice exports (Section 55);

• Temporary import and re-export business (Section 57);

• Logistics services business (Section 60);

• Car service and maintenance business (Section 78);

• Ship agency services (Section 90);

• Business management and operation of condominiums (Section 119);

• Business management and operation services for cremation facilities (Section 120);

• Manufacturing helmets for motorcyclists (Section 203);

• Producing, distributing and disseminating films (Section 206);

• Travel services business (Section 210);

• Business of performing art show, fashion show, beauty contest, modeling (Section 212)

• Advertising services for advertising products to the public (Section 215).

• Printing services, except packagin (Section 128).

- The following 10 business lines have unsuitable controlling scope:

• Food business under the specialized management of the Ministry of Industry and Trade (Section 52);

• Franchise (Section 59);

• Seafood business (Section 150);

• Aquatic and animal feed business (Section 151);

• Pesticides business (Section 161);

• Trading food which is under the specialized management of the Ministry of Agriculture and Rural Development (Section 172);

• Fertilizer business (Section 174);

• Seeds and livestock business (Section 176);

• Aquatic breeders business (Section 177);

• Trading food which is under the specialized management of the Ministry of Health (Section 194).

In Part II: Business conditions in some lines under the Ministry of Industry and Trade, the Ministry of Communications and Transport and the Ministry of Science and Technology - Identification and Recommendation, the report bases on the business conditions regulations in the Investment Law 2014 and the guiding documents for defining business conditions to evaluate business conditions with the criteria of consistency, transparency, rationality and feasibility.

The report shows 3 main problems with business conditions after reviewing 15 different sectors:

- Business conditions that impose enterprise's size:

These conditions are found in 8 out of 15 surveyed lines, mainly under the Ministry of Industry and Trade and Transportation.

- Business conditions that interfere with the self-determination right of the business

The business law recognizes the right of enterprises to self-determinate their business forms and employment. These rights seem to be far interferred in some regulations on business conditions.

- Business conditions that interfere with the market by administrative measures/orders.

Business activity of the enterprise is only bound by business conditions in some cases relating to public interest. However, many business conditions interfere with the quality of service provided by the business and business performance, which are supposed to be adjusted by market.

Accordingly, the report makes some recommendations:

- 05 business lines subject to business conditions of the Ministry of Industry and Commerce: the report proposes to reject 56 business conditions and amend 04 business conditions;

- 04 business lines subject to business condition of the Ministry of Transport: the report proposes to remove 27 business conditions and amend 04 business conditions;

- 05 business lines subject to business condition of the Ministry of Science and Technology: the report proposes to remove 12 business conditions and amend 05 business conditions.