VietNamNet Bridge - Business behavior that causes serious consequences to society may face criminal prosecution as lawmakers are considering adding an article to the amended criminal law they are drafting.

The behavior causing disastrous consequences should have been placed into criminal proceedings

Lawyer Hoang Van Huong from Hoang Hung Law Office said it is necessary to clarify the criminal liability of legal entities in criminal law.

Huong said such behavior conducted by businesses has caused disastrous consequences in recent years. The cases should have been placed into criminal proceedings, he said.

Vedan, a seasoning powder manufacturer, was found discharging untreated waste water directly into the Dong Nai River, thus poisoning the river and affecting the lives of thousands of locals. 

In another example, Nicotex, a Thanh Hoa-based Company, buried hundreds of barrels of chemicals under the earth, causing serious underground water and soil contamination. 

Keangnam, the South Korean real estate developer and Metro, the German distributor, was found committing transfer pricing, affecting Vietnam’s investment environment.

Huong said the fines for violators under administrative regulations and civil law were too low to act as a deterrent to future violations. 

Criminal liability of legal entities is written in the criminal laws of 120 countries worldwide, including five in South East Asia.

In Vietnam, the issue was first put into discussion many years ago, when lawmakers built the 1999 Criminal Law. However, the businesses’ criminal liability was not included in the law.

The matter has once again been brought out into the open as lawmakers believe that new laws are needed in new circumstances.

Le Dang Doanh of Hanoi Law University noted that imposing fines cannot be used to deal with sophisticated tricks played by businesses, including transfer pricing and the discharge of untreated wastewater in the environment.

These cases need to be judged as criminal cases, because this is the only way to deter violators and serve as a warning to others.

Meanwhile, Lawyer Tran Huu Huynh from the Vietnam International Arbitration Center, said policy makers need to be very cautious when creating provisions relating to legal entities’ criminal liabilities, warning that criminalization will badly affect the business environment.

“Imprisonment sentences hanging over them will make them suffer constant anxiety,” Huynh said.

The violations not stipulated in specialized laws will be judged in accordance with Article No 165 of the Criminal Law, and charged as “deliberately breaking the state’s regulations on economic management, causing serious consequences”.

However, lawyers pointed out that the lack of clarity stipulated in the article could be exploited by prosecution bodies.

Tran Thuy