A new legal safeguard for those who dare to think and act

Minister of Public Security Luong Tam Quang has submitted a draft resolution to the National Assembly that, if adopted, would provide a new legal mechanism to protect those who dare to think and act for the common good.

He said the resolution is intended to institutionalize the Party's policies on protecting dynamic and innovative people who are willing to think boldly and take action in pursuit of the common good.

To put that objective into practice, the draft proposes giving priority to economic, civil and administrative measures, while encouraging violators to proactively remedy the consequences of their actions before criminal penalties are considered in certain eligible cases.

Acts involving corruption, self-interest, vested interests or deliberate profiteering would, of course, remain outside the scope of these protections.

What makes the draft resolution noteworthy is not simply the new provisions it proposes, but the policy message behind them: the state sees a need for a legal mechanism to protect people doing business and entrepreneurs willing to invest, innovate and accept risks.

The reasons for this can be found in a shift taking place in the mindset of the business community.

Legal risks and the worries of business owners

For nearly five years, I have stopped by a familiar grocery store almost every week to pick up a few things. But on a recent visit, its roller shutter was down, the interior was empty and almost all the merchandise had been cleared out.

The owner told me she had sent her employees back to their hometowns and temporarily closed the shop. Since new rules on electronic invoices and tax administration for household businesses were introduced, she said, tax management has become stricter.

Meanwhile, many of the suppliers she has long relied on are still unable to provide proper invoices. To comply fully with the rules, she cannot source the goods she needs; but if she continues buying as before, she has no input invoices to demonstrate the legitimacy of the transactions.

“I can't get input invoices, so I'm afraid of being fined. I decided to stop for a while and see what happens,” she said.

A few months earlier, the owner of a beer restaurant in Hanoi told me a similar story. His business once employed 10 people but now has only five. He has reduced purchases, cut his workforce in half and scaled back operations because many suppliers still cannot provide the required input invoices.

“If I keep operating at the same scale as before, it will be very difficult to avoid risks. There are many products for which I simply cannot obtain input invoices,” he said.

These two business owners operate in different sectors, yet they made strikingly similar decisions: to suspend or scale back operations because they were unable to comply with the new regulations.

Stories like theirs are no longer isolated cases.

A survey by the Vietnam Chamber of Commerce and Industry (VCCI) found that 73.3% of household businesses encountered legal difficulties during the transition away from the presumptive tax system. Another 73.7% said they were making only “small profits,” while 81.5% reported lower revenue in 2025.

Behind those figures lies a troubling reality: many household businesses are choosing to scale down or even temporarily suspend operations, not because they have lost the desire to do business, but because they no longer feel confident enough to continue.

Among formally registered enterprises, similar concerns are emerging in a different form.

In recent months, reports of criminal cases involving companies or corporate executives accused of breaking the law have become commonplace in the media. From aviation and construction to electricity, chemicals and infrastructure, a series of major cases have been prosecuted and investigated.

But alongside these developments, a question has gradually emerged within the business community: Where is the line between a risky business decision and a legal violation? And could a decision considered legitimate today be viewed differently years later?

At a recent meeting between the Prime Minister and the business community, VCCI Chairman Ho Sy Hung said “legal risk” is now the biggest concern among Vietnamese businesses.

Of nearly 900 recommendations submitted to VCCI, legal risk was the most frequently raised issue. Hung described institutional uncertainty as “an invisible but very substantial cost.”

It is a cost that appears on no financial statement, yet can be powerful enough to change an investment decision.

VCCI's 2025 Legal Flow Report recorded as many as 787 legal obstacles reported by businesses.

The figure suggests that, beyond the cost of capital, labor and logistics, Vietnamese businesses face another persistent concern: legal risk.

The line between business risk and breaking the law

According to Nguyen Si Dung, PhD, the private sector can become a driver of growth only if entrepreneurs are allowed to take risks.

In a market economy, not every failed project is a mistake, much less a crime. Nor does every business decision that falls short of expectations amount to wrongdoing. Risk is an inevitable part of investment, innovation and market competition.

What concerns Dung is when the boundary between normal business risk and violations of the law becomes unclear. The natural response among entrepreneurs is then not to seek new opportunities, but to postpone investment, limit production expansion and avoid decisions that might expose them to risk.

Dung argues that if the private sector is to genuinely become an important engine of the economy, the law must distinguish between deliberate deception for personal gain and the ordinary risks inherent in doing business.

Only when entrepreneurs are confident that business failure will not be equated with criminal conduct will they be willing to invest, innovate and take the risks needed to generate growth.

From Dung's perspective, the draft resolution submitted to the National Assembly by Minister Luong Tam Quang can be seen as an attempt to find an answer.

The proposal does not stand alone. It follows a broader process of policy adjustment that began with Resolution 68.

In May 2025, Resolution 68 identified the private sector as one of the economy's most important growth engines. It also called for economic, civil and administrative relations not to be criminalized and for a clear distinction between the responsibilities of legal entities and individuals.

More than a year later, Conclusion 56 continued this policy direction, calling for changes to criminal policy in the economic sphere, including reduced prison sentences in certain cases, greater use of economic measures, a stronger focus on asset recovery, and safeguards to ensure that investigations, prosecutions and trials do not obstruct investment, production or business operations.

The latest draft resolution is the next step in translating that policy direction into practice. But it would be a mistake to interpret it as an effort to “go easy” on economic crime.

What experts are concerned about

Economist Pham Chi Lan, who was among the experts involved in implementing the 1999 Enterprise Law, said businesses that engage in dishonest practices must be removed from the market because no economy can develop without discipline.

But she also argued that the entire business community should not be viewed through the lens of a number of criminal cases.

Vietnam has around one million businesses. Even if only 1% violated the law, that would amount to 10,000 companies - enough to create the impression that another new case is emerging every day.

Lan said this reality cannot be denied, but neither should it obscure the fact that nearly a million other businesses continue to operate legitimately. They pay employees, contribute taxes to the state and create wealth for society.

In her view, those that break the law are merely “a few bad apples” and cannot represent the majority of entrepreneurs who conduct their businesses honestly.

Nguyen Dinh Cung, PhD, is also cautious when discussing individual criminal cases, noting that outsiders do not have enough information to judge right from wrong. What concerns him more, however, is the effect that reports of such cases can have on businesses and investment sentiment.

“Vietnam is pursuing a high-growth target, which requires highly positive social energy for investment and business. That is why the entrepreneurial spirit needs to be encouraged,” he said.

Giving businesses the confidence to act

Under the draft resolution, in certain cases where all required conditions are met, legal proceedings authorities may decide not to pursue criminal liability, temporarily suspend proceedings or grant exemptions from criminal liability. Economic, civil and administrative measures would be prioritized, while offenders would be encouraged to remedy the consequences of their actions before criminal sanctions are considered.

However, the mechanism would not apply to corruption, self-interest, vested interests or deliberate profiteering.

Reviewing the draft, Phan Van Mai, Chairman of the National Assembly's Economic and Financial Committee, also stressed the need to strictly address violations while clearly distinguishing between criminal, civil and administrative liability, as well as between the responsibilities of legal entities and individuals. The objective is to uphold the rigor of the law without obstructing investment, production and business activities.

That is also the line the draft resolution seeks to clarify: those who deliberately exploit the system for personal gain must be dealt with strictly, while the ordinary risks inherent in investment and business should not be treated as criminal conduct.

For the private sector, that means building a transparent and predictable legal environment in which entrepreneurs can invest, innovate and take risks with greater confidence.

Tu Giang