return icon Vietnamnet.vn

Short-lived legal documents cause a hindrance to firms

Many legal documents in Vietnam have been made in such a way that creates a great compliance burden on firms, according to insiders.

A stainless steel factory. Circular 15 on stainless steel was a short-lived legal document with a lifespan of eight months. — Photo baodautu.vn

Many legal documents in Viet Nam have been made in such a way that creates a great compliance burden on firms, according to insiders.

Nguyen Thi Dieu Hong from the Legal Department, Vietnam Chamber of Commerce and Industry (VCCI), underlined circulars as written statements of government policy that are highly influential on firms. In some fields, firms regard circulars as legal documents with higher legal validity than laws and decrees.

However, firms normally have little say in the circular-making process. Their limited involvement has resulted in many impractical circulars that were repealed just a few months after their enactment.

"Firms have little opportunities to give their voice to final drafts. There was once a circular that was abolished shortly after it was enacted," said Hong.

She took Circular 15 on stainless steel as an example of such short-lived circulars. The circular remained effective for just eight months. Many firms were caught off guard by its less-than-one-year lifespan.

"Short-lived circulars cause huge costs to both the State and firms," she added.

Nguyen Van De, chairman of the Vietnam Private Hospital Association, mentioned a whole bunch of circulars that have been causing a great compliance burden to firms.

He also remarked that in Viet Nam circulars are deemed to be higher than decrees in the hierarchy of legislation. Despite of their crucial role, many circulars have turned out to be more of a hindrance than a help.

"Impractical circulars are more destructive than corruption. They hold back firms and fuel unemployment to the detriment of the State budget," said De.

Nguyen Quoc Hiep, chairman of the Vietnam Association of Construction Contractors, said legal inconsistencies inherent in the 12 laws regulating the realty sector have given rise to many compliance difficulties.

He took the Law on Housing and Law on Construction as an example. Under the first law, investors are required to give a warranty of at least 60 months for their apartments. Meanwhile, the second law requires a warranty of 24 months at most.

"The two laws have been drawn up by two departments under the same ministry, the Ministry of Construction, and on the same issue, yet they are inconsistent," said Hiep.

He revealed that he had made some inquiries about the legal inconsistency but no reply has been given so far. Some firms told him they would quit investing in the sector on that account.

Tran Ngoc Anh, a representative from US-ASEAN Business Council, remarked that firms, in fact, did make comments on many drafts but their comments normally got nowhere.

"A whole bunch of firms failed to get customs clearance because of the legal incompatibility between local and foreign laws," added Anh.

Chu Thi Hoa, deputy head of the Institute of Legal Sciences, Ministry of Justice, asserted that frequent adjustments to legal documents would cause huge costs to both the State and firms.

"After a legal revision, firms incur additional compliance costs whereas the State incurs the costs of revising the documents and making the revised versions known to the public," said Hoa.

The deputy head called on law-makers to listen to the voices of business community when formulating legal documents to ensure their practicality.

She also said law-making process should strictly follow the steps specified in Law on Promulgation of Legal Documents to ensure their consistency. — VNS

MORE NEWS

FDI hoped to help realty market develop sustainably in long term

Vietnam’s real estate sector last year attracted an additional 1.85 billion USD in foreign direct investment (FDI), retaining its second place among industries drawing FDI with combined investment of 4.45 billion USD.

Party chief’s book on fight against corruption and negative phenomena released

A ceremony was held in Hanoi on February 2 to release the book by General Secretary of the Communist Party of Vietnam (CPV) Nguyen Phu Trong.

Make in Vietnam drives ICT firms into international markets

Global expansion has become a trend in domestic ICT enterprises in recent years.

Schools launch digital-related majors to meet students’ needs

In 2023, many universities have launched new subjects associated with the digital era to meet students’ needs.

Southeast region prepares for new FDI wave

The southeast region is preparing conditions in infrastructure, administrative procedures and human resources to welcome a new wave of foreign direct investment (FDI), as investors have flocked to the region from the beginning of this year.

VIETNAM NEWS HEADLINES FEBRUARY 2/2023

PM chairs monthly teleconference with localities

Experts call for stricter penalties as drink driving soars over Tet

The maximum punishment for car drivers with alcohol concentration levels exceeding 0.4mg per litre of breath, or 80mg in 100 ml of blood, is a fine of VND40 million (US$1,693) and a two-year suspension of their driving licences.

Over 32% of apparel firms remain closed in Hanoi

Nearly a third of textile and garment firms have yet to reopen in Hanoi although the Lunar New Year holiday has ended.

Domestic tourism hits five-year high

Domestic tourism numbers hit 13 million in January, the highest in the last five years, according to the Vietnam National Administration of Tourism.

VIETNAM BUSINESS NEWS FEBRUARY 2/2023

Businesses exporting medicinal herbs to China required to register

Cashless payments on the rise: convenience and security for expats in Vietnam

As digital payment methods surge in popularity, expats in Vietnam are not alone in embracing the change to cashless transactions.

My Dinh Stadium needs money for more upgrading

Having been upgraded with a package worth VND408 billion, My Dinh Stadium is still in poor condition.

Vietnam needs more submarine cables to ensure internet services

Vietnam will need at least two or three more submarine cables to ensure proper internet services for the country's development in the next five years, according to Vu The Binh, Secretary-General of the Vietnam Internet Association.

Government convenes January meeting

The Government convened its first regular monthly meeting for 2023 in Ha Noi on Thursday under the chair of Prime Minister Pham Minh Chinh.

Scammers steal information, money on first days of Year of the Cat

The first days of the New Year are the time for scammers to increase their activities. The most common tricks are stealing information and money from victims’ accounts.
back_to_top