1. Amending the regulations on foreigners working in Vietnam
The Government issued Decree 70/2023/ND-CP (“Decree 70”) dated 18 September 2023 to amend the regulations on foreigners working in Vietnam stipulated in Decree 152/2020/ND-CP (“Decree 152”) dated 30 December 2020. Decree 70 takes effect from the date of signing and introduces some key amendments as follows:
Conditions for issuance of work permits
Under Decree 152, it is required that foreign experts and technical workers must have relevant education or training background matching their job positions to be eligible for work permits in Vietnam. Decree 70 relaxes the condition on educational qualification and working experience for issuance of work permits for foreign experts and technical workers by providing that (i) foreign experts can obtain work permits when they have bachelor degrees or equivalent or higher qualifications and have at least 3 years of experience corresponding with the job positions that they are expecting to work in Vietnam, and (ii) foreign technical workers can obtain work permits when they have received at least one year’s training and have at least 3 years of experience corresponding the job positions that they are expecting to work in Vietnam.
With respect to the position of executive director, Decree 70 clarifies the scope of such term by providing additional cases where executive directors may include (a) persons who are the head of a branch, representative office or business location of an enterprise, and (b) persons who are the head of and directly executively operate at least one sector of an agency, organisation or enterprise and subject to direct instruction from the head of that agency, organisation or enterprise.
Approval for employment of foreign employees
The time period for employers (excluding contractors) to submit an explanatory report for their demand of foreign employees in each job position has been shortened from 30 days (as required under Decree 152) to 15 days before the expected date of employment. In addition, instead of the Provincial People’s Committee or the management boards of industrial park and economic zone as stipulated under Decree 152, the Ministry of Labour, War-Invalids and Social Affairs (“MOLISA”) or the Department of Labour, War-Invalids and Social Affairs (“DOLISA”) (depending on where the foreigner(s) will work) will now have the competency to assess the employers’ demands for foreign workers; certify exemption from work permits; and issue, re-issue, renew, and revoke work permits.
From 01 January 2024 onwards, employers must place the notification of recruitment of Vietnamese employees for the positions that they plan to recruit foreign employees on the MOLISA’s website or the website of the Job Service Centre established by the provincial People’s Committee at least 15 days before the submission date of the explanation for the demand of foreign employees.
Besides, Decree 70 amends and clarifies several cases of exemption from the determination of the demand of foreign employees, such as employers are not required to determine the demand of foreign employees if foreign employees are persons certified by the Ministry of Education and Training to come to Vietnam to (a) lecture or conduct research, or (b) hold positions of managers, executive directors, rectors or deputy rectors of education establishments set up by foreign diplomatic representative agencies or inter-governmental organisations.
Applications dossier for work permit
Decree 70 has amended and supplemented Form No. 11/PLI first issued under Decree 152 on explanation of demand for employing foreign workers. Notably, in case a foreign employee works for one employer at different places, all such places must be listed in the application.
Decree 70 provides more clarity to documents proving that the foreigner is a manager, executive director, expert, or technical worker. It additionally provides for the application dossier for work permit in case where a foreigner is an expert or technical worker whose work permit has been extended once and wants to continue his/her employment in the same job position and the same job title as recorded in the issued work permit.
Report on the use of foreign employees
Decree 70 revises the form of periodic report on the use of foreign employees that employers must submit to the MOLISA and/or the DOLISA. Besides, it provides that if a foreign employee works for one employer in several provinces, the employer must provide a written notice through an online system to the MOLISA and the relevant DOLISA within 03 working days after the date on which the foreign employee commences to work.
2. Compulsory fire & explosion insurance and construction insurance
The Government issued Decree 67/2023/ND-CP (“Decree 67”) dated 6 September 2023 regulating compulsory insurance for the civil responsibility of vehicle owners, compulsory fire & explosion insurance, compulsory insurance in construction investment activity.
Decree 67 takes effect from its signing date and replaces Decree 03/2021/ND-CP dated 15 January 2021, Decree 23/2018/ND-CP dated 23 February 2018 (as amended) and Decree 119/2015/ND-CP dated 13 November 2015 (as amended). Below are some key issues relating to fire & explosion insurance, and construction insurance.
Compulsory fire & explosion insurance
Organisations and individuals possessing a fire and explosion-prone establishment stipulated in the law on fire prevention and fighting must purchase compulsory fire & explosion insurance. Decree 67 specifies premium rates and deductible level of insurance for fire and explosion-prone establishments (excluding nuclear facilities) as follows:
- For fire and explosion-prone establishments (excluding nuclear facilities) with a total insured sum of assets less than VND 1,000 billion, the premiums and deductibles are specified in point 1 Section I and point 1 Section 2 of Annex II of Decree 67. The insurers may increase or decrease the insurance premiums by up to 25% according to the level of risk of the insured subjects;
- For fire and explosion-prone establishments (excluding nuclear facilities) with a total insured sum of assets of VND 1,000 billion or more per location, the premium and deductible level will be agreed between the insurer and the insurance purchaser but the agreed premium must not be lower than the premium equal to VND 1,000 billion multiplied by 75% of the premium rate specified in point 1 Section I of Annex II of Decree 67.
For nuclear facilities, the insurer and the insurance purchaser may agree on the rules, terms, premium and deductible level.
Insurers shall pay indemnity for loss and damage to the insured assets, except cases of exclusion of insurance liability as provided in Article 25 of Decree 67. The indemnity amount may not exceed the amount for which the asset is insured (as agreed and stipulated in the insurance contract and insurance certificate). The insurer may deduct up to 20% of the indemnity amount if the fire and explosion-prone establishment fails to fully and promptly implement the recommendations in the minutes on fire prevention and fighting safety examination issued by the competent police agency that leads to an increase in the loss and damage when the fire or explosion occurred.
Compulsory insurance in construction investment activity
Decree 67 still requires project owners to purchase insurance for construction works to cover loss and damage during the construction period for (i) works and work items with a large impact on community safety as set out in Annex X of Decree 15/2021/ND-CP, (ii) works that are likely to cause significant adverse environmental impact or adverse environmental impacts as set out in Annexes III and IV of Decree 08/2022/ND-CP and on the list of projects for which an environmental impact assessment report must be obtained, and (iii) works with complex technical requirements and/or complex building conditions as prescribed in construction laws and other relevant laws. The minimum sum insured is the value of the works after completion but it must not be less than the value of the construction contract, including any adjustment (if any).
Building contractors must purchase insurance for employees working on construction site and third party civil liability insurance as follows:
- insurance for employees working on construction site provides cover for death or injury of employees caused by occupational accidents and occupational diseases on construction site. The limit of insurance liability is VND 100 million for one person in one case; and
- third party civil liability insurance provides cover for health, life and property damage of the third party that directly occur in the course of construction and related legal fees (if any). The limit of insurance liability for health and life damage is VND 100 million for one person in one case. For property damages and legal fees, the limit of insurance liability is 10% of the value of the works (if the works value below VND 1,000 billion) or VND 100 billion (if the works value at VND 1,000 billion or more) for the entire insurance term with no limit to the number of cases.
Consultant contractors must purchase professional indemnity insurance for the provision of construction survey and construction design services for works classified as Class II or higher. The limit of insurance liability is equal to the value of the construction survey contract or the construction design contract.
Decree 67 also lists cases of exclusion of insurance liability for each type of compulsory construction insurance. For instance, with respect to insurance for construction works, an insurer will not be obliged to pay indemnity for loss arising from deliberate breaches of the insurance purchaser, or losses caused by corrosion, abrasion and oxidation.
3. Intellectual Property
The Government issued Decree 65/2023/ND-CP (“Decree 65”) dated 23 August 2023 to implement several provisions of the Law on Intellectual Property regarding industrial property rights, protection of industrial property rights and plant variety rights, and State management over intellectual property. Decree 65 takes effect from 23 August 2023 and replaces Decree 103/2006/ND-CP dated 22 September 2006 (as amended).
Decree 65 specifies procedures and provides the new application forms for registering, renewing, amending, recording assignment and license of patents, layout designs of integrated circuits, industrial designs, trademarks and geographic indications with the National Office of Intellectual Property (“NOIP”). Notably, Decree 65 has shed light on the registration requirements of sound marks as IP Law 2022 for the first time allows protection over sound marks. Besides, protection title will be issued in electronic form (by default) or paper form (only if the applicant requires the protection title to be issued in paper form).
Under the Law on Intellectual Property, owners of industrial property rights may assign ownership of industrial property objects (except for geographic indications) or license the right to use of industrial property objects (except for geographic indications and trade names) to a third party. The procedures for registration of assignment or licensing agreements with the NOIP are set out in Decree 65. Any foreign language agreement in the registration dossier must be translated into Vietnamese language.
In addition, as the Hague Agreement Concerning the International Registration of Industrial Designs (“Hague Agreement”) has entered into force in Vietnam since 30 December 2019, Decree 65 also provides for the detailed procedures to file international applications to protect industrial designs in accordance with the Hague Agreement.
Regarding enforcement of industrial property rights and plant variety rights, Decree 65 provides grounds for the determination of acts, nature and extent of infringement. In particular, civil procedures can be applied to handle infringement at the request of the right holder or the party that suffers damage caused by an infringement of industrial property rights or plant variety rights. Meanwhile, the competent authorities can apply administrative procedures to handle infringements either on their own initiative or in response to a request of the right holder, the party that suffers damage caused by an infringement or the party that discovers an infringement. Criminal procedures will be applied in case where an infringement constitutes a crime pursuant to the Criminal Code. The competent authorities can take necessary action to enforce industrial property rights or plant variety rights. Infringing goods may be distributed or used for non-commercial purposes (subject to certain conditions), destroyed, delivered out of Vietnam after taking down infringing contents, or removed from channels or commerce.
4. New Law on Co-operatives
The National Assembly adopted the Law No. 17/2023/QH15 on Co-operatives (“Law on Co-operatives”) dated 20 June 2023. Law on Co-operatives will be effective on 01 July 2024 (except for Articles 115.3 and 115.4 which became effective on 01 September 2023) and replaces Law No. 23/2012/QH13 on Co-operatives.
Law on Co-operatives regulates, among others: (i) conditions for members of cooperatives or unions of cooperatives, (ii) establishment and registration of cooperatives or unions of cooperatives, (iii) cooperative governance, (iv) capital contribution and financial management, and (v) re-organisation, dissolution or bankruptcy of cooperatives or unions of cooperatives.
Under Law on Co-operatives, the kinds of participants in cooperatives are expanded, including official members, capital-contributing affiliated members, and capital-noncontributing affiliated members. Besides, the maximum capital contribution ratio of the official members increases from 20% and 30% to 30% and 40% of the charter capital of cooperative or union of cooperative, respectively. Individuals or organisations can make the capital contribution by Vietnamese Dong, freely convertible foreign currency, gold, land use rights, intellectual property rights, technologies, technical know-how, other assets and other rights which can be valued in Vietnamese Dong. The timeline for capital contribution is 6 months from the date of the cooperative registration certificate or the date of admission.
Law on Co-operatives also introduces incentives and supports for cooperatives and unions of cooperatives such as tax and fees incentives, land incentives, credit assess, trading and investment promotion, human resources and consultancy support, infrastructure support etc. A cooperative/union of cooperative which simultaneously satisfies conditions for different support levels for the same content as stipulated in the Law on Co-operatives and other relevant laws, shall be entitled to select the most beneficial support level.