Trade

Vietnam's accession to the World Trade Organization (WTO) on 11th January 2007 provides an important boost to the economy and ensure the continuation of free-market reforms. Moreover thanks to the government’ policy, Vietnam has demonstrated its strong commitment to trade liberalization in recent years. It has signed Free Trade Agreements (FTAs) with ASEAN countries and the USA. Vietnam also has a agreement of cooperation with EU. The share of foreign trade in country’s GDP is nearly 150%. The top three export partners of Vietnam are the USA, Japan, and China. The products mainly exported are crude oil, textile, footwear, sea products, and rice. Its top three import partners are: China, Japan and Singapore. It mainly imports petroleum, textiles & fabric, iron & steel, machinery, and vehicles.

Trade by partner countries

Vietnam’s Exports


Vietnam's export is growing rapidly and export of goods and services now constitute about 70 percent of GDP, more than double the 30 percent share recorded in the mid 1990s. Crude oil is a large part of total export revenues; other major export items include textiles, garments and footwear, seafood, wood products, rice, coffee, cashew, pepper and coal. Vietnam's largest export markets are the United States, EU, Japan, China and Australia.

Industrial production, imports and exports are growing with 15-20 percent annually. With an annual growth in GDP of 8.5 percent, the Vietnamese domestic market is also growing fast. The construction sector is expanding by 15-20 percent annually and inputs into this sector are increasingly in demand.
As the following chart indicates, most of the export sectors in Vietnam have some impressive growth rates:

Vietnamese goods and services have carved inroads in more than 160 countries, especially in the US, EU and ASEAN countries. Some goods have earned significant positions in the world market such as: crude oil, rice, processed sea products, coffee, rubber, pepper, and garments, and Vietnam is among the top countries for export of pepper, coffee, rice, and cashews.

Distribution channel

Roads

By the end of 2005, the total length of highways in whole country was about 17.300 kilometers and 85% out of them were asphalted. Along from North to South, No 1A Highway and Ho Chi Minh Highway are the most important roads in Vietnam road system. Constructing and developing these roads are important factor to enhance socio-economic development, maintain political and national defence security. No1A Highway is 2260 kilometer long, spreading to 31 provinces and cities in Vietnam with 400 bridges, such as big Chuong Duong (in Hanoi), My Thuan (in Tien Giang), Can Tho (in Can Tho).
Apart from highways, there are many provincial roads connecting districts in province and communes in districts together with the length of 27.500 kilometres and 50% out of them were asphalted.

Railways

Railway in Vietnam is 2600 kilometers long, 302 engines, 1063 railroad car for passengers and 4986 ones for cargo. At present, Vietnam has had railways connecting the whole country and to China. Two kinds of rail are rails for passengers and rails for cargo and 3 kinds of railways are 1000 millimeters in length, standard ways (1.435mm in length) and integrated ways (both 1000mm and 1435mm)

Water ways

Vietnam has a large water system with 2.300  rivers and canals, 198.000 kilometers in length, 41.000 kilometers out of them in use, locating at North Delta and South Delta. River and canal network passing  all big cities, communes and economic centers,..creates an advantageous transport lines with a various transportation potential
The authority’s statistics showed that waterway in Vietnam has 5.611 ports, 91% out of them are cargo ports, 7% out of them passenger ports and the rest are different kinds. Waterways in Vietnam are responsible for 30% of domestic cargo shipping, particularly Mekong River Delta accounts for 70% of regional cargo shipping.

Seaways

With the advantage of over 3.000 kilometer line, seaway system in Vietnam is drawn and distributed with a whole country scale at necessary and suitable positions in order to develop the advantages in nature, take advantages of seaway transportation, serve economic regions and industrial zones, economize expenses in investment and port exploitation.

Main ports in Vietnam are Haiphong, Cai Lan in North region, Tien Sa, Quy Nhon in Middle region and Saigon, Cat Lai in South region. In 2007, the total volume of cargo shipped at Vietnam ports was 177 million tons, 55% out of them was from Sai Gon port system. It is expected that the total volume of cargo shipped at Vietnam ports in 2010  will be 230-250 million tons/year and 500-550 million tons/year in 2020.

Airways

Vietnam has 26 airways in various type with completed landing strips, 8 out of them have 3.000 meter long runway that allows medium-sized airplanes or bigger ones, such as Airbus A320, Airbus A321 to land. International airports in Vietnam includes Tan Son Nhat, Cam Ranh, Cat Bi airpots, and some domestic airports are Dien Bien (Lai Chau), Vinh (Nghe An), Nha Trang, Can Tho. The total capacity of air transport is about 12 million passengers/year.

Electricity network

At present, power system in Vietnam includes 3 ranges of voltage: 500kV, 220kV and 110kV. Average per capita electricity output  in Vietnam is very low compared to that of regional nations, at 500kWh/person/year. In current power mechanism, Vietnam Head of Power Company have managed the whole national power transmission system, national adjustment system and distribution system.

Statistics until September 30, 2008
Districts having national power network: 548/548 (100%)
Communes having national power network: 8.838/9.087 (97,26%)
Households having national power network: 13.313.420/14.158.367 ( 94,03%)
Electricity outputs provided for national economy: 49,41 billion kWh, in which:

• Building Industry accounted for  50,28%
• Management in Civil consumption accounted for 40,29%

Customs who bought electricity directly: 11.333.645 persons

July  4, 2007, Vietnam Head of National Power Transmission Company  opened the introductory ceremony in Hanoi with the international trading name “National Power Transmission Corporation” (shortened NPT). The company is responsible for invest, operate and control the transmission system in range of from 220kV to 500kV of the national power system. Two great functions of the company are to safety operate and  to fully provide investment capital to develop power transmission network in the approved  plan in synchronization with power development in whole country.

Telephony

Telephone density in Vietnam is 35 unit/100 people (17/12/2008). At present, Vietnam has 46 million subscribes, 75% out of them are using cell phones with the density of 54 units/100 people.  These figures show that Vietnam has continued to be one of countries that have a quickest development speed in telephony in the world.
With 8 ground satellite stations and Interspunit, 3 international switchboards, Vietnam also has sea and land fiber cable lines, including Sea-me-we3 with the participation of 34 Asian-European-American nations, Tvh sea fiber cable line with the participation of  Thailand-Vietnam-Hong Kong, and land fiber cable line connecting 6 countries China - Vietnam - Laos – Cambodia – Myanmar – Singapore. Until now, international telecommunication network has had 5.764 direct communication channels that allows to carry out the thousands of call at the same time, in which 60% out of them are via sea fiber cable line and the rest are via satellite systems.
Vietnam is considered one of the most developing nations in telephony, at 35% , according to the statistics of 4th quarter, 2006. However, some remote  and rural regions have still not had fixed telephones. Vietnam has 25.5 million subscribes, over 4 million out of them registered to use in 2006 and more 10 million users have registered to use this year, increased 188% compared to that of previous years (statistics from Vietnam Net Bridge, 29/12/2006).

Internet network

November 19, 1997, Vietnam officially integrated into the international Internet network. After 10 years of development, Vietnam has over 5 million Internet subscribes  with over 18 million users frequently, accounted for 21.6% of Vietnam’s population, exceeded the average level in the world and Asia. Vietnam is also the country that deployed many modern Internet services such as Internet telephony,  Wimax, Wi-Fi soon.  Internet has widely penetrated into all socio-economic activities and people’s life, making an important contribution into process of modernization and industrialization and development in information society.

Workforce

General information

In Vietnam, labour is abundant with a quickly urbanising population.      

There are about 65% population in the age of labor force (about 53 billion people), but there are only 27.5% trained people. In addition, most of Vietnamese labor force are mainly agriculture labor (accounting for over 50%). Therefore, in some industrial zones are in shortage of workers, whereas local force can meet 50% their requirement. However, in the present time, the country has provided jobs for 10.85 million people during seven years (2001 – 2007). In the period of 2001 -2005, there were about 7.5 million people having jobs, increasing 25% in comparison with that of 1996 – 2000. There, there are more than 8 million working people being helped by eco – social development program; 2.37 million working people are helped by National Fund; 456 thousand people are exported. Especially, urban unemployment rate reduces gradually: from 6.28% (2001) down to 5,1% (2006).

Mechanism

Labor mechanism has changed positively. For example, in 2001, agriculture and forestry: 62.7%; industry – construction: 14.5%; commerce – service: 22.8%. In 2006, agriculture and forestry: 55.7%; industry – construction: 19.1%; commerce – service: 25.2%.

In 2007, six career sections had high supply index: finance – accounting, sales, administrative – secretary, bank – investment, administrative managing and application technique.

In 2008, most of career sections had an increase in labor demand, with 41/ 49 sectors having more new jobs. Sales, finance – accounting, administrative – secretary and application technique have the highest supply and demand. Sales is leader one with supply index increases 40% and demand supply raises 24%.. Labor supply in the real estate field and foreign labor also increases dramatically with the rate of 69% and 67% in turn compared to that of quarter 4 – 2007.

Salary

In comparison to many of its Asian neighbors, Vietnam has a relatively inexpensive labor rate. For factory operators, the average salary is $200.00/month while key managers and senior engineers are paid $1,500.00/month. Vietnam has a 48-hour workweek and the government-mandated social programs are approximately 25% of the salary costs.

Level

The quality of Vietnamese workforce has changed. Medium study level of labor has been improved. In 2006, there were 26.85% labors at the age of 15 graduating from secondary school and 23.46% graduating from high – school. Moreover, in 2006, social workforce were trained accounting for 31.5%, and 20% were trained from vocational school.

However, although the workforce is abundant, Vietnam is still in shortage of high – quality or advanced human resources. Most of them are not well – trained. Until 2005, workers having level of college and university were 2.4 million people, accounting for 5.5% of the total workforce, but the quality was still weak.

Long term strategies

Master Plan on the Development of Vietnam’s Leather & Footwear Industry by 2010

Overarching objectives:

The leather and footwear industry shall be developed into a crucial industry in service of domestic use and exports, helping generate more jobs and foreign exchange for the country.
Leather and footwear enterprises shall be able to grow in a sustainable manner by means of advanced technologies and the ISO 9000 quality management system and the ISO 14000 environmental management system.

Strategy for development of Vietnam’s seaport system and services

The aim of the strategy is to develop Vietnam’s seaport system according to a national master plan. Under the strategy, hubs linking transport infrastructures in regions, especially key economic zones, shall be set up to provide seaport-related technical  infrastructure in service of economic development, affirming the country’s predominant position in the regional and global marine economy, and creating major focal points for economic exchange at home and abroad. Based on the strategy’s goal and the need for seaport building in Vietnam, its seaport development orientation is aimed to refurbish, upgrade and modernize existing seaports. Focus shall be made the construction of several general ports for large-tonnage vessels in key economic zones. Additionally, special attention shall be paid to ports or specialized terminals for containers, bulk and liquid cargo, and international transshipment ports.


Adjusted plan for development of Vietnam’s paper industry up to 2010 with a vision towards 2020

To build Vietnam’s paper industry with advanced technologies, establishing centralized paper and pulp production areas with a fairly substantial capacity to satisfy domestic consumption and export needs. By 2020, 70% of domestic use shall be met, whilst boosting exports of paper articles, which are competitive in the regional and world markets.
To set up centralized paper raw material areas to provide sufficient raw materials for producing 600,000 tons of pulp by 2010 and 1,800,000 tons of pulp by 2020, facilitating the building of concentrated paper processing mills on a large scale

Plan on development of industrial parks in Vietnam by 2015 and orientation to 2020

The development of industrial parks in Vietnam by 2015 and orientation to 2020 aims to set up a system of pivotal industrial parks which will play a leading role in national industrial development and meanwhile establish industrial parks of appropriate scale to create conditions for industrial development, boosting economic restructuring in localities where the industrial share in GDP is low.
To increase the contribution of industrial parks to the gross value of industrial production from over 24% at present to around 39-40% by 2010 and up to over 60% in subsequent periods. The share of industrial product exports from industrial parks in the national export value is to increase to around 40% by 2010 and higher in subsequent periods from current 19.2%.

Vietnam’s Five-year Socio-economic Development Plan, 2006-2010
Economic growth shall accelerate, with increased efficiency and sustainability of development, so as to soon take the country out of the current under-development state:

• The people's material, cultural and spiritual life will be remarkably improved;
• To speed up industrialization and modernization and develop a knowledge-based economy, forming the basis for making Vietnam a fundamentally industrialized country in the direction of modernization by 2020.
• To maintain political stability, social order and safety
• To firmly defend national independence, sovereignty, territorial integrity and security
• To continue strengthening and broadening foreign relations, enhancing Vietnam's position in regional and international arenas

Plan on development of Vietnam’s chemical industry by 2010, with a vision towards 2020

• To build the chemical industry with a relatively comprehensive structure, covering main domains such as fertilizer, technical and consumer rubber, base chemicals (including both organic and inorganic chemicals), petro-chemistry, pure chemicals, pharmaceutical chemistry, and consumer chemicals to meet the domestic demand and the requirements of regional and world economic integration.
• To step by step build up a modern chemical industry, initially set up concentrated industrial parks and large-scale chemical manufacturing complexes using state-of-art technologies, so as to launch competitive products in the regional market.
• To strive for a growth rate of 16-17% a year. The share of the chemical industry in the national industrial structure is projected at 10-11% by 2010 and 13-14% by 2020.

Plan on Vietnam’s automobile industry development by 2010, with a vision to 2020

The auto industry of Vietnam is projected to develop into a crucial industry, which is able to fully satisfy domestic demands and to enter regional and international markets by 2010.

• For common use vehicles (trucks, buses and cars): by 2005 and 2010, to meet around 40 to 50% and 80% of the domestic market demand in terms of volume, respectively, while the ratio of local content is expected at 40% and 50%. Domestically manufactured engines and gearboxes are projected to account for 50% and 90%, respectively by 2010.
• For special use vehicles: by 2005 and 2010, to meet 30% and 60% of the domestic market demand respectively in terms of quantity, while the ratio of local content is seen at 40% and 60
• For high-class tourist vehicles, the ratio of local content is expected at 20-25% by 2005 and 40-45% by 2010 to satisfy most of the domestic market demand.
• For trucks and buses, the ratio of local content is seen at 20% in 2005 before expanding to 35-40% in 2010, meeting 80% of the domestic market demand

Plan on the development of Vietnam’s cement industry by 2010 with a perspective for 2020

The cement industry aims to fully meet domestic demand in terms of quantity and variety, moving towards exports and to develop into an efficient industry equipped with high technology, which is competitive in the domestic and world markets amidst the integration process

Plan on Vietnam’s Milk Industry’s Development by 2010 with a Vision to 2020

• To mobilize all resources from various economic sectors in a bid to develop the milk industry to cater to domestic demands and accelerate milk exports.
• To improve the competitive capacity of the milk industry and apply advanced technologies and techniques; to develop the industry in an open direction and flexible manner with diversified milk products to meet various market demands and the requirements of integration with the international economy.
• To step up development of dairy herd with high economic efficiency and competitive edge, setting up areas for concentrated dairy cattle husbandry by means of wide application of technical advances and new high-yield and -quality breeds.

Master planning on Vietnam's beverage industry development till 2010

• To develop Vietnam's beverage industry into an efficient economic branch. To make full use of domestic raw materials in order to develop the production of high-quality products of various kinds, improving packing and designs; to strive for lower production costs and higher competitiveness with a view to meeting domestic and export needs; to increase budget revenues and firmly integrate into the regional and international economies.
• To build the Vietnam Beverage Corporation into a strong economic group, playing the key role in wine and beer industry and taking the lead in the production of high-quality beverages.
• To encourage all economic sectors to participate in the production of high-quality non-alcoholic beverages from domestic raw materials, meeting domestic and export needs.

Development planning for Vietnam's coal industry in the 2003-2010 period with a perspective to 2020

Coal is a precious natural mineral and an undeniable energy. Hence, the exploration, mining, processing and use of coal must be carried out in an economical and efficient manner.

• To attain a sustainable development in the coal industry, meeting coal demand of the national economy. To ensure stability in the domestic coal market and set aside a rational part of coal output for export in order to regulate quantities and varieties of exported coal and generate foreign exchange.
• To develop the coal industry in line with the development of society, economy, tourism, national defense, security, and environmental and ecological protection in coal producing areas, especially in Quang Ninh province.
• To continually renovate and apply scientific and technical advances in order to raise productivity and ensure the safety of coal mining.
• To strictly manage domestic coal resources

Gender strategy for agriculture & rural development

• To generate higher incomes and reduce poverty for both men and women by introducing policies and programs for agriculture and rural development
• To improve gender equality and enhance position of women within the ARD sector
• To institutionalize the inclusion of gender issue in the designing, planning and introduction of ARD programs

Strategy for accelerating the growth of garment & textile industry by the year 2010

The Strategy for accelerating the growth of Vietnam’s garment & textile industry has been ratified by the Prime Minister in 1998. It aims to

• boost production of materials and accessories for export garments.
• increase the localization ratio of garment products from 25% to 50% and 75% by 2005 and by 2010, respectively.
• increase export turnover

Patent

As from November 27, 2003, the procedures for patent applications in Vietnam did run. Accordingly, the periods and required documents for the patent applications briefs as follows:

TIME FRAMES & PROCEDURE

Entry into Vietnamese national phrase

The time limit for the entry into Vietnamese national phrase as to the PCT application (for both application under PCT Article 22 and PCT Article 39) shall be 31 months from the earliest priority date among priority dates claimed.

That in question for the Conventional patent application shall be 12 months from the earliest filing date.

Periods for examinations

Formality examination: duration of examination is 1 month from the date on which the application is filed in due course with Vietnamese Patent Office.

Request for substantive examination: within 42 months for Invention and 36 months for Utility Solution counted from the priority date of the application, the substantive examination shall be performed upon request filed by the applicant.

Substantive examination: duration of examination is 12 months counted from either the date of receiving request if such request to be filed after publication date of application or the date of publication of application if such request to be filed prior to the publication date of application.

Publications

Application for patent officially accepted shall be published in the National Industrial Property Gazette in the 19th month from the priority date. However, upon a request by applicant for expedited publication, the application for patent shall be published in the 2nd month from the date of filing a request for expedition.

As to application with its request for substantive examination to be filed after the date of the Notice of the official acceptance of application as to formality, but before the expiration of duration of 18 months as of the priority date, shall be published in the Gazette in the 2nd month from the date of receiving the request.

As to application with its request for substantive examination to be filed prior to the date of the Notice of the official acceptance of application as to formality, shall be published in the Gazette in the 2nd month from the date of Notice.

PCT application shall be published soon in the 2nd month from the date of the Notice of the official acceptance of the application as to formality.

FILING REQUIREMENTS

A. National/conventional applications
I . Documents required at FILING

• A notarized Power of Attorney (facsimile copy accepted at filing, but its original must be submitted within 3 months from the filing date). General Power of Attorney is acceptable for filing various patents in the name of the same applicant at the several times.
• One copy of Specification, Claims, Abstract and Drawings (if any); and Vietnamese translation of Specification will be prepared by us.

II. Documents filed LATE within 3 months from the date of filing

• A certified copy of priority documents if priority right is claimed; and its English translation if it is NOT in English, France , Russia .

III. Documents POSSIBLE to file within 1 month upon request of Vietnamese Patent Office

• A notarized Deed of Assignment from the inventor(s) to the applicant(s) if they are not the same one
• A notarized Deed of Assignment of priority right if the applicant is not one having filed the priority application
• Vietnamese translation of the priority documents (prepared by us)

B. PCT applications

• A Notarized Power of Attorney that is required within 3 months from the filing date (NOT required at the filing)
• A Photostat copy of the International Application including the Specification, Claims, Abstract, and Drawings, International preliminary examination report, Amendments (if any) under PCT Article 19 and/or under PCT Article 34.2.b (but is a certified copy if the application for entry into national phase is filed prior to the international publication date of the application). Their Vietnamese translations will be prepared by us to submit within 31 months from the priority date.

Tax

Corporate tax

Tax rate for resident companies: 28%
Tax rate on long-term capital gains: Gains derived from sales of fixed assets are treated as taxable profits and are subject to tax at the normal income tax rates. Gains derived from sale of shares in foreign-invested enterprises are subject to tax at a rate of 25%.
System governing groups of companies and dividends paid by subsidiaries to their parent companies: The remittance tax is abolished, effective from 1 January 2004.      
Tax rate on branches: Foreign branches are taxed on profits made in Vietnam at the rate of 28%.

Income tax

The fiscal year begins on January 1st and ends on December 31st of the same year.

Income tax rate: There are 3 types of schedules concerning the levy of individuals in Vietnam. The Vietnamese law distinguishes these three following categories:

A/ Vietnamese citizens perceiving only incomes of Vietnamese source.
B/ Foreign residents in Vietnam perceiving only incomes of Vietnamese source
C/ Foreigners and Vietnamese perceiving "irregular" incomes of Vietnamese source

These are the corresponding schedules:

A/ Progressive rates from 0% to 50%, divided in 6 brackets.
B/ Progressive rates from 0% to 60%, divided in 7 brackets.
C/ Progressive rates from 0% to 30%, divided in 6 brackets.

VAT rates

General rate of VAT is 10%. The rate of 20% applies to trade of gold, silver and precious stones, hotel, tourism, lotteries, maritime agent services and to brokerage. Luxuries are subjected to the tax in the special consumption rates which varies between 15 and 100%.

Reduced rates: There are 2 reduced rates:
- 0%: exported goods
- 5%: agricultural products, water, medical goods and teaching aids.

Other important taxes

Rights of recordings: 2% to 4% 
Tax on imports of samples: 5% to 150% according to the nature of the product 
Donations: 5% for 2 millions of VND and more

Trademark

A trademark has to fulfill the following conditions in order to claim protection.

•    it must be distinctive
•    it cannot be generic
•    it cannot be deceptively similar to a previous or existing trademark.
•    It cannot be a geographical name or surname
•    It cannot be deceptive or confusing
•    It cannot be scandalous or offensive
•    it cannot have direct reference to the character or nature of the goods/services

Membership:

Vietnam is a party to the Madrid Agreement. 

Eligibility:

The owner of the mark is the only competent person to file an application for the registration of a mark.
Applicants not residing or carrying on business in Vietnam have to nominate a Vietnamese Registered Trademark agent to act on their behalf.

Procedure

Vietnam Trademark Application

1. Searching

This is the first step before an application made for the registration of a trademark. Although a prior search is optional it helps in determining the existence of previous marks.

2. Application

Every applicant is required to submit an application containing  the following information.
•    Notarized Power of Attorney
•    Trademarks Samples
•    List of Products and Services
•    Priority Documents

3. Examination

Formal Examinations are conducted within 3 months from the filing date. Responses for amendments to application are made within 2 months from the date of request.

4. Publication

A trademark will after examination be published in the government gazette subject to the satisfaction of the registrar.

5. Substantive Examination

A substantive examination takes place 6 months from the date of publication.

6. Registration

On completion of the formalities a certificate of registration is granted. The duration of registration takes a minimum period of 12 months. The registration is effective from date of application.

7. Protection

A trade mark once registered is valid for a term of 10 years and can be renewed every  10 years for an unlimited period.

8. Enforcement Remedies

Infringement proceedings are instituted in Courts of law and often contain remedies of final injunction, damages and account of profits.

Charges

Exit and Entry Custom

1. The provisions on baggage of passengers on entry:

- Passengers’ baggage consists of essential personal belongings for the purpose of the journey, including accompanied baggage, unaccompanied baggage sent before or after the journey.
- The time limit to receive the passengers’ accompanied or unaccompanied baggage sent before or after the journey shall not exceed 30 days (thirty days) from the date the baggage arrives at the border.
- Passengers on entry may deposit the baggage at the border-gate customs warehouses and reclaim them as they are on exit. The baggage deposit time limit shall not exceed 180 days (one hundred and eighty) as from the date the baggage deposited at the customs warehouses.
- During the time the baggage deposited, if the passengers on entry make written letters to abandon the deposited baggage, or, if the baggage deposit time past, they fail to reclaim the baggage, the chief of the border-gate customs sub-department shall organize the liquidation or destruction thereof according to law provisions in cases where such baggage has decayed. The proceeds from the goods liquidation shall be remitted into the State budget after subtracting the arising expenses from preservation and liquidation of the goods according to law provisions.

2. The duty-free baggage quotas of passengers on entry:

- The duty-free baggage quotas of passengers on entry issued with the Degree 66/20002/ NĐ-CP dated on 01/07/2002:

+ Besides the duty-free baggage quotas mentioned above if passengers on entry have goods to be imported as gifts and donations to Vietnamese organizations and/or individuals having a value of less than VND 1.000.000 (one million) shall be exempt from duties. 

- For each item of goods to the quotas are stipulated as follow:

• For liquor: if people on entry carry the completed bottle, pot, jar or can (hereafter referred collectively to as bottle) with a volume of not more than 1 (one) liter in excess of the prescribed quota, the whole bottle shall be exempt from duty; if the volume exceeds the above stated limit, they must pay tax on the excess volume according to law provisions.
• For cigarettes:  (rolled cigarettes, and cigars) passengers on entry may carry within the duty-free quotas; if passengers on entry carry rolled cigarettes, and cigars in excess of the duty-free quotas, the excess quantity must be deposited at the border-gate customs warehouses and reclaimed within the given time limit.
• For clothes, belongings and other articles in service of the passengers’ daily life needs; passengers on entry may carry with reasonable quantity and types for their trip’s purposes.

- The duty-free baggage quotas for each passenger on entry are stipulated for each time of entry, not to aggregate the duty-free quotas of several passengers on entry for setting the duty-free exemption for a passenger on entry, except for the accompanied luggage of members of a family on the same journey.
3. Customs declaration procedures:

- The passengers on entry shall compare the accompanied baggage with duty-free baggage quotas specified by Vietnam before their customs declaration. If passengers on entry do not have accompanied luggage which exceeds the duty-free quotas, or which is sent before or after the journey, they shall not have to make customs procedures on Vietnam’s exit/entry declaration form.

- The passengers on entry carry luggage, which exceeds the duty-free quotas, they shall have to make customs procedures on Vietnam’s exit/entry declaration form. The excess volume shall be considered import goods, which must comply with law provisions on import goods and duty and tax registration. The passengers on entry may select articles to pay duties and tax thereon if the accompanied luggage consists of several articles.

- In case, the excess volume of the duty-free baggage quotas must be taxed, but the total payable duty amount is under VND 50.000 (fifty thousand), such volume shall also be exempted from duty and tax.

- The passengers on multiple-entry due to the nature of their job shall not be entitled to enjoy the duty-free baggage quotas for each time of entry for the articles stated at item 1, 2, 3 and 5 in the appendix, but enjoy the duty-free quotas every 90 days (ninety). The passengers on multiple-entry due to the nature of their job are the drivers of airplanes, trains, sea-ships, crews on international vehicles; and car drivers, Vietnamese labors working in neighbor countries, which share common land border with Vietnam.

- The baggage of passengers on entry must be declared and produced to customs officers in the following cases:

• Exceed the duty-free baggage quotas;
• Baggage sent before and after the journey;
• Goods temporarily imported and re-exported or vice Visa;
• Foreign currency exceeds 7.000 USD (seven thousand US dollars) or its equivalent in other foreign currencies, or exceeds 15.000.000 VND (fifteen million) in cash;
• Over 300gram of gold;
• Medicines, addictive medicines, narcotics of all kinds;

- The passengers on entry must declare completely the information on page 2, 3, 4 and 5 on the exit/entry declaration form, they only use the completed arrival exit/entry declaration form (page 4 and 5) for re-entry. (In case if the passengers have goods and luggage to declare, they are not allowed to use the completed arrival exit/entry declaration form (page 4 and 5), but they have to use a brand new exit/entry declaration form for their declaration.

- In case if the passengers have goods and baggage temporarily imported and re-exported or vice Visa, or taxed goods they have to stick “x” on the exit/entry declaration form and have to declare completely on the non-trade declaration form (kinds of goods, brand, value) and time temporarily imported and re-exported;

- The passengers on entry are not allowed to import the items stated in the List of prohibited and conditional imports, for the items licensed by the competent body, the passengers on entry must declare and produce to customs officers for re-checking.

- The list of prohibited imports according to the law provisions:

• All kinds of weapons, munitions, explosives, military technical equipment and tools;
• All kinds of crackers, devices harmful to traffic measuring equipments;
• Used consumer goods;
• Reactionary and morally harmful cultural publications and goods that are banned on dissemination and circulation in Viet Nam;
• Used spare-parts and vehicles;
• Material waste, garbage and freezing devices with C.F.C
• Products and materials containing armiant incorporated in the amphibious group;
• Drugs;
• Toxic chemicals;
• …

- The list of conditional imports according to the law provisions:

• Sport guns;
• Postage stamps;
• Radar devices and radio support devices;
• Satellite transmitter-receivers and transmission equipments;
• Money printing machines, metal money moulding machines, money printing ink, money cutting machines, money printing papers;
• Color photocopy machines;
• Children toys;
• Electrical game machines with bonus programs, professional casino devices;
• Motorcycles and motorized tricycles with a capacity of up 175cm3;
• Rare wild animals, pet and plants under CITES convention;
• Pesticides for plants, veterinary medicines and materials, biological products, fertilizers and animal feeds;
• Gold (Fine-art articles, raw material gold, international standard gold);
• Pre-substances, addictive medicines, narcotics of all kinds;
• Medicines for men and its materials;
• Medical equipments;
• Cosmetics;
• Toxic chemicals;
• Industrial explosives;
• …

Note: Passengers shall be handled according to Vietnamese laws for their in observance of the regulations stated in this guide. Contact customs officers at the border gate for further information.

Import and Export Custom

Customs declaration procedures

When carrying out customs procedures for exporting and importing goods, the customs declarers must submit and present a customs dossier at the headquarters of Customs Sub-branch and be responsible for legality and lawfulness of customs dossiers and accurateness of declared contents on customs declaration form.

- Documents to be submited and presented

• The import goods declaration forms: 02 originals
• The goods purchase and sale contract or papers of equivalent legal value: 01 duplicate
• The commercial invoice: 01 original
• The bill of lading: 01 duplicate

- Documents to be additionally submitted for the following cases

• The  packing list of goods (for lots of goods of many categories): 01 original, 01 duplicate
• The import goods declaration forms (for cases applied according to GATT): 02 originals
• The import permit of the competent State body (for goods on the list of goods banned from import or subject to conditional import):

+ Single importation:                  01 original
+ Multiple importation:               01 duplicate, submit the original

• The certificate of origin (C/O) (for cases requiring the submission as prescribed): 01 original
• The entrusted import contract (if umdertaking the entrusted import): 01 duplicate
• The written registration for goods quality inspection or inspection exemption notice issued by the State quality inspection agency (for import goods included in the list of those subject to state quality inspection): 01 original
• The written quarantine registrations issued by quarantine agencies (for import goods subject to quarantine): 01 original.
• When carrying out customs procedures for goods imported through seaports, the customs declarers must additionally submit the delivery order (D/O).

- Documents to be produced:

• The business registration certificate: 01 original
• The certificate of import/ export business code registration: 01 copy (duplicate or original).

- Other regulations on declaration, documents included in the customs dossiers:

• The customs declarers may submit the certificate of origin 60 (sixty) days later; other documents belonging to the customs dossiers (excluding customs declaration) 30 (thirty) days later as of the registration of customs declaration form in case where they obtain the approval of the Heads of Customs Sub-Departments.
• Before the time the customs officers conduct the actual goods inspection, if the customs declarers made written requests which are approved by the Heads of Customs Sub-Departments, they may withdraw the registered customs declarations for supplementation and/ or amendment or replacements.
• The customs declarers may register the customs declaration for the import goods before the goods arrive at the border gates within 15 (fifteen) days, later than this time limit the customs declaration is no longer valid. If goods are imported later than this time limit, the declarer must register the other customs declartion.
• If the goods owners who regularly exports and/ or imports the same items of goods within a given period under the same purchase and sale contract may use a single customs declaration (registered once) for carrying out customs procedures for the exportation or importation of such goods items within the delivery time determined in the purchase adn sale contracts.

Inspection of the goods’ actual conditions

- Exemption from actual goods inspection:

• Conditions for goods owners to enjoy exemption from actual goods inspection: the goods owners have a record of two year’ importation, who have not been handled for customs-related violations or have been handled for customs-related violations within the sanctioning competence of the Heads of Customs Sub-Departments.
• The goods of the owners who meet the conditions for exemption from actual goods inspection: Equipment, machinery, fresh and raw foodstuffs, goods requiring special preservation; goods stored in bonded warehouses, goods stored in tax-suspension warehouses; imports to be taken into export processing zones, tax-suspension warehouses or other customs preferences zones; liquid and bulky goods and goods items whose volume, quality and categories must be determined on the basis of competent State bodies or expertising organizations; regularly imported goods; other goods stipulated by the Government.

- Probability inspection of the actual conditions of goods of no more than 10% of goods lot

• The subjects applied this probability inspection consist of: The goods owners and the goods of the owners not belonging to the subjects that meet conditions for exemption from actual goods inspections, shall have to be inspected 10% of goods lot before carrying out customs procedures.

- Determination of the inspection rate

• If the goods are packed in bales, the inspection rate shall be the rate of inspected bales.
• If the goods are packed in containers, the inspection rate shall be the rate of inspected containers or the rate of inspected bales in each container.

- Inspection of the actual conditions of the whole export or import goods lots

• For the goods owners who have been more than three times handled for customs-related violations within two years as of the date of carrying out customs procedures for import activities, and one year, as of the date of carrying out customs procedures for export activities,  with the level of each fine falling beyond the sanctioning competence of the Directors of Provincial, inter-provincial, and munipal Departments.
• For the export or import goods lots showing signs of violation of the customs legislation.

- Conditions for goods customs clearance

• The declartion of the customs declarer or the results of the State inspection body or expertising organization, for goods exempt from actual inspection.
• The results of the actual godos inspection by the customs office, for goods subject to actual inspection.
• The certificate of registration of State inspection of goods quality, which is issued by the expertising organization, or the noticeon exemption from State inspection of goods quality, which is issued by a competent State management body, for imports goods subject to State inspection of goods quality.
• The expertise results, for goods requiring expertise.
• Export goods and import goods not subject to taxes collected by the customs offices, duty-free goods, processed goods, and other special goods shall enjoy customs clearance immediately after there is the customs office’s certification of the goods inspection results on the declaration forms.
• Export goods and import goods subject to goods cleard  immediately after the customs declarers pay taxes. Goods enjoying grace days of tax payment cleared immediately on the tax notification of the Customs office.

Legal system

Vietnam's legal system is fast evolving and the legislation work has been significantly improved. In line with the increasing number of legal texts, the Official Gazette has increased its rate of publication from two issues per month in 1995 to daily in 2004. The number of laws and other legal texts increases rapidly. From early 2003, legal texts must be published in the Official Gazette as a compulsory condition for becoming effective. This compulsory publication is a great improvement compared to the previous situation where most of legal texts became effective 15 days after the date of signature and not all legal texts were published. The dynamism and transparency of the legal system, as a result, were improved significantly.

Despite these significant improvements, Vietnamese legislation work is still weak resulting in the legal system being inadequate and unstable. One of the reasons explaining this shortcoming is the function of the National Assembly. The National Assembly does not consist of professional and specialized legislators. Its members are working people gathering only during two 30-day sessions per year. Its mandate of approving the country's economic and social development plans, financial and monetary policies, the national budget, as well as questioning the Government's activities takes up a large amount of time, leaving a modest agenda to legal debate and approval of laws. On the other hand, its legislation workload increased tremendously under the country's commitment under the 2000 U.S.-Vietnam Bilateral Trade Agreement and under the commitments in its adhesion to the World Trade Organization. Most of laws are passed after one or two session of debate by the National Assembly. Vietnam's first Competition Law, as a typical example, was given four days of debate before being passed into Law in November 2004. The input of the National Assembly on the country's laws is therefore still limited.

In practice, the real legislators are the administrators, particularly the Ministries. A set of rules on a specific issue in Vietnam typically includes: (i) a law drafted by a relevant Ministry, consented first by the Government, then approved by the National Assembly; (ii) an implementing Decree drafted by that Ministry and issued by the Government; and (iii) an implementing Circular issued by the same Ministry. Adding to this, a significant number of parliamentarians are administration officials. This has important impacts on the National Assembly's decision. Laws are usually drafted in such general terms that they are not enforceable without the implementing decrees and circulars.

This legislation process magnifies the power of the executives, conferring them the unwritten power to interpret law. Constitutionally, this is in the power of the Standing Committee of the National Assembly. In the absence of a specialised and effective supervisor of the constitutionality and legality of legal documents, interpretation of the executive bodies sometimes results in a de facto amendment to the law.

Jurisprudence is not recognized as a source of law and is not part of the legal system. However, as a matter of practice, every year, the Supreme Court produces a collection of typical cases with comments and instructions. These treatises are relied on seriously by the inferior courts.

There is no formal process of codification in Vietnamese law. In certain important area where the law issued by the National Assembly is relatively comprehensive and complete, the name "Code" is used. To date, following are the major codes: the Civil Code, the Civil Procedure Code, the Criminal Code, the Criminal Procedure Code, the Labour Code, and the Maritime Code.

Informal compilation of legal texts in specific areas are carried out and published by different publishing houses. The most reliable source is the National Political Publishing House that publishes a wide range of legal texts and compilations of legal texts. The National Political Publishing House operates under the Communist Party of Vietnam. It has been assigned by the Politburo the mandate of publishing political and legal publications

Law is the instrument of the legal system. There are many laws in Vietnam such as:

Constitutional law

• Constitution of 1992
• Constitution of Vietnam

Administrative / Public Law

• Law On Technology Transfer Draft 28 July 2006
• Law on Nationality of Vietnam
• Statistics Law

Criminal Law

• Penal Code

Civil Law

• Civil Code
• Decree Providing For Implementation Of Law On Land
• Land Law

Commercial Law

• Amendment and supplement to the law on foreign investment in Vietnam
• Commercial Law
• Commercial law (revised - 2005)
• Law on Investment 2005
• The Law amending and supplementing a number of Article of the Law on Export Tax and Import Tax No.4/1998/QH10 of May 20, 1998 by National Assembly of the Socialist Republic of Vietnam.

Company law

• Enterprise Law 2005
• Law on Private Enterprises

Labor Law

• Labour Code
• Labour Code. Dated 23 June 1994.
• Law on Trade Unions
• Loi du 23 juin 1994 portant Code du travail.

Health law

• Law on HIC/Aids Prevention and Control

Mining Law

• Mineral Law
• Mineral Law (1996)

Insurance Law

• Law on Insurance Business

Tax law

• Law on Corporate Income Tax
• Law on Import/Export Tax
• Law on Turnover Tax
• Law on amendment of and addition to a number of articles of the law on special sales tax
• Tax Administration Law
• The Law on Special Consumption Tax No.5/1998/QH10 of May 20, 1998

Banking law

• Decree On organization and operation of foreign bank branches, joint venture banks, 100% foreign owned banks and representative offices of foreign credit institutions in Vietnam
• Law on Accounting
• Law on Foreign Investment
• Law on business bankruptcy
• Law on the State bank of Vietnam on 1997
• The Law on Foreign Direct Investment in Vietnam on November 12, 1996
• Vietnamese Bankruptcy Law

Transport and Maritime Law

• Maritime Code

Environmental Law

• Decree No. 179/1999 Stipulating The Implementation Of The Law On Water Resources
• Environmental Protection, Law on (1993)
• Law On Environmental Protection
• Law on Environmental protection
• Law on water resource
• The Law on Environmental Protection

Intellectual Property Law

• Intellectual property law
• Ordinance on Plant Varieties

Energy law

• Petroleum Law 1993
• Petroleum Law 2000

Construction law

• Law on Housing

Agriculture Law

• The Basic Law on Food, Agriculture and Rural Areas

In the present time, Vietnam’s legal and regulatory environment is undergoing profound change. Ongoing efforts to implement BTA commitments and to lay the legal and regulatory foundation for WTO accession will bring about significant changes in Vietnamese law affecting an array of commercial issues. In 2005, Vietnam’s National Assembly is expected to finalize a number of important legislative initiatives. Among the laws and ordinances expected to be passed in May 2005 are a full revision of the Commercial Law, intended to provide a modern and simplified legal framework for commercial transactions, as well as a broad legal framework for liberalizing distribution services in Vietnam. A new Civil Code, addressing contract enforcement, secured transactions and property rights is also slated for passage in the spring of 2005. Amendments to the Customs Law of 2000 are also anticipated, including provisions intended to modernize customs procedures and implement greater use of technology in the customs clearance process.

A second series of legal changes is likely to follow in late 2005 or 2006. These should include a new Intellectual Property Rights Law which will be intended to bring Vietnam into compliance with BTA obligations and the WTO agreement on Trade Related Intellectual Property; a new Law on Electronic Transactions to form the legal basis for how digital information is used in commercial transactions; amendments to the Law on Import and Export Duties addressing procedures for collecting import tariffs and taxes; revisions of the Enterprise Law intended to unify and streamline regulations for registration and corporate governance of private, state-owned and foreign-owned companies; and a new Law on Technology Transfer intended to modernize an outdated legal and policy framework for technology transfer.
The items above are only a partial list of the legislative initiatives currently underway that should transform key elements of Vietnam’s commercial environment. Still, effective implementation and issuance of follow-on implementing regulations will be important to determining the impact of these legislative initiatives.

INDUSTRIAL PROPERTY

Intellectual property (IP) protection is one of the fastest developing areas of law in Vietnam. The pace of development has been expedited in recent years when Vietnam initiated the country’s bid for the World Trade Organization (WTO) membership. The open door policy that Vietnam embarked upon a long time ago increased foreign investment and technology transfer from overseas companies to Vietnam.

The Establishment of Industrial Property by Patents

Ownership of inventions, utility solutions, industrial designs, trademarks, and the appellations of origin are created based on registration or patent issued by the competent state authority. Ownership of other objects of industrial property shall be created pursuant to the provisions of law.

The Right to Apply for Patents

1. The following persons are entitled to file applications for a protection title of their inventions, utility solutions, and industrial designs:
   a.  Inventors or co-inventors who create inventions, utility solutions, and industrial designs out of their own efforts and at their own expense;
   b.  Employers of employees who create inventions, utility solutions and industrial designs during the performance of their assigned duties unless the employers and employees have agreed otherwise;
   c.  Legal persons and individuals who hire inventors to carry out techno-scientific research or project implementation;
   d.  Legal persons and individuals who receive inventions, utility solutions or industrial designs pursuant to contracts or the law.
2. Individuals, legal persons and other subjects who legally conduct business are entitled to register their trademarks in order to protect them.
3. Legal persons and individuals who trade in specific goods that come from a locality that has the features stipulated in Article 786 of this Code are entitled to register the appellations of origin.

Priority Rights

1. The priority right in respect of an application for patents or a registration of inventions, utility solutions, industrial designs, trademarks, the appellations of origin or other objects as per the law, shall be determined on the basis of the priority date.
2. The priority date shall be the date on which the application for patents is received by the competent state authority, or shall be determined according to the Conventions to which Vietnam has signed or joined.
3. In order to have a priority right determined by the conventions which the Socialist Republic of Vietnam has signed or joined, the applicant must indicate in the application his intention to have the priority right. The applicant must prove his priority right.

The Revocation of Patents

1. A patent or certificate may be revoked in any of the following circumstances:
   a.  If the objects of industrial property to be patented do not satisfy the requirements provided by law at the time of the issuance of the patent or certificate;
   b.  If the patent has been issued to a person who does not have the right to apply for it;
   c.  If there are other causes for revocation as provided for in the law
2. When a patent revoked the industrial property right under its protection shall be deemed not to have been created.

The Suspension of a Patent's Validity

1. The validity of a patent or certificate shall be suspended in any of the following circumstances:
   a.  If the owner of the objects of industrial property does not pay the fee to maintain his protection title on time;
   b.  If the owner of industrial property rights for a trademark or the user of the appellation of origin ceases business activities;
   c.  If the owner of industrial property rights for a trademark fails to use the registered trademark or to transfer it to another person during the period required by law commencing with the moment when the registration took effect; d. If there is any other cause as provided by law.
2. When the validity of a patent or certificate is suspended, the industrial ownership protected thereby shall be suspended from the moment of the suspension.

Transferring the Right to Use Inventions, Utility Solutions and Industrial Designs According to the Decision of the Competent State Authority

Upon application by persons who have the need to use the inventions, utility solutions and industrial designs, the competent State authority may order the owners thereof to transfer the right to use these inventions, utility solutions and industrial designs to such persons on the basis of reimbursement, if any of the following circumstances hold true:

1. The owners have failed to use the industrial property, or have used it in a manner not in accordance with the needs of the economic or social development of the country and without reasonable motivation
2. The persons who need to use such inventions, utility solutions or industrial designs have negotiated with the owners in different ways and offered a reasonable price, but the latter still refuses to conclude a contract for the transfer of the right to use such objects;
3. The use of such industrial property is necessary to meet the needs of national defense, national security, health or other urgent needs of society.