Directive No. 11/1998/CT-TTg On Implementing the Government Decree No. 10/1998/NĐ-CP and Improving Procedures for Foreign Direct Investment

 DIRECTIVE

REGARDING THE IMPLEMENTATION OF THE GOVERNMENT DECREE AND IMPROVEMENT OF FOREIGN DIRECT INVESTMENT PROCEDURES 10/1998/NĐ-CP ON FOREIGN DIRECT INVESTMENT

To implement Decree No. 10/1998/NĐ-CP January 23, 1998 on certain measures to encourage and ensure foreign direct investment activities in Vietnam (hereinafter referred to as the Decree), improve procedures to facilitate the operations of foreign-invested enterprises, the Prime Minister instructs the Ministries, ministerial-level agencies, agencies under the Government, and provincial People's Committees (hereinafter collectively referred to as the Ministries and provincial People's Committees) to carry out the following tasks:

1. The Ministries and provincial People's Committees shall be responsible for immediately implementing the provisions of the Decree, guiding implementation, and handling issues within their authority and responsibility in accordance with the content of the Decree.

Strictly prohibit the issuance of regulations and procedures outside their authority, or guidance, interpretation, and application inconsistent with the spirit and content of the Decree.

The Ministry of Planning and Investment shall serve as the coordinating agency with relevant agencies in explaining and resolving difficulties faced by foreign investors.

2. The Ministries and provincial People's Committees shall review, amend, or revoke regulations issued contrary to the Decree; publish and post at the locations where applications are received all procedures and processes for handling foreign investment issues; identify and publicly announce a single point of contact for receiving, processing, and responding to foreign investors and foreign-invested enterprises; direct and inspect competent agencies to strictly implement the Decree's provision that foreign-invested enterprises only need to notify the competent State agency to commence business operations according to the objectives and industries specified in the investment permit, without needing to apply for a Business License and Professional Practice Permit.

3. The Ministry of Finance, in collaboration with the Ministry of Planning and Investment, the General Department of Land Administration, and related agencies, shall draft and publish regulations on compensation and land clearance applicable to foreign direct investment projects; submit proposals to adjust unreasonable import tax rates and income tax rates for high-income individuals (primarily foreigners and Vietnamese working in foreign-invested enterprises).

4. The General Customs Department shall promptly revise and publicly announce customs regulations, procedures, and formalities within its authority in a simplified manner to facilitate enterprise operations; strengthen organization, increase inspection and supervision of provincial and city customs offices and border gates to immediately address harassment and corruption; establish mechanisms to receive and process customer feedback and complaints.

5. Provincial Industrial Zone Management Boards shall review rental prices and payment methods for land in industrial zones, guide infrastructure development companies to reduce rental prices for developed land and adopt flexible payment methods to enhance investment attraction in industrial zones.

6. The General Department of Land Administration shall provide detailed guidance to land administration departments on implementing Circular No. 697/TT-ĐC dated May 12, 1997, conducting cadastral surveys and mapping only once, and simplifying all other land-related procedures.

7. The Ministry of Trade shall guide provincial People's Committees and industrial zone management boards to facilitate and expedite the confirmation of export-import plans for enterprises.

8. The Ministry of Science and Technology and Environment shall amend Circular No. 1100/TT-MTg dated August 20, 1997, specifying and announcing environmental protection standards for investors to comply with and face penalties if violated; based on this, reduce the list of projects required to prepare environmental impact assessments; specify exemptions from preparing environmental impact assessments for enterprises applying advanced countries' environmental standards pursuant to Clause 3, Article 39 of Decree No. 10/CP; adjust Decision No. 2019/1997/QĐ-BKHCNMT December 1, 1997 to be more lenient towards wholly foreign-owned enterprises or those exporting all products.

9. The Ministry of Labor, Invalids, and Social Affairs shall study and propose the Government to amend certain provisions of Decree No. 58/CP dated October 3, 1996 and Circular No. 09/LĐTBXH-TT dated March 18, 1997 to simplify work permit application documents for foreigners working in foreign-invested enterprises, delegate authority to provincial Labor, Invalids, and Social Affairs Departments and industrial zone management boards to issue Work Permits for all categories and durations; review Circular No. 11/LĐTBXH-TT dated May 3, 1995 to not apply domestic enterprises' wage scales, allowances, and subsidies; and study foreign investors' suggestions regarding wages, insurance, and allowances for Vietnamese workers in foreign-invested enterprises.

10. The Ministry of Home Affairs, in coordination with the Government Organizational Cadre Board, shall amend Joint Circular No. 32/TT-LB December 30, 1993 to decentralize authority to provincial public security agencies to handle and register seals for foreign-invested enterprises.

11. The Ministry of Interior and the Ministry of Foreign Affairs shall timely issue entry visas for foreign investors as prescribed in Article 4 of Decree No. 04/CP dated January 18, 1993 (one year and renewable annually); study and submit to the Government for issuance of a unified decree on exit and entry to replace the current decrees of the Government (No. 04/CP dated January 18, 1993, No. 48/CP dated July 8, 1993, No. 24/CP dated March 24, 1995, and No. 76/CP dated November 6, 1995). Amend the current regulations on the validity period of entry visas for foreigners implementing investment projects in Vietnam according to the duration of labor contracts; issue multiple-entry entry visas with a validity of three years for foreign investors who are not residents in Vietnam. Review and amend regulations on visa issuance and visa fees, inspect to ensure smooth implementation for foreigners and consistency among domestic and overseas Vietnamese agencies.

12. The Ministry of Transport shall study to amend regulations on quality inspection of domestically produced and assembled motor vehicles bearing foreign brand names, simplifying related documentation and technical procedures, while coordinating with the General Department of Standardization, Metrology, and Quality Control to stipulate that quality inspections for such vehicles be conducted only once during brand registration, avoiding duplication.

13. The Vietnam Electricity Corporation and the Vietnam Post and Telecommunications Corporation shall proactively implement tasks within their scope of operation to ensure external infrastructure for businesses and, together with other relevant businesses, promptly address cases where foreign investors have invested in constructing external infrastructure (electricity, water...) outside the fence upon agreement with the investors.

14. The Ministry of Planning and Investment shall coordinate with the Ministry of Industry, the Ministry of Agriculture and Rural Development, the Ministry of Construction, and other economic and technical management ministries to periodically publish a list of products for which foreign investors applying for investment permits must ensure at least 80% exportation of production volume.

The Ministry of Industry shall take the lead in studying and submitting to the Government domestic localization policies (gradually increasing the number of components and parts produced in Vietnam) for mechanical and electronic products.

The Ministry of Construction shall take the lead, in coordination with relevant ministries and sectors, to study and submit to the Government mechanisms allowing foreign-invested enterprises to engage in housing business, construction of infrastructure, and development in new urban areas.

Tasks from Section 1 to Section 14 shall be completed before April 30, 1998.

15. The State Bank of Vietnam shall take the lead in drafting and promulgating or submitting to the Government for promulgation regulations on opening bank accounts abroad, guarantees, pledges, and mortgages for foreign-invested enterprises.

16. The Government Price Management Board shall take the lead, in coordination with the Ministry of Finance, the State Bank of Vietnam, and relevant agencies, to study a proposal on service prices under state price management and regulations requiring foreign-invested enterprises to pay service fees in Vietnamese currency, gradually moving towards a single pricing mechanism.

17. The Ministry of Planning and Investment shall take the lead, in coordination with relevant ministries and provincial People's Committees, to study and submit to the Government proposals for handling cases of foreign investment without permits; consider investment cases in production fields, and if conditions are met, issue Investment Permits according to the Law on Foreign Investment in Vietnam.

18. The Ministry of Labor, Invalids, and Social Affairs shall take the lead, with the participation of the Government Organizational and Cadre Management Board and relevant agencies, to establish standards for the professional qualifications, knowledge of laws, and language proficiency of Vietnamese cadres participating in the management of foreign-invested enterprises, suitable for different scales and types of operations; mechanisms for the dispatch, appointment, recruitment, rewards, and disciplinary actions for Vietnamese cadres working in foreign-invested enterprises.

19. The Ministry of Education and Training, in coordination with the Ministry of Labor, Invalids, and Social Affairs, shall take the lead, in collaboration with the Ministry of Planning and Investment, to complete the planning and training programs for Vietnamese cadres participating in the management of foreign-invested enterprises, cadres engaged in foreign investment work at state management agencies, as well as technical workforce to meet immediate and long-term requirements.

20. The Ministry of Planning and Investment shall take the lead, in coordination with the Ministry of Finance and the State Bank of Vietnam, to study and submit to the Government proposals on foreign investment through joint-stock companies; issuance of bonds by foreign-invested enterprises; establishment of investment funds; piloting the privatization of some foreign-invested enterprises.

21. The Ministry of Planning and Investment shall take the lead, in coordination with relevant ministries and sectors, to study and submit proposals to gradually create a legal framework and uniformly apply tax policies and service charges (land rent, electricity, water, postal, telecommunications, aviation...) for both domestic and foreign investors.

Ministries, sectors shall urgently implement the above tasks and report results to the Prime Minister by the end of the third quarter of 1998.

22. The Ministry of Planning and Investment shall coordinate with the Government Office to be responsible for monitoring and summarizing the implementation of this Directive to promptly report to the Prime Minister. Regulatory documents and guidelines issued by ministries, sectors, and localities to implement this Directive should be sent to the Ministry of Planning and Investment and the Government Office.

Ministers, heads of ministerial-level agencies, heads of government agencies, and Chairmen of provincial and municipal People's Committees directly under the Central Government shall strictly and fully implement this Directive. In cases where issues related to legal regulations exceed their authority, they shall report to the Prime Minister and competent authorities for timely supplementation and amendment.