The ASEAN-Hong Kong, China Free Trade Agreement (AHKFTA) came into effect on June 11 for Vietnam, Laos, Myanmar, Singapore, and Thailand. The remaining ASEAN member states will complete the ratification process later this year. The deal was first signed and agreed in November 2017 to increase economic cooperation, reduce taxes, and increase investment between regional […]
Vietnam’s visa and work permit procedures, can be confusing for first time visitors. Vietnam Briefing explains the steps and what foreigners should pay attention to when planning a long-term visit. The number of foreign skilled workers coming to Vietnam has steadily increased in recent years, surging to over 80,000 at the end of 2018. Most foreign […]
Foreign contractors are subject to taxes on payments for work done in Vietnam based on the contracts signed with a Vietnamese partner in the form of the foreign contractor tax (FCT). FCT is not a separate tax, but typically comprises a combination of value added tax (VAT) and corporate income tax (CIT), or personal income tax (PIT) for the income of foreign individuals. […]
Terminating an employee can be challenging for foreign investors in Vietnam. Vietnamese labour law is generally considered employee friendly and the termination process must be based on statutory grounds, subject to formal requirements and procedures. The Vietnamese labour law applies to all employers working in Vietnam under labour contracts regardless of whether such employees are […]
Fueled by continuous growth, Vietnam continues to attract record foreign direct investment (FDI). The latest data from the Foreign Investment Agency (FIA) shows that FDI in Vietnam in the first five months of the year reached a four year high of US$16.74 billion. This inflow represents a year-on-year increase of 69.1 per cent. Around 1,363 new projects […]
Industrial Zones (IZs) in Vietnam are a popular destination for foreign investors. But what are they? IZs are locations earmarked by Vietnam’s government for the industrial production of goods and services. Investors often locate in an IZ because IZs often have regionally competitive facilities, infrastructure, and logistics. Foreign invested companies are also able to tap […]
Vietnam will introduce new regulations on the minimum basic salary for social insurance. The government’s Decree 38/2019/ND-CP on minimum basic salary will take effect from July 1, 2019. As per the new law, the minimum basic salary cap for social insurance will be raised to US$1,295 (29,800,000 VND) from the current US$1,208 (27,800,000 VND) per month. This […]
Industrial zones (IZs) and Export processing zones (EPZs) in Vietnam have played an important role in attracting foreign investments and the development of the local economy. Firms investing in these zones have enjoyed preferential governmental policies in terms of tax and land rent incentives. But now some IZs and EPZs are lagging behind in attracting […]
The government recently issued two regulations to help and incentivize small and medium-sized enterprises (SMEs): Circular No 06/2019/TT/BKHDT on network of consultants for SMEs and Circular No 05/2019/TT/BKHDT on subsides for training courses for women-owned SMEs went into effect May 12. The consultant network is defined as a group of consultants and consultancies specialized in a broad range of fields to […]
Global supply chain networks have been disrupted since the US-China trade war began in January 2018, prompting several foreign investors to look for manufacturing alternatives. Vietnam Briefing highlights three key steps if planning a supply chain shift to Vietnam. Vietnam is not without its share of challenges. In the short-term, manufacturers may find the production […]
Vietnam recently issued new updates on labor outsourcing regulations under Decree 29/2019/ND-CP (Decree 29). The new regulation came into effect on May 5 and details guidelines on Clause 3 of Article 54 of the Labor Code regarding outsourcing services, deposit payment and the list of permissible outsourced jobs. We look at five main highlights of the decree […]
This article appeared in Vietnam Briefing in March 2018. On March 8, 11 countries signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership or CPTPP in Chile. The agreement represents 13.5 percent of the global economy, a total of US$10 trillion dollars and 15 percent of the global trade revenue, equal to US$5 trillion. Members […]