Legal Document Updates in English (21/2012)

OFFICIALLY APPROVING THE SOLUTIONS OF
DIFFICULTY REMOVING FOR ENTERPRISES
 

On May 10, 2012, the Government issued the Resolution No. 13/NQ-CP on solutions to remove difficulties for production, business and market support.

Under this Resolution, the Government agreed to grant a 06 month extension of the deadline for submission of value added tax in April, May and June 2012 for the following enterprises who are implementing value-added tax payment by deduction method: small and medium enterprises, not including small and medium enterprises in the sectors of lottery, securities, finance, banking, insurance, production of goods and services subject to special consumption tax and enterprises ranked the 1st and special classes of economic groups and corporations; Enterprises employing a lot of workers in the field of production, processing agricultural, forestry and aquatic products, textiles, footwear, electronic devices, construction of social and economic infrastructure.

These enterprises mentioned above are granted 09 month extension of the deadline for corporate income tax from 2011 and backwards that has not paid into the state budget. This policy is also applied for the enterprises manufacturing mechanic products being the capital goods, water transport; manufacturing steel and cement.

Some economic organizations operating in the field of trade and services are reduced 50% of payable land rental in 2012 for. The project investors having financial difficulties are granted a maximum of 12 month extension of the deadline for land use levy payment to

The Minister of Finance by procuration of the Prime Minister will report to the National Assembly for consideration and decision on the reduction of corporate income tax for enterprises, business households. The State Bank of Vietnam continue lowering the interest rates on loans, giving priority to agriculture, rural sector; small and medium enterprises; exported products producing enterprises and supporting industrial enterprises.

The Ministries, agencies and localities should take measures to mobilize 2,000 billion VND for adding loan capital source for investment in solidifying canals, developing rural roads, electric pump houses for agricultural production, infrastructure of aquaculture and rural craft villages. Besides, they should continue stepping up the reform of administrative procedures.

IMPLEMENTING THE SCHEME ON RESTRUCTURING OF ENTERPRISES
 

This is one of the Ministry of Finance’s responsibilities as prescribed in the Directive No. 08/CT-TTg dated March 02, 2012 of the Prime Minister on boosting the operation and enhancing the management of the securities market.

Accordingly, from March 02, 2012, the Ministry of Finance shall assume the prime responsibility for, and coordinate with related agencies in, implementing the Scheme on restructuring of enterprises, focusing on state economic groups and corporations. Besides, the Ministry of Finance shall implement some contents such as: Assume the prime responsibility for, and coordinate with related ministries and

sectors in, implementing the Strategy for development of Vietnam’s securities market during 2011-2020;assume the prime responsibility for, and coordinate with the State Bank in, implementing the Scheme on   management of foreign indirect investment capital  and in, renovating the securities settlement and securities transaction payment system; Assuming the prime responsibility for, and coordinate with related ministries and sectors in, implementing the Scheme on restructuring of the securities market after it is approved by the Prime Minister; Developing the system of professional securities investors; Restructuring the bond market.

BY 2020, THE TOTAL VALUE OF THE STOCK MARKET CAPITALIZATION
WILL REACH 70% OF GDP
 

The Prime Minister issued the Decision No. 252/QD-TTg of March 1, 2012, approving the Strategy for development of Vietnam’s securities market during 2011-2020, focusing on increasing the size, depth and liquidity of the securities market to strive that the total value of the stock market capitalization will reach around 70% of GDP by 2020; to develop the bond market into an important channel for raising and distributing capital for economic development;

The Government also aims to restructure the organizational model of the securities market in the direction that the country will have only one Stock Exchange, and step by step equitize the Stock Exchange to assure uniformity of its operation and conveniently improve its governance capacity and attract capital from market members; Formulating a mechanism for linking the monetary market with the capital market by permitting fund management companies to associate with commercial banks in designing financial products.

Improving the competitiveness of market intermediary institutions and supporting institutions is on the basis of restructuring securities companies and step by step increasing their size and financial potential and diversify their professional operations according to international practices and standards; to open the market for foreign financial intermediaries according to the committed roadmap and the competition level of domestic institutions.

Also under this Decision, by 2015, a new Law on Securities shall be promulgated in replacement of the current Law on Securities with a broader scope of regulation and better conformity with international practices and standards, which comprehensively regulates securities activities in connection with the financial market service sector.

AMENDING THE REGULATIONS ON CASES OF DISPOSAL
OF SECURITY ASSETS
 

On February 22, 2012, the Government issued the Decree No. 11/2012/ND-CP of February 22, 2012, amending and supplementing a number of articles of the Government’s Decree No. 163/2006/ND-CP of December 29, 2006, on secured transactions. Of which, the Government amends 02 following cases of disposal of security assets including the right to use land or own houses and assets attached to land.

Firstly, in case only the land use right is mortgaged while the asset attached to land is not and the land user is concurrently the owner of the asset attached to land, asset attached to land shall be handled together with the land use right, unless otherwise agreed upon. Parties may reach agreement on or hire a price appraisal organization to determine the value of the land use right and asset attached to land. Proceeds from the handling of the security asset shall be firstly used to make payment to the owner of the asset attached to land, unless otherwise agreed upon.

Secondly, the land use right is mortgaged while the asset attached to land is not and the land user is not the owner of the asset attached to land, when the land use right is handled, the owner of the asset attached to land may further use land as agreed with the land user, unless otherwise agreed upon. Rights and obligations of the mortgagor and the owner of the asset attached to land shall be transferred to the buyer or the recipients of the land.

Under this Decree, future assets don’t include the right to use land, future assets include assets procured with loans; assets which are in the making or lawful created at the time of entering the secured transactions; assets which have been formed and are subject to ownership registration but are registered in accordance with law after the time of entering the secured transaction.

All amendments and supplements shall take effect on April 10, 2012.

REGIMES FOR PERSONS IN STAY PENDING THEIR EXIT
 

The Government issued the Decree No. 09/2012/ND-CP dated February 17, 2012 providing the management of and regimes for persons in stay pending their exit under the law on execution of criminal judgments.

A person in stay shall be arranged in a collective room according to his/her gender (male or female) with a toilet and a lying space of at least 3 m2 and be provided with a mat, blanket and mosquito net. The monthly food ration for a person in stay is as follows: 17 kg of ordinary rice, 0.7 kg of meat, 0.8 kg of fish, 0.1 kg of salt, 0.5 kg of average-category sugar… This ration shall be provided by the State and converted into cash at current market prices in localities where accommodation establishments are located.

Persons in stay may have healthy physical training, sports and cultural performance activities within their accommodation establishments. Each room shall be furnished with a color television set and persons in stay may borrow books and newspapers of accommodation establishments. They may telephone or send mails to their relatives and consular offices under regulations of accommodation establishments.

Under this Decree, under-16 children of persons in stay who live with their parents at accommodation establishments may be provided with lying space in the same room with their parents according to characteristics of their age and gender.

NEW WORKING REGULATION OF THE GOVERNMENT:
HEIGHTENING THE PERSONAL RESPONSIBILITY
 

The Government issued the Decree No. 08/2012/ND-CP dated February 16, 2012 on the Working Regulation of the Government. This Regulation prescribes the principles, responsibility regime, working style, working relationships and order of handling affairs of the Government and the Prime Minister.

Under this Decree, the Government works according to the regime of combining the responsibility of the Government collective with the heightening of the personal responsibility of the Prime Minister and every member of the Government. One person takes charge of and responsibility for a task. If a task is assigned to an agency, the head of such agency shall take the main responsibility.

The Government shall hold its regular meetings once a month; The Government may hold irregular meetings under decisions of the Prime Minister or at the request of at least one-third of the total number of the Government members to handle urgent or certain affairs. The preparation for convening and organization of affairs related to irregular meetings comply with the direction of the Prime Minister.

Also under this Decree, The Government and the Prime Minister shall comprehensively inspect the enforcement of legal documents of the National

Assembly, the National Assembly Standing Committee, and the President, the Government and the Prime Minister as well as the performance of tasks assigned to ministries, sectors and localities.

The Prime Minister and other Government members shall implement the regime of reporting to the public on important issues through their reports before the National Assembly, answers to questions of National Assembly deputies, petitions of voters, press conferences and addresses with the mass media as regulated.

DECREASE MOBILIZATION INTEREST RATE TO 11% FROM MAY 28, 2012
 

The State Bank of Vietnam has recently issued the Circular No. 17/2012/TT-NHNN dated May 25, 2012 prescribing the ceiling interest rate for Vietnam-dong capital mobilizations of 1% from May 28, 2012.
In particular, Apply ceiling interest rate of 3%/year to non-term deposits and term deposits under 01 month. Apply ceiling interest rate of 11%/year for term deposits from 01 month and above; particularly, grassroots People's Credit Funds may fix those annual interest rates not exceeding 11.5%. All this interest rate reduces by 1% compared to regulation issued by the State Bank of Vietnam 01 month ago.

Explain for the decision in decreasing mobilization interest rate, the State Bank of Vietnam states that the liquidation of the bank system has been secured and surplus for first five months of the year, the monetary market is stable beside remained difficulties.

This Circular takes effect on May 28, 2012 and replaces the Circular No. 08/2012/TT-NHNN.