Resolution No. 58/NQ-CP 2020 the action program to implement Resolution No. 50-NQ/TW

resolution

Promulgating the Government’s action program to implement the Political Bureau’s Resolution No. 50-NQ/TW of August 20, 2019, on orientations for improving institutions and policies to raise the quality and effectiveness of foreign investment cooperation through 2030^[1]

THE GOVERNMENT

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the Political Bureau’s Resolution No. 50-NQ/TW of August 20, 2019, on orientations for improving institutions and policies to raise the quality and effectiveness of foreign investment cooperation through 2030;

At the proposal of the Minister of Planning and Investment,

RESOLVES:

Article 1.To promulgate together with this Resolution the Government’s action program to implement the Political Bureau’s Resolution No. 50-NQ/TW of August 20, 2019, on orientations for improving institutions and policies to raise the quality and effectiveness of foreign investment cooperation through 2030.

Article 2.This Resolution takes effect on the date of its signing.

Article 3.Ministers, heads of ministerial-level agencies, heads of government-attached agencies, and chairpersons of provincial-level People’s Committees shall implement this Resolution.

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC

THE GOVERNMENT’S ACTION PROGRAM

To implement the Political Bureau’s Resolution No. 50-NQ/TW of August 20, 2019, on orientations for improving institutions and policies to raise the quality and effectiveness of foreign investment cooperation through 2030

(Promulgated together with the Government’s Resolution No. 58/NQ-CP of
April 27, 2020)

The Political Bureau on August 20, 2019, adopted Resolution No. 50-NQ/TW, on orientations for improving institutions and policies to raise the quality and effectiveness of foreign investment cooperation through 2030 (below referred to as Resolution No. 50-NQ/TW) with the following overall objectives: “To improve institutions and policies on foreign investment cooperation to be highly competitive and supportive to international integration, which must meet the requirements of renewing the growth model, restructuring the economy, protecting the environment, properly addressing social issues, and raising the productivity, quality, effectiveness and competitiveness of the economy. To basically overcome limitations and weaknesses in the formulation, finalization and implementation of institutions and policies on foreign investment cooperation. To build up the country’s business environment and increase its competitiveness to be ranked among the ASEAN-4 group before 2021 and the ASEAN-3 group before 2030.”

Based on the objectives, tasks and solutions set forth in Resolution No. 50-NQ/TW; the evaluation of the general shifting trend of foreign investment capital flows in the context of profound changes in the global economy and fiercer competition; impacts of trade disputes among major economies; and impacts of the COVID-19 pandemic on the global recession, the Government promulgates this action program aimed at surmounting difficulties in and seizing opportunities from foreign investment cooperation in the coming time with the following principal contents:

I. OBJECTIVES AND REQUIREMENTS

1. To concretize all the viewpoints, objectives, tasks and solutions set forth in Resolution No. 50-NQ/TW for implementation.

2. To clearly identify tasks for ministries, sectors and localities to make their own action plans and organize, inspect, supervise and evaluate the implementation of this action program.

3. To uniformly direct authorities at all levels and sectors to organize the implementation and concretization of Resolution No. 50-NQ/TW, bringing about substantial changes in awareness and action about the importance of the improvement of institutions and policies to raise the quality and effectiveness of foreign investment cooperation.

4. To demonstrate the Government’s facilitating and coordinating role in the spirit of renewing the growth model, restructuring the economy, protecting the environment, raising the quality and effectiveness of foreign investment cooperation, and flexibly adapting to economic changes in the region and the world as well as new trends of foreign investment cooperation.

5. To raise the responsibility of ministers and heads of sectors and localities in directing the performance of assigned tasks.

II. MAJOR TASKS AND SOLUTIONS

In order to achieve the objectives set forth in Resolution No. 50-NQ/TW, in the coming time, ministries, ministerial-level agencies, government-attached agencies and provincial-level People’s Committees shall, in addition to their routine tasks, concretize, and organize the performance of, the following tasks:

1. To renew and raise awareness and unify action concerning foreign investment

a/ To widely disseminate the contents of Resolution No. 50-NQ/TW to all ministries and sectors as well as local authorities and Party organizations at all levels, Fatherland Front Committees, organizations, enterprises and people of all strata, especially the Party’s viewpoints about the position and role of foreign investment as an important component of the economy.

b/ To bring into play the strengths of foreign investment activities in socio-economic development; to strictly carry out examination, inspection and supervision activities and handle violations; to exercise publicity and transparency and prevent and effectively remediate limitations of foreign investment activities in all sectors and localities.

c/ To proactively raise the quality and effectiveness of foreign investment attraction and cooperation in localities, which will be regarded as a criterion for assessing the capabilities and responsibilities of local leaders and also an index for ranking the effectiveness of foreign investment in localities.

2. To enhance socio-political and macroeconomic stability; to improve the business investment environment; to raise the productivity, quality, effectiveness, competitiveness as well as independence and self-reliance of the economy

To concentrate efforts on firmly maintaining social stability, further improving the investment and business environment and strengthening macroeconomic foundations; to make more substantial achievements in performing the strategic breakthroughs, restructuring the economy in association with renewing the growth model toward sustainable development and environmental protection, thus facilitating business investment activities in Vietnam.

3. To improve general institutions and policies on foreign investment

a/ The Ministry of Planning and Investment

- To amend and supplement the regulations on investment procedures and conditions, definitions of investment activities, lists of geographical areas, sectors and entities eligible for investment incentives in the laws concerning foreign investment and relevant laws to ensure uniform implementation and conformity with Vietnam’s international commitments.

- To study and add the “national defense and security conditions” in the process of consideration and grant of investment registration certificates (or documents of equivalent legal validity) to new investment projects and in the process of consideration and approval of investment activities in the form of contribution of capital or purchase of shares or capital contributions.

- To assume the prime responsibility for, and coordinate with the Ministry of Finance, the State Bank of Vietnam and the Ministry of Justice in, synchronizing the regulations on investment, securities and foreign exchange management toward clearly distinguishing direct investment from indirect investment, and ensuring consistency between the provisions of the law on enterprises and the law on foreign exchange management regarding accounts for purchase and sale or transfer of shares.

- To study and create regulations to put an end to the problems of “too little equity”, “illegal” investment or “disguised” investment.

b/ The Ministry of Finance shall assume the prime responsibility for studying and making regulations to prevent transfer pricing; and coordinate with the Ministry of Planning and Investment in synchronizing regulations on investment and securities toward clearly distinguishing direct investment from indirect investment.

4. To strengthen institutions and policies on investment attraction

a/ The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Drafting a list of business lines to which market access is not yet allowed and a list of business lines to which market access is conditional applicable to foreign investors in conformity with Vietnam’s international commitments for promulgation together with the (revised) Law on Investment and/or Decree guiding the Law on Investment.

- Developing investment criteria (investment ratio, labor use, technology, environment, domestic value added, and capabilities to link to, exert spillover impacts and join international value chains, etc.) for selection, prioritization and attraction of investors in conformity with sectoral and local development strategies, master plans and orientations for issuance together with the Decree guiding the Law on Investment.

- Drafting regulations to disallow the expansion and extension of projects using obsolete technologies potentially causing environmental pollution and excessively using natural resources for inclusion in the (revised) Law on Investment.

- Drafting regulations on mechanisms for security assessment and review for foreign investment projects and activities affecting or likely to affect national security as prescribed in the Law on Investment for inclusion in the Decree guiding the Law on Investment.

- Drafting internationally-competitive incentive institutions and policies for facilitating business activities in order to attract large projects, national key projects, hi-tech projects, etc., as well as strategic investors and multinational groups to make investment and form added-value production and supply chains  participating in regional and global markets, locate their head offices and establish research and development (R&D) centers and innovation centers in Vietnam, for inclusion in the (revised) Law on Investment.

- Studying and improving institutions and policies applicable to economic zones and industrial parks toward clearly identifying development focuses as well as superior mechanisms and policies suitable to the characteristics of each model, ensuring connectivity and synchrony with other areas in order to propose them to Government for amending Decree No. 82/2018/ND-CP of May 22, 2018, on management of industrial parks and economic zones in response to the new circumstances.

- Strengthening the legal framework for diversifying and effectively promoting the public-private partnership (PPP) model in infrastructure investment; revising the regulations on merger and acquisition (M&A) applicable to foreign investors for inclusion in the (revised) Law on Investment.

- Developing mechanisms and policies on investment incentives based on such criteria as level of participation in value chains, domestic value added, hi-tech component, R&D, innovation, social responsibility, etc., for addition to the (revised) Law on Investment.

- Studying and proposing policies for and pilot implementation of new investment modes and business models on the platform of digital economy in order to make use of opportunities from the Fourth Industrial Revolution.

b/ The Ministry of Finance shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Adding incentives for enterprises that effectively operate and properly fulfill their obligations and commitments.

- Developing a mechanism of granting investment incentives associated with the satisfaction of specific conditions and commitments and a mechanism of post-licensing inspection and refund claim for breaches of commitments.

c/ The Ministry of Industry and Trade shall assume the prime responsibility for, and coordinate with ministries and sectors in:

- Developing a mechanism on proper incentives to increase connectivity between foreign investment and domestic investment and determining industrial areas prioritized for investment attraction; developing sector-based clusters and value chains, contributing to increasing the domestic value added and competitiveness of products and position of the country in global value chains.

- Upgrading and improving regulations on supporting industries.

- Assessing the compliance with Vietnam’s competition law concerning practices in restraint of competition and economic concentration by foreign-invested enterprises, especially large enterprises and enterprises operating technological platforms in Vietnam’s market.

- Reviewing and revising regulations against monopoly and economic concentration in accordance with the competition law and in conformity with international practices.

- Studying and formulating mechanisms and policies to protect the domestic distribution market and facilitate the development of local enterprises in conformity with international commitments.

d/ The Ministry of Science and Technology shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Devising policies to encourage cooperation, technology transfer and governance on the basis of negotiation and voluntary agreement to Vietnamese enterprises.

- Developing national standards and technical regulations on products, protection of the environment and natural resources and energy conservation in harmony with international and regional standards.

- Upgrading and improving regulations on startup and innovation.

- Adopting policies to help domestic enterprises connect with foreign-invested enterprises, increase their capabilities to absorb technologies and gradually develop own technologies and participate in global value chains.

- Strengthening laws and policies to promote the effective operation of hi-tech parks.

dd/ The Ministry of Labor, Invalids and Social Affairs shall assume the prime responsibility for, and coordinate with other ministries and sectors in, developing and submitting to competent authorities for promulgation incentives for foreign-invested enterprises to train and raise professional qualifications and skills for Vietnamese workers; and employ Vietnamese who have worked and studied in advanced countries. Develop training programs and effectively and promptly organize the training of skilled workers to meet enterprises’ demands.

e/ The Ministry of Information and Communications shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Adopting mechanisms and policies on development of Vietnamese technology enterprises on the basis of cooperation and joint venture with multinational technology groups in the field of information and communication technology.

- Offering proper incentives to increase connectivity between multinational technology groups and local technology enterprises for developing the digital ecosystem, thus helping increase the value of research, innovation and content created by Vietnamese in the global digital ecosystem.

g/ Ministries, sectors and localities shall create favorable conditions for overseas Vietnamese to make investment in Vietnam; remove difficulties and obstacles in administrative procedures for investment activities carried out by overseas Vietnamese in Vietnam.

5. To improve institutions and policies for protecting, and raising responsibility and cooperation of, investors

a/ The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Revising and supplementing regulations on guarantee of rights and obligations, recognition and protection of lawful ownership rights over assets, intellectual property rights, investment capital, income and other lawful interests of investors and related stakeholders in conformity with international commitments; and imposing strict sanctions against violations of the (revised) Law on Investment.

- Clearly stating in the (revised) Law on Investment investors’ responsibility for environmental protection and cooperation in improving the environment in the process of investment, implementation of projects and operation of enterprises throughout the period of project implementation in accordance with law.

b/ The Ministry of Culture, Sports and Tourism shall assume the prime responsibility for, and coordinate with other ministries, sectors and localities in, drafting and submitting to competent authorities for promulgation regulations on responsibility and cooperation of infrastructure investors and foreign-invested enterprises in building social houses, workers’ dormitories, kindergartens, and health, culture and sports facilities serving workers.

c/ The Ministry of Labor, Invalids and Social Affairs shall assume the prime responsibility for, and coordinate with other ministries, sectors and localities in:

- Revising and supplementing regulations on labor, employment and wage, ensuring harmony between interests of employees and employers, transparency and satisfaction of international integration requirements.

- Rationally adjusting the differences between region-based minimum wages in order to limit concentration of employees in large urban centers and reduce pressure on infrastructure facilities.

6. To improve institutions and policies on investment management and monitoring

a/ Ministries, sectors and localities:

- To increase the analysis and forecast capabilities of agencies formulating and promulgating institutions and policies.

- To submit in time to competent authorities for promulgation regulations governing new economic relations and new business models and methods so as to facilitate business investment activities of investors and management activities of state agencies.

- To step up assignment of tasks, delegation of powers, authorization and coordination among state management agencies; to apply single-window and inter-agency single-window mechanisms.

b/ The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Drafting and supplementing provisions to the Decree guiding the (revised) Law on Investment regarding:

+ Mechanisms for prevention and proactive and prompt settlement of problems, complaints and lawsuits of investors, reduction of investment disputes, and raising of the responsibility of state management agencies.

+ Provisions aiming to effectively remove obstacles for projects involving the commitment to transfer assets of foreign investors to the Vietnamese State or partner without indemnification at the end of the projects operation duration.

+ Improvement of specific provisions on handling of cases in which foreign investors are missing or flee away in the course of carrying out investment activities in Vietnam.

+ Criteria for evaluation of economic, environmental and national defense-security benefits of foreign investment activities.

- Revising the Government’s Decree No. 84/2015/ND-CP of September 30, 2015, on investment monitoring and evaluation, clearly defining the prime and coordinating responsibilities of ministries, sectors and localities in the management and monitoring of foreign investment activities.

- Developing criteria for evaluation of the effectiveness and building information systems and databases serving the evaluation and management of activities of economic zones and industrial parks in order to revise Decree No. 82/2018/ND-CP of May 22, 2018, on management of industrial parks and economic zones.

c/ The Ministry of Finance shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Guiding the Law on Tax Administration and revising and supplementing regulations to combat transfer pricing in tax administration; developing databases and disclosing information for control, management, and combat of transfer pricing and tax evasion for the purpose of reducing tax amounts payable in Vietnam for enterprises with related-party relationships and transactions.

- Building a specialized apparatus in charge of combating transfer pricing and profit transfer to meet the requirements of tax administration of enterprises with related-party relationships and transactions.

- Developing and implementing international cooperation programs on building of international tax administration capacity and control of transfer pricing activities of enterprises with related-party relationships.

- Coordinating with related agencies and sectors in developing a regulation on coordination of management and inspection activities to prevent and limit transfer pricing and profit transfer causing state budget losses.

d/ The Ministry of Industry and Trade shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Improving regulations on anti-monopoly in conformity with international practices; and regulations on satisfaction of economic concentration conditions under the competition law.

- Developing mechanisms and policies to protect the domestic distribution market and facilitate the development of domestic enterprises in conformity with international commitments.

dd/ The Ministry of Justice shall assume the prime responsibility for, and coordinate with other ministries and sectors in, reviewing, and proposing competent authorities to revise regulations to raise the quality and effectiveness of dispute prevention and settlement institutions and enforcement of dispute settlement awards.

7. To renew investment promotion activities for higher effectiveness

a/ Ministries, sectors and localities:

- To further renew and improve investment promotion activities for higher effectiveness.

- To strengthen coordination and cooperation between authorities of central and local levels, among regions, and between state management agencies and trade associations in investment promotion activities.

- To take the initiative in carrying out targeted and focused investment promotion activities in alignment with new investment cooperation criteria; to continue maintaining traditional markets and partners while developing new ones.

- To diversify trade promotion activities and approaches; to attach importance to on-the-spot investment promotion activities based on successful specific cooperation projects.

- To make proper investment in investment promotion activities. To prioritize national, inter-regional and inter-sectoral investment promotion activities.

- To ensure publicity and transparency of socio-economic databases, laws, policies, master plans, plans and markets, etc.

- To promote dialogues, renew and expand modes of receipt of petitions and reports from investors; to completely and timely settle difficulties and problems faced by ongoing projects.

b/ The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with other ministries, sectors and localities in, reviewing and restructuring the system of existing trade promotion agencies (without establishing new ones) to be professional, independent and separate from agencies performing the state management of foreign investment; to consider the possibility of combining trade promotion and tourism in a flexible manner depending on the requirements and characteristics of each locality.

c/ The Ministry of Foreign Affairs shall assume the prime responsibility for, and coordinate with the Ministry of Planning and Investment and other ministries, sectors and localities in, directing overseas Vietnamese representative missions to step up investment promotion in economic diplomacy activities; to further monitor and study trends of international investment capital flows, offshore investment strategies and policies of other countries and major business groups, and international evaluation of Vietnam’s business investment environment.

8. To raise the effect and effectiveness of state management of foreign investment

a/ Ministries, sectors and localities:

- To strictly implement the investment law and other laws concerning foreign investment activities, and take the initiative in avoiding international complaints and disputes.

- To strictly deal with the problem of inconsistent implementation of institutions and policies by central and local authorities and different localities.

- To prohibit theultra viresor illegal licensing, adjustment, management and negotiation of foreign investment projects or issuance of regulations on investment incentives and supports.

- To ensure the negotiation and agreement on government guarantee undertakings (GGUs), signing of BOT contracts, and sale of products, etc., comply with law.

- To improve the management and implementation of investment projects, ensuring the projects’ economic-social-environmental benefits, conformity with relevant master plans, and satisfaction of project selection criteria, etc. To ensure strict implementation of the law-prescribed process and procedures for grant, modification or revocation of licenses or termination of operation of foreign investment projects; to refrain from criminalizing economic and civil relations in the settlement of investment-related complaints and petitions.

- To enhance examination, supervision and inspection together with raising the responsibility of local administrations and heads in the observance of the Party’s policies and the State’s laws concerning foreign investment.

- To completely handle projects causing environmental pollution, inefficiently using land or suffering business losses over multiple years, and projects failing to fulfill their commitments. To early and effectively prevent and settle disputes related to foreign investment.

- To attach importance to raising the capacity and professional ethics of officials in charge of state management of foreign investment in ministries, sectors and localities to meet new requirements and tasks of foreign investment management.

- To develop and improve their information systems and databases for connection to the national information system on foreign investment.

b/ The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with other ministries and sectors in:

- Increasing coordination among ministries, sectors and localities in combination with conducting examination and supervision of the state management of foreign investment.

- Improving the national database and information system on investment to be synchronous and connected to the information systems on labor, land, tax, customs, credit, foreign exchange, etc., and those of localities. Raising the quality of statistical work, ensuring timeliness, adequacy, accuracy and conformity with international practices.

- Closely coordinating with business associations and international organizations in raising the quality and effectiveness of the selection and commendation of foreign-invested enterprises; periodically selecting and commending outstanding foreign investors.

III. ORGANIZATION OF IMPLEMENTATION

1. Ministries, sectors and localities shall draw up their own plans on performance of the tasks assigned in Section II and the Appendix to this Resolution; and early submit to competent authorities for promulgation or revision relevant legal documents for implementation of this Resolution according to regulations.

2. Ministries and sectors shall regularly update and summarize data and analyze and evaluate the situation of state management of foreign investment in specialized fields; review, examine and supervise the implementation of specialized laws by units under their management in order to remove difficulties for foreign investment projects and timely propose adjustments to relevant policies.

3. Ministers, heads of sectors and chairpersons of provincial-level People’s Committees shall examine and supervise the performance of agencies, organizations and individuals under their management. Closely monitor and assess the actual situation for taking flexible and timely measures or propose timely and effective solutions to competent authorities. Before March 31 every year, report on implementation results to the Ministry of Planning and Investment for summarization and reporting to the Prime Minister before June 30.

4. The Ministry of Planning and Investment shall assume the prime responsibility for, and coordinate with related ministries and agencies in, reviewing, examining and supervising the implementation of this Resolution; annually review and report on the situation and results of implementation of this Resolution’s contents to the Government and the Prime Minister. When necessary, it may propose revisions to this Resolution and direct its implementation as suitable to reality. Make reports under regulations on relevant contents of the working programs of the Political Bureau, the Secretariat, the Party Central Committee, the National Assembly and the National Assembly Committee.-

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC

* The Appendix to this Resolution is not translated.