Vietnam to revise laws to cope with runaway foreign investors
Vietnam to revise laws to cope with runaway foreign investors
Vietnam will revamp the Investment and Enterprise laws to make them more liberal for honest investors but tougher for those either failing to fulfill their investment commitments on schedule or leaving behind their poor business operations without prior notice.
Quach Ngoc Tuan, deputy head of the Legal Department of the Ministry of Planning and Investment, told a seminar on foreign direct investment (FDI) attraction in HCMC last week that the Investment Law would be amended in a way that would include tough sanctions against runaway investors.
For fear that a legal basis is absent and that certain FDI investors might file legal action at a foreign court in case Vietnamese authorities take back their investment licenses, the Ministry of Planning and Investment has long got stuck in tackling the projects whose investors are nowhere to be found.
Statistics of the ministry show there are hundreds of FDI projects in which their investors could not be found at the registered addresses, might have fled the country, or could not have been contacted.
According to the ministry, those projects might have been unprofitable, and thus unable to pay debts, wages or taxes. There are a couple of projects whose investors had run away after they raised funds from partners here.
This chronic issue is ascribable to the complicated and time-consuming procedures for business dissolution and liquidation. The consequences are workers are unpaid, local partners lose money and the State loses tax revenues.
The Investment Law will be revised in a way that makes foreign investors more responsible for delays in their project implementation, thus ensuring land and other natural resources can be put into full use and public confidence in FDI projects can be maintained.
Speaking at the seminar, Deputy Minister of Planning and Investment Nguyen Van Trung said the Government’s Resolution 103/NQ-CP provides a variety of vital measures for improving the attraction of FDI capital and the efficiency of FDI activity.
The measures include improving the legal framework for FDI, changing the FDI incentive policy, building a mechanism for channeling FDI into supporting industries and high-tech parks, completing regulations on environmental protection, and strengthening foreign exchange, credit and land policies.
The country will be further streamlining investment appraisal, approval and licensing procedures to allow investors to put their projects into operation as soon as possible, Trung told the seminar, which was held by the ministry in coordination with a number of organizations.
Vietnam lacks specialized IPs
The country now has around 300 industrial parks but a majority of them are designed for a variety of sectors, thereby leading to the lack of an investment focus, said Professor Nguyen Mai.
Haiphong and Ba Ria-Vung Tau are the country’s two provinces to have specialized industrial parks for supporting industries following an instruction by the Government, so efforts are being made to attract investment capital into these parks, said Huynh Ngoc Phien, chairman of Amata Vietnam.
This way of investment attraction could hardly work as investors involved in supporting industries always come together with larger manufacturers like Samsung in Bac Ninh and Thai Nguyen provinces in the country’s north. Nonetheless, Haiphong and Ba Ria-Vung Tau have yet to have big producers who are able to bring their suppliers to the country to get involved in supporting industries.
Phien said the Government should let investors choose where to invest in supporting industries, instead of selecting this or that province to build a supporting industries park before knowing what investors actually want.
vietnamnet
