VCCI proposes scrapping business conditions

VCCI proposes scrapping business conditions

The recommendation was part of VCCI’s feedback on the review and assessment of the implementation of regulations concerning conditional business sectors, and its proposal to amend, streamline or supplement the list of conditional sectors under the Law on Investment.

Customers at a car showroom/service centre in HCM City. The automobile warranty and maintenance is among the 16 conditional business sectors. — VNA/VNS Photo

The Việt Nam Chamber of Commerce and Industry (VCCI) has proposed removing 16 sectors from the list of conditional business lines, aiming to reduce barriers for enterprises and align with efforts to reform the business environment. 

Conditional business lines are sectors that require specific conditions to operate to protect national interests. They include healthcare, security and defence, telecommunications and media, transportation, banking and education, among many others.  

VCCI has suggested removing more than a dozen of these lines, including accounting services, customs brokerage, rice exports, temporary import and re-export of frozen food, film distribution and overseas study consultancy, among others.

The recommendation was part of VCCI’s feedback on the review and assessment of the implementation of regulations concerning conditional business sectors, and its proposal to amend, streamline or supplement the list of conditional sectors under the Law on Investment.

According to VCCI, the number of conditional business lines under the 2020 Law on Investment has been steadily rising over the years due to the addition of new conditional sectors in subsequent specialised laws. In practice, the actual number of conditional business lines far exceeds what is listed, as the scope of each line is broad and includes many sub-sectors, all subject to the same requirements.

Since the law came into effect, there has been no comprehensive review of the conditional business list to assess whether these sectors still warrant conditional status. Based on prior review rounds, business feedback and the current state of the economy, VCCI argues that a thorough reassessment is necessary to foster a more transparent and enabling investment climate.

Clause 1, Article 7 of the 2020 Law on Investment defines conditional business sectors as those that require restrictions for reasons of national defence and security, public order and safety, social ethics or public health. In line with this principle, any business activity subject to conditions should be demonstrably linked to protecting the public interest in one of these areas.

Using this clause as a benchmark, VCCI has conducted a preliminary review of the current list and made several recommendations. These include removing sectors that do not significantly impact public interest as outlined in Article 7; removing sectors for which alternative, more effective forms of regulation are already in place; and narrowing the scope of certain sectors to more precisely identify which specific business activities should remain subject to conditions.

VCCI also proposes reviewing the list to ensure internal consistency and avoid overlaps between sectors on the same list or across lists governed by other special regulatory frameworks.

Based on these criteria, VCCI has recommended removing 16 conditional business sectors, namely accounting services; customs procedures; rice export; temporary import and re-export of frozen food; trading activities of foreign service providers in Việt Nam; employment services; labour subcontracting; automobile warranty and maintenance; construction, conversion and repair of inland waterway vessels and seagoing ships; construction operations by foreign contractors; management and operation of cremation facilities; overseas study consultancy; film distribution; performing arts, fashion shows, beauty contests and modelling events; and printing and minting of money.

It also recommends narrowing or redefining the scope of five other sectors: research, manufacture, testing, repair and maintenance of unmanned aircraft and related devices; fertiliser trading; aquaculture seed supply; water resource exploitation services; and gold trading. 

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