New Inspection Regime for Foreign Owned Enterprises

Posted by Reading Time: 3 minutes

By: Dezan Shira & Associates
Editor: Koushan Das

Vietnam’s Ministry of Finance (MoF) has issued Decision 1381/QD-BTC introducing a new inspection regime for Foreign-invested enterprises (FIEs). The decision is already in effect since 24 July 2017. The MoF will be coordinating with other departments such as General Department of Customs, Department of Tax Policy, Department of Finance, Department of Planning and Investment, and provincial Tax and Customs Departments to supervise and audit FIEs. The new decision is being implemented to reduce malpractices by existing FDI firms.

The annual audits are supposed to take place in October, while the next year’s inspection plans will be decided by the MoF’s Inspectorate, and submitted to MoF and the Ministry of Planning and Investment (MPI), before November 30 of the same year.

DZS RELATED: Pre-Investment Advisory Services from Dezan Shira & Associates

Inspection Scope

The scope of inspection will include auditing the following;

  • Value of assets contributed as capital by the foreign-owned enterprises such as land use rights, tangible and intangible fixed assets;
  • Use of imported assets such as machinery and equipment which were imported duty free for purposes as declared;
  • Provision of loans (corporate bonds, bank loans etc.);
  • Making and use of provisional funds, depreciation of fixed assets, and accounting of exchange rate differences;
  • Profit share from state-contributed capital in foreign invested economic organisations or projects;
  • Ownership changes
  • Ensuring commitments made in order to qualify for financial incentives and investment support (excluding tax incentives);

Although the decision is in place, there is not much information about the timeline regarding inspections. Foreign owned enterprises should be prepared for inspections anytime this year.


About
 Us

Vietnam Briefing is published by Asia Briefing, a subsidiary of Dezan Shira & Associates. We produce material for foreign investors throughout Eurasia, including ASEANChinaIndiaIndonesiaRussia & the Silk Road. For editorial matters please contact us here and for a complimentary subscription to our products, please click here.

Dezan Shira & Associates provide business intelligence, due diligence, legal, tax and advisory services throughout the Vietnam and the Asian region. We maintain offices in Hanoi and Ho Chi Minh City, as well as throughout China, South-East Asia, India, and Russia. For assistance with investments into Vietnam please contact us at vietnam@dezshira.com or visit us at www.dezshira.com

 

Related Reading Icon-VB

dsa brochureDezan Shira & Associates Brochure 
Dezan Shira & Associates is a pan-Asia, multi-disciplinary professional services firm, providing legal, tax and operational advisory to international corporate investors. Operational throughout China, ASEAN, and India, our mission is to guide foreign companies through Asia’s complex regulatory environment and assist them with all aspects of establishing, maintaining and growing their business operations in the region. This brochure provides an overview of the services and expertise Dezan Shira & Associates can provide.

DSA_Doing Business in Vietnam 2017_cover_126x90pxAn Introduction to Doing Business in Vietnam 2017
An Introduction to Doing Business in Vietnam 2017 will provide readers with an overview of the fundamentals of investing and conducting business in Vietnam. Compiled by Dezan Shira & Associates, a specialist foreign direct investment practice, this guide explains the basics of company establishment, annual compliance, taxation, human resources, payroll, and social insurance in this dynamic country.

VB_2016_12_en_Managing_Contracts_and_Severance_in_Vietnam_-_Cover (1)

Managing Contracts and Severance in Vietnam
In this issue of Vietnam Briefing, we discuss the prevailing state of labor pools in Vietnam and outline key considerations for those seeking to staff and retain workers in the country. We highlight the increasing demand for skilled labor, provide in depth coverage of existing contract options, and showcase severance liabilities that may arise if workers or employers choose to terminate their contracts.