Mandated Nutrients to be Included in Vietnamese Food
The Prime Minister has approved a decree – effective March 15th – mandating certain nutrients in Vietnamese food In order to meet national technical standards and food safety. The regulation states that iodine, iron, zinc and vitamin will be compulsory in certain food products. Salt fortified with iodine, iron and zinc must be added to wheat flour, while vegetable oil that contains soybean oil, coconut oil, canola oil or peanut oil is required to have vitamin A. This process is known as fortification which prevents serious consequences on health due to vitamin and mineral deficiencies.
Authorities have suggested that adding these elements will reduce malnutrition which remains a public health priority. While statistics show that malnutrition has been significantly reduced, it still accounts for 45 percent of total deaths for children under five years of age.
Special Sales Tax explained
Vietnamese authorities have issued a new decree on Special Sales Tax (SST) which became effective on January 1 of this year. Notable Changes include:
- Goods that are imported (except for types of petrol (gas)) will be subject to SST at both import and selling stages; the SST paid at importation is creditworthy against SST paid at the selling stage.
- For manufactured or imported goods (except types of petrol and cars below 24 seats) which are later sold by a trading enterprise, the SST taxable price must not be less than 93% of the average selling price of the trading enterprise. A trading enterprise is the first entity within the distribution network that has no parent – subsidiary relationship or same parent as the manufacturing or import company.
- For cars that are imported with less than 24 seats sold via a trading enterprise, the SST taxable price is the importer’s selling price, but must not be lower than 105% of the imported car cost, which is equal to import price plus import duty plus SST at import stage.
New Decree on Foreign Representative Offices
Authorities issued a new decree on Representaive Offices (ROs) and branches of foreign companies this January which comes into effect March 10th. Under new regulations, several changes have been made that leave considerable room for interpretation, and thus should be watched closely. Key examples include:
- The permitted activities of an RO has been limited. Earlier, ROs were under a broad category of permitted activities which was dictated by Decree 72 “monitoring and stimulating of the implementation of contracts of the head office which signed with Vietnamese parties or which relate to the Vietnamese market”. This has now been removed.
- A foreign country is allowed to set-up an RO in accordance with commitment to “international treaties” to which Vietnam is a party; however, “international treaties” has not been defined. For a foreign company that is from a country with no international treaty the RO must be approved by an appropriate government ministry.
- As per the new decree, the head of an RO does not have to reside in Vietnam but must authorize a person responsible if the head is out of the country for more than 30 days, or else appoint a new head of the RO.
Foreign companies that have offices in Vietnam or are planning to open new offices must make note of the new law and follow developments as the authorities are likely to clarify and make amendments to the new decree.
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