Vietnam Regulatory Brief: Foreign Investment Scrutiny, Foreign Research Restriction, and the Regulation of Photo Exhibitions

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Authorities Increase Scrutiny of Foreign Investors

The Ministry of Planning and Investment (MPI) recently issued Circular 09/2016/TT-BKHDT, which aims to inspect and assess FDI across the country. The government hopes to ensure that foreign firms observe relevant regulations and that violations will be discovered quickly. Examinations will be made in relation to capital contributions, project construction, the implementation processes, realization of investment targets, technology transfers, and fulfillment of investment requirements.

The regulation is expected to be implemented within 45 days and will include checks on tax obligations, labor regulations, land use, natural resources and environmental protection. The monitoring of companies will be conducted via routine as well as snap inspections. Despite the use of snap inspections, the circular states that all checks will be conducted in accordance with current regulations and should not overlap or affect operations of companies under inspection.

As a whole, the new bill is thought to allow for greater scrutiny of FDI, something which may discourage some from entering the country. Foreign investors in the country presently must ensure they are in compliance with all regulations to avoid any violations.

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New Regulations for Foreign Entities Conducting Water Research

The government has issued Decree 41/2016/ND-CP which regulates the authorization of research operations for foreign organizations or individuals in Vietnam’s territorial waters. As per the new law, such organizations or individuals will have to be authorized by competent agencies. A foreign organization or individual will be allowed to do research for not more than two years and an extension would be granted for a maximum of one year.

The government has listed eight cases where authorization will not be granted; these include: research conducted which may affect the country’s sovereignty, national defense activities and security, exploitation of natural resources, poisonous chemicals, construction in the sea and drilling of the seabed among others. In addition, research documents with unclear or incorrect information will also not be authorized.

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Regulation on Exhibition Management Creates Confusion

Internet users in the country have raised concern over a draft decree issued by the government that aims to regulate photography exhibitions in the country by requiring individuals or organizations posting photos to apply for a permit. The new decree has raised concerns over whether the government would require social media users to obtain permits for sharing photos online. Vi Kien Thanh, general director of the Authority for Arts, Photography and Exhibition (AAPE), which helped draft the decree, stated that posting personal photos on social media sites was not considered an exhibition and “only posting photos in the form of an online exhibition falls under governing scope of the decree and requires a permit.” However, Thanh did not clarify the difference between personal pictures and an online exhibition. A circular on that is expected to be published at a later date.

Analysts have argued that the decree is too vague and that it may affect photography contests, festivals or galleries held as internal activities among groups, forums or organizations online. In addition, studies show that there are around 30 million Facebook users and thousands of Instagram users which would make it extremely difficult for any authority to handle the paperwork required. Nevertheless, any restriction on photo sharing is likely to face opposition from the public.


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