EFFECTIVE POLICIES RELATING TO FOREIGN ELEMENTS IN 2016

A string of new policies on civil status registration, employment, escorted transfer of violators, and individual income exemption involving foreign elements came into effect in 2016.

Civil status registration  

The Law No. 60/2014/QH13, dated November 20, 2014, on civil status came into force since January 1, 2016.

Under the Law, the district-level People's Committees will be responsible for registering civil status events involving foreign elements. This decentralization aims to bring into full play the capacity of local authorities and strengthen the state management role of the provincial-level People's Committees toward achieving the long-term objective of absolute delegation of the power to register civil status to local authorities.

Under the law, civil status events involving foreign elements include birth registration for children, marriage registration, guardianship registration, registration of parent and child recognition, and death registration.

* Birth registration for children born in Viet Nam and having a parent being a Vietnamese citizen and the other being a foreigner or a stateless person, a parent being a Vietnamese citizen residing in the country and the other being a Vietnamese citizen residing abroad, both parents being Vietnamese citizens residing abroad, or both parents being foreigners or stateless persons; birth registration for children born abroad with their birth not yet registered abroad and taken to reside in Viet Nam and having both parents being Vietnamese citizens or a parent being a Vietnamese citizen.

* Marriage registration between Vietnamese citizens and foreigners; between Vietnamese citizens residing in the country and Vietnamese citizens residing abroad; between Vietnamese citizens residing abroad; between Vietnamese citizens who also have foreign citizenship and Vietnamese citizens or foreigners; and between foreigners residing in Viet Nam.

* Guardianship registration between Vietnamese citizens and foreigners together residing in Viet Nam.

* Registration of parent and child recognition between Vietnamese citizens and foreigners; between Vietnamese citizens residing in the country and Vietnamese citizens residing abroad; between Vietnamese citizens residing abroad; between Vietnamese citizens also having a foreign citizenship and Vietnamese citizens or foreigners; and between foreigners either or both of whom permanently residing in Viet Nam.

New regulations on overseas workers

Decree 11/2016/ND-CP (Decree 11), dated February 3, 2016 on  providing detailed guidance on the Labor Code 2012 focusing on management of expatriates working in Viet Nam came into force on April 1, 2016. Decree 11 altered conditions for foreign experts to work in Viet Nam with working experience of at least three years in their fields (instead five years as earlier requirement).

The decree supplemented regulations on work permit exemption for foreign employees who stay in Viet Nam for working as a manager, an executive director, an expert or a technician for a period of less than 30 days; are studying at foreign schools/ institutions entering Viet Nam pursuant to an internship contract signed with agencies, organizations or enterprises in Viet Nam; family members of staff of foreign diplomatic missions;  foreigners holding diplomatic passports entering Viet Nam to work for State agencies, political organizations, or socio-political organizations.

Two foreign subjects exempted from personal income tax

Since May 1, 2016, foreign experts in non-governmental aid programs and projects and Vietnamese working at representative offices of the United Nations system in Viet Nam have enjoyed personal income tax (PIT) exemption. Under Decision No. 06/2016/QD-TTg (Decision 06), foreign experts shall be exempted from PIT on the direct income from the implementation of the activities of the foreign non-governmental aid programs and projects. The conditions for PIT exemption includes (i) a foreign nationality; (ii) entering into the contract with any agency, organization as the project owner or the foreign non-governmental aid owner that directly implements the aid project activities by the competent authority and the assignment terms for foreign experts accompanying the contract.              

Decision 07/2016/QD-TTg (Decision 07)  stipulates any Vietnamese working or employed under any labor contract to work at the representative office of the international organization of the UN in Viet Nam shall be exempted from PIT on any salary, wages paid in such office. The conditions for PIT exemption includes (i) the nationality of Viet Nam; (ii) an employee as confirmed by the authorized attorney of the representative office of the UN organizations in Viet Nam.

Fresh regulations on temporary custody and escorted

Decree No.17/2016/ND-CP, dated March 17, 2016, amends a number of articles of the Government's Decree No. 112/2013/ND-CP issued on October 2, 2013, providing the sanction of expulsion and the measures of temporary custody and escorted transfer of violators according to administrative procedures, and management of foreigners  violating Viet Nam's law pending the completion of expulsion procedures.

The Decree took effect since May 2, 2016, supplement to Clause 1 Article 3, Article 11 and Article 12 of Decree No. 112/2013/ND-CP in order to add more entities that are applied the form of temporary custody of persons according to administrative procedures. Accordingly, if foreigners that have the act of smuggling, illegal transport of goods through border gates, abscond, destroy violated material evidences, means, they shall be remanded in custody.

Regulations on foreign workers

Circular No. 40/2016/TT-BLĐTBXH guiding the implementation of a number of articles of Decree No.11/2016/NĐ-CP detailing a number of articles of the labor code in respect of foreign workers in Viet Nam came into effect on December 12, 2016. The Circular defines that the Ministry of Labor, Invalids and Social Affairs accepts the demand for using foreign laborers, identifies unlicensed foreign workers, reissues working licenses, revokes working licenses and proposes police deport unlicensed foreign laborers.

It handles these issues from the following agencies: State agencies, foreign non-governmental organizations, international organizations in Viet Nam, organizations specified in point a, b and c clause 1 Article 2 of the Decree No.55/2012/ND-CP, including public organizations under the ministries, ministerial-level agencies, organizations established by the Government and the PM, Ha Noi National University of Education and Viet Nam National University - Ho Chi Minh City, representative offices of foreign-invested projects or international organizations in Viet Nam and business associations established based on legal regulations. The Circular stipulates that employers must send reports on demand for using foreign laborers to the Ministry of Labor, Invalids and Social Affairs or Chairmen of provinces' People's Committees at least 30 days prior to the time of hiring foreign workers or changing the demand for hiring working laborers.

Personal income tax exemptions for experts of UN, NGOs

Circular No. 96/2016 / TT-BTC and Circular No. 97/2016 / TT-BTC in order to guide the procedure about personal income tax exemption for foreign experts in implementation of programs and aid projects of foreign Non-governmental organizations (NGOs) in Viet Nam and Vietnamese works at representative offices of international organizations of the United Nations (UN) in Viet Nam is valid from August 15, 2016.

Within 30 days of the foreign expert's contract becoming valid, the governing body or the non-governmental aid abroad will provide exempt records to the Tax office. Additionally, within 15 working days from the date of receipt of complete dossiers, the Tax office will issue a Confirmation of the personal income tax exemption for income from the implementation of programs and projects and non-governmental aid abroad.

Number of apartments owned by foreigners defined

Circular No.19/2016/TT-BXD guiding the implementation of the Housing Law and Decree No. 99/2015/ND-CP dated October 20, 2015 of the Government guiding the implementation of the 2014 Housing Law took effect from August 15, 2016. Accordingly, the proportion of apartments owned by foreign organizations and individuals to the total number of apartments in all apartment buildings for sale or lease-purchase in a ward must not exceed 30%. As for individual houses for sale or lease-purchase under commercial housing projects, the total foreign ownership must not exceed 10%.

As required by the Decree, in order to own property in Viet Nam, a foreigner must possess a valid visa stamped by the Vietnamese immigration authority. Persons entitled to diplomatic privileges and immunities under the Ordinance on Privileges and Immunities for Diplomatic Representations, Foreign Consulates and Representative Offices of International Organizations in Viet Nam may not own apartments or individual houses in Viet Nam. Foreign organizations and individuals doing business in Viet Nam may carry out property transactions if possessing valid investment registration certificates or relevant certificates granted by Vietnamese competent authorities.

Management of foreign construction contractors stipulated

Circular No.14/2016/TT-BXD on guiding procedures for the grant of contractor licenses and management of foreign construction contractors in Viet Nam became effective on August 15, 2016. Foreign contractors are allowed to launch construction activities in Viet Nam only when they are granted with construction licenses by Vietnamese authorities. Foreign contractors must follow Viet Nam's laws and regulations and relevant Conventions Viet Nam has signed.

The granting of construction license will be realized based on Article No. 71 of Decree No. 59/2015/ND-CP dated June 18, 2015 of the Government on construction project management. Foreign contractors are responsible for paying expenditures when receiving construction licenses or licenses to adjust construction activities. Foreign contractors will have their construction licenses revoked in the cases that they do not surmount violations when asked by State management agencies or they are sanctioned for administrative violations more than twice.

Regulations on foreign insurance business providing trans-border insurance services

Decree No.73/2016/ND-CP guiding the implementation of the Vietnamese Law on Insurance defines that the objects of supplying insurance services and trans-border insurance brokers are foreign insurance businesses and insurance brokers located at nations signing international trade treaties with Viet Nam, including agreements on trans-border insurance service supply. Accordingly, a foreign insurance business providing trans-border insurance services in Viet Nam is required to have a total asset worth US$2 billion. The users of trans-border insurance service are enterprises which are established in Viet Nam with the foreign capital holdings more than 49% and foreigners. The Decree stipulates that reinsurance services, international maritime insurance, international aviation insurance, international reinsurance brokers, consultancy service, calculation service, risk evaluation and compensation must be realized within the current legal regulations and rules.

Life insurance and health insurance are not applied in this case. Foreign insurance businesses and brokers providing trans-border insurance service in Viet Nam have to meet demands on financial capacity and loss-absorbing capacity.

These businesses must be ranked at least "BBB" by the Standard & Poor's or the Fitch or "B++" by the A.M.Best or the Moody's. The Decree is valid from July 1, 2016.

Source:

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