I. AMENDMENTS TO THE LAW ON INSURANCE BUSINESS AND LAW ON INTELLECTUAL PROPERTY 2019
To ensure the implementation of the Comprehensive and Progressive Trans – Pacific Partnership (CPTPP), the National Assembly has passed the Amendments to the Law on Insurance Business and Law on Intellectual Property under simplified procedures, taking effect as of 01/11/2019, except for several intellectual property provisions taking effect as of 14/01/2019 (Clause 4 Article 3).
1. Insurance auxiliary service is a conditional business line
In this amended Law on Insurance Business, the National Assembly added a new type of insurance business: insurance auxiliary services. This service includes 05 activities: (1) insurance consulting; (2) insurance risk assessment; (3) actuarial analysis; (4) insurance loss assessment; (5) insurance claim assistance. Insurance auxiliary service will be added to the list of conditional business lines.
The above addition has built a legal corridor for a more proactive approach to opening the insurance market; risk reduction; loss prevention; limiting insurance fraud; quick and full payment of insurance premiums, thereby protecting the interests of the insured.
2. Invalidating trademarks not being used continuously for 5 years or more
The contents related to intellectual property in this Law focus on 5 major groups of issues, including: (1) Applications for granting industrial property rights; (2) inventions; (3) trademarks; (4) geographical indications; and (5) protection of intellectual property rights.
In detail, from now on applications for granting industrial property rights shall be submitted physically to industrial property authority (as previously prescribed) or electronically via the online filing system of Intellectual Property Office.
Regarding invention, the period of exemption from loss of novelty is extended from 6 months to 12 months and a Technical solution that is an invention which is disclosed under this exemption shall not be used as a basis for assessing the inventive level of such invention.
Relating to trademark, another supplementation is the case that a transferree’s usage of trademark under a trademark use agreement shall also be considered an act of using the holder’s trademark and in case the trademark is not used continuously for five years or more, the Trademark Registration Certificate shall be invalidated. About objects ineligible for protection as geographical indications, this Law specifies that the basis for identifying name and indications, which have become common names of goods, is the perceptions of consumers in Vietnam. In addition, processing of international proposals on geographical indications is also regulated in this Law.
II. DECREE 75/2019/ND-CP
“New regulations on penalties for administrative violations against regulations on competition”
Decree No. 75/2019/ND-CP (“Decree 75”) dated 26/09/2019 of the Government prescribing penalties for administrative violations against regulations on competition, takes effect as of 01/12/2019, replacing Decree No. 71/2014/ND-CP.
Decree 75 has supplemented 01 additional penalty, being that the violating entity shall have its/his/her license, practicing certificate or operations suspended for a period of 06 – 12 months depending on the nature and severity of its violation. For remedial measures, Decree 75 has widened the scope of subjects to both organizations and individuals, instead of only organizations as previously presribed. Moreover, Decree 75 also provides the case that state agency performing any prohibited acts shall immediately cease such violations, implement remedial measures and compensate for damages pursuant to the law.
Regarding the maximum fine, for organizations violating the regulations on unfair competition, the maximum fine has been raised to 10 times equivalent to VND 2.000.000.000 as compared to previous regulations. The maximum fine imposed on violations against regulations on anti-competitive agreements or abuse of dominant position or monopoly position shall be 10% of total turnover of the violating enterprise but shall not be lower than the minimum fine imposed upon the violating entity prescribed in the Criminal Code. Violation against regulations on economic concentration shall be fined 05% of total turnover of the violating enterprise. Following the new regulations, if total turnover of the violating enterprise in the financial year is determined to be zero, it shall be subject to a fine ranging from VND 100.000.000 to VND 200.000.000.
Besides that, Decree 75 has supplemented the violation of providing information for or mobilizing, inciting, coercing or enabling enterprises to engage in anti-competitive or unfair practices and its fine. Previously, Decree 71 did not provide for this violation. In addition, the aggravating circumstances and mitigating circumstances specified in this Decree (previously prescribed in Article 85 of Decree 116/2005/ND-CP) also makes it easier to take actions against violations in comparison to previous regulations.
III. DECREE 74/2019/ND-CP
“Increasing the maximum loan amounts up to VND 02 billion/project for production, business establishments and VND 100 million/employee”
Decree No. 74/2019/ND-CP (“Decree 74”) dated 23/09/2019 of the Government amending Decree No. 61/2015/ND-CP (“Decree 61”) on employment creation policies and national employment fund, takes effect as of 08/11/2019.
Previously, Decree 61 prescribed that the maximum loan granted to production, business establishments shall be 01 billion VND/project and not exceeding 50 million VND/employee provided with job. Decree 74 has increased the maximum loan amounts for business establishments up to VND 02 billion/project but not exceeding VND 100 million/employee benefiting from employment creation, maintenance and development policies. The maximum loan amount granted to each eligible employee is VND 100 million, VND 50 million higher than previous. Decree 74 also extends the maximum period of loans to 10 years, rather than 5 years as previously prescribed.
Regarding collateral, Decree 74 prescribes that business establishments is required to provide collateral for such loan if the loan amount is VND 100 million or more, instead of VND 50 million as provided in Decree 61. For employees who apply for a concessional loan for working abroad under a labour contract, they must provide collateral if the loan amount is VND 100 million or more instead of VND 50 million as previously prescribed.
IV. DECREE 77/2019/ND-CP
“New regulations on cooperative groups”
Decree No 77/2019/ND-CP (“Decree 77”) dated 10/10/2019 of the Government replaces Decree No. 151/2007/ND-CP providing for the formation, organization, operation and cessation of cooperative groups, and takes effect as of 25/11/2019.
Decree 77 provides several new regulations as follows:
- Cooperative groups do not have legal status; enterprises and organizations may join cooperative groups instead of only individuals as per previous regulations;
- Cooperative groups operate on the basis of cooperation contracts, the head of cooperative groups shall submit notification on establishment of cooperative group to the Commune-level People’s Committee where the cooperative group is established. The Commune-level People’s Committee shall set up a book to monitor and update changes of the cooperative group instead of cooperation contracts having to be certified by the Commune-level People’s Committees as per previous regulations;
- Simultaneously, a cooperative group is formed when there are two members being individuals or organization, instead of three individuals as previously prescribed.
These new regulations enable cooperative groups to operate as independent economic entities, independent from Commune–level People’s Committee, open up opportunities for cooperative groups to improve their position, attracting businesses, households and others organizations to join hands.
V. DECREE 80/2019/ND-CP
“Organizations providing auxiliary insurance services shall be penalized for disclosing customer information”
Decree No. 80/2019/ND-CP (“Decree 80”) dated 01/11/2019 of the Government amending and supplementing several provisions of Decree No. 73/2016/ND-CP dated 01/07/2016 of the Gorvernment on details of implementation of the Law on Insurance business and the Law on amendments to a number of articles of the Law on Insurance business; and Decree No. 98/2013/ND-CP dated 28/8/2013 providing for the sanctioning of administrative violations against regulations on insurance business and lottery business, and takes effect as of 01/11/2019.
Accordingly, Decree 80 supplements a new chapter on auxiliary insurance services, including: requirements regarding degrees, certificates and standards of individuals directly providing auxiliary insurance services in organizations providing auxiliary insurance services; professional liability insurance for auxiliary insurance service provision; auxiliary insurance services standards. Regarding confidentiality of customer information, Decree 80 also supplements regulations on penalties for violations committed by organizations and individuals providing auxiliary insurance services in customer information confidentiality, misuse of customer information or disclosure of information to a third party without the customer’s permission, which shall be subject to a fine ranging from 20 to 30 milions Dongs.
VI. CIRCULAR 68/2019/TT-BTC
“From 01/11/2020, enterprises, economic organizations, other organizations, household businesses and individual businesses must register for application of electronic invoices”
Circular 68/2019/TT-BTC (“Circular 68”) of Minister of Finance guiding the implementaion of Decree 119/2018/ND-CP providing for electronic invoices for goods and provision of service, is efective as of 14/11/2019.
Firstly, on the time of application, enterprises, economic organizations, other organizations, household businesses and individual businesses must register for application of electronic invoices (“EI”) from 01/11/2020.
Secondly, on the time of issuing EI, (i) for sale of goods: the time of issuing EI is upon transfer of the right to own or use goods to the buyer, irrespective of whether payment is collected or not; (ii) for provision of services: the time of issuing EI is upon completion of provision of services, irrespective of whether payment is collected or not; (iii) in case the goods are delievered in multiple instances or each item, phase of service is transferred, it is mandatory to issue an invoice showing quantity, value of goods or service for each respective delivery or transfer.
Thirdly, the content of EI is fundamentally similar to that of paper invoices under Circular 39/2014/TT-BTC with additional information as follows: code of tax authority (TA) on EI having code of (TA); fees and charges payable to state budget and other relevant information (if any).
Circular 68 provides details on 07 exceptions where EI is not required to display all information: (1) EI issued by a supermarket or shopping mall to a non-business buyers; (2) EI for sale of oil and gas to non-business individuals; (3) EI in the form of stamps, tickets or cards; (4) electronic air tickets issued via website and e-commerce systems to non-business individual buyers following international practice are considered EI; (5) invoices for construction and installation; construction of houses for sale under instalment plans; (6) electronic delivery notes; (7) invoices for interline payment between airlines issued in accordance with regulations International Air Transport Association. Although the use of EI is new to businesses, organizations and individuals, it is impossible to deny its advantages sush as: cost savings, fast delivery and receipt, safety and high accuracy; no report on usage of invoice is required, etc.
VII. CIRCULAR 62/2019/TT-BTC
“Regulations on determination of origins of export, import goods for application of special preferential tax rates within the Comprehensive and Progressive Agreement for Trans-Pacific Partnership”
Circular No. 62/2019/TT-BTC (“Circular 62”) dated 05 September 2019 of the Ministry of Finance amending and supplementing several provisions of Circular 38/2018/TT-BTC dated 20/02/2018, regulating the determination of origins of export, import goods, is effective as of 21/10/2019.
In this Circular 62, it is worth noting that the Government has supplemented regulations on determination of origins of export, import goods for application of special preferential tax rates within the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (hereafter referred to as CPTPP).
Accordingly, during procedures, the time of submitting certificate of origin for application of special preferential tax rates must be taken into account. At the time of carrying out customs procedures for imports, the declarant must submit to the customs authority on of the following documents for application of special preferential tax rates: Self-certification of origin (01 original copy); Certificate of origin (C/O) issued by competent authority of exporting member country (01 original copy).
In case no declaration for application of special preferential tax rates is made during customs procedures for imports, in order to be eligible for special preferential tax rates, the declarant must clarify the origin of goods and state on the customs declaration form that the proof of origin shall be submitted later; Make additional declaration and submit 1 original copy of certificate of origin within 12 months from the date on which the customs declaration is registered. Procedures for refunding overpaid tax shall comply with the laws on tax administration.
In addition, proof of origin for application of special preferential tax rates within the CPTPP must contain at least 09 items of information stipulated by Circular 62 and issued in paper or electronic form. In case the certificate of origin is not in English, the declarant must translate it into Vietnamese or English and be responsible for the translation. On application of Circular 62, a noteworthy point is that the provisions on origin and tax rates under CPTPP, Decree No. 57/2019/ND-CP dated 26 June 2019 of the Government, stipulating the Schedule of special preferential imports, exports tariffs for the implementation of CPTPP for the 2019 – 2022 period, and Article 1.4 of this Circular shall be applied to customs declarations for imports, exports registered from 14 January 2019 to the date before the Circular comes into effect, except for the provision of reference number, date of issuance or statement of late submission of proof of origin on the customs declaration form for imports. The declarant who has overpaid tax shall submit a written request for refunding of overpaid tax to the Customs authority where the declaration is registered.