Legal update on April 2021 (Part 3)

BLawyers Vietnam - Legal update

Our Vietnam legal update #157 would lead you on 03 legal issues:

I. Detailing several articles of the Law on Enterprises

The Government issued Decree No. 47/2021/ND-CP dated 01 April 2021 to detail several articles of the Law on Enterprises:

  • About the Social Enterprises:
    • The Social Enterprises shall send written notice on receipt of financial donations to the sponsorship management agency of the provincial People’s Committee within 10 working days from the date of receipt.
    • In case the social and environmental targets are terminated before the commitment time and dissolution of the Social Enterprise, then the unused property or money of the aid and sponsorships received by the social enterprise may be transferred to the State under the Civil Code.
  • About the State-owned Enterprises and groups of companies:
    • The charter of a joint-stock company must specify the time and the total number of votes or a voting rate corresponding to each voting preferred shares.
    • The period of voting preference for voting preferred share of a joint-stock company hold by a founding shareholder is 03 years from the date of obtaining the enterprise registration certificate of the company, except for the case in which a voting preference share is held by an organization authorized by the Government.
  • About the Defense and Security Enterprises:
    • Regulations on defining conditions, organizational structure, and manager job titles of the Defense and Security Enterprises.
    • State policies towards enterprises and enterprise’s employees.
    • Application for recognition and re-recognition of enterprises.
  • Regulations on publishing information and national enterprise registration database of the State – owned Enterprise.
  • Appendixes of List of Business lines or the areas where Defense and Security Enterprise executives for defense, security; Power of Authority for publishing the information, etc.

II. Guidance on the implementation of regulations on foreign workers in Vietnam

Ho Chi Minh City Department of Labor, War Invalids and Social Affairs issued Official Letter No. 5756/SLDBXH-VLATLD dated 26 March 2021 to guide the implementation of regulations on foreign workers (“FW”) in Vietnam with the following contents:

a.    Regarding the procedures of recruitment, employment of FW in Vietnam:

    1. The employer shall report explaining the need to use FW at least 30 days in advance from the expected date of employing the FW. If there is a change in demand, the employer reports at least 30 days in advance.
    2. After being approved for the need to use FW, the employer shall proceed with procedures with the labor-management authority: confirming that the FW is not subject to a work permit (“WP”); issuing WP; extending WP; reissuing WP.
    3. In case of the FW works under the labor contract, and after being issued with WP, the employer and the FW must sign a written labor contract before the expected date of employing and send the signed labor contract to the labor-management authority who issued the WP.
    4. The employer makes the first-6-month-report (before 5 July) and annual report (before 5 January of the following year) to the labor-management authority on the employment situation.
    5. The employer revokes the WP of the FW to return to the labor management authority under the Labor Code, within 15 days from the date of expiration of the WP, together with the document on the revocation of the WP of the FW and then the authority decides to revoke.

b.   This Official Letter specifically mentions the applicable case, the list of the dossier, and the processing time of the above-mentioned procedures. Paying attention to cases that are not required to confirm that the FW is not subject to a WP, but still must report in writing to the labor-management authority.

c.    Issuing templates:

  • Regarding the FW is not required to do procedures to confirm that the FW is not subject to the issuance of a WP.
  • Regarding the revocation of the work permit of the foreign worker.

III. Guidance on the PIT policy for the income earned in Vietnam by foreigners

Tax Department of Hanoi City issued Official Letter No. 9584/CTHN-TTHT to answer Official Letter No. 139/VNM-DN dated 31 March 2021 of a company about PIT policy for the income earned in Vietnam by foreigners. Some notable points are:

Determination of status of residence of individuals in Vietnam to determine taxable income is as follows:

  • The individual has been present in Vietnam for at least 183 days in a calendar year or 12 consecutive months from the arrival date.
  • The individual has a regular residence in Vietnam in one of the following cases: (i) He/she has a regular residence according to regulations of law on residence; (ii) He/she rents a house in Vietnam according to regulations of law on housing under a contract that has a term of at least 183 days in the tax year.
  • If the individual has a permanent residence in Vietnam but his/her actual presence in Vietnam is shorter than 183 days in the tax year and he/she fails to prove his or her residence in any country, that person will be considered a resident of Vietnam.

Regarding the specific situation in this official letter, the determination of residence status of an individual with Hong Kong nationality, if this individual is a resident of both Vietnam and Hong Kong, then the status of residence is determined according to Tax agreement between the two countries.

For down-loading: 

Legal Update #157 (EN version)

Maybe you are interested in reading other updates: April 2021 (Part 2)April 2021 (Part 1)March 2021 (Part 4)March 2021 (Part 3) | March 2021 (Part 2) | March 2021 (Part 1) | February 2021 (Part 2) | February 2021 (Part 1) | January 2021 (Part 5) | January 2021 (Part 4) 

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