[Legal Updates] Monthly Legal Update 20190904

LEGAL UPDATES

[Legal Updates] Monthly Legal Update 20190904

I. REMARKABLE LEGISLATIONS WHICH HAS EFFECTIVE DATE IN SEPTEMBER 2019

1| Conditions in the business of karaoke and nightclubs services

This Decree shall be applied with Vietnamese and foreign businesses, enterprises operating karaoke, nightclubs; other agencies, organizations, individuals who are involved in the karaoke, nightclub operations.

This Decree stipulates the detail conditions for operating karaoke and night clubs as follows:

– For operating the karaoke service:    

  • Enterprises or businesses must be established under the legislation;          
  • Ensure fire safety, public security and order as specified in Decree No. 96/2016/ND-CP dated July 01, 2016 of the Government on security, order conditions of conditional business lines;          
  • Have singing rooms with usable areas of 20 square meters or larger, excluding the auxiliary works;        
  • Ensure no door locks or alarming devices (except fire alarm) are installed inside the singing rooms.  

– For operating the night club:       

  • Enterprises or businesses must be established under the legislation;        
  • Ensure fire safety, public security and order as specified in Decree No. 96/2016/ND-CP dated July 01, 2016 of the Government on security, order conditions of conditional business lines;          
  • Have a usable area of 80 square meters or larger, excluding the auxiliary works;            
  • Ensure no door locks or alarming devices (except fire alarm) are installed inside the singing rooms; 
  • Be located at least 200 meters away from schools, hospitals, religious establishments, cultural – historical heritage.

Besides that, this Decree also stipulates that the enterprises or the businesses which operates in karaoke service must not operate from 00AM to 08AM. For the enterprises or the businesses which operates in night club service, must not operate from 02AM to 08AM.

Decree No. 54/2019/ND-CP comes into effect on September 1st, 2019.

2| Direct investment capital bank account in Vietnam (DICA)

Circular No. 06/2019/TT-NHNN issued on June 26th, 2019 by the State Bank of Vietnam guiding the foreign exchange management for the foreign direct investment in Vietnam.

This Circular shall be applied to enterprises with foreign direct investment, foreign investors, Vietnamese investors in the enterprises have foreign direct investment capital, foreign investors participating in business cooperation contracts (hereinafter referred to as BCC), foreign investors participate in investment contracts in the form of public-private partnerships (hereinafter referred to as PPP), organizations, individuals related to foreign direct investment activities in Vietnam.

According to this Circular, enterprises include (i) enterprise which established in the form of Investment in establishment of a business organization, in which the Foreign Investors are members or shareholders, and it is required to have the Investment Registration Certificate in accordance with the law on invest; (ii) Enterprise which are not required to have the Investment Registration Certificate but 51% of its charter capital or more is held by Foreign Investors; and (iii) Project Management Enterprise established by the Foreign Investors to implement the PPP project in accordance with investment law are deemed as enterprises with foreign direct investment and shall open a direct investment account in an authorized bank (DICA).

In cases, the following enterprises which have opened a direct investment account, have to close such account, and at the same time the foreign investors who are non-resident own the shares, contribution capital in the enterprise open an indirect investment account under the regulations of foreign exchange:

  • The enterprise which has the foreign investors own under 51% of its charter capital, except it is required to obtain the Investment Registration Certificate under the regulations of the investment laws;    
  • The enterprise which is not required to have the Investment Registration Certificate but has the demand to have one and obtained the Investment Registration Certificate from the Competent Authority in accordance with the regulations of the investment laws;        
  • The direct foreign investment enterprise has stocks listed on the stock exchanges or registered for trading on the Stock Exchange.

Circular No. 06/2019/TT-NHNN comes into effect on September 06th, 2019.

II. THE EXECUTED LEGISLATIONS IN AUGUST 2019

No. DOCUMENT TITLE EXECUTION DATE EFFECTIVE DATE
Circular No. 48/2019/TT-BTC issued by the Ministry of Finance on guiding the appropriation and use of provisions for devaluation of inventories, loss of financial investments, bad receivable debts and warranty for products, goods, services and construction works at enterprises 08/08/2019 10/10/2019
Circular No. 49/2019/TT-BTC issued by the Ministry of Finance on guiding the management and use of state budget funding to support the development of human resources for small and medium-sized enterprises. 08/08/2019 23/09/2019
Circular No. 13/2019/TT-NHNN issued by the State Bank of Vietnam on amending the Circulars related to the licensing, organization and operation of credit institutions and branches of foreign banks 21/08/2019 05/10/2019