New laws create a favourable business climate

09:16 | 11/05/2016 Economy- Society

The two amended laws on investment and enterprises took effect as of July 1 last year. Changes to the two laws, along with the upgrade of the national information system on enterprise registration, the launch of the national information system on foreign investment and the strict implementation of these two laws at the local level have brought about encouraging results.

New laws create a favourable business climate

The duration for registering enterprises has been cut to 2.9 days for establishing new businesses and 2.7 days for filing for changes, which means enterprises are able to save more than half a million days in waiting. These strong reforms have been recognised by the World Bank which noted Vietnam’s improvement in the ‘Starting a business’ category in its latest Doing Business report.

Recently a report released on the provincial competitiveness index also showed that the indicator for establishing new companies recorded the largest improvement, recording the highest score in 11 years. These results suggest that the business environment has been improved to some degree since the two laws came into effect.

Nevertheless, many obstacles have arisen during implementation; however most impediments are of a technical nature and relate to the attitude and working style of civil servants and relevant agencies. For the new investment law, due to the magnitude of the changes which cover a wide scope and concern many legal documents and different State management agencies, a number of problems have emerged. Specifically, there are points of difference, incompatibility and inconsistency between articles stipulated in the new investment law, Government Decree 118/2015/NĐ-CP and relevant laws and legal documents on investment. Such problems mainly exist in the fields of land, natural resources, environment, construction, housing and real estate as well as services with restrictions on foreign investors.

There are also impediments in the gathering, review and reform of regulations on business requirements under the amended investment law and in the registration of investment projects and enterprises. These obstacles usually lengthen the registration period and require investors and enterprises to deal with unnecessary paperwork and administrative procedures.

The difficulties of implementing the two laws, especially the investment law, are quite perse, causing some parts of the two laws not to be implemented fully and consistently.

Recently in a government meeting on removing obstacles to the implementation of these two laws, Prime Minister Nguyen Xuan Phuc reiterated his political will to strictly implement stipulations of the laws, not to allow legal loopholes and take immediate action to put the two laws into effect.

The prime minister called for a spirit of reform, facilitating businesses, supporting and protecting the right to do business, disclosing business requirements and not allowing law infringements and sub-licences that obstruct enterprises or the people.

The amended investment and enterprise laws must be implemented together with Government Resolution 19/NQ-CP on improving the business climate. Another important task is to enhance the role of the working group on the implementation of the two laws to timely discover the downsides and tackle officialdom of civil servants. The bureaucracy must serve the people. Administrative reforms and better laws are one thing but if the civil servants do not fulfil their duty, they will hinder development progress./.


Source: NDO