New Decree Implementing the Vietnam Labor Code 2019

On 14 December 2020, the Government issued a new decree to implement the regulations on labor conditions and labor relationship under the Labor Code 2019 (Decree 145/2020). Decree 145/2020 will take effect as from 1 February 2020. We list below some notable changes to labor regulations under Decree 145/2020. This post is written by Nguyen Hoang Duong and Le Vo Thuy Tien.

New method for labor usage declaration

The employer now can include its first declaration of labor usage in a company registration application in accordance with new procedures for coordinating various business commencement steps of a company under Decree 122/2020.

Regarding the periodical reports on change to the labor usage, the employer now can submit its declaration formulated in prescribed form to the labor authority via National Public Service Portal.

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Written by Nguyen Quang Vu On

New Decree on Enterprise Registration in Vietnam

The Government recently issued Decree 1/2021 which takes effect from 4 January 2021 and replaces Decree 78/2015 in terms of enterprise registration procedures. There are certain new regulations and changes under Decree 1/2021 in relation to registration and notification of enterprise information as follows:

  • Decree 1/2021 clarifies “person submitting the application” including the person having the authorization to sign the application (Authorized Signatory) and the person being authorized by the Authorized Signatory.

  • ID number issued to a branch or representative office of an enterprise is specified as tax identification code of such branch or representative office.

  • Language of the application - Enterprise registration application must be prepared in Vietnamese. The translation of documents in a foreign language must be notarized. In case the application is made in the bilingual language of English and Vietnamese, the Vietnamese version will be used for registration procedures. That means, although parties may agree that the English version will prevail as between the parties, parties must take care of the Vietnamese version/translation to avoid any inaccuracy as the authority only review the Vietnamese version of the application.

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Written by Nguyen Quang Vu On In

Reputational damage arising from breaches of a commercial contract under Vietnamese law

In Vietnam, it is not common to see the aggrieved party claiming for damage which causes harm to its reputation (Reputational Damage) due to breaches of commercial contracts by the defaulting party. However, in principle, Reputational Damage due to breaches of a commercial contract should be claimed and recovered under Vietnamese law for the following reasons:

  • Under Article 419.3 and 361.3 of Civil Code 2015, an aggrieved party may claim for moral damage arising from a breach of contract, which includes, among others, moral losses caused by infringement of reputation;

  • Reputational Damage may be considered as “actual and direct loss” under Article 302.2 of Commercial Law 2005 if the aggrieved party has actually incurred the loss of reputation directly arising from a breach of contract by the defaulting party;

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Written by Nguyen Quang Vu On In ,

Unofficial clarifications by Vietnam Competition Authority on merger filing

On 14 January 2021, the Competition Management and Consumer Right Protection Authority (VCA) organized a seminar on “M&A regulation under Vietnamese Competition Law”. During the Q&A sections, the head of the merger filing division responded to various questions raised by lawyers from Venture North Law and other law firm. The official from the VCA has given some notable clarification as follows:

· Internal restructuring. Internal restructuring transactions within companies under the control of the same ultimate parent company is subject to the notification requirement. However, since the parties to the transactions in this case belong to the same group companies, the market share report of each party in this case will include market share information of the individual entity which is the party to the internal restructuring but not the whole company group. It is not clear on what legal basis, the official from VCA gave this explanation.

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Written by Nguyen Quang Vu On In ,