Decree 53/2022 - Further guidance on data localisation in Vietnam

Introduction

In August 2022, the Government issued Decree 53/2022 providing, among other things, further guidance on data localization requirements in Vietnam. Article 26.3 of the Law on Cyber Security 2018 (LCS 2018) provides for a general data localization requirement. However, due to the lack of implementing regulations, such provision is not enforced in practice for several years. The new guidance under Decree 53/2022 will likely make the law enforceable in practice from 1 October 2022. In this post, we discuss some salient points of the data localization requirements under Decree 53/2022. This post is written by Trinh Phuong Thao and edited by Nguyen Quang Vu.

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Written by Nguyen Quang Vu On In ,

Injection of increased capital into DICA of foreign invested companies in Vietnam after expiry of contribution time limit

Under Circular 6 of the State Bank of Vietnam dated 26 June 2019 guiding the forex management on direct foreign investment into Vietnam (Circular 6/2019), foreign and Vietnamese investors (Investors) of a foreign invested enterprise (FIE) are required to inject capital contributions to the FIE through its direct investment capital account (DICA) opened at a bank in Vietnam. This article will discuss whether the Investors can inject the increased charter capital (Increased Capital) into the DICA if the time limit for making the capital contribution under the IRC already expired.

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Written by Lawyers VNLaw On In

Stricter conditions for foreign borrowings by Vietnamese entities under draft circular

The State Bank of Vietnam (SBV) is drafting a circular (Draft) to replace Circular 12 dated 31 March 2014 on conditions for enterprises to borrow foreign loans not guaranteed by the Government (Circular 12/2014). The Draft has some remarkable changes to the conditions of foreign borrowings by Vietnamese companies and credit institutions, and generally will tighten such conditions.

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Written by Lawyers VNLaw On In

GSM’s delegation to the Board under Vietnamese law

Under the law of Vietnam, it is unclear whether the General Shareholder’s Meeting (GSM) of a joint stock company (JSC) is allowed to authorise (or delegate) its power to the Board or to what extent can the GSM delegate its power to the Board, if the former is possible. In particular:

  • Article 15.4 of Decree 156/2020 imposes a penalty on the Chairman of the Board if he/she does not report to the GSM on the implementation of the GSM’s resolution except when he/she is authorised by the GSM. This provision suggests that the GSM of a public JSC may delegate the chairperson of the Board to make change to matters already decided by the GSM. Arguably, if the GSM could delegate its power to the chairperson of the Board then arguably the GSM could delegate its power to the Board.

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Written by Nguyen Quang Vu On In ,