VietNamNet Bridge - Under the Investment Law, there are seven prohibited business fields and 243 conditional business fields. However, according to the Central Institute of Economic Management (CIEM), it found 4,284 business conditions set by ministries and branches as of August 10, 2017.

The economics institute believes that this is not the final figure, because business conditions and licenses are ‘born’ every day and in different forms.

Business conditions include requirements on the number of workers, production capacity, the way workshops are located or financial capability. The requirements on businesses’ capacity account for the largest proportion (1,336), followed by requirements on workforce (1,100).

According to CIEM head Nguyen Dinh Cung, the requirements create unreasonable barriers that prevent businesses from joining the market, and restrict the number of investors registering their business and discourage operational enterprises. 

CIEM has asked the government to remove nearly 3,000 business conditions, including 302 on financial conditions, 1,400 on locations and 1,336 on production capacity.

He pointed out that many potential investors give up their business plans after learning about the requirements, because they don’t have large production premises, facilities and production lines, or degrees and experience as required.

CIEM, in the latest move, has asked the government to remove nearly 3,000 business conditions, including 302 on financial conditions, 1,400 on locations and 1,336 on production capacity.

The proposal by CIEM, according to Dau Anh Tuan, head of VCCI’s (Vietnam Chamber of Commerce & Industry) legal department, is a ‘daring move’.

“This is a reasonable approach way, though it is a bit too ambitious. 3,000 would be a shocking figure, but this would be a great opportunity to check business conditions,” Tuan commented.

“I look forward to the discussions about the proposal,” he said.

MOIT (Ministry of Industry and Trade) has strong support from the public on the removal of 675 business conditions under its control. The number accounts for 55.5 percent of the existing conditions (1,216). If MOIT fulfills its commitments, this would be a ‘record high number of licenses to be cut in the industry and trade sector’s history’.

Tran Dinh Thien, head of the Vietnam Economics Institute, said that the removal of such a high number of licenses by MOIT shows that the system of licenses in Vietnam is intricate.

VCCI has suggested that it is necessary to set up a mechanism to supervise the process of removing licenses. Ministries and branches must be punished if they don’t remove the business conditions that the government requires.

Currently, ministries and branches have been asked to check business conditions themselves and report the number of licenses to remove. 

However, there is no independent body which supervises the process. 

“Independent agencies such as National Assembly committees and associations need to get more actively involved in the process of checking and removing business conditions,” Tuan said.

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