Law Digest 2024

October

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Data

At the moment Decree 13 “On Personal Data Protection” applies to both entities and individuals inside and outside Vietnam processing data related to Vietnam. The new draft law expands the scope to cover entities and individuals processing foreigners’ personal data within Vietnam. Some of the key points of the draft law in its latest iteration are below:

• Consent requirement: The draft law imposes stricter rules on consent when processing and transferring personal data, prohibiting coercive conditions.
• Location and biometric data: It requires clear notification and explicit consent when processing location and biometric data.
• Sensitive data protection: It introduces new categories of sensitive data, including land user information, and requires a data protection trust rating.
• Data protection trust rating: This is a mandatory element in data protection impact assessments.
• Data protection in the context of big data: It provides detailed regulations on data protection in data-intensive sectors such as recruitment, finance, social networks, and communication services.
• Violations of personal data protection regulations: Punitive measures against violators include disciplinary actions, administrative fines, or criminal prosecution, depending on the severity of the violation. There is already a draft on administrative sanctions for cybersecurity violations. Regarding criminal sanctions, violations of personal data regulations can be prosecuted under two offenses stipulated in Articles 159 and 288 of the 2015 Penal Code, with a maximum prison sentence of seven years.

Commerce

This document will impact businesses engaged in the trading of goods and services, promotional activities, and organizing trade fairs and exhibitions. Some noteworthy amendments and supplements include:

• The requirement to clearly stipulate that the value of promotional goods and services cannot exceed 50% of the sales price immediately prior to the promotion period, which is more detailed than the previous regulation, and provides more guidance on calculating promotional values to ensure compliance.
• The addition of cases where businesses are exempt from the administrative procedure to provide notification of promotional activities. Notification methods have also been updated, allowing businesses to provide notification through the National Public Service Portal or the Provincial Administrative Procedure Resolution System.
• The inclusion of circumstances where it is not necessary to announce the results and distribute prizes for promotional programs in cases of force majeure.
• The elimination of the requirement to report the results of submitting to the state budget within 10 days from the date of submission of 50% of the published value of unclaimed promotional prizes. The deadline for submitting such funds to the State has been extended from 15 days to 45 days from the date of receiving the State’s collection decision.

Energy

The decree will impact businesses interested in developing rooftop solar power systems for self-consumption, as well as those in the rooftop solar power business. According to this decree, self-produced, self-consumed solar power systems will be exempt from operating license requirements and capacity limits in certain cases (details below) and will also receive tax incentives and streamlined administrative procedures.

General conditions for self-produced, self-consumed rooftop solar power systems:

• Compliance requirements: Rooftop solar power projects must comply with regulations on investment, construction, land, environment, safety, and fire prevention before and during installation. Compliance documentation must be provided to the Department of Industry and Trade and other relevant authorities when registering or notifying the system.
• Restriction on used equipment: The use of imported second-hand solar panels and direct current conversion devices is prohibited.

Registration and notification requirements:

• Systems with a capacity of 1,000kW or more must register with the local Department of Industry and Trade to obtain a development certificate and ensure alignment with the Power Development Plan VIII.
• Systems with a capacity of less than 1,000kW and non-grid-connected systems are exempt from registration but must notify the relevant authorities.

Capacity limits:

• Systems under 100kW for households are not subject to capacity limits.
• Systems under 100kW for production and business facilities must comply with capacity planning requirements.
• Grid-connected systems over 100kW must be developed in accordance with the plan.
• Systems not connected to the national grid or with “zero export” devices may be developed without capacity limits.

Transitional systems: Self-consumed systems developed after January 1, 2021, and before the decree’s effective date are not required to register, only to report to the provincial Department of Industry and Trade. However, these systems are not allowed to sell excess electricity to EVN (Vietnam Electricity).

Households and businesses with excess electricity may sell up to 20% of their system’s capacity to the national grid. The purchase price for this excess electricity is set at the average market electricity price from the preceding year.

The decree also encourages the installation of battery energy storage systems to ensure safe and stable operations.

September

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Energy

The Ministry of Industry and Trade is requested to review and transition from coal power to gas power and develop nuclear power, as follows:

• Review the power sources in the Power Development Plan VIII, transition baseload power from coal to gas, prioritize domestic production to achieve an annual electricity growth rate of 12-15%, ensure energy security, and provide sufficient electricity for production and people’s daily lives, while fulfilling commitments made with foreign investors.
• Study international experience in developing nuclear power and propose nuclear power development in Vietnam to supplement the electricity supply while minimizing environmental risks, and report to the Politburo for consideration and decision.

For projects that have been licensed, investors are required to fulfill their commitments; in cases where commitments are not fulfilled, the competent authorities will revoke licenses in accordance with legal regulations.

Banking & Finance

This circular, which entered into effect on August 12, 2024, introduces five key adjustments:

• Revisions to align with the operations of credit institutions: Certain provisions have been modified, especially regarding bond transactions between credit institutions under special control, supporting credit institutions, and those involved in mandatory transfer operations.
• Increased transparency: Bond-issuing enterprises must disclose information about related individuals and organizations before credit institutions purchase their bonds. This aims to enhance the transparency of transactions and reduce credit risk.
• Promotion of cashless payments: Credit institutions are required to use cashless payment methods in bond transactions to facilitate the monitoring of capital use, improve transparency, and support the sustainable development of the bond market.
• Enhanced debt recovery responsibility: Credit institutions must oversee the use of funds raised from bond issuances. If the funds are misused, the institution can demand the enterprise to repurchase the bonds ahead of schedule. If the enterprise fails to comply, the credit institution may take measures to recover the bond principal and interest in accordance with regulations.
• Credit limit adjustment (amended in line with the Law on Credit Institutions 2024): The total balance of bond purchases will be included in the overall credit balance of the credit institution to ensure compliance with legal credit limits.

These changes are designed to strengthen risk management, ease difficulties in the corporate bond market, unlock capital flow for the real estate sector, enhance market liquidity, and promote the sustainable development of the corporate bond market.

This circular introduces new regulations aimed at resolving issues related to pre-margin deposits and ensuring equal access to information for foreign investors. It is part of an effort to upgrade Vietnam’s stock market from a frontier market to an emerging market, thus attracting more foreign investment. It enters into effect on November 2, 2024, with certain information disclosure requirements taking effect from January 1, 2025 (see below).

Previously, investors, including foreign institutional investors, were required to have sufficient cash in their accounts in Vietnam at the time of placing a trade order. When this circular takes effect, foreign investors may be allowed to place buy orders for shares without having the full amount of funds available at the time of order placement. If foreign investors fail to fully pay for their stock purchases, the securities company handling the trade will be responsible for covering the remaining payment. These companies also have the right to disclose information about investors who do not pay in full, which helps reduce the risk of non-payment.

The circular also requires simultaneous information disclosure in English; listed organizations and large public companies will be required to publish their periodic financial reports in both Vietnamese and English starting from January 1, 2025. If there is a discrepancy between the two versions, the Vietnamese version will take precedence.

Employment

The Law on Social Insurance, which enters into effect on July 1, 2025, includes significant changes aimed at expanding coverage, adjusting contribution periods, and enhancing benefits. Key points include:

• Expansion of mandatory social insurance participation: The law expands mandatory social insurance coverage to include enterprise managers, part-time workers, and unpaid management positions. Additionally, certain groups are exempt from mandatory participation, such as foreign workers and unpaid managers of retirement age.
• Reduction of the contribution period for retirement benefits: The minimum contribution period to qualify for a pension has been reduced from 20 years to 15 years.
• Clarification of the wage base for social insurance contributions: The law clarifies that the wage base for contributions includes: (i) the salary; (ii) salary allowances; and (iii) other agreed-upon regular, stable supplements. This replaces the broader previous definition of “all other supplements”.
• Change in social insurance payment deadline: Employers are given until the end of the following month to make their contributions.
• Further details on pension calculation: While the pension calculation method remains unchanged, the law introduces new provisions on contribution periods and pension calculations for individuals working in multiple countries.
• New one-time retirement allowance: The law adds incentives for workers to continue contributing after reaching retirement age, including a one-time allowance.
• Expansion of one-time social insurance benefits: The law expands eligibility for receiving one-time social insurance benefits.
• Stricter penalties for evasion of social insurance contributions: Stricter sanctions have been introduced for avoiding social insurance contributions, including both administrative and criminal penalties.
• Introduction of an electronic social insurance book: The law introduces the concept of an electronic social insurance book, which will have the same legal validity as the paper version and is set to be implemented starting in 2026.

Asset Auctions

This law, which updates the 2016 Law on Asset Auctions, enters into effect on January 1, 2025. Key changes include:

• More assets subject to auction: The law broadens the range of assets subject to auction, including land use rights, mineral exploitation rights, radio frequency spectrum, public property, secured assets, bad debts, and other types of assets as prescribed by the law.
• Fairer auction process: The new law prohibits collusion, falsified auction participation documents, and manipulation of auction outcomes to ensure fairness and transparency, preventing price-fixing or undercutting schemes.
• Heightened transparency of auction rules: Auction rules must now be publicly posted at the office of the auction organization, at the auction venue, and on the National Property Auction Portal. This replaces the previous general requirement for public announcements, adding more specific guidelines. Moreover, any changes to the auction rules must also be publicly announced.
• Penalties for failure to pay: Auction winners who fail to make payments, leading to the annulment of the auction result, will face bans from participating in auctions of the same asset type for periods ranging from six months to five years.
• Introduction of online auctions: The law includes detailed regulations on online auctions, allowing auctions to be conducted via the National Property Auction Portal or auction organizations’ websites.

August

Electricity

This decree is effective immediately and applies to renewable energy generation businesses and large electricity consumers (those who use an average of 200,000 kWh/month or more) that require direct power purchases. The DPPA mechanism allows customers to purchase electricity directly from the generation unit in two forms, as follows:

1. Direct power purchase through a private connection line: The generation unit can sell electricity directly to customers, provided they are a large electricity consumer. The electricity price will be directly negotiated between the two parties. If the generation unit produces a surplus, the excess electricity can be sold back to Vietnam Electricity (“EVN”).
2. Direct power purchase through the national grid: In cases where the generation unit’s facility and the customer are located far apart, without a direct physical connection, the generation unit will transmit electricity to the customer’s facility through the national grid system.
   This form of power purchase applies only to the following entities:
   • Generation units utilizing wind or solar power with a capacity of 10MW or more
   • Large electricity consumers using power for production purposes at a voltage level of 22kV or higher
   • Electricity retailers within zones or clusters1 authorized by large electricity consumers using power for production purposes to purchase electricity and enter into contracts

Accordingly, direct power purchases through the national grid are carried out as follows:

• • The generation unit will be connected to the national power system. They will sell all their generated electricity into the spot market2 of the competitive wholesale electricity market,3 where the generation unit signs a power purchase agreement with EVN.
  • The customer (or an electricity retailer within authorized zones or clusters) signs a power purchase agreement with EVN (or an authorized/delegated entity) to buy all of the electricity needed to meet their demand.
  • The customer (or an electricity retailer within authorized zones or clusters) also signs a forward contract with the generation unit to purchase electricity. The contract volume and price are negotiated and agreed upon by both parties for each trading cycle in the spot market.

The DPPA mechanism should increase the number of electricity buyers for generation units. It will unlock bottlenecks in the electricity market, creating favorable conditions for the development of renewable energy generation businesses. It also allows electricity-buying businesses to obtain carbon emission reduction certificates, enhancing their competitiveness in the international market.

Banking and Finance

The amendments and additions in this new circular aim to adjust certain provisions in the old circular related to participation by enterprises in stock award programs involving issuances abroad.

Since some stock award programs are not intended to incentivize and retain employees but rather to raise capital for foreign organizations, functioning as indirect foreign investment activities, the new circular primarily addresses this issue.

For example, it changes the general provision in the old regulations concerning the form of “Stock purchase rights with preferential conditions” to “Other forms of stock awards abroad that do not result in the outflow of funds.” Additionally, the new circular reduces related administrative procedures, helping enterprises lower costs and contributing to attracting foreign currency into Vietnam through stock award programs.

The new circular entered into effect on 12 August 2024.

Taxation

The latest draft introduces the following noteworthy change: A reduction in corporate income tax rates for small and micro enterprises, which make up 94% of active businesses in Vietnam, from 20% to 15% or 17%, as follows:

• A 15% tax rate applies to enterprises with total annual revenue not exceeding VND3 billion.
• A 17% tax rate applies to enterprises with total annual revenue exceeding VND3 billion but not exceeding VND50 billion.

However, this tax rate does not apply to enterprises that are subsidiaries or affiliated companies if the affiliated company does not meet the conditions for applying the tax rate as specified.

July

Land

The Land Law 2024 enters into effect on 1 August 2024, along with a series of new guiding decrees that were issued on 30 July 2024. Some of the notable changes are highlighted below:

• The new law clarifies that foreign-invested entities (“FIEs”) are companies in which foreign investors hold more than 50% of the equity (the previous version of the law did not specify a percentage). Therefore, companies in which foreign investors hold 50% or less of the equity are considered domestic companies.
• The regulation on land price frameworks has been abolished, and an annual Land Price Table will be introduced. Each provincial People’s Committee must develop a Land Price Table based on market principles and the specific conditions of each province; the table will be detailed down to each individual plot of land. The provincial People’s Committee will prepare and submit the initial Land Price Table to the provincial People’s Council for approval, with the table to be announced and applied starting 1 January 2026 (until that time, the land price list under the provisions of the old law will apply).After that, each provincial People’s Committee will present its proposed adjustments, amendments, and additions to the Land Price Table to the provincial People’s Council for approval, and then the updated table will be followed from 1 January of the subsequent year.

• The transfer of leasehold rights in a land lease agreement[1] is a new provision introduced by the Land Law 2024, offering more flexible investment and land use opportunities for economic entities (including FIEs). The transfer of leasehold rights includes the transfer of any assets attached to the land. The transferee of the leasehold rights inherits the rights and obligations of the transferor with respect to the State; therefore, this transfer of obligations requires the State’s approval. The new law allows economic organizations, individuals, overseas Vietnamese, and FIEs to switch from paying land rent in a one-time lump sum to annual payments, and vice versa (the old law only allowed switching from annual payments to a one-time lump sum).
  • Where the land rent has already been paid in a lump sum: When switching from a one-time payment to annual payments, no refund of the amount already paid will be given but the amount will be deducted from the annual land rent payments over time. The annual land rent may increase due to the appreciating value of the land over time or as influenced by new legal policies.
  • Where the lump-sum payment has not yet been made and payment of land rent is switched to annual payments: This provision offers economic benefits, such as reducing the financial pressure and burden during the initial stages of project implementation. The land rent for the period during which the land has been used must be paid, along with any late payment fees.
• The new law stipulates that if land allocated for an investment project is not used for a continuous period of 12 months from the date of handover on-site, or if the land use progress is delayed by 24 months compared to the schedule stated in the investment project, the investor may be granted an extension of no more than 24 months and must pay an additional fee to the State. If, by the end of the extension period, the investor still has not utilized the land (except in cases of force majeure), the State will reclaim the land without compensation (this penalty did not exist in the old law).

[1] Leasehold rights in a land lease agreement refer to the rights of the land user that are established when the State leases land with annual rent payments (Article 3.37 of the Land Law 2024).

Banking and Finance

Notable changes from this new law are provided below:

• The new law permits a controlled testing mechanism in the banking sector (known as a “Regulatory Sandbox”[1]), which sets the foundation for the legal framework governing digital banking services offered by commercial banks and activities such as payment processing, data sharing via Open API (Application Programming Interface), peer-to-peer lending, credit scoring, and more by financial technology companies. Currently, the State Bank of Vietnam (“SBV”) is drafting decrees regulating the Regulatory Sandbox.
• The new law enhances transparency in the corporate governance of credit institutions, addressing issues such as cross-ownership and manipulation within these organizations through several significant changes:
  • The concept of “related persons” has been expanded to include grandparents, uncles, aunts, and cousins of an individual.
  • Credit institutions and their subsidiaries are prohibited from contributing capital to or purchasing shares in other businesses or credit institutions that are related persons of major shareholders. The SBV is drafting circulars regulating the development and implementation of compliance schedules for this provision.
  • Any shareholder owning 1% or more of a credit institution’s charter capital must provide to the credit institution personal identification information, detailed information about related persons, and the number and percentage of shares owned by themselves and related persons. The credit institution must submit this information in writing to the SBV and publicly disclose it.
  • An institutional shareholder is not allowed to hold more than 10% (the old regulation was 15%) of the charter capital of a credit institution. The total ownership of a shareholder and their related persons must not exceed 15% (the old regulation was 20%) of the charter capital of a credit institution.
• The new law provides clearer criteria for detecting and managing problematic credit institutions and grants the SBV greater authority to oversee and intervene in the operations of these institutions, including by the use of special loans (which were previously only available to credit institutions under special supervision).
• The proceeds from the liquidation of collateral for non-performing loans are distributed in the following priority order:
  1. Collateral preservation expenses
  2. Expenses incurred for the seizure and liquidation of collateral
  3. Court fees and expenses for the enforcement of court judgments and decisions related to the liquidation of collateral (these were not clearly prioritized before; this encourages courts to resolve disputes and handle debts more effectively)
  4. Taxes and fees directly incurred from the transfer of collateral, including personal income tax and registration fees
  5. Debts secured by the credit institution, foreign bank branch, or bad debt purchaser/manager
  6. Other unsecured liabilities, as specified in the laws and regulations

[1] An environment that allows experiments on technologies, products, services, and business models on a limited scale, space, and duration; institutions participating in the regulatory sandbox must satisfy the conditions and criteria for participation and be subject to supervision by the competent State agencies. (Article 106.1 of the Law on Credit Institutions 2024).

June

Energy

The long-awaited regulation relating to the direct power purchase mechanism has been officially issued in Vietnam.

The key highlights include:

• 2 models (grid-connected and off-grid) power sales are envisaged;
• more flexibility in agreeing on key terms of the power purchase agreements;
• eligibility thresholds in the final version of the Decree are lower than in some of the interim drafts made available earlier.
• one of the first instances of express mentioning of the regime for Renewable Energy Certificates in the detailed procedural guidance document relating to the direct power sale market.

Direct power purchase can be conducted in 2 forms:

• Through Dedicated Connection Lines: by signing electricity purchase contracts and the transfer of electricity between renewable energy generation units and large electricity users as specified in Chapter II of the decree.The purchasers of electricity must meet the threshold of consuming at least 200,000 kWh on average per month.

• Through the National Grid: through signing a series of contracts under which:
  • Renewable energy generation units selling all produced electricity into the spot market of the competitive wholesale electricity market.
  • Large electricity users or authorized retail electricity units signing contracts with the Electricity Corporation (or authorized/subordinate units) to purchase all electricity needed.
  • Long-term contracts between renewable energy generation units and large electricity users or authorized retail electricity units.
  • Entities that can participate in this form include:
    • Renewable energy generation units from wind or solar power with a capacity of 10MW or more, connected to the national power system.
    • Large electricity users purchasing electricity from the Electricity Corporation or other retail electricity units, connected at a voltage level of 22kV or higher.
    • Retail electricity units in industrial zones or clusters authorized by large electricity users to purchase electricity from the Electricity Corporation and sign long-term contracts with renewable energy generation units.

OPPORTUNITIES UNLOCKED

The DPPA Decree 80 re-ignites the interest of more local and international developers in the Vietnam’s energy sector, in particular the renewables.    After a wave of investments during the earlier period of effectiveness of “feed-in-tariff” (FiT), the new Decree opens a new route to structure energy projects, negotiate bankable PPAs, and address key concerns of lenders and equity investors, including tariff, curtailment and termination risks.

This could allow developers, lenders and equity investors to have broader basis for negotiating project finance and M&A transactions for energy projects in Vietnam, with consequential benefits to transactions other sectors, including industrial parks, manufacturing and logistics infrastructure.

Please contact our team in Vietnam, if you would like to discuss the possibilities opened by Decree 80 for your existing or new project.

Taxation

The decree continues the value added tax (“VAT”) rate policy previously ratified by the government under Resolution No. 142/2024/QH15. The reduction in VAT from 10% to 8% has been extended for the period 1 July to 31 December 2024. The goods and services eligible for the reduced VAT rate will remain the same as under the previous policy with the exception of the following products and services:

• Telecommunications, financial activities, banking, securities, insurance, real estate, metals and fabricated metal products, mining products (excluding coal mining), coke, oil refineries, and chemical products
• Goods and services subject to the special consumption tax
• Information technology according to the Law on Information Technology

In addition, the VAT reduction for goods and services uniformly applies across all stages of import, production, processing, and trading. For coal products, including those screened and classified before sale, the VAT reduction applies. However, coal products listed in Appendix I of the decree, at stages other than exploitation, are not sold and thus do not qualify for the VAT reduction.

The decree does not apply to goods and services that are either exempt from VAT or subject to a 5% VAT rate.

Labor

The key points of the decree are as follows:

Increases in statutory minimum wages, as shown in the table below:

Region*	Statutory minimum wages per month (VND)		Statutory minimum wages per hour (VND)
	2023	2024	2023	2024
Region I	4,680,000	4,960,000	22,500	23,800
Region II	4,160,000	4,410,000	20,000	21,200
Region III	3,640,000	3,860,000	17,500	18,600
Region IV	3,250,000	3,450,000	15,600	16,600

^*A list of the areas under each of the regions is included in the appendix attached to the decree.

Application of the minimum wage by region:

• The applicable region is based on the location of the employer’s operations.
• Units or branches should apply the minimum wage for the region where they operate.
• Industrial parks and export processing zones should apply the highest minimum wage of the areas involved.
• Areas for which there have been name changes or administrative division changes into another region should temporarily apply the previous minimum wage until new regulations are issued.
• Newly-established areas from multiple regions with different minimum wages should apply the highest minimum wage.
• Newly-established provincial cities from Region IV should apply the minimum wage of the remaining provincial cities.

May

Banking and Finance

This decree takes effect on 1 July 2024 and replaces Decree No. 101/2012/ND-CP. It introduces significant improvements to Vietnam’s non-cash payment landscape, establishing a more comprehensive and user-friendly framework for non-cash payments in Vietnam, promoting transparency and security in financial transactions. The State Bank remains responsible for overseeing and managing these activities.

Below is a breakdown of the key changes:

• Clearer definitions: The decree provides a more precise definition of electronic money, including the different forms used for prepayment activities.
• Simplified international payments: International payments and systems are clearly defined, along with regulations for international financial switching services and cross-border service provision.
• Enhanced payment account management: The decree revises and expands regulations on opening, using, authorizing, blocking, closing, and managing balance of payment accounts.
• Streamlined public service payments: Businesses providing public services, such as banks, credit unions, microfinance institutions, and postal service providers, can now offer payment options that don’t require customers to have individual accounts. This section of the decree outlines the approval process from the State Bank.
• Increased combating of illegal activities: The decree introduces a few additional clauses that explicitly prohibit unauthorized intermediary payment services, violations related to operating licenses, and the use of payment services for illegal purposes.

Energy

The notice promulgates the conclusions of Deputy Prime Minister Tran Hong Ha on the development and promulgation of a decree stipulating the direct electricity trading mechanism between renewable energy generators and large-scale electricity customers (“DPPA”).

The DPPA decree will focus on prioritizing the development of renewable energy instead of fossil energy, and at the same time research to expand the scope to biomass power and waste power. However, to ensure effectiveness and transparency, the DPPA decree needs to clarify a number of important issues, specifically the following:

• Subjects of application: Clearly define eligible buyers and sellers, including minimum electricity consumption requirements for large customers.
• DPPA policy: Ensure an open, market-driven approach with clear trading forms, responsibilities for all parties, and government oversight.
• Procedures: Simplify administrative processes to encourage business participation.
• Electricity pricing: Consider flexible pricing reflecting market value and incentivizing renewable energy use.
• Infrastructure: Synchronize grid development with renewable energy transmission needs.
• For direct connections contract: Define electricity planning, allow market-based negotiations, and avoid rigid contracts.
• For national grid usage contract:
  • Clarify roles for government, Vietnam Electricity, and the National Electricity System Dispatch Center.
  • Publicly disclose transmission service costs, infrastructure fees, and loss charges.
  • Expand the definition of “large customer” to include service providers.
  • Define renewable energy sources (wind, biomass, battery storage).
  • Ensure the DPPA decree complements existing regulations on rooftop solar power.

The Ministry of Industry and Trade is tasked with completing the draft DPPA decree and submitting it to the government in May 2024.

April

Energy

This decision marks the official approval for executing the national energy master plan from 2021 to 2030, with a forward-looking vision to 2050. It delineates a comprehensive framework covering vital sectors such as oil and gas, coal, electricity, and renewable energy sources. Notable highlights of the master plan are as follows:

• The plan elaborates on specific initiatives within each subsector. For instance, within the oil and gas domain, it highlights endeavors such as exploration, exploitation, processing, and the transportation and distribution of petroleum products.
• It underscores the importance of advancing new and renewable energy sources, encompassing wind, solar, biomass, and other emerging technologies. It emphasizes the development of alternative energy sources, such as offshore wind power in conjunction with other renewables, such as hydrogen and green ammonia, catering to both domestic consumption and export demands.
• Renewable energy sources are given precedence, permitting unhindered development to meet domestic and export requirements, all while ensuring national defense, energy security, and economic efficacy.
• Finally, the decision endorses the anticipated land-use and investment capital requirements for facilitating the development of infrastructure and energy projects in line with the master plan.

Several projects were added to the list as below:

• Section 1 covers 12 power source projects.
• Section 2 comprises 28 power grid projects, encompassing initiatives such as fortifying the connection of the North-Central power grid, boosting transmission capacity to serve significant load areas, synchronizing power grids, relieving capacity strain on power sources, alleviating pressure on northern hydroelectric plants, and augmenting electricity procurement from China and Laos.
• The list also encompasses gas-to-power projects such as Block B and Ca Voi Xanh, LNG storage and power plants, and upgrades to the Dung Quat Oil Refinery and Long Son Petrochemical Complex.
• The National Program for Economical and Efficient Energy Use spanning 2019 to 2030, the power supply initiative targeting rural, mountainous, and island regions from 2021 to 2025, and a pilot project aimed at offshore wind power development were also incorporated into the list.

The decision tasks the Ministry of Industry and Trade with the responsibility for reviewing and proposing necessary amendments to the list, while the Prime Minister holds the authority to approve these adjustments during the implementation phase.

March

Energy

The key objectives of the decision are to:

1. Develop a roadmap for organizing the implementation of projects to meet the goals outlined in the PDP VIII and address the electricity requirements for socioeconomic growth in each phase.
2. Establish a robust energy transition strategy from fossil fuels to renewable sources to mitigate environmental pollution and greenhouse gas emissions, aligning with the government’s commitment to achieve net zero emissions by 2050.
3. Implement solutions to attract investment in the power development sector.
4. Provide guidance for coordinating mechanisms among ministries, departments, and local authorities to execute assigned tasks effectively.
5. Ensure a balanced development of power sources across regions, focusing on matching supply with demand and ensuring the feasibility, synchronization, and adaptability of power sources and grid development within the national context.
6. Finalize policies and laws while enhancing the scientific and technological capabilities of the electricity industry during the planning period.
7. Maximize the mobilization of resources and involvement of various economic sectors in the power development plan.
8. Identify the list of essential and priority power source and grid projects, including regional interconnected power grids, as well as renewable energy projects for each locality until 2025, as outlined in Appendices II and III of the PDP VIII.

Banking and Finance

The law takes effect from 1 July 2024 and replaces the current Law on Credit Institutions 2010. It aims to strengthen credit institutions, promote economic growth, and stimulate innovation in the country’s financial operations.

It introduces considerable changes, primarily to the operations of commercial banks and foreign bank branches compared to the current Law on Credit Institutions. Some of the most notable highlights are provided below:

• There are improved corporate governance procedures with the amendment and supplementation of regulations on organization, governance, administration, and risk management. Additionally, it provides for increased self-inspection and internal controls of credit institutions and foreign bank branches.
• A number of regulations were amended to limit the manipulation of credit institutions in addition to the stricter requirements on governance and administration.
• The new law clarifies regulations on credit institutions and overseas bank branches, and supplements regulations on controlled testing systems in the banking sector.
• There is a new chapter on policy banks.
• There are improved finance, accounting, and reporting regulations to promote the sustainable development of credit institutions and foreign bank branches while meeting international standards.
• The legislative framework to address weak credit institutions has been enhanced.
• There are improvements in the regulations on state management, including ones that enhance the State Bank’s inspection and oversight obligations as well as improve coordination between the State Bank and agencies, including the Ministry of Finance, for efficient management, inspection, and supervision.

There are supplemental regulations to protect customers’ interests and prohibit certain behaviors along with adjust licensing regulations to reduce administrative burdens.

February

PPP/ Taxation

Some key highlights of the decree are as follows:

1. Principles for control and payment of public investment capital applied to BT projects in Ho Chi Minh City:
   • The State Treasury is the responsible party.
   • The BT contracting agency must open an account at the State Treasury where it is convenient for the transaction following the Government of Vietnam’s regulations.
   • Following receipt of the comprehensive capital allocation document of the public investment plan (along with any supplements or adjustments) from the People’s Committees at all levels of Ho Chi Minh City, the State Treasury will distribute capital for the project based on the payment request document for projects that have completed the investment procedures as outlined in Resolution 98/2023/QH15 and have been allocated.
   • The State Treasury is responsible for controlling and paying capital for the project in a timely (within three working days), full, and regulatory-compliant manner upon receiving legally adequate payment conditions and documentation; payment will not be made in the case of inadequate documentation or non-compliance.
   • The total capital for a BT project must not exceed the total investment approved by the competent authority. The amount of public investment capital disbursed during a year for a project must not exceed the planned capital allocated for the project for that year.
   • Under current legal regulations, BT contracting agencies are accountable for the correctness of the implementation volume, unit price, payment request value, and records and documents provided to the State Treasury. They are also responsible for managing and using capital for the appropriate purpose and target audience economically and effectively.

2. Exemption from corporate income tax and personal income tax in Ho Chi Minh City
   • Exemption from corporate income tax applies to enterprises and supporting organizations who have income from innovative start-up activities in Ho Chi Minh City if they qualified under the Ho Chi Minh City People’s Council priority fields, criteria, conditions, and content for innovative start-up activities.
   • Exemption from personal income tax applies to Individuals with income from capital contribution transfers and capital contribution rights to entities mentioned in Point 2.1 above.

Energy

The decision lays out principles under the development strategy as follows:

1. Path to 2030:
   • Gradually develop the hydrogen energy market under and in sync with the fuel conversion roadmap in energy-using sectors of the economy, including electricity production, transportation (road, rail, waterways, air), industrial (steel, cement, and chemical production, oil refining, other industries), commercial, and civil.
   • Deploy and apply hydrogen-based energy testing in several fields with the ability to take advantage of existing infrastructure while ensuring system safety and a reasonable price, specifically:
     • Electricity production: Research and pilot the co-firing of gas with hydrogen, and coal with ammonia, at gas and coal power plants to prepare for the implementation of the fuel conversion roadmap to hydrogen-based energy.
     • Transportation: Research and pilot the implementation of hydrogen energy for public transportation and long-distance transportation.
     • Industry: Research and pilot the implementation of green hydrogen energy to replace gray hydrogen in fertilizer production and petrochemical refining. Pilot the use of hydrogen and hydrogen-derived fuel in the production of green steel, cement, etc. with low emissions.

2. Path to 2050:
   • Promote the application of green hydrogen energy and hydrogen-derived fuels in all energy-using sectors to decarbonize the economy and make an important contribution to the goal of achieving zero stream emissions by 2050, of which:
     • Electricity production: Implement fuel conversion for gas and LNG power plants to use hydrogen, and coal power plants to use ammonia according to the National Power Development Plan for the period 2021 – 2030, with a vision for 2050.
     • Industry: Make the transition to using hydrogen energy in fertilizer production, the petrochemical industry, and steel and cement production to decarbonize the industrial sector.
     • Transportation: Make the transition to using hydrogen energy and hydrogen-derived fuel for vehicles under the green transformation roadmap for the transportation industry.
   • Form and develop the hydrogen energy consumption market according to market mechanisms and healthy competition with other forms of energy.
   • Strive for the proportion of hydrogen energy and hydrogen-derived fuel to reach about 10% of final energy consumption needs.

Security

Per this circular, from 1 February 2024, the following two circulars are terminated:

1. Circular 01/2019/TT-BTP dated 17 January 2019 of the Minister of Justice providing guidance on the registration of security interests on aircraft and ships;
2. Circular 07/2019/TT-BTP dated 2 November 2019 of the Minister of Justice providing guidance on the registration of the mortgage of land-use rights and assets attached to the land.

In addition, the circular reiterates the cases where security interests must be registered:

• Registration of property mortgage, property pledge, and preservation of ownership rights according to the provisions of the 2015 Civil Code and other related laws.
• Registration under an agreement between the securing party and the secured party, or registration at the request of the secured party, except for liens.
• Registration of a notice of disposal of a secured asset registration if an asset is used to secure the performance of multiple obligations with multiple security recipients or in cases where the securing party and the secured party have an agreement.
• Registration of an amendment to the registered content and deregistration of the registered content for the aforementioned cases.

January

Energy

Some key highlights of the Letter 644 implementation plan include the following.

The implementation plan will be done in two phases:

• The first phase will primarily cover the list of significant and high-priority power source and grid projects (see below for the list) along with the wind power, small hydropower, biomass power, waste-to-energy projects that meet the guidelines and the types of power sources that need to be developed.
• After being evaluated and re-proposed by the appropriate authority, the second phase will cover approval of the wind power, small hydropower, biomass power, waste-to-energy projects that did not fulfill the requirements to be included in the first phase.

The implementation plan covers:

• Forecast of electricity demand;
• Investment plan for the power sector;
• Land use requirements;
• Solutions and resources needed to carry out the implementation plan.

Below are the significant and high-priority power projects that were selected using the standards and explanations provided in Decision No. 500/QD-TTg, as provided in Appendix III of Letter 644:

• LNG thermal power with a total capacity of 22,400MW (Table 1);
• Coal-fired thermal power with a total capacity of 30,127MW (Table 2);
• Co-generation, residual heat utilization, blast furnace gas, and byproducts with a total capacity of 2,700MW (Table 4);
• Domestic gas-fired thermal power with a total capacity of 14,930MW (Table 5);
• Hydropower with a total capacity of 29,346MW, including medium and large projects (Table 6);
• Tidal hydropower with a total capacity of 2,400MW (Table 7).

Circular 19/2023/TT-BCT takes effect from 19 December 2023.

Power generation pricing framework principles

The power generation price bracket is a range of values from a minimum value of VND0/kWh to the maximum value that will be established and issued annually, which will be applicable for:

• Ground-mounted solar power plants;
• Floating solar power plants;
• Onshore wind power plants;
• Nearshore wind power plants;
• Offshore wind power plants.

At the end of each year, the MOIT will approve a “standard” solar power plant and a standard wind power plant to develop the power generation price framework for the following year. The price bracket of these two standard plants is the maximum value applicable to power plants of each respective type, which will be determined according to the methods detailed in Circular 19.

In addition, for ground-mounted and floating solar power plants, the pricing bracket applicable must be established on the basis of the average radiant intensity of Vietnam’s Northern, Central, and Southern regions.

Vietnam Electricity will bear the responsibility to either handle all determination itself or to delegate a committee to choose the standard power plants, calculate the power generation pricing bracket, and submit a package of required documents to the related authorities for approval before November every year.

Real Estate

The 15^th National Assembly of Vietnam voted and ratified the Amended Laws on Real Estate Business (“Amended LREB“) at its 6^th meeting in November 2023. This legislation takes effect from 1 January 2025.

Noteworthy revisions are set out below.

1. Certain foreign-invested enterprises will be treated the same as wholly domestic-owned enterprises.

Foreign-invested enterprises under the Amended LREB may be allowed to register and conduct real estate business like local enterprises, provided they are not subject to the restrictions and procedures under the Law on Investment applicable to foreign investors.

They may be permitted to engage in an assortment of real estate projects, including:

• Selling, leasing, and subleasing land-use rights after having invested in and completed the required technical infrastructure;
• Purchasing construction works for sale, lease, or lease-purchase;
• Purchasing land-use rights with completed infrastructure in a real estate project for sale or lease;
• Leasing land-use rights that have been equipped with the required technical infrastructure in a real estate project for subleasing.

2. Buyers of residential properties still in the construction phase can opt to disregard bank guarantees.

Before selling or leasing for purchase a house that is still under construction, developers of residential real estate must obtain a financial guarantee from a licensed commercial bank. The option fee and other amounts due to the client under the terms of the signed purchase or lease-purchase agreement and the financial guarantee will be returned by the guarantor if the developer does not deliver the house on time.

This condition may be waived by the buyer at their discretion under the Amended LREB. This gives customers the freedom to decide if the extra security layer justifies the guarantee’s increased cost, which developers frequently pass along to customers.

3. A reduced ceiling on pre-collection fees for future real estate hire-purchases.

Regardless of the project, the Amended LREB establishes a lower ceiling on pre-collections of hire-purchases of future property. Currently, only hire-purchases of future residential property are subject to the 50% contract price cap. Once the Amended LREB enters into force, developers of all kinds of future real estate will be permitted to pre-collect only up to 50% of the hire-purchase contract value prior to handover.

4. Capped deposits for future property hire-purchases and offers for sale.

For the first time, the Amended LREB caps deposit payments for sales and hire-purchases of future real estate at 5% of the contract amount. Notably, the 30% first-time pre-collection level includes this 5%.