Monthly Legal Update - September, 2009

• New regulations on construction of industrial complexes
  

The Prime Minister signed Decision No 105/2009/QD-TTg on August 19, promulgating regulations on the management of industrial complexes. Accordingly, district-level People's Committees will prepare application dossiers for establishing or expanding industrial complexes and submit it to the provincial department of industry and trade for appraisal. The provincial People's Committee will make the final decision.

The regulations also require designation of an infrastructure developer. In absence of such a designation, the industrial complex development centre shall instead carry out the function of infrastructure trading. Enterprises that are interested in investing into such industrial complex will contact the infrastructure developer for the guidance as to planning, industries allocation, land price, and warehouse in the complex and to sign the in-principal contract on location.

• Ministries agree to fast track infrastructure projects
  

The Ministry of Construction and the Ministry of Planning and Investment have issued Joint Circular No 30/2009/TTLT-BXD-BKH establishing time limits for approvals of new urban area projects and industrial zone infrastructure.
Under the circular, approval of project plans would not exceed 30 working days, plus 15 working days for the gathering of opinions on proposed projects from relevant agencies. If the agencies do not respond in that time, the issues raised are assumed settled in favour of the project investor.

• Safety requirements imposed on certain businesses
  

Government Decree No 72/2009/ND-CP, issued on September 3, requires hazardous products and services to meet safety standards, including explosive materials, sealants, firearms repair, fireworks production, home and office leasing agents, printing houses, pawnbrokers, karaoke parlours, bars, massage parlours, casinos and debt collection agencies. Enterprise engaged in these lines of business must be licensed prior to the commencement of operations. The director must have good morals, and no criminal record, be of civil capacity, and no history of drug addiction.

• Regulation on drug advertisements
  

The Ministry of Health issued Circular No 13/2009/TT-BYT on September 1 on drug information and advertising.

Under the circular, only entities which have registered drugs are permitted to advertise them or issue information about them. Such a unit may authorise another to do so only by written power-of-attorney.

Prohibited is advertisement of prescription drugs, vaccines and other preventative medicines; information and advertisement of cosmetic, food products and other non-drug products that may cause users to misunderstand that such products are medicinal; misuse of Drug Administration Department registration numbers; and reference to the name of the drug administration authority of other countries in drug advertisements.

The Drug Administration Department shall receive and process applications to advertise drugs or issue drug information, and the Department of Health shall process applications and issue identity cards for agents of pharmaceutical producers.

• Taxing gains from foreign exchange
  

The Ministry of Finance issued Circular No 177/2009/TT-BTC on September 10, on determination of taxable income in the cases of gains made on foreign exchange rates in account payable collected in foreign currency. Accordingly, any gains or losses due to exchange rate differences during a period are counted as income or deductible expenses during that period to determine taxable income for corporate income tax purposes. Losses may be carried forward into the next period. The circular, which takes effect 45 days from its issuance, will apply to the 2009 tax year.

• Economic workers eligible for tax relief
  

The Ministry of Finance issued the Circular No 176/2009/TT-BTC on September 9, guiding the application of personal income tax (PIT) reductions for individuals working in economic zones.

Under the circular, Vietnamese and foreign residents or non-residents in Viet Nam eligible for the reduction who have taxable income from wages received for work in economic zones shall be entitled to a 50-per-cent reduction of income tax payable. The circular, which takes effect 45 days from its issuance, will apply to the 2009 tax year.