CHAPTER
I
General
Provisions
Article 1
The State of the Socialist Republic of Vietnam encourages
foreign investors to invest in Vietnam on the basis of respect
for the independence and sovereignty of Vietnam, observance of
its law, equality and mutual benefit.
The State of Vietnam protects the ownership of invested
capital and other legal rights of foreign investors, provides
favourable conditions and formulates simple and prompt
procedures for foreign investors investing in Vietnam.
Article 2
In this Law, the following terms shall have the meanings
ascribed to them hereunder:
1. Foreign direct investment means the bringing of
capital into Vietnam in the form of money or any assets by
foreign investors for the purpose of carrying on
investment activities in accordance with the provisions of
this Law.
2. Foreign investor means a foreign economic
organization or individual investing in Vietnam.
3. Foreign party means one party comprising one or more
foreign investors.
4. Vietnamese party means one party comprising one or
more Vietnamese enterprises from any economic sector.
5. Two parties means the Vietnamese party and the
foreign party.
Multi-party means a Vietnamese party and more than one
foreign party, or a foreign party and more than one
Vietnamese party, or more than one Vietnamese party and
more than one foreign party.
6. An enterprise with foreign owned capital includes a
joint venture enterprise and an enterprise with one
hundred (100) per cent foreign owned capital.
7. A joint venture enterprise means an enterprise
established in Vietnam by two or more parties on the basis
of a joint venture contract or an agreement between the
Government of the Socialist Republic of Vietnam and a
foreign government, or an enterprise established on the
basis of a joint venture contract between an enterprise
with foreign owned capital and a Vietnamese enterprise or
between a joint venture enterprise and a foreign investor.
8. An enterprise with one hundred (100) per cent
foreign owned capital means an enterprise in Vietnam the
capital of which is one hundred (100) per cent invested by
foreign investor(s).
9. A business co-operation contract means a written
document signed by two or more parties for the purpose of
carrying on investment activities without creating a legal
entity.
10. A joint venture contract means a written document
signed by the parties referred to in item 7 of this
article for the establishment of a joint venture
enterprise in Vietnam.
11. A Build-Operate-Transfer contract means a written
document signed by an authorized State body of Vietnam and
a foreign investor(s) for the construction and commercial
operation of an infrastructure facility for a fixed
duration; upon expiry of the duration, the foreign
investor(s) shall, without compensation, transfer the
facility to the State of Vietnam.
12. A Build-Transfer-Operate contract means a written
document signed by an authorized State body of Vietnam and
a foreign investor(s) for the construction of an
infrastructure facility; upon completion of construction,
the foreign investor shall transfer the facility to the
State of Vietnam and the Government of Vietnam shall grant
the investor the right to operate commercially the
facility for a fixed duration in order to recover the
invested capital and gain reasonable profits.
13. A Build-Transfer contract means a written document
signed by an authorized State body of Vietnam and a
foreign investor(s) for the construction of an
infrastructure facility; upon completion of construction,
the foreign investor shall transfer the facility to the
State of Vietnam and the Government of Vietnam shall
create conditions for the foreign investor to implement
other investment projects in order to recover the invested
capital and gain reasonable profits.
14. An Export Processing Zone means an industrial zone
specializing in the production of exports and the
provision of services for the production of exports and
export activities with specified boundaries established,
or permitted to be established, by the Government.
15. An Export Processing Enterprise means an enterprise
which specializes in the production of exports and the
provision of services for the production of exports and
export activities and which is established and operated in
accordance with the regulations of the Government on
export processing enterprises.
16. An Industrial Zone means a zone which specializes
in the production of industrial goods and the provision of
services for industrial production established, or
permitted to be established, by the Government of Vietnam.
17. An Industrial Zone Enterprise means an enterprise
established and operated within an Industrial Zone.
18. Invested capital means the capital required to
implement an investment project, including legal capital
and loan capital.
19. Legal capital of an enterprise with foreign owned
capital means the capital required to establish the
enterprise as stated in its charter.
20. Capital contribution means the capital contributed
by a party to the legal capital of an enterprise.
21. Reinvestment means using profits and other lawful
earnings from investment activities in Vietnam to invest
in projects which are being implemented or to make new
investments in Vietnam under any of the forms stipulated
in this Law.
Article 3
Foreign investors may invest in Vietnam in sectors of its
national economy.
The State of Vietnam encourages foreign investors to invest
in the following sectors and regions:
1. Sectors:
(a) Production of exports;
(b) Animal husbandry, farming and processing of
agricultural produce, forestry, and aquaculture;
(c) Utilization of high technology and modern
techniques, protection of ecological environment and
investment in research and development;
(d) Labour intensive activities, processing of raw
materials and efficient utilization of natural resources
in Vietnam;
(e) Construction of infrastructure facilities and
important industrial production establishments.
2. Regions:
(a) Mountainous and remote regions;
(b) Regions with difficult economic and social
conditions.
The State of Vietnam will not license any foreign
investment project in sectors or regions which may have
adverse effects on national defence, national security,
cultural and historical heritage, fine custom and tradition,
or the ecological environment.
Based on the development planning and orientation for each
period, the Government shall stipulate the regions in which
investment is encouraged and shall issue lists of encouraged
investment projects and specially encouraged investment
projects, lists of sectors in which licensing of investment is
conditional, and lists of sectors in which investment will not
be licensed.
Private Vietnamese economic organizations shall be
permitted to co-operate with foreign investors in sectors, and
subject to conditions, stipulated by the Government.
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