Author: Dr. Oliver Massmann

The issue of personal data processing is getting hotter than ever in this digital age with increasing cases where large conglomerate or even national governments being accused of utilizing citizen’s personal data without consent. This trend makes no exception in Vietnam.

On 17 April 2023, Decree No. 13/2023/ND-CP on personal data protection (PDPD) was officially issued by the Vietnamese Government. The long-awaited and controversial decree is set to be the first ever legal document with comprehensive regulations on both personal data and its protection in Vietnam. With an exception being the grace period of 2 years for SMEs, after 1 July 2023, the PDPD will be applicable to all entities located in Vietnam and/or outside Vietnam but directly conducting activities in relation to the processing of personal data in Vietnam. We outline below some key terms and foundation of the PDPD:

I. The Basic: New Decree on Personal Data Protection and Cross-Border Provision of Data

1. Definition

Personal data means data about an individual under all forms (symbol, letter, number, image, etc.), or relating to the identification or possible identification of a particular individual. Personal data is comprised of two tranches: (i) Basic personal data includes name, date of birth, blood type, marriage status and most notably, data that reflects activity or history of activity of an individual on cyberspace; and (ii) Sensitive personal data concerning political opinion, health, financial details (credit history, income level…), social relationships and data considered by laws as specific and require necessary security measures.

Personal data processing is broadly defined as one or more acts having an impact on personal data, including collection, record, analysis, storage, change, disclosure, access right, extraction, withdrawal, encryption, decryption, delivery, deletion, cancelation and other related acts.

Automatic personal data processing is defined as a form of personal data processing carried out by electronic means to evaluate, analyze and predict the activities of a specific person, such as habits, preferences, level of trust, behavior, location, trends, capacity and other circumstances.

Similar to the famous EU’s General Data Protection Regulation, the PDPD introduces the concept of “Personal data controller” and “Personal data processor” and a whole new concept of “Personal data controlling and processing entity” (Entities).

Personal data controller refers to an organization or individual that decides purposes and means of processing personal data. Personal data processor refers to an organization or individual that processes data on behalf of the Personal data controller via a contract or agreement with the Personal data controller. Meanwhile, Personal data controlling and processing entity refers to an organization or individual that jointly decides purposes and means, and directly processes personal data.

2. Consent and Exception

Generally, the PDPD strictly regulates that a data owner must give his/ her consent prior to any processing and disclosing such data, except for the five following limited cases:
• Under emergency situations to protect life and health of the data owner or others;
• Lawful disclosures;
• Processing by competent state authorities for national defense and security, disasters, fatal disease;
• Contractual obligations; and
• Activities of state authorities as stipulated under specified laws.

When requesting to process personal data, the data owner’s silence or unresponsiveness does not constitute approval. The data owner can agree only to a part of the request or approve the request with attached conditions. The data owner’s consent must be displayed in a format that is printable and copy-able in writing. Also, consent is only valid in case the data subject clearly and voluntarily knows (i) the type of personal data to be processed; (ii) the purpose of data processing; (iii) the allowed entities to process personal data; and (iv) their rights and obligations.

With regard to sensitive personal data, the data owner must be fully informed of the nature of the data to be processed. In case of dispute, the burden of proof lies on the data processor.

3. Prior to any processing activity regarding sensitive personal data, the data owner must be notified, except when:

• The data owner knows and fully consents to the contents;
• The personal data is processed by the competent state agency with a view to serving operations by such agency as prescribed by law;
• The personal data shall be processed to protect the life and health of the data subject or others in an emergency situation;
• Disclosure of personal data is in accordance with the law;
• Processing of personal data by competent regulatory authorities in the event of a state of emergency regarding national defense, security, social order and safety, major disasters, or dangerous epidemics; when there is a threat to security and national defense but not to the extent of declaring a state of emergency; to prevent and fight riots and terrorism, crimes and law violations according to the provisions of law ;
• The personal data shall be processed to fulfill obligations under contracts the data subjects with relevant agencies, organizations and individuals as prescribed by law;
• The personal data shall be processed to serve operations by regulatory authorities as prescribed by relevant laws;
• Competent agencies and organizations making audio and video recording and process personal data obtained from audio or video recording activities in public places in order to protect national security, social order and safety, legitimate rights and interests of organizations and individuals as prescribed by law.

4. Personal data processors have an obligation to notify the data owner prior to their processing, except for the following:

• The data owner has fully agreed with the contents and activities of processing personal data;
• The personal data shall be processed to protect the life and health of the data subject or others in an emergency situation;
• Disclosure of personal data in accordance with the law.
• Processing of personal data by competent regulatory authorities in the event of a state of emergency regarding national defense, security, social order and safety, major disasters, or dangerous epidemics; when there is a threat to security and national defense but not to the extent of declaring a state of emergency; to prevent and fight riots and terrorism, crimes and law violations according to the provisions of law ;
• The personal data shall be processed to fulfill obligations under contracts the data subjects with relevant agencies, organizations and individuals as prescribed by law;
• The personal data shall be processed to serve operations by regulatory authorities as prescribed by relevant laws;

5. Cross-border transfer of personal data of Vietnamese citizens must satisfy all following three conditions:

• The data owner consented the transfer;
• Original data is stored in Vietnam;
• A personal data transfer impact assessment records shall be provided by the Parties transferring data abroad (including Personal data controllers, Personal data processors and controllers, Personal data processors, third parties).

The PDPD requires the Entities to make available and submit the dossier on personal data protection impact to the Department of Cyber Security and High-Tech Crime Prevention in case of processing personal data and transferring personal data abroad within a timeframe of 60 days from the processing date. While it is clearly a new obligation applicable to the Entities, the implementation of such obligation is anticipated to be time-consuming for both organizations and relevant state authorities.

6. Penalties for violation of personal data protection rules:

• Monetary fines range from VND 50 million to VND 100 million;
• Penalties under Criminal Code;
• Additional penalties: Suspend the processing of personal data up to 3 months, deprive the right to use written consent issued by the Personal Data Protection Committee to process sensitive personal data and cross-border transfer of data, forcible payment of money gained from committing acts of violation.

Multiple violations of personal data protection regulations by a personal data processor in Vietnam can result in a maximum penalty of 5% of total revenue of the data processor in addition to the aforementioned penalties.

II. Vietnam’s Commitments under the EVFTA and the CPTPP

Data protection and relevant issues play an important part in shaping digital economy. The PDPD is one of several legal instruments that have been developed in Vietnam so that it can be more aligned with international standards. The PDPD is the first consolidated set of regulations concerning personal data protection.

Vietnam’s commitments on data privacy under the CPTPP is mainly discussed under Chapter 14 (E-commerce). Article 14.11 provides that data must be allowed to be transferred cross-border except in cases where to prevent such would serve a legitimate public policy objective, provided that the measure “is not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction on trade; and does not impose restrictions on transfers of information greater than are required to achieve the objective.”. Article 14.13 imposes the same conditions on data localization on each party to the agreement.

While Chapter 8 of the EVFTA covers issues of trade, services, and e-commerce, it does not contain any immediate commitments on issues of e-commerce, data protection, or data localization other than that it calls for the formation of a committee to develop unified principles and regulatory regimes as far as these are concerned.

III. Preliminary Guidance on Practical Handling

The PDPD provides several obligations of the party processing and disclosing personal data, thus it is critical for employers/ enterprises (the “Employer” or “Enterprise”) to consider and adopt all those obligations into its internal rules and contracts/ agreements with third parties.

1. Internal Labor Rules and Labor Contracts

It is required for the Employer to adapt all relevant obligations in relation to personal data over its employees, staff, directors, etc. as well as those in relation to the Employer’s customers, members and their staff into the Employer’s internal labor rules/ codes and collective labor agreement (if any). This is to ensure that its employees and staff shall comply with those personal data related obligations.

Otherwise, there is a very high risk that the Employer shall be fully responsible for the unpermitted processing and disclosing made by its employees without necessary tools to address such violations. In addition, it is advisable to state clearly in the labor contracts with the employees that they must comply with requirements on personal data protection promulgated by the Employer and the applicable law.

In addition, it is advisable to negotiate and agree with the employees in the relevant labor contracts about the possible data processing made by the Employer again such employees’ personal data for the purpose of employment such as tax information, CVs, health information, etc. This would very likely prevent the future claims from the Employer’s employees over unpermitted processing of employees’ personal data. We will advise in detail if desired subject to the final Decree.

2. Contract/ Agreement with Customers/ Members

It is advisable for the Enterprise and Employer to consider, renegotiate and update all current and future contracts/ agreements between the Enterprise and its customers/ members that the Enterprise and Employer is entitled to disclose/ process a specific list of personal data and the customers/ members agree to give consents for such disclosure/ processing. The Enterprise should, with our support if desired, build a clear list and procedure for collecting, storing, disclosing and otherwise processing personal data of customers/ members.

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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

1. What are the three central/federal government entities that have conducted the largest procurements by volume in Vietnam in the last three years? Please, list the three procuring entities in the order of importance.
In my experience, the three largest procuring entites are Ministry of Health, Ministry of Industry and Trade, Ministry of Transport

Procuring Entity Sector – Ministry of Health
1.1 Please identify the most common sector purchased by the procuring entity
Goods

Procuring Entity Sector – Ministry of Industry and Trade
1.1 Please identify the most common sector purchased by the procuring entity
Goods

Procuring Entity Sector – Ministry Transport
1.1 Please identify the most common sector purchased by the procuring entity
Works

1.2 Is any of the three procuring entities that you have selected a State-Owned Enterprise or an Independent Authority?
Yes

1.3 Does any of these SOEs or Independent Authorities have a specific public procurement regulatory frame work compared to the other centralized/federal procuring entities?
Yes

2. Please provide a list of laws, regulations, and other binding materials (including guidelines and manuals) that regulate public procurement in Vietnam.
• Law No. 43/2013/QH13 on Bidding (Law on Bidding)
• Law No. 49/2014/QH13 on Public Investment
• Law No. 64/2020/QH14 on Investment in the form of Public – Private Partnership
• Law No. 03/2022/QH15 amending and supplementing some of articles of Law on Public Investment, Law on Investment in the form of public-private partnership, Law on Investment, Law on Housing, Law on Bidding, Law on Electricity, Law on Enterprises, Law on Consumption Tax Special and the Law on Execution of Civil Judgments.
• Decree No. 95/2020/ND-CP guiding the procurement under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership
• Decree No. 09/2022 ND-CP amending and supplementing some articles of Decree No. 95/2020/ND-CP guiding the implementation of procurement under the CPTPP, the EVFTA and the UKVFTA
• Decree No. 63/2014/ND-CP detailing the implementation of several provisions of the Bidding Law on the selection of contractor
• Decree No. 25/2020/ND-CP detailing the implementation of several provisions of the Bidding Law on the selection of investors
• Decree No. 21/2022/TT-BKHDT detailing the preparation of bidding documents for non-consulting services for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Decree No. 20/2022/TT-BKHDT detailing the preparation of bidding documents for consulting services for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Circular 09/2022/TT-BYT detailing the sample invitation to bid for procurement of herbal ingredients and traditional medicines at public health facilities
• Circular 12/2022/TT-BKHDT detailing the preparation of bidding documents for the procurement of goods for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Circular No. 15/2022/TT-BKHDT detailing the preparation of bidding documents for construction and installation for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Circular 08/2022/TT-BKHDT detailing the provision and posting of information on bidding and contractor selection on the National Procurement Network System
• Circular No. 09/2022/TT-BGTVT guiding some contents on methods and criteria for evaluating bids for investor selection under the public-private partnership method and the form of a build-operate-transfer contract in the transport sector
• Circular No. 23/2021/TT-BGTVT guiding the formulation, approval and publication of the list of projects; methods and criteria for evaluating bids and bidding for selection of investors in specialized aviation service works at airports and aerodromes
• Circular 22/2021/TT-BGTVT detailing methods and criteria for evaluating bids to select investors to implement projects on dredging seaport waters and inland waterways in combination with product recovery
• Circular No. 06/2020/TT-BKHDT guiding the implementation of Decree No. 25/2020/ND-CP detailing the implementation of a number of articles of the Law on Bidding on investor selection
• Circular 15/2020/TT-BYT promulgating the List of drugs for bidding, the List of drugs for concentrated bidding, and the List of drugs eligible for price negotiation.
• Circular No. 14/2020/TT-BYT promulgating some contents in bidding for medical equipment at public medical facilities
• Circular 15/2019/TT-BYT regulating on drug bidding at public health facilities
• Circular No. 10/2015/TT-BKHDT detailing the contractor selection plan
• Circular No. 19/2015/TT-BKHDT detailing the preparation of appraisal report during the contractor selection period
• Circular No. 23/2015/TT-BKHDT detailing the preparation of evaluation report of bid dossier
• Circular No. 16/2016/TT-BKHDT guiding the preparation of pre-qualification dossier, bidding dossier for the investor carrying land use projects

3. Specific instruments applicable to a sector (goods, services or works):
• Decree No. 21/2022/TT-BKHDT detailing the preparation of bidding documents for non-consulting services for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Decree No. 20/2022/TT-BKHDT detailing the preparation of bidding documents for consulting services for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Circular 09/2022/TT-BYT detailing the sample invitation to bid for procurement of herbal ingredients and traditional medicines at public health facilities
• Circular 12/2022/TT-BKHDT detailing the preparation of bidding documents for the procurement of goods for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Circular No. 15/2022/TT-BKHDT detailing the preparation of bidding documents for construction and installation for bidding packages within the scope of the CPTPP, the EVFTA and the UKVFTA
• Circular No. 23/2021/TT-BGTVT guiding the formulation, approval and publication of the list of projects; methods and criteria for evaluating bids and bidding for selection of investors in specialized aviation service works at airports and aerodromes
• Circular 22/2021/TT-BGTVT regulating on methods and criteria for evaluating bids to select investors to implement projects on dredging seaport waters and inland waterways in combination with product recovery
• Circular 15/2020/TT-BYT promulgating the List of drugs for bidding, the List of drugs for concentrated bidding, and the List of drugs eligible for price negotiation.
• Circular No. 14/2020/TT-BYT promulgating a Circular stipulating a number of contents in bidding for medical equipment at public medical facilities
• Circular 15/2019/TT-BYT regulating on drug bidding at public health facilities

4. Does the regulatory framework establish value thresholds for determining procedural or regulatory aspects of the procurement process?
Yes (Articles 2.2 and 3.2, Law on Bidding)

5. Is there an operational central electronic public procurement (e-procurement) portal in Vietnam?
Yes (https://muasamcong.mpi.gov.vn)
6. Is the central e-procurement portal used by all the procuring entities?
Yes

7. Please complete the table below based on the features available in the central electronic public procurement portal
Yes, fully digitized Yes, but hard copy documents must be submitted No

Registering as a vendor x
Accessing notices on procurement opportunities x
Accessing bidding documents x
Asking a procuring entity for clarifications x
Submitting tenders x
Submitting bid security with electronic validation x
Bid opening x
Virtual workspace to manage tender procedures (including operative tools for members of the evaluation committee) x
Notification of decisions (clarifications, awards, contract signing, etc.) x
Accessing award decisions (including their rationale) x
Submitting performance guarantee with electronic validation x
Contract signing x
Accessing contracts x
Accessing contract amendments x
Submitting invoices to the procuring entity x
Module for framework agreement management x
E-catalogue of approved suppliers x
Green catalogue x
E-reverse auction module x
E-contract management and implementation module x
Receiving payments from the procuring entity x
Applying for vendor eco-certifications/eco-labels x
Access to specifications, standards, or criteria for eco-labels and environmentally preferable goods and services x

8. Are the features supported by the central e-procurement portal available for procurements of goods, works, and services?
Yes

9. For the following types of data, please select if there is a data portal that provides open access to such information in machine readable format:
Yes No
Data on tenders (including description, dates, category of spending, estimated value, contracting authority, and identification of bidders) x
Data on tenders (including description, dates, category of spending, estimated value, contracting authority, and identification of bidders) x
Data on suppliers x

10. Link to the webpage with data
https://muasamcong.mpi.gov.vn/web/guest/contractor-selection?render=index

11. Are there any main procuring entities for which data on contracts and tenders is not published on the open access data portal?
No.

12. Are gender-disaggregated data on firms that have participated in tenders collected by the central e-procurement portal?
No.

13. Does the regulatory framework require procuring entities to use standard bidding/tender documents when preparing a tender?
Yes, but with some exception.

14. Circumstances the use of model bidding/tender documents is not required.
Based on sector of procurement (Article 4, Circular No. 08/2022/TT-BKHDT)

15. Do these standard bidding documents contain sustainability clauses?
Yes, in all model documents

16. Does the regulatory framework define minimum content requirements for procurement plans?
Yes. (Article 35, Law on Bidding)

17. Do the minimum content requirements for procurement plans include a gender dimension?
No.

18. According to the regulatory framework, which of the following tools must be used when a procuring entity prepares to estimate the contract value of the new procurement opportunity?
Regulations are silent on this matter

19. Is there a legal mandate for the development and implementation of special programs to engage innovative and emerging suppliers?
No.

20. Does the regulatory framework establish open procurement as a default method for tendering a contract?
Yes, but with some exception.

21. Circumstances exceptions to the general rule of using open procurement are provided in the regulatory framework.
Based on the value of procurement and based on the entity conducting the procurement (Articles 21, 22, 23, 24, 26, 26, Law on Bidding)

22. Does the regulatory framework designate specific tendering procedures for innovation procurement?
No

23. Does the regulatory framework provide incentives for preparing bids with environmentally-friendly components?
No.

24. Does the regulatory framework impose any participation or award restrictions on foreign firms?
Yes, in some public tenders

25. If the restrictions apply only in some public tenders, please identify the parameter in which these restrictions are applicable:
Sector (Article 15, Law on Bidding).

26. Does the regulatory framework require foreign firms to have partnerships with domestic firms to be eligible to participate in a tender?
Yes, in some public tenders (Article 5.1(h), Law on Bidding)

27. Does the regulatory framework require foreign firms to own (fully or partially) subsidiaries in the domestic economy to be eligible to participate in a tender?
No. (Article 5.1, Law on Bidding)

28. Does the regulatory framework prohibit splitting contracts for the purpose of circumventing thresholds for open tendering?
Yes (Article 89.6(k), Law on Bidding)

29. According to the regulatory framework, which of the following documents need to be made publicly available?
Yes, for all contracts Yes, except for low value contracts No
Procurement plans x
Tender notices x
Tender documents (project specific) x
Award decisions Yes x
Contracts x
Contract amendments x
Subcontractors x

30. Please provide the legal basis for all the key materials listed in the table above:
Article 8, Law on Bidding; Article 9, Law on Investment in the form of Public – Private Partnership

31. Does the regulatory framework set a minimum timeframe between advertisement of a tender notice and a submission deadline?
Yes, for all procurement procedures (Article 12.1(b), Law on Bidding)

32. According to the regulatory framework, how should clarification requests from potential bidders be communicated?

Required to communicate answers to all bidders (Article 77.1, Law on Bidding; Article 51.4, Decree No. 35/2021/ND-CP; Article 14.2(c), Decree No. 63/2014/ND-CP)

33. In practice, how many days would usually pass between bid opening, and contract signing (i.e., the time in which all tenderers, participants and relevant parties are notified of the award decision and the awardee can start implementing the contract) for the following scenarios:
Days to complete a procurement of a works contract in an open procedure valued above the threshold for international procurement: 210
Days to complete the procurement of a services contract in a restricted procedure with limited competition, valued below the threshold for international procurement: 210
Days to complete the prequalification of supplier: 0
Days to complete an electronic auction: 45
Days to complete a Framework agreement with a competitive second stage: 0

34. Does the regulatory framework establish criteria for identifying abnormally low bids?
Yes, but only in some procurement procedures (Articles 117.6 and 117.9, Decree No. 63/2014/ND-CP)

35. According to the regulatory framework, which award criteria must be used in bid evaluations for high-value procurement?
Lowest price, Project life cycle cost, Total cost of ownership, Value for money, Most economically advantageous tender, Sustainability (Article 12, Decree 63; Articles 39 – 41, Law on Bidding)

36. Please indicate whether Lowest price must be used for some or all procurement sectors.
No, applicable to some.

37. Please indicate whether Project life cycle cost must be used for some or all procurement sectors.
No, applicable to some.

38. Please indicate whether Total cost of ownership must be used for some or all procurement sectors.
No, applicable to some.

39. Does the regulatory framework explicitly recommend the preference to use Most Economically Advantageous tender criteria over lowest price criteria?
Yes, but only in some procurement procedures
.
40. According to the regulatory framework, should the procuring entity provide a reference price in tender documents?
Yes, but only in some procurement procedures.

41. Does the regulatory framework include gender-specific provisions that promote gender equality in public procurement?
Yes (Article 14.3, Law on Bidding)

42. Does the regulatory framework outline a designated procedure for awarding contracts based on a framework agreement where contracts are awarded following a competitive two-stage process?
No, only one stage is competitive (Article 65, Law on Bidding)

43. Which of the small and medium-sized enterprise preferential treatment approaches are included in the regulatory framework?
None (Article 6 Decree No. 63/2014/ND-CP, Article 14.2.c Bidding Law)

44. Does the regulatory framework mandate communication of an award decision?
Yes, to all bidders (•Articles 42.3, 43.2, 11.8(d), 11.8(dd), Law on Bidding)

45. Is there a mandatory standstill period between the public notice of award and contract signing to allow unsuccessful bidders challenge the decision?
No.

46. Does the regulatory framework establish a timeframe within which a procuring entity must process a payment once an invoice is received?
Yes, for all contracts (Articles 94, 95, 96, 97, 98, Decree No. 63/2014/ND-CP)

47. Does the regulatory framework allow firms to claim interest on late payments (or any similar contractual penalty) if the government does not pay within the legally established timeframe?
Yes (Article 94.1, Decree No. 63/2014/ND-CP)

48. How often does the government pay late payment interest (or any similar contractual penalty) in the event that it fails to meet the payment deadline?
Government often pays late payment interest.

49. Does the regulatory framework designate a specialized and independent authority to receive procurement challenges filed by firms on decisions issued by the procuring entities?
Yes, specialized (Articles 91 and 92, Law on Bidding)

50. Does an aggrieved bidder have the right to appeal decisions on challenges made by the authority that receives procurement challenges?
Yes (Articles 92.1(c), 92.2(c), 92.3(c), 92.4(c), Law on Bidding)

51. Are there any legally binding time limits to resolve a procurement challenge?
Yes, for all types of challenges (Article 92, Law on Bidding)

52. Is there a legal recourse for an aggrieved bidder experiencing delays in either challenge or review processes?
Yes, for all types of challenges (Articles 91.1(b) and 91.2, Law on Bidding)

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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

1. What new domestic law or regulation enacted in 2023 has been the most impactful on clients?
By the first half of 2023, the Vietnam National Assembly has passed several laws. These include the Law on Protection of Consumers’ Rights (LPCR), the Revised Law on Bidding, the Law on E-transactions, the Law on Prices, and the Cooperative Law. These legal instruments have had a substantial impact in strengthening Vietnam’s legal framework. Notably, two key instruments, the LPCR and the Law on Bidding, are anticipated to notably affect our clients. The LPCR, which was enacted on June 20th, 2023, and is set to be effective from July 1st, 2024, includes new protective measures for vulnerable consumers, and an expanded list of prohibited acts. Therefore, clients should pay more attention when entering into contracts with their customers. This might involve incorporating the new regulations of the LPCR into contracts or undertaking a comprehensive review and revision of the company’s model contracts accordingly. Meanwhile, the Revised Law on Bidding is expected to shed more light on international bidding and criteria for accessing bids and selecting winning bidders. Thanks to more bidding transparent procedures in the new Bidding Law, bidding in Vietnam is more predictable and attractive to foreign investors.

2. What Asia-Pacific issues, such as China’s economic recovery, supply chain tensions, monetary policy, productivity, geopolitical issues, etc., have been the most significant?
By the end of 2022, China’s Zero Covid was lifted, resulting in its economic recovery and thus having a significant impact on Vietnam’s economy. The primary impact is reestablishment of the supply chain between Vietnam’s retailers and those in China. This reconnection includes the import of input materials from China, such as technology linkages, textile linkages. Furthermore, Vietnamese tourism will recover thanks to the Chinese tourist flow into Vietnam. For your information, Chinese tourists accounted for one third of international travelers to Vietnam before COVID-19 pandemic took place. China’s new policy may also impact Vietnam’s regulatory framework, resulting in a shift towards more stringent regulations concerning e-transactions and cross-border trade.

3. What international law or regulatory change has had the most impact?
In recent time, Vietnam has signed numerous new generation Free Trade Agreements (FTAs) such as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), the EU – Vietnam Free Trade Agreement (EVFTA), etc. These new-generation FTAs contain Vietnam’s unprecedented commitments. They have encouraged and accelerated the institutional reforms in order to improve the legal environment in compliance with Vietnam’s commitments. As a result, they help Vietnam become a competitive economy, attract foreign investments, technology and other important resources for development. With regards to investment-related dispute settlement mechanism, under the EVFTA, an investor is allowed to bring such dispute to the Investment Court for settlement (Investor-state dispute settlement mechanism- ISDS). The final arbitration award is binding and enforceable without the local courts’ review of its validity. This is an advantage for European investors as the fact shows that the percentage of applications for enforcement of foreign arbitral awards being rejected by the Vietnamese courts is notably high for various reasons. Under the CPTPP, for the first time investors of a party may sue the Government of the other party for its violation of investment-related commitments when the investors make investment in that party. It covers new provisions compared with existing agreements such as transparency in arbitral proceedings, disclosure of filings and arbitral awards, and participation of interested non-disputing parties to make amicus curiae submissions to a tribunal. Arbitral awards are final, binding and fully enforceable in CPTPP countries.
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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Vietnam is rich in mineral resources but only a fraction of these have been discovered to date due to lack of modern technologies and methods. With the increasing flow of FDI under the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA), Vietnam can enjoy many advantages to modernize the mining sector. However, some challenges hinder Vietnam from seeking the benefits under the two agreements, such as lack of coordination and communication among Vietnamese authorities, shortcomings in the Vietnam Mineral Law itself and excessively high taxes and royalties compared to other countries.
1. VIETNAM’S COMMITMENTS IN THE MINING SECTOR UNDER CPTPP AND EVFTA
Vietnam has opened its mining investment regime under both CPTPP and EVFTA. The CPTPP outlines several conditions for foreign investment in the mining sector in Vietnam. In particular, approval for foreign investment will only be granted if the investment project is proved to bring net benefits to Vietnam. In making this evaluation, the competent authority may take into account various factors, including the project’s impact on economic activity, job creation, equipment and services made in and exported from Vietnam, competition, and the compatibility of the project with other national policies, etc. Meanwhile, the EVFTA offers a great opportunity for market access in the mining sector as it allows for the establishment of joint ventures with maximum 51% of foreign capital contribution or 100% foreign-owned enterprises.
With regard to tariff, the CPTPP targets to remove custom duties for all mining-related goods imported from member states and the EVFTA shall reduce almost all tariffs by up to 99%, which can attract the FDI flows to the mining industry in Vietnam, especially mining equipment services and technologies and oilfield service providers.
The EVFTA, which adopts core labor standard of the International Labor Organization, also provides better working conditions for workers, which is a key aspect for laborers working on mining projects.
With the above commitments of Vietnam under the CPTPP and EVFTA, it is expected that new mining methods and better technologies will be introduced to the mining sector in Vietnam, which will later bring benefits in the exploration, mining, and processing of minerals.
2. BENEFITS OF TECHNOLOGICALLY MODERN EXPLORATION AND MINING IN VIETNAM
By using modern technology, Vietnam can discover and develop many minerals in deeper surface deposits. Having these metals sourced and available instead of importing them can help Vietnam develop downstream high-tech manufacturing industries and establish itself as a dominant regional and global hub. This is in line with the MPI Foreign Investment Agency’s emphasis on capacity building of manufacturing and supporting industries in Vietnam and partnership with Vietnamese enterprises where possible.
Modern technological exploration and mining can also help Vietnam meet the Vietnamese Government’s commitments under COP26, aiming for environmental sustainability in the mining sector, as state-of-the-art technologies in process, cycling, and refining base metal resources will reduce carbon dioxide emissions. It also contributes to meeting the challenges of the Government’s strategy for its Socio-Economic Development Goals (SDGs), particularly in mountainous areas with dominantly ethnic minorities, where the mining projects are mostly located. Responsible mining can help alleviate poverty in these remote areas by creating strong employment opportunities and enhancing local goods and services. In addition, it can also improve physical infrastructure since mining has long been recognized to be one of the most effective drivers of physical infrastructure improvement around the world.
Modern sustainable mining in Vietnam would therefore also meet two of the World Bank’s stated key objectives of its Country Partnership Framework in Vietnam, which are to (a) deliver infrastructure and (b) broaden the economic participation of ethnic minorities.
3. CHALLENGES AND ISSUES
• Consultation and clarification
Foreign investors require Vietnamese authorities seek detailed industry consultation on the key components of the draft amended Vietnam Mineral Law, together with its guiding documents. For example, key mining taxes require transparency on how minerals are valued. Since mineral grade is not an acceptable methodology, a revenue-based system is recommended. In addition, since the last annual VBF in February 2022, the MOIT has issued a draft nickel sulfide concentrate standard. However, consultation before the draft standard was limited to Vietnamese nickel producers only, which led to limited exposure to the international commercial realities, input from international experts, and evaluation of other countries regulating nickel mining and processing. Foreign investors have also been confused about the purpose of the adopted standard, i.e., whether the standard is used to restrict import or export, to be a part of a review of royalties or duties, related to future approval, or any other specific purposes.
• Mining industry long term investment and risk
Investment in the mining sector takes time and significant upfront investment in exploration and development. Therefore, in order to attract quality direct foreign investment in the sector, the Government should: (i) benchmark Vietnam’s fiscal regime against peer countries and provide a competitive fiscal regime with those offered by other jurisdictions; (ii) simplify the current fiscal regime for ease of explanation to investors; (iii) provide fiscal stability and reduce frequency of policy changes; and (iv) continue improving internal standards and consider recognizing and adopting international mineral resource standards (e.g. JORC).
Because there are many risks in mining exploration, the Government must ensure that exploration and mine planning, the formulation of investment projects, and the development of mechanisms and policies will encourage exploitation rationally and with best efficacy. Companies that have a proven track record of conducting technically advanced and environmentally responsible exploration programs should be granted with priority in their future applications.
• Scientific research and technological development
In October 2021 at a series of ASEAN Ministerial Meetings on Minerals, it was suggested that the minerals industry must take the lead in digital transformation, scientific research, technology development, and investment in all stages of the mineral value chain.
However, foreign investors and foreign-invested mining companies have been hindered from testing and applying new technologies due to restrictions on temporary import into Vietnam of research piloting equipment. Furthermore, detailed studies of various ores at world-class research facilities are limited due to the inability to export samples out of Vietnam for study purposes.
To address this issue, the Government should increase funding for Vietnam research facilities and ease the import-export restrictions.
• Amending the Vietnam Mineral Law and reducing mineral taxes
High natural resource tax and the fee for granting mining rights prevent large mining companies from operating in Vietnam. Therefore, Vietnam needs to introduce a more competitive fiscal regime.
4. CONCLUSION
The review and revision of Vietnam’s 2010 Mineral Law must be open and consultative, allowing the opportunity for input from Vietnamese and FDI mining companies and experts. This is to ensure a clean and environmentally sustainable mining and to take advantage of the EVFTA as well as the CPTPP, and to further contribute to Vietnam’s impressive economic growth in the upcoming years.
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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

On 18 September 2023, the Government issued Decree No. 70/2023/ND-CP on amendments and supplementations to Decree No. 152/2020/ND-CP on foreign workers working in Vietnam, and recruitment and management of Vietnamese workers working for foreign employers in Vietnam (“Decree 70”). At a glance, the key points to note of Decree 70 are as follows:

1. Adjustments to relax the conditions and requirements of Expert, CEO and Technical labor (i.e. more relaxed conditions for the mentioned positions, clearer definition for the job position of “business managers”, etc.) to match the common practice of these positions;

2. Removal of the exemption of Work Permit’s waiver application to foreign employees with Vietnamese spouses. In other words, expats with Vietnamese spouse, after the effective date of Decree 70, will have to implement the waiver application to be allowed to work in Vietnam;

3. From 1 January 2024, employers will be required to, at least 15 days before submitting the application for the approval of foreign labor use, publish notice on job application for Vietnamese employees with regard to positions of which foreign employees are expected to take. Such notice will be published on the electronic portal of the Occupational Department of the Ministry of Labor, Invalids and Social Affairs (MOLISA) or a qualified job service center.

4. Amendments to the forms for the application for Work Permit (i.e. working location(s));

5. Clearer guidance of authority for issuance of Work Permit between the MOLISA and the Department of Labor, Invalids and Social Affairs (DOLISA) whereby the MOLIA will issue the Work Permit for foreign employees who work for organizations permitted to be established by the Government, Prime Minister, Ministries, Ministry-level agencies or agencies of the Government while the DOLISA will handle the Work Permit in other cases not falling into the governing authority of the MOLISA. Further, the industrial zone authority, according to Decree 70, no longer has the authority to issue Work Permit/Work Permit exemption certificate to foreign employee working in such industrial zone.

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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) and the EU-Vietnam Free Trade Agreement (EVFTA) has opened up many opportunities for Vietnam in the agriculture sector as it creates favorable conditions for local enterprises to access international markets. While the global economy is still recovering after the COVID-19 pandemic, the agriculture sector in Vietnam has been benefiting a lot from these two FTAs.

The tariff reduction in the CPTPP and the EVFTA has increased demand and boosted exports from Vietnam to the international market. With the CPTPP, most of Vietnam’s key agricultural exports will enjoy a tax rate of 0% immediately after the CPTPP takes effect or after 3-5 years, for example, some types of seafood (fish, shrimp), fresh and processed vegetables, rice,… when exported to large markets such as Canada, Japan and Mexico. With the EVFTA, tax rates on a series of agricultural products exported to the EU will gradually decrease to 0% after a short period from the effective date of the EVFTA. Tax rate on many Vietnamese products will fall to 0-4% such as pepper (currently 0-11%); rice and grain products. For fisheries, about 50% of tariff lines will be eliminated, and the remaining 50% will be eliminated within a 3-7 year roadmap. This is a potential opportunity for Vietnamese businesses to grow exports in potential markets as well as contribute to diversifying exports of agricultural, forestry and fishery products, which are the strength of Vietnam. In 2022, the sector’s export turnover reached 53 billion USD with a trade surplus of 8.5 billion USD, up 30% from 2021. The export of agricultural, forestry and fishery products also achieved new records. In particular, the domestic fishery industry exports to the CPTPP markets expanded by 30% to 27% of the country’s total fishery export value. In 2022, rice exports in Vietnam hit a record 7 million tons, up 13.8 percent in volume and 5.1 percent in turnover in 2021. In 2023, Vietnam expects further opportunities for export growth of agricultural products by diversifying markets and target production to satisfy export market requirements on food safety, and effectively complete post-harvest activities.

Vietnam’s participation in the CPTPP and in the EVFTA also increases connectivity between businesses through participating in regional and global supply chains. Through these two FTAs, Vietnamese agricultural products have the opportunity to access 37 large markets including Japan, Canada, and Australia. The participation will help raise the level of development of the economy in general and Vietnam’s agriculture in particular, at the same time increasing competitiveness compared to other competitors who do not have FTAs with the EU or other CPTPP member states, for example, India and Thailand. With regard to production, businesses can participate in production stages with higher value added by investing in domestic production and chain development while reducing export of raw materials and preliminary processing. This creates motivation for domestic enterprises and income opportunities for workers in rural areas. Vietnam’s commitments on import- export related rules and procedures create conditions to attract more domestic and foreign investment to improve the business environment in general and in agriculture sector in particular. Overall, this is a great opportunity to upgrade Vietnam’s agriculture in the next 5 – 10 years.

As the growth in Vietnam’s agricultural sector continues to flourish with new opportunities for trade, so are the need for further clarity in Vietnam’s regulations or stricter requirements from each partner’s market. There are challenges coming from regulations on animal and plant quarantine and safety (SPS), regulations on product labeling (TBT) or related regulations on social responsibility, labor standards and high requirements on intellectual property protection and environmental protection, especially for markets with strict standards such as the EU and Canada. For instance, Vietnamese businesses might fail to meet the regulations on traceability, rules of origin and maximum residue levels (MRLs) for pesticides in foods, which are prerequisites for access to the EU market. Although there are many shortcomings regarding management, quality control and production process, Vietnam’s agriculture sector is shifting to adapt to growing diversity, especially which of highly demanding markets. This drives the requirements for improved product quality and enhances food safety with an emphasis on environmental responsibility and management. Under competition pressure, Vietnamese agriculture will need to absorb new science and technology through transnational investment activities accompanied by science and technology and improving labor skills, thereby changing the traditional agriculture and improving production efficiency and product quality. With stricter requirements of the export markets, the agriculture sector needs to be more innovative and adaptable, which requires building a sustainable agricultural industry and focusing on automation and digital transformation in the sector.

As part of aiming for sustainable development, Vietnam has made specific actions such as committing at the 26th United Nations Climate Change Conference (COP 26) and endorsing the UN Sustainable Development Goals (SDGs), which can help build sustainable agriculture, join the global value and food chains and improve living conditions. In 2023, Vietnam will focus on the rural economy with activities of cooperatives, OCOP (One Commune One Product) development, and agriculture-based tourism. Vietnam also set some priorities to focus on the development of circular agriculture:

• Efficient water use and wastewater management;
• Minimisation of waterway and wetlands salination (notably Mekong delta);
• Monitoring of Climate Change and its effect on weather patterns;
• Development of smart agriculture systems through digital transformation;
• Tracking and traceability of clean and hygienic food;
• Development of opportunities to join the global agriculture supply chain, and;
• The need for FDI companies to be more environmentally and socially responsible and concentrate on sustainable agricultural operations.

Agriculture is one of the priority sectors of Vietnam’s plan for digital transformation. One of Vietnam’s development orientations for 2021-2030 is to develop agriculture based on digital transformation and linkage of domestic and international markets. The application of technology and digital in production and business in the agriculture sector will create a turning point in agricultural production, moving from a traditional agrarian economy to an agricultural economy. Therefore, Vietnam needs to re-invent the agriculture sector with new ideas and concepts, new farming models, innovation, digitization, more efficient logistics, and a greater focus on circular agriculture and environmental responsibility.

Vietnam is in the direction of restructuring the agricultural sector, reorganizing production, and piloting a number of models for advanced production, promoting the application of science and technology, supporting businesses and farmers in agricultural production and business activities to improve productivity and quality of agricultural products, thereby being able to compete at home and reach the world market. The arrival of 4.0 smart agriculture in Vietnam signals the end of an exclusive dependence on water, fertilizers, and pesticides. Instead, farmers will acess data, GPS technology and moisture sensors to break down traditional challenges into crop selection, market access, and innovation. New applications in agriculture such as advanced breeding techniques, robotization and precision farming using satellite data and drones will play a big role in the farms as it helps to produce more with fewer resources.

Although the technological level of agriculture in Vietnam is low, there are still good prospects for the application of technology 4.0 in this sector. This is evident by the increasing, although modest, number of enterprises providing digital and technical solutions for farming. Currently, many large Vietnamese corporations are interested in investing in the agricultural sector with advanced production and management technologies, such as Nextfarm and AgriConnect. In addition, agriculture enterprises remain active in applying innovative solutions for leading farmers toward digitalization. From the demand side, there is a new wave of private investment in agriculture for medium and large-scale farms.

CONCLUSION

The ongoing transformation of the agriculture sector to a sustainable and innovative way is important for Vietnam to maximize the benefits of CPTPP and EVFTA. We do hope that Vietnamese agricultural, forestry and aquaculture products from local and foreign-invested companies will be more competitive in the international market and be able to satisfy stringent phyto-sanitary and other quality standards, including traceability and packaging.

To achieve this, we have some recommendations as follow: (i) there is a need for further movement to larger-scale farming operations away from smallholdings and also to improve quality management, minimal pollution, energy savings and effective disease control; (ii) it is also necessary to accelerate digital transformation process by bringing with it Smart Agriculture which allows for better water, feed, fertilizer, traceability and waste management; and (iii) logistics and supply chain management needs to be improved, which will allow Vietnam to join global supply chains and have efficient movement of goods within the country between provinces and distribution hubs and centers.

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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Member of Financial Action Task Force (FATF)? No, Vietnam is currently not a member of FATF.
Vietnam is a member of the Asia/Pacific Group on Money Laundering (APG).
For more information about the assessment of the implementation of anti-money laundering and counter-terrorist financing (AML/CFT) measures in Vietnam, please consult the APG website.
On FATF Blacklist? No.
Member of Egmont? No.
ML background in region
Overview of country risks
Vietnam’s deeper integration into the regional and world’s economy for the past few years has been a great opportunity for international money laundering crimes. However, money laundering activities only become clearly visible recently though bank accounts opening, securities trading, gambling, illegal transfer of foreign currencies out of the country, use of credit cards, etc.
Combating money laundering becomes one of the top concerns, not only for the State Bank of Vietnam, but also other relevant authorities in Vietnam. According to a report of the State Bank of Vietnam, in 2012, suspicious transactions had a total value of VND51,000 billion, while in 2013 it was VND79,000 billion and in 2014, the value went up to VND119,000 billion. This shows an increasing and alarming number of transactions suspicious of money laundering. We note that the Law on Anti-money Laundering took effect on January 1, 2013.
However, it seems that the anti-money laundering legal framework is still not sufficient, guiding implementation remains unclear, awareness of credit institutions of money laundering is low, ability to detect money laundering activities is weak, information technology in anti-money laundering activities is not sufficient, and especially punishment regime for violating acts of the AML is only formalistic. The government, especially the State Bank of Vietnam, is strongly recommended to tighten their regulations in this sector.
Key directives/Legislative framework
Law on Prevention of and Anti Money Laundering No. 14/2022/QH15, issued by the National Assembly on November 15, 2022 (AML);
• Decree No. 19/2023/ND-CP dated April 28, 2023 issued by the Government on detailing the implementation of certain provisions of the AML (Decree 19);
• Decree No. 88/2019/ND-CP dated November 14, 2019 issued by the Government on sanctions for administrative violations against currency and banking legal regulations (Decree 88), amended by Decree 143/2021/NĐ-CP;
• Decision No. 20/2013/QD-TTg dated April 18, 2013 of the Prime Minister on determination of high value transactions subject to report obligation (Decision 20);
• Circular No. 09/2023/TT-NHNN on guiding the implementation of certain regulations on anti- money laundering, issued by the State Bank of Vietnam on July 28, 2023; and
• Penal Code No. 100/2015/QH13 issued by the National Assembly on November 27, 2015, as amended by Law No. 12/2017/QH14 dated June 20, 2017 (Penal Code 2017). Penal Code 2017 became effective January 1, 2018.

Who are the regulators/monitoring authorities
Who are affected/reporting entities?
The following state authorities are responsible for reporting, preventing, and fighting against money laundering activities:
• SBV is mainly responsible to the Government for state administering the implementation of AML regulations;
• Ministry of Public Security is responsible for collecting, receiving and investigating information of money laundering related crimes;
• Ministry of National Defence is responsible for exchanging information and documents on money laundering activities aimed at financing for proliferation of weapons of mass destruction in Vietnam and foreign countries with the State Bank of Vietnam.
• Ministry of Finance is responsible for implementing AML measures in insurance business, securities sector, accounting service, prize-winning games and casinos, lottery, betting and other service sectors under the state management of the Ministry of Finance;
• Ministry of Construction is responsible for implementing AML measures in real estate business sector, except real estate leasing, subleasing and real estate consulting services;
• Ministry of Justice is responsible for implementing AML measures applicable to the notary public and law practising sectors;
• Ministry of Industry and Trade is responsible for implementing AML measures applicable to trading in precious metals and gems sectors, except for trading in gold bars and gold jewellery and fine arts.
• Ministry of Planning and Investment is responsible for implementing AML measures applicable to the sectors under its management.
• Ministry of Home Affairs is responsible for implementing AML measures applicable to associations, social funds, charity funds and religious institutions.
• Ministry of Foreign Affairs is responsible for implementing AML measures applicable to foreign non-governmental organizations.
• Ministry of Information and Communications is responsible for implementing AML measures applicable to telecommunications or Internet network-based game business sector.
• The People’s Procuracy and the People’s Court coordinate with other agencies in the investigation, prosecution, and resolution of money laundering crimes;
• People’s Committees at all levels are responsible for conducting legal training on anti-money laundering in the province, co-ordinating with state authorities to implement policies, strategies, and plans to prevent and fight money laundering; and
• The Anti-Money Laundering Steering Committee is responsible for assisting the Prime Minister in preparing strategy, plans, policies and programs in the process of preventing and fighting against money laundering:
o Client acceptance policy;
o Processes and procedures to identify clients, verify and update client information;
o Transactions which must be reported;
o The process of review, detection, handling and reporting of suspicious transactions; the way to communicate with the clients who make suspicious transaction;
o Information keeping and security;
o Applying temporary measures and principles of handling the cases of transaction delay;
o Reporting and information supply regime to the State Bank of Vietnam and the competent state agencies;
o Professional training on the prevention of and combating money laundering;
o Internally controlling and auditing the compliance with the policies, regulations, processes and procedures related to the prevention of and combating money laundering, responsibilities of each individual and division in the implementation of internal rules in the prevention of and combating money laundering.

For financial institutions
• The clients open accounts or set up transactions with the financial institutions for the first time;
• The clients do not have a bank account or make no transactions for the past 6 months or deposit, withdraw or make a bank transfer of at least VND 400,000,000, or a foreign-currency amount of equal or greater value per day, except for final settlements or withdrawals of savings interest, credit card debt repayments, repayments of loans to financial institutions, instalment payments registered with financial institutions, withdrawals of profits from securities or bond investment portfolios ;
• There are doubts about transaction or the parties concerned in transactions are related to the money laundering;
• There are doubts about the accuracy or completeness of the clients identification information previously collected.
• For relevant non-financial institutions or individuals:
• Doing business in prize-winning games, including prize-awarding electronic games; telecommunications network-based games, Internet-based games; casinos; lottery tickets: clients implementing high value transactions (i.e.¸ over VND70 million per day);
• Doing real estate business and management services, except for real property leasing, subleasing, and consulting services: when providing these services to the buyer, purchaser and asset owner;
• Trading in precious metals and stones: when clients performing the sale and purchase transaction in cash of precious metals and stones with value of over VND400 million per day;
• Providing legal agreement services: when acting on behalf of the customer to perform a transaction related to establishment, administration or management of legal agreements;
• Providing services of establishment, management and executive of enterprise; supplying registration office, address or place of business; supplying services of company representative : clients requesting such services;
• Providing services of director and secretary provision of the enterprise to a third party: third party and director / secretary to such director;
Legal requirements for KYC
Customer due diligence
Application of measures to identify clients are required depend on the results of money-laundering risk assessment. Procedures for management of money laundering risks cover classification of customers by low, medium and high level of risk. In particular, the abovementioned services providers/entities must update the client identification information on a regular basis during the period of having relations with the clients.
In addition, clients must also be classified into different groups, product and services used, their place of residence or headquarter based on different risk exposure levels.
Reporting requirements/obligations
Recordkeeping
Information, documents, records relating to customer identification, results of the reporting entity’s analysis and assessment of customers and/or reporting transactions and other related documents must be kept for at least five years from closing date of the transaction or the date of account closure or the reporting date. Reports of high value transactions (i.e., from VND400 million), suspicious transactions and transactions of electronic money transfer exceeding VND500 million or equivalent amount in foreign currency (for domestic transfer) or $1,000 (for inbound or outbound transfer) and information, documents and records of the transactions, must be kept for at least five years from the date of the transaction.
Tipping off
The reporting entity/ individual, management or employees of reporting entity/individual is not allowed to inform a person involved in a suspicious transaction that it has reported or will report the transaction to the State Bank of Vietnam.
Whistle-blowing
The AML only sets out regulations on reporting to the following state agencies instead of whistle-blowing.
• State Bank of Vietnam;
• Investigating agencies, agencies assigned to conduct a number of investigative activities, or People’s Procuracies, national security protection agencies under the People’s Public Security;
• State inspection agencies, agencies assigned to perform the function of conducting the specialized inspection of reporting entities.
Offences
Enforcements
If the parties related to the transactions are included in the blacklist or there are grounds to believe that the transaction required to be performed is related to the criminal activities or requested by competent state authorities, the reporting entity/ individual must apply measures to delay the transaction within maximum three working days and must immediately report in writing and notify via phone to the competent State agencies and the SBV for cooperation. If the reporting entity/individual does not receive any feedback from the competent state agencies after three working days, it can proceed the transaction.
In addition, the reporting entity/individual must block the accounts or seal or temporarily seize assets of the individuals/organizations upon having decision of competent state agencies under the law and make report on the implementation to the State Bank of Vietnam.
Penalties
Persons violating the AML are subject to administrative sanctions of up to VND500 million, discipline or criminal penalty depending on the nature and seriousness of such violations. The criminal sanctions varies from one year to maximum 15 year imprisonment, together with partly or wholly confiscation of assets, monetary fine of up to three times of the violated amount, abandonment of holding certain positions or titles from one to five years.
The criminal sanctions against corporate legal entities include monetary fine of VND1 billion up to VND20 billion, together with business operation suspension of one to three years, banning from particular business field operations of one to three years, or forced termination and liquidation.
Internal procedures and training
Pursuant to Article 24 of the AML, reporting entities/ individuals must establish internal procedures on prevention and combating money laundering with the following contents:
• Customer acceptance policy;
• Customer identification procedures and processes;
• Risk management policies and procedures;
• Procedures for reporting of should-be-reported transactions;
• Steps in examining, detecting, handling and reporting suspicious transactions; methods of contact with customers performing suspicious transactions;
• Storage, security and confidentiality of information;
• Apply provisional measures, principles for handling postponement of transactions;
• Regimes for reporting or providing information to the State Bank of Vietnam and other competent state authorities;
• Recruitment and training of personnel specializing in AML activities;
• Internal control, audit of compliance with policies, regulations, regulatory processes and procedures relating to AML activities; responsibilities of each natural person or department for implementation of internal rules and regulations on AML.
Sanctions
International conventions
International cooperation in the field of prevention of and combating money laundering includes: (i) exchange and provide information on prevention of and combating money laundering; (ii) determining and blocking assets of the violating persons; (iii) performing judicial assistance; (iv) research, training, information support, technical assistance, financial aid and AML experience exchange and (v) other aspects. The process, procedures and cooperation methods are in accordance with international agreements to which Vietnam is a party.
CTF – Countering terrorist finance
The Ministry of Public Security is tasked with the preparation of a list of organizations and individuals related to terrorism and terrorist finance (blacklist). The reporting entity/ individual must promptly report to the competent anti-terrorism authorities, and at the same time send reports to the State Bank of Vietnam upon detecting organizations and individuals to conduct transactions included in the blacklist or when there is evidence that other organizations and individuals commit acts related to the money laundering crime for terrorism financing.
At the same time, the reporting entity/individual must apply measures to delay the transaction and block the accounts or seal or temporarily seize assets of the individuals/ organizations.
Anti bribery and corruption laws
Corruption is widespread throughout Vietnam. For information, Vietnam ranks 77/180 according to the 2022 Corruption Perception Index, a significant increase compared with its rank in 2021 (87th). Sectors most affected by corruption are police; public administration; health sector, judiciary; and land management. The Vietnamese government acknowledges the negative impact of corruption on both Vietnam’s future prosperity and the party’s own legitimacy, thus has adopted one of the most comprehensive and ambitious anti-corruption laws in Asia. The anti-corruption legal framework has seen some improvements after the adoption of the Anti-corruption Law by the National Assembly in 2005 (as amended in 2007, 2012 and 2018) and the National Strategy on Anti-corruption to 2030.
However, in the last 10 years of implementation, considering the increasing level of complexity of corruption cases, the current legal framework has been proved to be inadequate to combat corruption in Vietnam. This prompted the Vietnamese government to refine the current regime to make the policies fully effective and operational in practice.
There is no definition of “bribery” under Vietnam laws. However, in essence, it could be defined as an act of offering, promising, making or receiving money or anything of value (minimum threshold: VND 2 million (approx. $90) or intangible benefit: no clear guidance but sex, job positions, and education acceptance offerings may be considered) to induce or influence an act/omission or decision. The current laws only target people with positions and power (i.e., state officials). Please note the receipt of minimum VND 1 billion is subject to death penalty.

This country profile was kindly provided by Dr. Oliver Massmann, general director of Duane Morris Vietnam LLC

On 31 August 2023, the Deputy Prime Minister Tran Hong Ha passed the Decision No. 1009/QD-TTg on the Approval for the Implementation Plan of the Political Declaration on establishing the Just Energy Transition Partnership (Decision 1009). The main goals of the implementation plan under Decision 1009 are to implement the Just Energy Transition Partnership (JETP Declaration), to promote the development of renewable energy to achieve net zero greenhouse gas emissions by 2050, and to ensure the efficient use of energy. With regard to a more detailed set of goals and relevant tasks to be carried out of the Implementation Plan, Decision 1009 also highlights the following:
(i) The reception and efficient use of partnership with international partners in terms of technology transfer, governance, training for officer-in charge and financial provision for the implementation of the JETP Declaration;
(ii) By 2030, a suitable legal framework to attract investors and businesses to engage in the transition of the JETP Declaration is expected. A resource mobilization plan to implement the JETP Declaration with pilot projects related to the JETP Declaration is also projected to be developed by relevant units. The mentioned resource mobilization plan is expected to cover international financial support and technology transfer to promote the conversion from coal-fired power and fossil energy to clean energy, and develop renewable and new energy forms;
(iii) The development of the smart grid and advanced and modern infrastructure facilities for production, transmission, storage, distribution and management of electricity is also mentioned as an important part for the implementation of JETP Declaration. From January 2024 to January 2026, it is a priority to involve the investments of private entities to contribute to the development of the grid, the tasks to carry out this goal include (iii1) determining the scope and structure for investment of private entities into the grid; (iii2) promoting the development of the legal framework to facilitate the investment into the gird; and (iii3) promoting the development of cross-border transmission and offshore transmission.
(iv) One of the main tasks outlined in the plan is switching from coal-fired power plants to clean energy sources, along with creating an ecosystem for renewable energy businesses and services, encouraging the production of electricity from biomass, garbage, and solid waste to utilize by-products from agriculture and forestry, creating and implementing regulations on the rate of renewable energy for electricity distribution companies, and creating a market for renewable energy credits.

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Please do not hesitate to contact Dr. Oliver Massmann at omassmann@duanemorris.com if you have any questions. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Marktüberblick
Mitglied der IAIS? Ja, Vietnam ist seit 2007 Mitglied der IAIS.
Globale Regulierungsbehörden, Organe und für das Land geltende Gesetze
Das Projekt „ComFrame“ wurde von der Internationally Active Insurance Groups (IAIG, mit Verbindung zur IAIS) ins Leben gerufen, um einen regulatorischen Rahmen mit verpflichtenden Standards zu schaffen. Es ist Ende 2019 in Kraft getreten. Vietnam muss sich als Mitglied der IAIS deren Vorschriften unterwerfen.
Als Mitglied der WTO und WHO muss Vietnam ebenfalls die Vorschriften bezüglich Versicherungen dieser Organisationen einhalten. Bindende Verpflichtungen bezüglich Versicherungen hat Vietnam auch in seinen bilateralen / multilateralen Abkommen wie dem Korea – Vietnam FTA, EU – Vietnam FTA, Hong Kong – ASEAN FTA, ASEAN – China FTA, ASEAN – Australia – New Zealand FTA sowie dem CPTPP abgegeben.
Darüber hinaus ist Vietnam auch Mitglied der OECD, die unverbindliche Leitlinien und bewährte Praktiken veröffentlicht.
Inland
Das Finanzministerium ist für die staatliche Regulierung der Versicherungswirtschaft zuständig. Zusätzlich hat das Finanzministerium (MOF) mit der am 12. Februar 2009 erlassenen Entscheidung Nr. 288./QD-BTC unterhalb des MOF die Aufsichtsbehörde für Versicherungen geschaffen (ISA). Die ISA unterstützt den Minister des MOF bei der landesweiten Regulierung der Versicherungswirtschaft; sie regelt und beaufsichtigt direkt die Geschäftstätigkeiten und Dienstleistungen im Zusammenhang mit dem Versicherungswesen nach den gesetzlichen Vorschriften. Derzeit sind die Aufgaben der ISA durch die am 11. September 2017 erlassene Entscheidung 1799/QD-BTC festgesetzt.
Im Juni 2009 wurde durch die Entscheidung Nr. 1379/QD-BTC unterhalb der ISA das Forschungs- und Trainingszentrum für Versicherungen (IRTC) errichtet. In den Aufgabenbereich des IRTC fällt es, wissenschaftliche Untersuchungen sowie Schulungen zu Versicherungen und dem Versicherungsmarkt zu organisieren.
Gesetze und wichtige Gerichtsentscheidungen/urteile
Die folgenden Gesetze und Vorschriften regeln maßgeblich das Versicherungsgeschäft in Vietnam:
• Gesetz über das Versicherungswesen Nr. 08/2022/QH15 erlassen von der Nationalversammlung am 16. Juni 2020 (Gesetz über das Versicherungswesen);
• Dekret Nr. 46/2023/ND-CP über Leitlinien für die Umsetzung des Gesetzes über das Versicherungswesen, erlassen von der Regierung am 1. Juli 2023 (Dekret 46);
• Dekret Nr. 98/2013/ND-CP über Verwaltungssanktionen im Versicherungs- und Lotteriegeschäft, erlassen durch die Regierung am 28. August 2013 (Dekret 98), geändert durch Dekret 48/2018/ND-CP vom 21. März 2018 (Dekret 48) und mit Dekret 80/2019/ND-CP vom 1. November 2019 (Dekret 80);
• Rundschreiben Nr. 195/2014/TT-BTC über Leitlinien für die Bewertung und Einstufung von Versicherungsunternehmen, erlassen durch das Finanzministerium am 17. Dezember 2014 (Rundschreiben 195), geändert durch Rundschreiben 89/2020/TT-BTC vom 11. November 2020 (Rundschreiben 89);
• Entscheidung Nr. 1826/QD-TTg des Premierministers über die Genehmigung des Plans über die „Restrukturierung des Wertpapiermarktes und Versicherungsunternehmen“ vom 28. Dezember 2012 (Entscheidung 1826).
Die wichtigsten Vorschriften und Anforderungen
Zuständigkeiten der oberen Führungsebene
• Erlass von rechtlichen Maßnahmen und Leitlinien zur Umsetzung für das Versicherungswesen; Formulierung von Strategien, Bestimmungen, Masterplänen und spezifischen Plänen für die Entwicklung des vietnamesischen Versicherungsmarktes;
• Erteilung und Entzug von Lizenzen für die Errichtung und Betrieb von Versicherern und Versicherungsmaklern sowie von Lizenzen für die Errichtung von Repräsentanzen von ausländischen Versicherern und Versicherungsmaklern in Vietnam;
• Erlass, Ratifizierung und leiten der Umsetzung von Versicherungsvorschriften, Bestimmungen, Prämien- und Provisionstarifen;
• Beaufsichtigung der Versicherungstätigkeit über die berufliche Tätigkeit, den Finanzstatus, die Unternehmensführung, das Risikomanagement und die Einhaltung des Gesetzes über das Versicherungswesen und Makler; Anwendung der nötigen Maßnahmen, mit denen sichergestellt wird, dass die finanziellen Anforderungen erfüllt werden und ihre Verpflichtungen gegenüber den Käufern von Versicherungen zu erfüllen;
• Organisation der Bereitstellung von Informationen über den Zustand des Versicherungsmarktes und Marktprognosen;
• Internationale Zusammenarbeit auf dem Gebiet der Versicherungen;
• Genehmigung zur Auslandstätigkeit von Versicherern und Versicherungsmaklern;
• Verwaltung der Tätigkeit der Repräsentanzen von ausländischen Versicherern und Versicherungsmaklern in Vietnam;
• Organisation des Aufbaus und Ausbildung von Personal für das Versicherungsmanagement und Versicherungsfachkräften; sowie
• Überprüfung und Kontrolle von Versicherungsgeschäften; Klärung von Beschwerden und Anzeigen; und Behandlung von Verstößen gegen das Gesetz über das Versicherungswesen.
Whistle-blowing Vorschriften
Es gibt keine dies betreffenden spezielle Vorschriften im Versicherungssektor.
Grenze der ausländischen Beteiligung an einer bestehenden Versicherungsaktiengesellschaft
Ausländische Investoren sind berechtigt, Aktien oder eingebrachtes Kapital mit einem Anteil bis zu 100% des Satzungskapitals einer Versicherungs- oder Rückversicherungsgesellschaft zu halten.
Anforderungen an die Kapitalrücklage
Reservefonds
Versicherer und Versicherungsmakler müssen einen verpflichtenden Fonds errichten, um ihr Satzungskapital zu ergänzen und ihre Solvenz abzusichern. Die Rückstellungen für den obligatorischen Reservefonds müssen jährlich in Höhe von 5% des Gewinns nach Steuern betragen. Der Maximalbetrag für den verpflichtenden Reservefonds entspricht 10% des Satzungskapitals der Versicherungsgesellschaft oder des gezeichneten Kapitals der ausländischen Niederlassung.
Zusätzlich zu diesem obligatorischen Reservefonds können Versicherer und Versicherungsmakler andere Reservefonds aus ihren Gewinnen nach Steuern des Steuerjahres errichten, wie in ihrer Satzung festgelegt. Es wird darauf hingewiesen, dass die Gewinne nach Steuern unter den Aktionären aufgeteilt werden können, jedoch erst, wenn 5% dieser Gewinne in den oben genannten obligatorischen Fonds eingezahlt wurden.
Versicherungstechnische Rückstellungen
Mit versicherungstechnischen Rückstellungen sind Geldbeträge gemeint, die ein Versicherer für seine im Voraus festgelegten Versicherungsverbindlichkeiten zurückstellen muss. Der Betrag ergibt sich aus den abgeschlossenen Versicherungsverträgen.
Die Versicherungsreserve muss für jede Art von Versicherungsprodukt oder Versicherungspolice eingerichtet werden in Bezug auf den vom Versicherer oder der ausländischen Niederlassung zu tragenden Teil der Haftung. Die für die versicherungstechnische Rückstellung bestimmten Verträge ergeben sich aus Rundschreiben 50. Versicherungsgesellschaften sind berechtigt, die Methode und Grundlage für die versicherungstechnische Rückstellung zu wählen, müssen aber die vorherige Genehmigung des MOF für die Umsetzung dieser Methode / Grundlage einholen.
Sicherheitsleistung

Versicherer müssen bei der Gründung einer Versicherungsgesellschaft, einer Rückversicherungsgesellschaft oder einer ausländischen Niederlassung eine Sicherheitsleistung in Höhe von 2% des Mindestkapitals oder des zugewiesenen Kapitals, wie es für die jeweilige Art an Versicherungsunternehmen festgelegt (Beispielsweise muss eine Krankenversicherung eine Sicherheitsleistung von 15 Milliarden VND oder entsprechend 630,000 USD hinterlegen), bei einer in Vietnam tätigen Bank hinterlegen. Ein Versicherungsunternehmen oder eine ausländische Niederlassung kann ihre Sicherheitsleistung zur Erfüllung von Verpflichtungen gegenüber Versicherungsnehmern nur nutzen, wenn seine Solvenz unzureichend ist und nur mit schriftlicher Genehmigung des Finanzministeriums. Der Gesamtbetrag der Sicherheitsleistung kann nur nach Beendigung der Geschäftstätigkeit entnommen werden.
Produktspezifische Bestimmungen
Einschlägige Beratungsdokumentation oder andere Anforderungen einschließlich steuerlicher Anforderungen.
Lebensversicherung
Mindestkapitalanforderungen
• Für das Lebensversicherungsgeschäft (ohne fondsgebundener Versicherung und Rentenversicherung) und Krankenversicherungsgeschäft: 750 Milliarden VND
• Lebensversicherungsgeschäft und fondsgebundenes Versicherungsgeschäft oder Rentenversicherungsgeschäft: 1,000 Milliarden VND
• Lebensversicherungsgeschäft, fondsgebundenes Versicherungsgeschäft und Rentenversicherungsgeschäft: 1,300 Milliarden VND
Qualifikationen des ernannten Aktuars
• Gemäß Unternehmensgesetz das Recht haben, ein Unternehmen zu führen;
• Keine verwaltungsrechtliche Strafe aufgrund eines Verstoßes im Versicherungssektor; keine Disziplinarmaßnahme in Form einer Entlassung aufgrund von Verstoß gegen interne Vorschriften innerhalb eines Zeitraums von drei aufeinanderfolgenden Jahren vor der Ernennung; keine Strafverfolgung durch eine zuständige Behörde zum Zeitpunkt der Wahl oder Ernennung.
• Ausbildung als ernannter Aktuar und mindestens zehnjährige Arbeitserfahrung als ernannter Aktuar im Lebensversicherungs- oder Krankenversicherungssektor sowie mindestens fünfjährige Arbeitserfahrung nach dem Mitglied werden in einer international anerkannten Vereinigung von Aktuaren. Hierzu zählen unter anderem das „Institute of Actuaries of England“; die „Society of Actuaries of the USA“; das „Institute of Actuaries of Australia“; das „Canadian Institute of Actuaries“; oder Mitglied einer anderen Vereinigung von Aktuaren, welche ein offizielles Mitglied der internationalen Vereinigung von Aktuaren ist; oder mindestens fünfjährige Arbeitserfahrung als ernannter Aktuar im Lebensversicherungs- oder Krankenversicherungssektor, nach dem man Mitglied einer der oben genannten Vereinigungen geworden ist. Im Falle eines ernannten Aktuars, genehmigt vom MOF vor dem Inkrafttreten des Dekrets 46, ist die in diesem Absatz genannte Voraussetzung nicht einschlägig.
• Kein Verstoß gegen die Berufsethik der Aktuare.
• Angestellter der Lebens- oder Krankenversicherer.
• Während der Amtszeit wohnhaft in Vietnam.
Zulässiger Umfang der Geschäftstätigkeit
• Versicherungsgeschäft, Rückversicherungsgeschäft, Rückversicherungstransfer;
• Management von Fonds und Investitionskapital aus Versicherungsgeschäftstätigkeiten;
• Erbringen von versicherungsbezogenen Hilfsdienstleistungen;
• Es ist Lebensversicherungsunternehmen nicht erlaubt, Krankenversicherungs-/ Nicht-Lebensversicherungsgeschäfte zu tätigen, mit der Ausnahme des Falls der Durchführung von Krankenversicherungsgeschäften durch Lebensversicherungsunternehmen;
Versicherungsrückstellung
Die Versicherungsrückstellung der Lebensversicherungsunternehmen enthält: Deckungsrückstellung, Prämienübertrag, Ausgleichsrückstellung, Rückstellung für Gewinnausschüttungen, gebundene Zinsrückstellung und Bilanzrückstellung.
Investitionstätigkeiten
Versicherungsgesellschaften, Rückversicherungsgesellschaften und ausländische Niederlassungen dürfen in Vietnam folgende Investitionstätigkeiten nicht durchführen:
• Investitionen im Immobiliengeschäft mit Ausnahme folgender Fälle: Erwerb von Aktien an Immobilienunternehmen, die auf dem Wertpapiermarkt notiert sind; von Investmentzertifikaten öffentlicher Fonds; Erwerb von Aktien von Immobilienunternehmen, die auf dem Wertpapiermarkt notiert sind, von Anteilsscheinen öffentlicher Fonds; Erwerb, Investition in oder Eigentum an Immobilien, die als Geschäftsräume, Standorte oder Tresorräume für die unmittelbare Nutzung für ihr Versicherungsgeschäft; Vermietung von leer stehenden Geschäftsräumen, die unter ihrer Kontrolle oder Verwaltung stehen; Beschlagnahme von Immobilien durch Verwaltung oder Veräußerung von Hypothekenanleihen oder Einziehung von durch Immobilien gesicherten Darlehen innerhalb von 03 Jahren ab dem Datum des Pfandrechts;
• Investitionen in Edelmetalle und Juwelen;
• Investitionen in immaterielle Vermögensgegenstände mit Ausnahme derjenigen, die für kommerzielle und geschäftliche Zwecke genutzt werden;
• Investitionen in Derivate oder Derivatkontrakte, mit Ausnahme solcher, die als Rücklagen für Risiken aus Versicherungs- und Rückversicherungspolicen sowie Aktienportfolios von Versicherungs-, Rückversicherungsgesellschaften oder ausländischen Niederlassungen in Vietnam aufgeführt sind.

Auslandsinvestitionen
Versicherungs- und Rückversicherungsunternehmen dürfen Auslandsinvestitionen in Bezug auf das Eigenkapital, das über das erforderliche Grundkapital hinausgeht, und ungenutztes Kapital aus Versicherungsrückstellungen von Versicherungspolicen mit Zinsen, die an ausländische Investitionsindizes gebunden sind, und von mit ausländischen Organisationen/Personen abgeschlossenen Versicherungsverträgen tätigen, wobei solche Auslandsinvestitionen aus dem genannten Eigenkapital nur in den folgenden Formen und mit den folgenden Einschränkungen zulässig sind:
• Gründung oder Einbringung von Kapital für die Gründung; Einbringung von Kapital, Erwerb von Anteilen von Versicherern oder Rückversicherern im Ausland; Gründung von Niederlassungen oder Repräsentanzen sowie andere Formen der kommerziellen Präsenz von Versicherern und Rückversicherern im Ausland ohne jegliche Beschränkung;
• Beschränkung von mittelbaren Auslandsinvestitionen:
– Erwerb von Staatsanleihen, Schatzanweisungen, Schuldscheinen: keine Beschränkung;
– Anleihen, Schatzanweisungen, Schuldscheine, die von Emittenten herausgegeben werden, welche von internationalen Kreditrating-Agenturen wie Standard & Poor’s, Moody’s Investors Service und Fitch Ratings, bewertet werden: Bis zu 50% des Betrags der Auslandsinvestition;
– Erwerb von notierten Anteilen, notierte Investmentzertifikate: Bis zu 15% des Betrags der Auslandsinvestition;
Nicht-Lebensversicherung
Mindestanforderungen an das Grundkapital
• Für das Nicht-Lebensversicherungsgeschäft (ohne Luftfahrtversicherungsgeschäft und Satellitenversicherungsgeschäft) und Krankenversicherungen: 400 Milliarden VND
• Für das Nicht-Lebensversicherungsgeschäft (einschließlich Luftfahrtversicherungsgeschäft oder Satellitenversicherungsgeschäft) und Krankenversicherungen: 500 Milliarden VND
• Für das Nicht-Lebensversicherungsgeschäft einschließlich Luftfahrtversicherungsgeschäft und Satellitenversicherungsgeschäft und Krankenversicherungen: 500 Milliarden VND
Qualifikationen eines ernannten Aktuars bezüglich Rückstellungen und Solvenz eines Nicht-Lebensversicherers
• Gemäß Unternehmensgesetz das Recht haben, ein Unternehmen zu führen;
• Keine verwaltungsrechtliche Strafe aufgrund eines Verstoßes im Versicherungssektor; keine Disziplinarmaßnahme in Form einer Entlassung aufgrund von Verstoß gegen interne Vorschriften innerhalb eines Zeitraums von drei aufeinanderfolgenden Jahren vor der Ernennung; keine Strafverfolgung durch eine zuständige Behörde zum Zeitpunkt der Wahl oder Ernennung.
• Mitglied der Vereinigung der Vereinigung der Aktuare gewesen, die offizielles Mitglied der internationalen Vereinigungen der Aktuare ist; oder mindestens fünfjährige Berufserfahrung im Nicht-Lebensversicherungssektor und Nachweis über mindestens zwei bestandene Prüfungen folgender Vereinigungen: „Institute of Actuaries of England“; die „Society of Actuaries of the USA“; das „Institute of Actuaries of Australia“; das „Canadian Institute of Actuaries“ oder Nachweise über bestandene Prüfungen in einer versicherungsmathematischen Ausbildung, die durch eine der oben genannten Vereinigungen als den zwei Prüfungen der Vereinigungen entsprechend anerkannt ist.
Nach drei Jahren ab Inkrafttreten dieses Dekrets muss der ernannte Aktuar eines Nicht-Lebensversicherers, Rückversicherers oder einer ausländischen Niederlassung mindestens Mitglied einer Aktuarvereinigung sein, die offizielles Mitglied der internationalen Aktuarvereinigung ist und nicht gegen die Berufsethik der Aktuardienste im Versicherungswesen verstößt.
Nach fünf Jahren ab Inkrafttreten dieses Dekrets muss der ernannte Aktuar eines Nicht-Lebensversicherers, Rückversicherers oder einer ausländischen Niederlassung ein Mitglied sein, der im Nicht-Lebensversicherungsgeschäft von einer Aktuarvereinigung, die offizielles Mitglied der internationalen Aktuarvereinigung ist, ausgebildet sein und nicht gegen die Berufsethik der Aktuardienste im Versicherungswesen verstößt.
• Angestellter des Versicherers, Rückversicherers oder der ausländischen Niederlassung in Vietnam.
• Während der Amtszeit wohnhaft in Vietnam.
Zulässiger Umfang der Geschäftstätigkeit
• Versicherungsgeschäft, Rückversicherungsgeschäft, Rückversicherungstransfer;
• Management von Fonds und Investitionskapital aus Versicherungsgeschäftstätigkeiten;
• Erbringen von versicherungsbezogenen Hilfsdienstleistungen;
• Es ist Nicht-Lebensversicherungsunternehmen nicht erlaubt, Krankenversicherungs-/Lebensversicherungsgeschäfte zu tätigen, mit der Ausnahme von Krankenversicherungsprodukten mit einer Laufzeit von einem Jahr oder weniger sowie Versicherungsprodukte für Todesrisiken mit einer Laufzeit von einem Jahr oder weniger
Versicherungsrückstellung
Die Versicherungsrückstellungen für Nicht-Lebensversicherer umfassen die Rückstellung für Prämienüberträge, für Versicherungsfälle und die Schwankungsrückstellung für Großschäden.
Investitionstätigkeit und Auslandsinvestitionen
Wie bei Lebensversicherungen
Rückversicherungen
Mindestanforderungen an das Grundkapital
• Für das Nicht-Lebens-Rückversicherungsgeschäft oder sowohl Nicht-Lebens-Rückversicherungsgeschäft und Kranken-Rückversicherungsgeschäft: 500 Milliarden VND;
• Für das Lebens-Rückversicherungsgeschäft oder sowohl Lebens-Rückversicherungsgeschäft und Kranken-Rückversicherungsgeschäft: 900 Milliarden VND;
• Für Geschäfte in allen der drei Typen an Lebensrückversicherung, Nicht-Lebensrückversicherung und Krankenrückversicherung, 1,400 Milliarden VND.
Qualifikationen eines ernannten Aktuars im Hinblick auf Rückstellungen und die Solvenz des Rückversicherers
Wie bei der Nicht-Lebensversicherung.
Zulässiger Umfang der Geschäftstätigkeit
Rückversicherungsunternehmen und ausländische Niederlassungen ebendieser können in folgenden Bereichen geschäftlich tätig sein:
• Rückversicherungs-, Rückversicherungsabtretungssektor;
• Fondsmanagement und Investition von Mitteln, die aus der Erbringung von Rückversicherungsdienstleistungen stammen;
• Andere Tätigkeiten, die unmittelbar mit Rückversicherungsdienstleistungen zusammenhängen.

Versicherungsrückstellungen
• Für die Nicht-Lebensrückversicherung: Prämienüberträge, Rückstellung für Versicherungsfälle und Schwankungsrückstellung für Großschäden;
• Für die Lebensrückversicherung: Deckungsrückstellung, Prämienüberträge, Entschädigungsrückstellung, Rückstellung für Gewinnausschüttungen, Rückstellung für gebundene Zinsen und Bilanzrückstellung;
• Für die Krankenrückversicherung: Deckungsrückstellung, Beitragsüberträge, Entschädigungsrückstellung und Bilanzrückstellung.

Investitionstätigkeiten und Investitionen im Ausland
Wie bei der Lebens- und Nicht-Lebensversicherung
Investitionsmanagement und Märkte
Ein Überblick über die einschlägigen Vorschriften, die sich auf die Investitionsportfolios der Versicherer auswirken, einschließlich Asset Liability Management (ALM)
Eine Versicherungsgesellschaft kann Investitionen aus Eigenkapital, ungenutztem Kapital aus der Versicherungsrückstellung und anderen rechtmäßigen Quellen tätigen.
Zusätzlich zu den Regeln über inländische Investitionen von ungenutztem Kapital aus Versicherungsrückstellungen, wie sie oben für jede Art von Versicherungsgeschäft erwähnt wurden, gelten folgende Grundsätze:
• Sicherstellung von Sicherheit, Liquidität und Effizienz; Einhaltung der bestehenden Vorschriften und Regeln zur Eigenverantwortung, die für die Investitionstätigkeit maßgeblich sind;
• Versicherungsrückstellungen dürfen nur in Vietnam als Investitionen verwendet werden, mit Ausnahme von ungenutztem Kapital aus Versicherungsrückstellungen von Versicherungspolicen mit Zinsen, die an ausländische Investitionsindizes gebunden sind, und abgeschlossenen Versicherungspolicen mit ausländischen Organisationen/Einzelpersonen.
• Es ist verboten, Fremdkapital für Investitionen und treuhänderische Investitionen in Wertpapiere, Immobiliengeschäfte oder Kapitaleinlagen in andere Unternehmen zu verwenden;
• Es ist verboten, dass Investitionen in Höhe von 30 % des Portfolios der Investitionen in Unternehmen getätigt werden, die derselben Unternehmensgruppe angehören und in gemeinsamem Eigentum stehen. Dieses Verbot gilt nicht für Einlagen bei Kreditinstituten und ausländischen Investmentfonds, die in Form der Gründung von Unternehmen oder der Errichtung von ausländischen Niederlassungen im Empfängerland bestehen;
• Investitionen, die als Gegenleistung für die Einlagen von Anteilsinhabern oder Gesellschaftern oder von Personen, die mit diesen Anteilsinhabern oder Gesellschaftern verbunden sind, getätigt werden, sind nicht zulässig, es sei denn, es handelt sich um Einlagen bei Transaktionsstellen der Anteilsinhaber oder Gesellschafter, die Kreditinstitute sind;
• Der Erwerb von Unternehmensanleihen, die zu bestimmten Zwecken der Umstrukturierung von Darlehen der emittierenden Unternehmen ausgegeben werden, ist nicht zulässig;
• Im Falle von fiduziarischen Investitionen müssen die Treuhänder zugelassen sein, um treuhänderische Investitionstätigkeiten durchzuführen, die in den Bereich der treuhänderischen Investitionen fallen.
Ein Versicherungsunternehmen kann auch Offshore-Investitionen tätigen, jedoch nur, um eine Offshore-Versicherungsgesellschaft oder eine Offshore-Versicherungsniederlassung zu gründen. Solche Offshore-Investitionen müssen vom MOF genehmigt werden.
Durchsetzung und Untersuchung
Regeln für die regulatorische Untersuchung
Um die spezialisierte Untersuchung von Versicherungsgeschäften durchzuführen, können die zuständigen Behörden unabhängige Prüfstellen, Beratungsunternehmen oder Spezialisten beauftragen, die Bewertungen und fachliche Kommentare zu verschiedenen Sachverhalten abzugeben, von denen angenommen wird, dass sie Auswirkungen auf die Sicherheit und Gesundheit der Inspektoren haben kann.
Beschwerdeverfahren
Es gibt keine bestimmte Vorschrift über Beschwerdeverfahren in Versicherungsgesellschaften. Stattdessen gelten die in den Versicherungspolicen angegebenen Bestimmungen, die den einschlägigen Vorschriften des Zivilgesetzbuches und den wirtschaftlichen Abkommen entsprechen müssen.
Der Umgang mit Beschwerden bezüglich Verwaltungsentscheidungen bestimmt sich nach dem Gesetz über Beschwerden und Denunziationen, das in allen Sektoren Anwendung findet.
Rechtsbehelfe, einschließlich des Ombudsdienstes
In Abhängigkeit von der Art und Schwere der Verstöße können gegen die Verantwortlichen Verwaltungssanktionen (Verwarnungen, Geldbußen, Suspendierung des Betriebs, Abhilfemaßnahmen) oder strafrechtliche Sanktionen verhängt werden. Falls Schäden verursacht worden sind, muss gemäß den vietnamesischen Gesetzen Schadenersatz geleistet werden.
Entschädigungsregelungen für die Versicherungsvermittlung
Wie in der Versicherungspolice angegeben. Der Versicherungsnehmer hat maximal ein Jahr Zeit, um die Entschädigung ab dem Zeitpunkt des Eintritts des Versicherungsfalls geltend zu machen. Bei Eintritt eines Versicherungsfalls muss der Versicherer die Entschädigung innerhalb der in der Versicherungspolice angegebenen Frist auszahlen. Falls im Vertrag eine solche Angabe fehlt, beträgt die Frist 15 Tage ab dem Eingang eines vollständigen und ordnungsgemäßen Antrags auf Zahlung der Entschädigung.
Lebens- und Krankenversicherung
Der Versicherungsnehmer kann die Versicherungsprämien einmalig oder in Raten zahlen, je nach der in der Versicherungspolice vereinbarten Frist und Vorgehensweise.

Sachversicherung
Sach-Unterversicherungspolice: Der Versicherer ist nur im Verhältnis zwischen der versicherten Summe und dem Marktwert der versicherten Sache zum Zeitpunkt des Vertragsschlusses zur Entschädigung verpflichtet.
Sach-Überversicherungspolice: Der Versicherer ist verpflichtet, den Schaden im Verhältnis zum Marktwert zum Zeitpunkt des Ereignisses zu ersetzen und dem Versicherungsnehmer den Betrag der bereits im Voraus gezahlten Prämien im Verhältnis zu dem den Marktwert des versicherten Objekts übersteigenden Versicherungsbetrag zurückzuzahlen.
Doppelversicherungen
Bei Eintritt des Versicherungsfalls ist jeder Versicherer nur nach dem Verhältnis der vereinbarten Versicherungssumme zur Gesamtversicherungssumme aller Versicherungsverträge, die der Versicherungsnehmer eingegangen ist, zur Entschädigung verpflichtet. Die Gesamtsumme, der von allen Versicherern zu leistenden Entschädigung darf den Wert des tatsächlichen Sachschadens nicht übersteigen.
Haftpflichtversicherung
Die Grenze der Haftung ist der Betrag, den ein Versicherer dem Versicherungsnehmer gemäß den Versicherungsbedingungen zu zahlen hat.
Insolvenz und Schutz der Versicherungsnehmer
Einschlägiges Regelungsregime?
Es gibt keine speziellen Insolvenzregelungen für Versicherer. Stattdessen gilt das Konkursgesetz, das bei Konkurs und Insolvenz in allen Sektoren Anwendung findet.
Grundsätzlich läuft das Verfahren im Insolvenzfall wie folgt:
• Einreichung des Antrags auf Eröffnung des Insolvenzverfahrens beim Gericht (durch Gläubiger, Arbeitnehmer, Basisgewerkschaft, gesetzliche Vertreter der Gesellschaft, Teilhaber, Vorstandsvorsitzende usw.)
• Das Gericht leitet das Verfahren zur Bearbeitung des Antrags auf Insolvenzeröffnung ein und erklärt das Versicherungs- oder Rückversicherungsunternehmen für insolvent, ohne dass eine Gläubigerversammlung abgehalten und Maßnahmen zur Sanierung des Unternehmens ergriffen werden müssen.
• Verwaltung und Liquidation der Vermögenswerte erfolgt durch einen vom Gericht zu ernennenden Insolvenzverwalter oder ein Unternehmen, welches hierauf spezialisiert ist.
Datenschutz
Es gibt keine spezialgesetzliche Regelung für den Datenschutz in Vietnams Versicherungssektor. Stattdessen sind Vietnams datenschutzrechtliche Normen über viele verschiedene Gesetze hin verteilt, wie unter anderem dem Zivilgesetzbuch, dem Strafgesetzbuch, dem Gesetz über Cyber-Informationssicherheit, dem Gesetz über Informationstechnologie, dem Telekommunikationsgesetz, dem Verbraucherschutzgesetz, dem E-Transaktionsgesetz, dem Cybersicherheitsgesetz und einschlägigen Dekreten über die Durchführung der genannten Gesetze.
Diese Gesetze enthalten Vorschriften, um Spam, Computerviren und Cyberattacken zu verhindern, erkennen, zu unterbinden und bekämpfen sowie Informationen, die im Cyberspace ausgetauscht werden, zu schützen.
Es gibt keine einheitliche Definition der „personenbezogenen Daten“ in Vietnams Gesetzgebung. Zu den personenbezogenen Daten zählen allgemein alle Informationen, die zur Identifizierung einer bestimmten Person genutzt werden können, einschließlich Informationen über Zahlungsvorgänge.
Organisationen, die personenbezogene Daten verarbeiten, müssen geeignete Verwaltungs- und technische Maßnahmen ergreifen, um die von ihnen gesammelten und gespeicherten personenbezogenen Daten zu schützen sowie sicherzustellen, dass die personenbezogenen Daten nicht verloren gehen, gestohlen, offengelegt, verändert oder ohne Zustimmung zerstört werden.
In Abhängigkeit von der Art des Verstoßes gegen datenschutzrechtliche Bestimmungen können Verwaltungsstrafen (Verwarnung, Geldstrafe) und mögliche Abhilfemaßnahmen oder strafrechtliche Sanktionen Anwendung finden.
Corporate governance
Manager und Führungskräfte von Versicherungs- oder Rückversicherungsgesellschaften sind:
• Vorstandsvorsitzender, Mitglied des Vorstands, Vorsitzender des Gesellschafterausschusses, Mitglied des Gesellschafterausschusses;
• Director oder General Director, stellvertretender Director oder stellvertretender General Director, gesetzlicher Vertreter;
• Hauptbuchhalter, Leiter einer Niederlassung, Leiter einer Repräsentanz, Abteilungsleiter und dergleichen gemäß Gesellschaftsvertrag oder Satzung.
Manager und Führungskräfte einer ausländischen Niederlassung sind:
• Director, stellvertretender Director;
• Hauptbuchhalter, Abteilungsleiter und dergleichen gemäß den Regeln und Vorschriften für die Organisation und Betrieb ausländischer Niederlassungen in Vietnam.
Die Besetzung der Personen muss nach den folgenden Grundsätzen erfolgen:
• Vorstandsvorsitzende, Vorsitzende des Gesellschafterausschusses oder Mitglied des Vorstandes, Mitglieder des Gesellschafterausschusses einer Versicherungs- oder Rückversicherungsgesellschaft können nicht gleichzeitig das Amt eines Vorstandsmitglieds oder eines Mitglieds des Gesellschafterausschusses einer anderen Versicherungs- oder Rückversicherungsgesellschaft in demselben Lebens-, Nichtlebens-, Kranken- oder Rückversicherungssektor in Vietnam ausüben.
• Ein Director oder General Director einer Versicherungs-, Rückversicherungsgesellschaft oder einer ausländischen Niederlassung in Vietnam kann nicht gleichzeitig für eine andere Versicherungs-, Rückversicherungsgesellschaft oder ausländischen Niederlassung in demselben Lebens-, Nichtlebens-, Kranken- oder Rückversicherungssektor in Vietnam arbeiten.
• Ein Director oder General Director, Leiter einer Niederlassung oder Leiter einer Repräsentanz einer Versicherungs- oder Rückversicherungsgesellschaft kann nicht gleichzeitig mehr als ein Amt, wie dem des Leiters einer Niederlassung oder einer Repräsentanz oder des Abteilungsleiters in derselben Versicherungs- oder Rückversicherungsgesellschaft innehaben. Der Leiter einer ausländischen Niederlassung in Vietnam ist der gesetzliche Vertreter und kann gleichzeitig nur ein Amt mehr halten, und zwar als ein Abteilungsleiter in dieser Niederlassung.
• Demgegenüber darf der Aktuar, der Leiter der Risikomanagementabteilung oder der Leiter der Compliance-Abteilung einer Versicherungs-, Rückversicherungsgesellschaft oder einer ausländischen Niederlassung in Vietnam keine andere leitende Funktion in demselben Unternehmen ausüben; er darf gleichzeitig nicht für eine andere Versicherungs-, Rückversicherungsgesellschaft oder eine ausländische Niederlassung in Vietnam arbeiten. Der Aktuar muss die vom Finanzminister zugewiesenen Aufgaben erfüllen.
• Der Vorsitzende des Aufsichtsrats oder der Controller darf keine andere Führungsposition bei demselben Unternehmen ausüben. Der Vorsitzende des Aufsichtsrats kann gleichzeitig keine andere Position als Controller oder Manager bei einer anderen Versicherungs- oder Rückversicherungsgesellschaft, die Vietnam tätig ist, ausüben.
• Der Hauptbuchhalter, Leiter der Innenrevisionsabteilung in einer Versicherungs-, Rückversicherungsgesellschaft oder ausländischen Niederlassung in Vietnam darf keine andere Position in demselben Unternehmen innehaben; er darf nicht gleichzeitig für eine andere Versicherungs-, Rückversicherungsgesellschaft oder ausländische Niederlassung in Vietnam arbeiten.
Prävention von Finanzkriminalität
Mitglied der FATF? Auf der schwarzen Liste der FATF?
Kein Mitglied der FATF und nicht auf der schwarzen Liste.
Dr. Oliver Massmann ist Partner und General Director bei Duane Morris Vietnam LLC

Market overview
Member of IAIS? Yes, Vietnam became member of IAIS in 2007.
Global regulators, bodies and legislation applicable to country
The project “ComFrame” was set up by the Internationally Active Insurance Groups (IAIG, related to IAIS) to establish regulatory framework with mandatory standards. It came into effect at the end of 2019. Vietnam, as a member of the IAIS, has to comply with its regulations.
As a member of the WTO and WHO, Vietnam must also comply with regulations of these organizations with respect to insurance. In its bilateral / multilateral agreements such as Korea – Vietnam FTA, EU- Vietnam FTA, Hong Kong – ASEAN FTA, ASEAN- China FTA, ASEAN – Australia – New Zealand FTA, CPTPP and EU-Vietnam Free Trade Agreement, commitments on insurance are also binding on Vietnam.
In addition, Vietnam is a member of the OECD, which issues guidelines and good practices of non-binding nature for member countries.
Domestic
The Ministry of Finance is in charge of the state regulation on insurance business. In addition, on February 12, 2009, the Ministry of Finance (MOF) issued Decision No. 288/QD-BTC to establish the Insurance Supervisory Authority (ISA) under the MoF. The ISA will assist the Minister of the MOF to regulate insurance business nationwide; directly govern and supervise insurance business activities and services related to insurance business in accordance with law. Currently, the role of the ISA is regulated under Decision 1799/QD-BTC issued on 11 September 2017.
In June 2009, Insurance Research and Training Centre (IRTC) under the ISA was established according to Decision No. 1379/QD-BTC. The IRTC is tasked with organizing scientific study and training on insurance and insurance market.
Laws and relevant court decisions/judgements
The following laws and regulations mainly govern insurance business in Vietnam:
• Law on Insurance Business No. 08/2022/QH15 issued by the National Assembly on June 16, 2020(Law on Insurance Business);
• Decree No. 46/2023/ND-CP on guiding the implementation of the Law on Insurance Business issued by the Government on July 1, 2023 (Decree 46);
• Decree No. 98/2013/ND-CP on administrative sanctions on insurance business and lottery business issued by the Government on August 28, 2013 (Decree 98) as amended by Decree 48/2018/ND-CP dated March 21, 2018 (Decree 48) and Decree 80/2019/ND-CP dated November 1, 2019 (Decree 80);
• Circular No. 195/2014/TT-BTC on guiding the assessment and classification of insurance companies issued by the Ministry of Finance on December 17, 2014 (Circular 195) as amended by Circular 89/2020/TT-BTC dated November 11, 2020 (Circular 89);
• Decision No. 1826/QD-TTg of the Prime Minister on approving the Plan on “Restructuring the securities market and insurance companies” on December 28, 2012 (Decision 1826).
Key rules and requirements
Senior management responsibilities
• Promulgation of legal instruments and implementing guidelines on insurance business; formulation of strategies, policies, master planning and specific plans for the development of the Vietnamese insurance market;
• Issuance and withdrawal of licenses for establishment and operation insurers and insurance brokers, and of licenses for establishment of representative offices of foreign insurers and foreign insurance brokers in Vietnam;
• Promulgation, ratification and guiding the implementation of insurance regulations, provisions, scales of premiums and commissions;
• Supervision of insurance business activities via professional activities, financial status, enterprise management, risk management and compliance with the law on insurers and brokers; application of necessary measures to ensure that insurers satisfy the financial requirements and fulfil their undertakings to purchasers of insurance;
• Organization of provision of information on the status of the insurance market and market forecasts;
• International cooperation in the area of insurance;
• Consent for overseas operations of insurers and insurance brokers;
• Administration of the operations of representative offices of foreign insurers and foreign insurance brokers in Vietnam;
• Organization of the formation and training of a workforce of insurance management personnel and insurance professional experts; and
• Inspection and checks of insurance business activities; resolution of complaints and denunciations, and dealing with breaches of the laws on insurance business.
Whistle-blowing rules
There are no such rules specifically for the insurance sector.
Foreign ownership limit in an existing shareholding insurance company
Foreign investors are entitled to own shares or contributed capital up to 100% of charter capital of insurance enterprises and reinsurance enterprises.
Capital reserve requirements
Reserve funds
Insurers and insurance brokers must establish a compulsory fund to supplement their charter capital and ensure their solvency. Appropriations for the compulsory reserve fund shall be made annually at 5% of after-tax profits. The maximum amount of compulsory reserve fund is equivalent to 10% of the charter capital of the insurance enterprise or issued capital of the foreign branch.
In addition to this compulsory reserve fund, insurers and insurer brokers may establish other reserve funds from their after-tax profits of the fiscal year as determined in their charter. It is noted that after-tax profits may be shared among shareholders but only after 5% of such profits is contributed to the compulsory reserve fund as provided above.
Insurance reserves
Insurance reserve means an amount of money which an insurer must set aside to pay for its insurance liabilities determined in advance and arising from the insurance policies which it has entered into.
Insurance reserve must be established for each type of insurance product or insurance policy with respect to that part of liability retained by the insurer or foreign branch. Specific amount contributed for insurance reserve is provided in Circular 50. Insurance companies are entitled to choose methods of and basis for setting insurance reserves but must seek prior approval from the MOF for implementation such insurance reserve methods / basis.
Security deposit
Insurers must pay a security deposit into a commercial bank operating in Vietnam in an amount of 2% of the minimum requirements of charter capital or allocated capital as specified for each type of insurance company (for example, a health insurance company must pay a security deposit of VND15 billion or $630,000 equivalent) at the time of establishment of an insurance company, reinsurance company or foreign branch in Vietnam. An insurance enterprise or foreign branch may only use its security deposit to meet undertakings to purchasers of insurance when its solvency is inadequate and upon written approval of the MOF. The whole amount of their security deposit can only be withdrawn upon termination of their operation.
Product specific legislation
Relevant advisory documentation or other requirements, including tax
Life
Minimum requirements of charter capital
• For life insurance business (excluding unit linked insurance and retirement insurance) and health care insurance business: VND750 billion
• Life insurance business and unit linked insurance business or retirement insurance business: VND1,000 billion
• Life insurance business, unit linked insurance business and retirement insurance business: VND1,300 billion.
Qualifications of the appointed actuary
• Having the right to manage an enterprise in accordance with the Law on Enterprises;
• Not being subject to an administrative penalty for a breach in the insurance business sector, not have been disciplined in the form of dismissal for a breach of internal rules for 03 consecutive years before the time of appointment; not have been prosecuted by a competent authority as prescribed by law at the time of being elected or appointed.
• Having undergone training as an appointed actuary, and have at least 10 years’ work experience as an appointed actuary in the life insurance or health insurance sector and have at least 5 years’ work experience from the time of becoming a fellow of one of the Associations of Actuaries which are widely recognized internationally such as the Institute of Actuaries of England; the Society of Actuaries of the USA; the Institute of Actuaries of Australia; the Canadian Institute of Actuaries; or be a member of another Association of Actuaries which is an official member of the International Associations of Actuaries; or have at least five years’ work experience as an appointed actuary in the life insurance or health insurance sector from the time of becoming a fellow of one of the above associations. In case of an appointed actuary approved by the MOF before the effective date of Decree 46, the above-mentioned qualification in this paragraph will not be applicable.
• Not having committed any breach of the professional ethics of actuaries.
• Being an employee of the life insurer or health insurer.
• Being resident in Vietnam during the term of office.
Permitted scope of business
• Insurance business, reinsurance business, reinsurance transfer;
• Managing funds and invest capital from insurance business activities;
• Providing auxiliary insurance services;
• Life insurance enterprises are not allowed to do health insurance business/non-life insurance business except for the case of life insurance enterprises implementing health insurance business;
Insurance reserve
Insurance reserve for life insurance companies includes: actuarial reserve, unearned premium reserve, compensation reserve, profit distribution reserve, committed interest rate reserve and balance reserve.
Investment activities
Insurance enterprises, reinsurance enterprises, and foreign branches in Vietnam are not allowed to implement the following investment activities:
• Investment in real estate business, except in the following cases: acquiring stocks of real estate businesses listed on the securities market, fund certificates of public funds; purchasing, investing in or owning real property used as business offices, locations or treasure vaults for direct uses for their insurance business; leasing out unoccupied business establishments under their control or management; seizing real property by managing or disposing of mortgage bonds, or recovering loans secured by real property within 03 years from the lien date;
• Investment in precious metals, jewels;
• Investment in intangible fixed assets, except those used for commercial and business purposes;
• Investment in derivatives or derivative contracts, except those listed as provisions for risks arising from insurance, reinsurance policies and portfolios of stocks that insurance companies, reinsurance companies or foreign branches in Vietnam are holding.

Outbound investment
Insurance enterprises and reinsurance enterprises are allowed to make outbound investment with regards to the owner’s equity in excess of the required charter capital and idle capital from insurance reserves of insurance policies with interests linked to foreign investment indexes and signed insurance policies with foreign organizatons/individuals, the outbound investment from the said owner’s equity shall only be allowed for the following forms and restrictions:
• Establishing or contributing capital for the establishment; contribution of capital, acquisition of shares of insurers, reinsurers in foreign countries; establishing branches or representative offices, and other forms of commercial presence of insurers and reinsurers abroad without any restriction;
• Restrictions on indirect outbound investment:
– Purchase of government bonds, treasury bills, promissory notes: No restriction;
– Bonds, treasury bills, promissory notes issued by issuers rated by international credit rating agencies like Standard & Poor’s, Moody’s Investors Service and Fitch Ratings: Up to 50% of outbound investment amount;
– Purchase of listed shares, listed fund certificates: Up to 15% of outbound investment amount;
Non-life insurance
Minimum requirements of charter capital
• For non-life insurance business (excluding aviation insurance business and satellite insurance business) and health insurance: VND400 billion
• For non-life insurance business (including aviation insurance business or satellite insurance business) and health insurance: VND450 billion
• For non-life insurance business, including aviation insurance business and satellite insurance business and health insurance: VND500 billion
Qualifications of an appointed actuary regarding reserves and solvency of non-life insurer
• Having the right to manage an enterprise in accordance with the Law on Enterprises;
• Not have been subject to an administrative penalty for a breach in the insurance business sector, not have been disciplined in the form of dismissal for a breach of internal rules for 03 consecutive years before the time of appointment; not have been prosecuted by a competent authority as prescribed by law at the time of being elected or appointed.
• Been an Associate of the Associations of Actuaries being an official member of the International Associations of Actuaries; or have at least 5 years’ work experience in non-life insurance sector and have proof of passing at least 2 exam of one of the following Associations: Institute of Actuaries of England; the Society of Actuaries of the USA; the Institute of Actuaries of Australia; the Canadian Institute of Actuaries or proofs of passing exams in an actuarial training course or program recognized by the above associations as equivalent to 2 exams of the Association.
After 3 years from the effective date of this Decree, the Appointed Actuary of a non-life insurer, reinsurer, or foreign branch in Vietnam must be at least an Associate of an actuary association which is an official member of International Actuarial Association and does not break the code of ethics for actuarial services in insurance.
After 5 years from the effective date of this Decree, the Appointed Actuary of a non-life insurer, reinsurer, or foreign branch in Vietnam must be a Fellow, who has been trained in non-life insurance of an actuary association which is an official member of International Actuarial Association and does not break the code of ethics for actuarial services in insurance.
• Be an employee at the insurer, reinsurer, or foreign branch in Vietnam.
• Be resident in Vietnam during the term of office.
Permitted scope of business
• Insurance business, reinsurance business, reinsurance transfer;
• Managing funds and invest capital from insurance business activities;
• Providing auxiliary insurance services;
• Non-life insurance enterprises are not allowed to implement life insurance business/health insurance business except for health insurance products with a term of 01 year or less and insurance products for death risks with a term of 01 year or less

Insurance reserve
Insurance reserve for non-life insurance companies includes unearned premium reserve, claim reserve, and large loss fluctuation reserve.
Investment activities and Outbound investment
Same as life insurance
Reinsurance
Minimum requirements of charter capital
• For non-life reinsurance business or both non-life reinsurance business and health reinsurance business: VND500 billion;
• For life reinsurance business or both life reinsurance business and health reinsurance business: VND900 billion;
• For business in all three types of life reinsurance, non-life reinsurance and health reinsurance, VND1,400 billion.
Qualifications of an appointed actuary regarding reserves and solvency of reinsurer
Same as in non-life insurance.
Permitted scope of business
Reinsurance companies and foreign reinsurance branches can be involved in the following range or area of business activities:
• Reinsurance, reinsurance cession sector;
• Management of funds and investment of funds generated from rendering reinsurance services;
• Other activities directly related to reinsurance services.

Insurance reserve
• For non-life reinsurance: unearned premium reserve, claim reserve, and large loss fluctuation reserve;
• For life reinsurance: actuarial reserve, unearned premium reserve, compensation reserve, profit distribution reserve, committed interest rate reserve and balance reserve;
• For health reinsurance: actuarial reserve, unearned premium reserve, compensation reserve, and balance reserve.

Investment activities and Outbound investment
Same as life insurance and non-life insurance
Investment management and markets
Overview of relevant regulation affecting insurers’ investment portfolios, including Asset Liability Management (ALM)
An insurance enterprise can make investment from its equity, idle capital from insurance reserves and other lawful sources.
In addition to rules of domestic investment of idle capital from insurance reserves as mentioned above for each type of insurance business, the following principles apply:
• Ensure safety, liquidity and efficiency; compliance with prevailing regulations and self-responsibility rules applied to investment activities;
• Insurance reserves may be used as investments in Vietnam only, except for idle capital from insurance reserves of insurance policies with interests linked to foreign investment indexes and signed insurance policies with foreign organizatons/individuals
• It is prohibitory that borrowed funds are used for investment and fiduciary investment in securities, real estate business or contribution of capital to other enterprises;
• It is prohibitory that investment accounting for 30% of the portfolio of investments in companies belonging to the same group of companies having mutual ownership relationship is made. This prohibition shall not apply to deposits made at credit institutions and outward investment funds existing in the form of establishment of companies or establishment of foreign branches in the receiving foreign countries;
• Investments made in return for those of shareholders or members contributing capital or persons associated with these shareholders or members contributing capital are not allowed, except in case of deposits made at transaction offices of shareholders or members that are credit institutions;
• Purchase of corporate bonds issued to serve certain purposes of restructuring of loans of issuing companies is not allowed;
• In case of fiduciary investments, trustees must be licensed to perform fiduciary investment activities falling within the scope of fiduciary investment.
An insurance enterprise may also make offshore investment but only to set up offshore insurance company or an offshore insurance branch. Such offshore investment must be approved by the MOF.
Enforcement and investigation
Rules of regulatory investigation
In order to carry out the specialized inspection of insurance business, competent authorities can hire independent audit bodies, consulting companies or specialists to assess and give professional comments on several matters that are alleged to cause any impacts on inspectees’ safety and health where necessary.

Complaints procedure
There is no specific rule on complaints handling procedures in insurance enterprises. Instead, such rules are as indicated in the insurance policies and must follow relevant regulations of the Civil Code and economic agreements.
Complaints on administrative decisions will be handled according to laws on complaints and denunciations, which are applied for all sectors.
Redress, including Ombudsman service
Depending on the nature and seriousness of violations, the violators may be subject to administrative sanctions (warnings, monetary fines, suspension of operation, remedies) or criminal penalty. In case of causing damages, they must compensate according to Vietnam laws.
Insurance mediation compensation schemes
As indicated in the insurance policy. The insured person has maximum one year to claim for indemnity from the date of occurrence of the insured event. Upon occurrence of such insured event, the insurer must pay the indemnity with the time-limit stated in the insurance policy. If there is no statement in the contract, the time-limit is 15 days from the date of receipt of a complete and proper application requesting payment of indemnity.
Life and health care insurance
The insurer can pay insurance premiums on a one-off basis or in installments according to the time limit and approach agreed upon in an insurance policy.

Property insurance
Property underinsurance policy: the insurer is only responsible to indemnify in accordance with the ratio of the sum insured to the market value of the insured property at the date of entering the contract.
Property overinsurance policy: the insurer is responsible to indemnify for lossess in proportion to the market value at the time of occurrence and repay the insured the amount of premiums already paid in advance in proportion to the amount of insurance in excess of the market value of the insured property.
Double insurance policies
Upon occurrence of the insured event, each insurer is only responsible to indemnify in accordance with the ratio of the agreed sum insured to the total sum insured under all insurance contracts which the purchaser of the insurance has entered into. The total sum of indemnity payable by all the insurers will not exceed the value of the actual property damage.
Liability insurance policies
The limit of liability is the amount of money that an insurer is bound to pay to the insured under terms and conditions of the insurance policy.
Insolvency and policy-holder protection
Relevant resolution regime?
There is no separate insolvency regime for insurers. Instead, the Law on Bankruptcy which deals with bankruptcy and insolvency in all sectors will apply.
The general procedure to handle bankruptcy cases is as follows:
• Filing the petition to the court to commence bankruptcy procedures (by creditors, employees, grass-root trade union, legal representative of the company, shareholders, Chairman of the Board of Management, etc.)
• The court will start the procedures for handling of the request for declaring bankruptcy and declare that the insurance company or reinsurance company is bankrupt without resort to any meeting of creditors to be held and business recovery actions to be taken.
• Management and liquidation of assets are conducted by a liquidator or company that is appointed by the court and specializes in the management and liquidation of assets.
Data protection
There is no separate rule governing data protection in the insurance sector in Vietnam. Instead, Vietnam’s data protection laws are scattered in many legislations, which include the Civil Code, the Penal Code, the Law on Cyber Information Security, the Law on Information Technology, the Law on Telecommunications, the Law on Consumer Protection, the Law on E-Transactions, cybersecurity law and relevant Decrees guiding implementation of the mentioned laws.
These laws include provisions to prevent, detect, stop and address spam, computer viruses and cyber-attacks, and protect information exchanged in cyberspace.
There is no consistent definition of “personal information” in Vietnam laws. General speaking, personal information could be any information that could be used to identify a specific person, including information on payment transactions.
Organisations processing personal information must take appropriate management and technical measures to protect personal information that they have collected and stored and ensure that the personal information is not lost, stolen, disclosed, modified or destroyed without consent.
Depending on the nature of violations of data protection policies, administrative fines (warning, monetary fine) and possible remedial measures or criminal penalties might apply.
Corporate governance
Managers and executives of insurance company or reinsurance company are:
• Chairperson of the Managing Board, Member of the Managing Board; Chairperson of the Board of Members, Member of the Board of Members;
• Director or General Director, Vice Director or Deputy General Director, Legal Representative;
• Chief Accountant, Director of a branch, Head of a representative office, Head of an operations department and the like under the Company’s Charter.
Managers and executives of a foreign branch are:
• Director, Deputy Director;
• Chief Accountant, Head of an operations department and the like under the rules and regulations on organization and operation of foreign branches in Vietnam.
Allocation of these people must follow the below principles:
• Chairperson of the Managing Board, Chairperson of the Board of Members or Member of the Managing Board, Member of the Board of Members of an insurance company or reinsurance company cannot concurrently hold the post as the Member of the Managing Board or the Member of the Board of Members of another insurance company or reinsurance company in the same life insurance, non-life insurance, health insurance or reinsurance sector in Vietnam.
• Director or General Director of an insurance company, reinsurance company or foreign branch in Vietnam cannot concurrently work for another insurance company, reinsurance company or foreign branch in the same life insurance, non-life insurance, health insurance or reinsurance sector in Vietnam.
• Director or General Director, Director of a branch or Head of a representative office of an insurance company or reinsurance company can hold only one more post like the Director of a branch or the Head of a representative office or the Head of an operations department in the same insurance company or reinsurance company. The Director of a foreign branch in Vietnam is the legal representative and can hold only one more post as the Head of an operations department of that branch.
• Meanwhile, the Actuary, Head of the risk management department or Head of the compliance department of an insurance company, reinsurance company or foreign branch in Vietnam shall not be allowed to hold any other executive post at the same host entity; shall not be allowed to concurrently work for any other insurance company, reinsurance company or foreign branch in Vietnam. The Actuary must perform the duties assigned by the Minister of Finance.
• The Head of the Supervisory Board or the Controller shall not be allowed to hold any other executive post at the same host entity. The Head of the Supervisory Board cannot concurrently hold another post as the Controller or manager of any other insurance company or reinsurance company operating in Vietnam.
• The Chief Accountant, Head of the internal audit department in an insurance company, reinsurance company or foreign branch in Vietnam shall not be allowed to hold any other post in the same host entity; shall not be allowed to concurrently work for any other insurance company, reinsurance company or foreign branch in Vietnam.
Financial crime prevention
Member of FATF? On FATF blacklist?
Not a member of FATF and not blacklisted.
Dr. Oliver Massmann is a partner and General Director in Duane Morris Vietnam LLC