VIETNAM – THE NEW LAW ON CREDIT INSTITUTIONS – WHAT YOU MUST KNOW:

On 18 January 2024, the National Assembly passed the new Law on Credit Institutions No. 32/2024/QH15 with effective from 1 July 2024(“New Law on CIs”). Generally, the objectives of the New Law on CIs are to fortify the resilience of the banking system, augment the independence and accountability of credit institutions, and boost the oversight, examination, and surveillance of Vietnam’s banking industry.

For further details, the New Law on CIs set out sets of rules to address the issue of cross-ownership in commercial banks in Vietnam whereby strict requirements are imposed on relevant entities. At the same time, the New Law on CIs introduces the management of bad debts and restructuring where all relevant aspects, including methodology, sale and purchase, enforcement of security, etc. of bad debts are thoroughly governed in a Chapter. Regarding the issue surrounding internet banking, the New Law on CIs governed the legal framework for the operation of digital banking with sandbox program for the banking sector. All of these new regulations introduced by the New Law on CIs, in a way, strengthen the market infrastructure of Vietnam and help Vietnam to take a step further into reaching the emerging market status.

According to the MSCI Global Market Accessibility Review – Country Comparison issued on June 2023 by Morgan Stanley and the FTSE Equity Country Classification September 2023 issued on 28 September 2023 by FTSE Russell, Vietnam remains a frontier market with several indices with improvements needed where information flow and market regulations are two of them. With the new additions and regulations of the New Law on CIs, Vietnam is one step closer with the emerging market status as the market regulations will become much more developed while the investors can benefit from the better information flow as provided under the New Law on CIs. For Vietnam to reach the emerging market earlier, it is believed that the guidance documents of the New Law on CIs should focus more on the availability of relevant information and the streamlined procedure for the setup of relevant investment account.

Regarding the compatibility of this New Law on CIs with Vietnam’s commitments in the EVFTA and the CPTPP, as some related banking/ financial new/ conflicting provisions in these agreements have been directly implemented in Vietnam, the adoption of the New Law on CIs does not derive from the need to bring Vietnamese laws into compliance with international commitments. In other words, in general, the New Law on CIs are introduced in the context that Vietnam’s commitments in the sector have been in line with those in the CPTPP and EVFTA.

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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com or any other lawyer listed in our office list if you have any questions on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Corporate Sustainability Due Diligence Directive (CSDDD or the EU Supply Chain Law): A Comprehensive Analysis and Review of its Implications on Vietnam-based Companies

In recent years, the European Union has increasingly prioritized sustainability, recognizing its fundamental role in addressing global challenges. Various legislative frameworks have been put in place to integrate environmental, social, and governance (ESG) considerations into corporate strategies, including the Non-Financial Reporting Directive (NFRD), the Sustainable Finance Disclosure Regulation (SFDR), the EU Taxonomy Regulation, the Corporate Sustainability Reporting Directive (CSRD), etc.

Recent developments have also seen individual EU Member States enact their own supply chain laws, varying in scope and legal consequences. Seeking to establish a common baseline across Member States, the European legislator aims to complement existing regulations with the Corporate Sustainability Due Diligence Directive (CSDDD), commonly referred to as the “EU Supply Chain Law”.
The Directive aims to establish a comprehensive due diligence framework, requiring companies to identify, prevent, and mitigate adverse impacts on human rights, the environment, and good governance throughout their supply chains. If enacted as expected, the CSDDD would impose substantial responsibilities on companies, including those operating in Vietnam and linked to the EU, necessitating compliance with the Directive’s provisions and engaging in effective due diligence practices.

As the legislative landscape evolves, companies should remain vigilant and be prepared for potential changes to their sustainability and due diligence obligations.
Below, you will find an overview of the relevant provisions of the CSDDD for companies based in Vietnam.

CSDDD – Overview
Status
After extensive discussions behind closed doors and multiple delays in the European Council’s vote, on 15 March 2023 the majority of EU member states have agreed on a draft overall compromise package of the CSDDD, paving the way for its adoption by the European Parliament. Parliamentary approval is expected to follow suit. As a next step, should the Parliament adopt its position at first reading in accordance with the compromise package, the European Council would approve the Parliament’s position, resulting in the adoption of the act in the wording corresponding to the Parliament’s position.

Achieving this breakthrough, however, required several significant changes to the original Draft Directive. While the concept of corporate civil liability as set out in the Draft Directive remains intact, the scope of the Directive has been narrowed, significantly reducing the number of companies affected, including companies in Vietnam. This was reached by raising the employee and turnover thresholds for companies, and by removing the original list of “specific sectors” (e.g. textile and leather production, agriculture, forestry and fisheries, and extractive industries) that were considered to have an inherently higher risk of human rights violations, potentially affecting companies with smaller staff and turnover. Additionally, a new aspect compared to the previous Draft is the introduction of a tiered approach, establishing transition periods ranging from three to five years based on the number of employees and global turnover for companies concerning CSDDD provisions.

Scope
General Scope

As a compromise solution, the Directive has been delineated with a flexible scope of application. It provides that it will only apply to companies meeting the specified conditions in two consecutive financial years. Conversely, the Directive will cease to apply to companies if the conditions outlined in the Directive are not met for each of the last two relevant financial years.

Addressees of Obligations
If the Directive – as set forth in the compromise package – comes into effect and is implemented by the Member States, the obligated entities would include companies, irrespective of their legal form and size, including SMEs and certain regulated financial undertakings outlined in the Directive.

The obligations set out in the Directive should apply to companies established under the laws of a Member State meeting the following criteria (“Category 1”):
(i) the company had, on average, more than 1000 employees and had a net worldwide turnover of more than EUR 450 million in the last financial year for which annual financial statements have been or should have been adopted;
(ii) the company did not meet the above thresholds but is the ultimate parent company of a group that reaches the thresholds in the last financial year for which consolidated annual financial statements have been or should have been adopted; or
(iii) the company entered into or is the ultimate parent company of a group that entered into franchising or licensing agreements in the Union in return for royalties with independent third-party companies, where these agreements ensure a common identity, a common business concept and the application of uniform business methods, and where these royalties amount to more than EUR 22,5 million in the last financial year for which annual financial statements have been or should have been adopted, and provided that the company had or is the ultimate parent company of a group that had a net worldwide turnover of more than EUR 80 million in the last financial year for which annual financial statements have been or should have been adopted.
In addition, obligations apply to companies established under the laws of a third country fulfilling one of the following conditions (“Category 2”):
(i) the company generated a net turnover of more than EUR 450 million in the Union in the financial year preceding the last financial year;
(ii) the company did not reach the above thresholds but is the ultimate parent company of a group that on a consolidated basis reaches the thresholds in the financial year preceding the last financial year; or
(iii) the company entered into or is the ultimate parent company of a group that entered into franchising or licensing agreements in the Union in return for royalties with independent third-party companies, where these agreements ensure a common identity, a common business concept and the application of uniform business methods, and where these royalties amount to more than EUR 22,5 million in the Union in the financial year preceding the last financial year; and provided that the company generated or is the ultimate parent company of a group that generated a net turnover of more than EUR 80 million in the Union in the financial year preceding the last financial year.
Exemptions

It is remarkable that the amended version of the Draft CSDDD significantly restricts its scope, as it now includes a provision for exemptions. Namely, if the primary activity of the ultimate parent company is holding shares in operational subsidiaries and it does not engage in making management, operational, or financial decisions affecting the group or any of its subsidiaries, it may be exempted from fulfilling the obligations under the Directive. However, this exemption is contingent upon one of the ultimate parent company’s subsidiaries, established in the Union, being designated to fulfill the CSDDD obligations on behalf of the ultimate parent company, including its obligations regarding its subsidiaries’ activities. In such instances, the designated subsidiary is granted the necessary means and legal authority to effectively fulfill these obligations, particularly in ensuring it receives relevant information and documents from the group’s companies to meet the ultimate parent company’s obligations under the CSDDD. The ultimate parent company must seek this exemption from the competent supervisory authority. If the above-mentioned conditions are met, the competent supervisory authority will grant the exemption. Nevertheless, the ultimate parent company remains jointly liable with the designated subsidiary for any failure of the latter to comply with its obligations.

Additionally, determining whether a company falls under the CSDDD is intended to be subject to ongoing assessment: Where a company has met the Category 1 or 2 criteria, the Directive shall only apply if this occurs in two consecutive financial years. Conversely, the Directive shall no longer apply to a company where the conditions laid down in the relevant Category cease to be met for each of the last two relevant financial years.

Temporal Scope of the Provisions
Moreover, the transposition periods for the CSDDD provisions vary depending on the size and formation of the companies. For companies falling under Category 1 (i) and (ii) with more than 5000 employees and a net worldwide turnover of over EUR 1500 million, the Directive will apply three years after its entry into force. Similarly, for companies meeting the same criteria but with more than 3000 employees and a net worldwide turnover of more than EUR 900 million, the Directive will apply four years after its entry into force. Companies falling under Category 2 (i) and (ii) with a net turnover exceeding EUR 1500 million in the Union, will be covered by the Directive three years after its entry into force, while those with a net turnover exceeding EUR 900 million fall under it four years after. All other companies in both Categories will be subject to the Directive five years after its entry into force. However, the measures necessary to comply with reporting obligations under the CSDDD will be applied to these companies starting on from January 1, 2028 or January 1, 2029.

Content – What Vietnam-based Companies Must Know?
Key Obligations
Companies are expected to fulfill their due diligence obligations through the following measures and exchange resources and information with their respective groups of companies and with other legal entities in accordance with applicable competition law:

· Integration of risk-based human rights and environmental due diligence into all their relevant policies and risk management systems, developed in prior consultation with the company’s employees and their representatives, and including an annually (or promptly following significant changes) updated due diligence policy containing a description of the company’s (long term) approach, a code of conduct (CoC) for employees, subsidiaries and (in)direct business partners, and a description of processes and measures taken to integrate and implement due diligence and to verify compliance with the CoC and to extend its application to business relationships.
· Identification and assessment of actual or potential adverse human rights and environmental impacts arising from the company’s operations (or those of their subsidiaries and – where related to their chains of activities – from their business partners) through “appropriate measures.” In essence, companies are required to (a) map their own operations, their subsidiaries’, and, if applicable, their business partners’ operations in order to pinpoint areas prone to adverse impacts; (b) carry out an in-depth assessment of these operations based on the mapping results. Furthermore, if essential information for the in-depth assessment can be obtained from business partners at different levels of the chain of activities, companies should prioritize requesting it directly from partners operating in areas most susceptible to adverse impacts.
If it’s not possible for companies to address all identified adverse impacts simultaneously and to their fullest extent, companies shall prioritize addressing of identified adverse impacts when fulfilling their obligation to prevent, mitigate, bring them to an end or minimize them. Prioritization should be determined based on the severity and likelihood of adverse impacts. Once the most severe and likely adverse impacts are addressed within a reasonable timeframe, companies shall then address less severe and likely adverse impacts.
A tiered regulatory concept follows the identification, distinguishing between potential and actual adverse impacts:
· Potential adverse impacts shall primarily be prevented and – if not (immediately) possible – adequately mitigated. To determine the appropriate measures companies have to take in this regard, consideration must be given to (a) whether the potential adverse impact stems solely from the company, jointly from the company and its subsidiary or business partner, or solely from the company’s business partner in the chain of activities; (b) whether the potential adverse impact may arise in the operations of the subsidiary, direct business partner, or indirect business partner; (c) the company’s ability to influence the business partner responsible for or contributing to the potential adverse impact.
Depending on the latter, the appropriate measures may include:
o the development without undue delay of a “prevention action plan” (in cooperation with industry or multi-stakeholder initiatives) adapted to company’s operations and chain of activities and containing defined timelines and indicators to measure improvement;
o establishing contractual assurances from direct business partners – and from their partners, to the extent that their activities are part of the company’s chain of activities – ensuring the compliance with the company’s CoC and and, as necessary, a prevention action plan;
o necessary financial or non-financial investments, adjustments or upgrades, such as into facilities, production or other operational processes and infrastructures;
o necessary modifications of, or improvements to, the company’s own business plan, overall strategies and operations, including purchasing practices, design and distribution practices;
o targeted and proportionate support for an SME which is a company’s business partner, as needed considering the SME’s resources, expertise, and limitations. This may involve providing or facilitating access to capacity-building, training, or upgrading management systems. If compliance with the CoC or the prevention action plan would jeopardize the SME’s viability, the company shall provide targeted and proportionate financial support, such as direct financing, low-interest loans, guarantees for continued sourcing, or assistance in securing financing;
o collaboration with other entities compliant with Union law for the purpose of increasing the company’s ability to prevent or mitigate the adverse impact, in particular where no other measure is suitable or effective;
· Actual adverse impacts should be primarily brought to an end or – if not immediately possible – minimized in their extent. Again, this should be based on appropriate measures to be determined according to the above-mentioned criteria regarding potential adverse effects. Such appropriate measures may include:
o neutralizing/minimizing the extent of impacts through actions appropriate to the severity of the adverse impact and to the company’s implication in the adverse impact;
o developing and implementing a “corrective action plan” without undue delay (in cooperation with industry or multi-stakeholder initiatives) adapted to the company’s operations and chain of activities and containing defined timelines and indicators to measure improvement, if the adverse impact cannot be immediately brought to an end;
o establishing contractual assurances from direct business partners – and from their partners, to the extent that their activities are part of the company’s chain of activities – ensuring the compliance with the company’s CoC and, as necessary, a correction action plan;
o making necessary financial or non-financial investments, adjustments or upgrades, such as into facilities, production or other operational processes and infrastructures;
o making necessary modifications of, or improvements to, the company’s own business plan, overall strategies and operations, including purchasing practices, design and distribution practices;
o providing targeted and proportionate support for an SME which is a company’s business partner, as needed considering the SME’s resources, expertise, and limitations. This may involve providing or facilitating access to capacity-building, training, or upgrading management systems. If compliance with the CoC or the prevention action plan would jeopardize the SME’s viability, the company shall provide targeted and proportionate financial support, such as direct financing, low-interest loans, guarantees for continued sourcing, or assistance in securing financing;
o collaborating with other entities compliant with Union law for the purpose of increasing the company’s ability to bring to an end or minimize the extent of such impact, in particular where no other measure is suitable or effective;
o providing remediation when the company is responsible for or contributes to an actual adverse impact. In cases where the adverse impact solely stems from the company’s business partner, the company may choose to offer voluntary remediation or utilize its influence over the partner to facilitate remediation.
Companies may, where relevant, implement additional measures beyond those outlined above. These may include engaging with business partners regarding expectations for preventing and mitigating potential adverse impacts or bringing actual adverse impacts to an end or minimize the extent of such impacts, as well as providing or facilitating access to capacity-building, guidance, administrative and financial support such as loans or financing, while considering the resources, knowledge, and constraints of the business partner.
In case the adverse impacts could not be prevented/adequately mitigated/brought to an end/minimized by the measures listed above, companies may seek contractual assurances with indirect business partners (including SMEs) accompanied by appropriate measures to verify compliance (e.g. independent third-party verification, including through industry or multi-stakeholder initiatives). To lighten the burden on SMEs, the CSDDD stipulates that the terms used shall be fair, reasonable and non-discriminatory, and costs of verification measures – if considered as necessary upon assessment – shall be borne by the company; In case the SME requests to pay at least a part of the cost, or in agreement with the company, it shall be able to share the results of verifications with other companies.

If the measures stated above are ineffective, the company shall – as a last resort – refrain from entering into new or extending existing relations with the business partner in connection with or in the chain of activities of which the impact has arisen; If permitted by law and after assessing whether the impacts of suspension or termination would outweigh those of the adverse impact, the company must then: (a) adopt and implement an enhanced prevention/corrective action plan without undue delay, by using or increasing the company’s leverage through the temporary suspension of business relationships with respect to the activities concerned, including a specific and appropriate timeline for actions, during which the company may seek alternative business partners; (b) terminate the relationship if there is no reasonable expectation that the efforts would succeed or the implementation of the plan fails to prevent/mitigate the adverse impacts. In this regard, Member States shall ensure that contracts allow for suspension or termination, except where mandated by law. The company shall prevent/mitigate/bring to an end the impacts of suspension/termination, provide notice to the business partner, and review its decision regularly. If the company opts not to suspend/terminate, it must monitor and reassess potential impacts and appropriate measures available periodically.

· Companies must also designate a legal or natural person established or domiciled in an EU Member State as an authorized representative to facilitate effective cooperation with the supervisory authority responsible for monitoring compliance obligations. Companies established in Vietnam will be subject to supervisory scrutiny, with the competent authority being that of the Member State in which the company has a branch. If the company has no branch in a Member State or has branches in different Member States, the authority of the Member State in which the company generated most of its Union net turnover in the financial year preceding the last financial year, preceding a certain date to be specified by the Member States or the time when the company first met the Category 2 criteria, whichever comes last, will be responsible. In the event of a significant change in circumstances, the company may request to change the competent supervisory authority.
· Member States must ensure that parent companies covered by the CSDDD and meeting certain conditions set out in it can fulfill the obligations outlined there on behalf of their subsidiaries under the Directive’s scope, provided it ensures effective compliance. However, this doesn’t affect subsidiaries’ supervision or their civil liability.
Other Relevant Provisions
The directive includes the following additional provisions the application of which must be ensured by Member States:
· Companies shall effectively engage with stakeholders, providing relevant information and allowing stakeholders to request additional information if needed. Stakeholder consultation should occur at various stages of the due diligence process; however, if effective engagement with stakeholders is not reasonably possible, companies shall consult additionally with experts who can provide credible insights into potential or actual adverse impacts. Companies must identify and address barriers to engagement, ensuring participants are protected from retaliation and retribution, including by maintaining confidentiality or anonymity. Companies shall also be allowed to fulfill these obligations through industry or multi-stakeholder initiatives; the latter, however, shall not replace consultation with employees and their representatives, which must comply with relevant EU and national legislation.
· Companies shall establish and maintain a “fair, publicly available, accessible, predictable and transparent” complaints procedure, in which companies shall take reasonably available measures to prevent any form of retaliation by ensuring the confidentiality of the identity of the person or organization submitting the complaint. Individuals and organizations (and their representatives) with legitimate concerns about the actual or potential adverse impacts of a company’s operations, operations of its subsidiaries or business partners in the company’s chain of activities can submit complaints to the company, demand appropriate follow-up actions, meet with company representatives for discussions, and shall be provided with the reasoning as to whether a complaint has been considered founded or unfounded. In the case of a well-founded complaint, they are to be provided with information on the steps and actions taken or to be taken, the adverse impact that is the subject matter of the complaint is deemed to be identified, and the company shall take appropriate measures.
Furthermore, companies shall establish an accessible mechanism for individuals and organizations to submit notifications regarding actual or potential adverse impacts related to their operations, subsidiaries, and business partners in their chains of activities. Notifications can be made anonymously or confidentially as per national law, and companies must prevent retaliation by maintaining the confidentiality of the notifier’s identity. Additionally, companies may inform notifiers about actions taken or planned. Companies shall also be allowed to fulfill these obligations through collaborative complaints’ procedures and notification mechanisms, provided they meet specified requirements. Submitting a notification or complaint does not affect access to other procedures or mechanisms.
· Companies shall assess the implementation and monitor the adequacy and effectiveness of their own operations and measures, those of their subsidiaries and, where related to the their chains of activities, those of their business partners regarding the identification, prevention, mitigation, bringing to an end and minimization of the extent of adverse impacts; the assessments shall be carried out without undue delay after a significant change occurs, but at least every 12 months and whenever there are reasonable grounds to believe that significant new risks regarding adverse impacts may arise. The company shall update its due diligence policy, the identified adverse impacts and the derived appropriate measures accordingly.
· Companies not subject to reporting requirements under the Accounting Directive (2013/34/EU) shall report on matters covered by the CSDDD by publishing an annual statement on their website. The statement must be published in at least one official language of the EU Member State of the supervisory authority designated pursuant to the CSDDD and, where different, in a language common in the sphere of international business. It should be published within 12 months after the financial year’s balance sheet date or, for companies voluntarily reporting under the Accounting Directive, by the annual financial statements’ publication date. Companies formed under third-country legislation – thus, also companies established under Vietnamese law – must include information about their authorized representative. By March 31, 2027, the Commission will adopt delegated acts specifying detailed reporting content and criteria, aligning them with sustainability reporting standards under the Accounting Directive and ensuring no duplication with reporting requirements for companies subject to the Disclosure Regulation (EU) 2019/2088.
From January 1, 2029, companies shall, when publishing their annual statement, simultaneously submit it to a collection body specified in the CSDDD. The purpose is to make the statement accessible on the European Single Access Point (ESAP) established under Regulation (EU) 2023/2859. Member States shall also ensure that the submitted information meets certain requirements: it must be in a data-extractable format as defined in Regulation (EU) 2023/2859 or, if required by Union or national law, in a machine-readable format. Metadata accompanying the information should include the company’s names, legal entity identifier, company size, industry sector, type of information, and an indication of whether personal data is included. Furthermore, Member States shall ensure companies obtain a legal entity identifier and, by December 31, 2028, designate at least one collection body and notify ESMA thereof, to make the information accessible on ESAP. The European Commission is empowered to adopt implementing measures to specify additional metadata, data structuring, and the required machine-readable format for information submission.
· Planned guidelines, including general guidelines and for specific sectors or specific adverse impacts, by the EU Commission will include model contract clauses.
· Member States shall, furthermore, establish dedicated websites, platforms, or portals to provide information and support to companies, their business partners, and stakeholders. These platforms should particularly cater to SMEs involved in companies’ chains of activities and provide access to reporting criteria, Commission’s guidance, a single helpdesk (through which companies may seek information, guidance and support about how to fulfil their obligations), and information for stakeholders on how to engage throughout the due diligence process. Member States may financially support SMEs and stakeholders, and the Commission may supplement these measures, including through joint stakeholder initiatives. Companies can participate in industry initiatives and use third-party verification to support due diligence obligations, ensuring independence and accountability. Guidance will be issued by the Commission to assess the suitability of such initiatives and verifiers.
· Companies shall adopt and implement a transition plan for climate change mitigation, aligning with the goals of the Paris Agreement and EU regulations. The plan must be updated annually, detailing progress towards time-bound targets and should include decarbonization strategies, investment details, and roles of administrative bodies. Companies already reporting a transition plan under relevant EU directives are considered compliant.
· Supervisory authorities shall be equipped with adequate powers and resources to enforce obligations outlined in the CSDDD, including to request information and conduct investigations. Supervisory authorities should be able to initiate inspections – without prior warning to the company where this hinders the effectiveness of the inspection – on their own motion or upon substantiated concerns. If non-compliance is identified, companies are given a chance to remedy the situation; however, measures imposed by the supervisory authority do not preclude administrative sanctions or civil liability in case of damage. In this context, supervisory authorities shall also have powers to order cessation of infringements, impose penalties, and take interim measures. These powers can be exercised directly, in cooperation with other authorities, or through judicial application. Inversely, individuals shall have the right to effective judicial remedies against decisions made by supervisory authorities. Supervisory authorities are required to keep records of investigations and enforcement actions. Decisions made by supervisory authorities regarding compliance do not affect a company’s civil liability.
· Natural and legal persons with objective grounds to believe that a company is violating national provisions adopted pursuant to the CSDDD shall be able to submit their substantiated concerns to any supervisory authority and be informed of the outcome of the examination and the supervisory decision. Access to national courts or other independent and impartial public bodies shall be granted to review the procedural and substantive legality of supervisory decisions, acts or failures to act.
· The reporting of breaches and the protection of reporting persons shall follow the Whistleblower Protection Directive (EU) 2019/1937 and the respective national implementation laws.
· Adherence to the obligations outlined in the CSDDD, whether through mandatory adoption or voluntary measures, shall be considered an environmental or social factor that contracting authorities can take into consideration when awarding public and concession contracts, as per Directives 2014/24/EU, 2014/25/EU, and 2014/23/EU.

Penalties and Liability
Member States shall establish and enforce penalties for violations of national provisions under the CSDDD, ensuring that they are “effective, proportionate, and dissuasive”. Penalties must consider the nature and severity of the infringement, previous violations, remedial actions taken, and financial benefits or losses from the infringement etc. Pecuniary penalties shall be based on the company’s net worldwide turnover, with a maximum limit of not less than 5% of the turnover in the preceding financial year. Decisions containing penalties must be published, publicly available for at least 5 years, and shared with the European Network of Supervisory Authorities (ENSA), excluding personal data.

Member States shall also ensure that companies can be held liable for damages caused by intentional or negligent failure to comply with the CSDDD obligations regarding the prevention of potential and bringing to an end of actual adverse impacts, provided that the right, prohibition or obligation listed in Annex I (“Rights And Prohibitions Included In International Human Rights Instruments”) is aimed to protect the natural or legal person, and the violation harms a natural or legal person protected under national law. This liability constitutes a legal novelty and entails the obligation for full compensation. It also extends to companies that have participated in industry initiatives or used third-party verification.

Nevertheless, a company can’t be held liable if damage is solely caused by its business partners. If the company is held liable, the affected party has the right to full compensation under national law without leading to overcompensation. Member States shall, furthermore, ensure reasonable limitation periods (at least 5 years) for bringing actions for damages and accessible legal proceedings which shall not begin to run before the infringement has ceased and the claimant knows or can reasonably be expected to know of the behavior, the caused harm and the identity of the infringer. Claimants shall also be allowed to seek injunctive measures and authorize relevant organizations to bring actions on behalf of injured parties. It should also be noted that national courts can order disclosure of evidence as necessary for claims, and companies involved in initiatives or third-party verification can still be held liable. In addition, the liability of a company for damages doesn’t affect the liability of its subsidiaries or business partners. The civil liability rules in the CSDDD don’t limit companies’ liability under other legal systems and may be enforced even if the applicable law isn’t that of a Member State.

Implications of the Potential Implementation of the CSDDD on Vietnam-based Companies
In the event of the CSDDD coming into effect, EU companies falling under Category 1 will extend their due diligence obligations to their business partners, including those overseas. As a result, even companies based in Vietnam closely linked to the chains of activities of these EU entities, would be indirectly held accountable. However, the CSDDD does not limit itself to indirect effects but explicitly extends its scope to companies based in third countries. Thus, Vietnamese companies or companies with branches in Vietnam would be direct addressees of Category 2 obligations. In this regard, the ENSA shall publish an indicative list of third country companies subject to the CSDDD. This is particularly relevant for Vietnam-based companies, as it will provide clarity on which entities fall under the scope of the Directive. However, it is important that the criteria for the opening of the scope of the Directive are regularly reviewed. The start of the application of the regulations, particularly for Category 2 companies, but also for Category 1 companies, as this may indirectly affect companies in Vietnam, must be also taken into account.

Moreover, the rules on penalties to be adopted by Member States will also be (in-)directly relevant for Vietnamese companies.
Therefore, investment in and adoption of sustainable technologies and practices, coupled with legal advice on appropriate strategies, will be critical in this context and for risk mitigation. Going forward, it will also be essential to comply with regulatory guidelines issued by the supervisory authorities and the European Commission.
Our firm is ready to assist and guide you in these matters and to help you develop appropriate strategies.

CSDDD and EVFTA
Nevertheless, Vietnamese companies are unlikely to be caught completely off guard by these commitments. Given their existing commitments under the EVFTA, encompassing CSR and environmental standards, climate protocols and biodiversity protection, they are not entirely unprepared. Chapter 13 of the EVFTA integrates sustainable development as a fundamental component of the bilateral trade relations with the EU. In light of the EVFTA commitments, Vietnam is striving to ensure and promote a high level of environmental, labor and social protection through its legislation and policies, and is constantly seeking to improve. Regarding procedural guarantees, unlike other topics discussed within the EVFTA framework, any dispute arising from Chapter 13 relating to trade and sustainable development, including labor, is not subject to the general dispute settlement procedures under Chapter 15. Discussion on labor issues can only be settled through government-to-government consultations or panel of expert as stipulated under Chapter 13.

In terms of labor standards, the EVFTA does not create any new standards, but emphasises the implementation of commitments that Vietnam and the EU made to as members of the ILO and it’s Declaration on Fundamental Principles and Rights at Work, and its follow-up, specifically: i) the freedom of association and the effective recognition of the right to collective bargaining, ii) the elimination of all forms of forced or compulsory labor, iii) the effective abolition of child labor; and iv) the elimination of discrimination in respect of employment and occupation. Prior to the entry into force of the EVFTA, Vietnam had already adopted and adjusted its laws, regulations, and policies to be in line with internationally recognized labor standards. This process continues as Vietnam fulfils its obligations under both the CPTPP and the EVFTA, notably the amended Labor Code in 2019.
In terms of environment protection, in addition to Chapter 13, the EVFTA also contains a dedicated chapter on Non-tariff Barriers to Trade and Investment in Renewable Energy Generation. It covers specific rules for the renewable energy sector (i) on non-discriminatory treatment in general (licensing and authorization procedures), (ii) on local content in particular, and further (iii) on the use of international standards.
Relevant recent initiatives include Decision No. 876/QD-TTg on approving the Action Program for Transition to Green Energy and Mitigation of Carbon Dioxide and Methane Emissions from Transportation, Decision No. 500/QD-TTg on the issuance of the Power Development Plan VIII, Law No. 72/2020/QH14 on Environmental Protection, and the “One Strategic Framework for Sustainable Development Cooperation between the Government of the Socialist Republic of Vietnam and the United Nations for the Period 2022-2026”, among others. These necessarily imply a number of obligations for companies operating in Vietnam to adhere to these standards and local requirements.

Conclusion
In essence, with the expected EU Supply Chain Directive on the horizon, companies based in Vietnam must remain vigilant.

The CSDDD sets out obligations for companies concerning actual and potential adverse impacts on human rights and the environment related to their own activities, those of their subsidiaries, and their business partners. Its current compromise-based wording suggests that the Directive will soon come into effect. Therefore, affected companies in Vietnam need to prepare for the future legal landscape as early as possible to remain competitive in the EU market. By proactively adapting to the evolving legal framework, Vietnamese businesses can effectively navigate these challenges and sustain their foothold in Europe.

ANWALT IN VIETNAM DR. OLIVER MASSMANN RECHTLICHER HINWEIS ZUM RUNDSCHREIBEN MIT VORSCHRIFTEN ZUR FESTLEGUNG DER TARIFSPANNEN FÜR DIE STROMERZEUGUNG

Am 1. November 2023 hat das Ministerium für Industrie und Handel (MOIT) das Rundschreiben Nr. 19/2023/TT-BCT veröffentlicht, welches die Methode zur Festlegung der Tarifspannen für die Stromerzeugung aus Solar- und Windenergie regelt (Rundschreiben 19). Das Rundschreiben 19 enthält Richtlinien für die Festlegung der jährlichen Einspeisetarife für Onshore-, Nearshore- und Offshore-Windkraftanlagen (mit Ausnahme von Übergangsprojekten) und legt die Schritte für die Erstellung und Umsetzung der Tarifspannen sowie die Verantwortlichkeiten von Investoren, Regulierungsbehörden und relevanten Parteien wie etwa Vietnam Electricity (EVN) fest. Das Rundschreiben 19 trat am 19. Dezember 2023 in Kraft; dementsprechend sollten die ersten Tarifspannen für das Jahr 2025 bis Ende 2024 vom MOIT bekannt gegeben werden.

Das Rundschreiben 19 ist eines der Regelwerke, an denen das MOIT arbeitet, um den Energieentwicklungsplan VIII (PDP 8) mit Leben zu füllen; sowohl das MOIT als auch die Regierung arbeiten weiterhin intensiv daran. Genauer gesagt hat das MOIT am 1. März 2024 – wie von der Regierung am 29. Februar 2024 unter der Berichtsnummer 1346/TTr-BCT gefordert – einen weiteren Entwurf des Umsetzungsplans für den PDP 8 vorgelegt. Auffallend ist dabei, dass der Entwurf weiterhin in zwei Umsetzungsphasen unterteilt ist, was die Regierung zuvor abgelehnt hatte. Fast gleichzeitig, am 4. März unterzeichnete das MOIT eine Entscheidung zur Einrichtung eines Entwurfsausschusses und eines Redaktionsteams für die Überarbeitung des Elektrizitätsgesetzes. Der Entwurf des novellierten Elektrizitätsgesetzes (Gesetzesentwurf) wird bis Ende März 2024 Gegenstand öffentlicher Konsultationen sein. Nach Prüfung durch das Justizministerium soll der Gesetzesentwurf der Regierung vorgelegt werden. Diese prüft und entscheidet, ob der endgültige Gesetzesentwurf der Nationalversammlung vorgelegt wird. Nach dem Arbeitsplan des MOIT ist die Vorlage des Gesetzentwurfs an die Regierung für Juli 2024 vorgesehen. Diese Vorlage muss, wenn sie von der Regierung genehmigt wird, spätestens 30 Tage vor der Eröffnung der 8. Sitzung der 15. Nationalversammlung im Oktober 2024 erfolgen. Es wird erwartet, dass alle relevanten Bestimmungen des Rundschreibens 19 und des PDP 8 nach der Verabschiedung des Umsetzungsplans und des geänderten Elektrizitätsgesetzes wesentlich klarer sowie leichter zu handhaben und durchzusetzen sein werden.

Im Einzelnen werden im Rundscheiben 19 die folgenden wesentlichen Bestimmungen geregelt:

1. Methoden zur Festlegung des Preisrahmens

Das Rundschreiben 19 legt die Formel zur Bestimmung der Obergrenze der Tarifspanne (des “Höchstpreises”) fest. Das MOIT wird jährlich einen Höchstpreis für jede Kraftwerkskategorie nach einer im Rundschreiben 19 festgelegten Formel bestimmen und veröffentlichen. Die Methode bei Solar- und Windkraftwerken folgt im Wesentlichen der gleichen Struktur: Der Höchstpreis wird auf der Grundlage der Erzeugungskosten des Standardkraftwerks bestimmt, die auf der Grundlage tatsächlicher oder hypothetischer Daten sowie der im Rundschreiben 19 festgelegten Methode ermittelt werden. Hierbei gilt, dass:
Ein Standardkraftwerk ein Solar- oder Windkraftwerk ist, das (i) in Übereinstimmung mit dem Energieentwicklungsplan realisiert wird, (ii) (einen) Investoren hat, der/die für das Projekt ausgewählt wurde/n, (iii) über eine gemeinsame Kapazität verfügt, (iv) nicht Gegenstand eines Stromabnahmevertrags und (v) für die Technologie/das System repräsentativ ist. Da das Rundschreiben 19 keine Definition von “gemeinsam” oder “repräsentativ” für die oben genannten Zwecke enthält, liegt dies wahrscheinlich im Ermessen der EVN. Letztere ist gemäß Rundschreiben 19 für die Auswahl der Standardkraftwerke verantwortlich.

Preisspanne: Für jede Region Vietnams wird es separate Tarifspannen für Solarstromprojekte geben, die auf der Grundlage der durchschnittlichen Einstrahlungswerte in jeder Region entwickelt werden. Das MOIT wird jährlich offizielle Tarifspannen entwickeln und veröffentlichen. Sollten die Tarifspannen für ein bestimmtes Jahr nicht rechtzeitig veröffentlicht werden, können vorübergehend die zuletzt veröffentlichten Tarifspannen gelten.

Höchstpreis: Der Höchstpreis wird nach folgender Formel berechnet:

P=FC+FOMC,

wobei

P: Stromgestehungstarif (Dong/kWh),
FC: durchschnittliche Fixkosten (Dong/kWh) und
FOMC: fixe Betriebs- und Wartungskosten (Dong/kWh)

bedeuten und im Einzelnen wie folgt zu bestimmen sind:

I. Durchschnittliche Fixkosten (FC): Rundschreiben 19 führt eine Formel zur Berechnung der durchschnittlichen Fixkosten eines Standardkraftwerks ein. Diese Komponente dient der Amortisierung der Investition und wird aus dem jährlich umgerechneten Investitionskapital und der prognostizierten durchschnittlichen elektrischen Energie, die das Standardkraftwerk im Laufe der Zeit liefern wird, abgeleitet.

Im Allgemeinen werden die FC auf der Grundlage der berechneten Kosten (ohne MwSt.) für den Bau des Standardkraftwerks pro Jahr (in vietnamesischen Dong) (TC) und der prognostizierten durchschnittlichen Stromlieferung des Standardkraftwerks über eine bestimmte Anzahl von Jahren (E) wie folgt berechnet:
FC=TC/E

II. fixe Betriebs- und Wartungskosten (FOMC): Dieses Element, das zur Deckung größerer Reparaturkosten und der jährlichen Betriebs- und Wartungskosten dient, wird anhand einer Formel berechnet, welche die gesamten fixen Betriebs- und Wartungskosten des Kraftwerks und die prognostizierte durchschnittliche jährliche Stromlieferung berücksichtigt.

FOMC werden nach folgender Formel berechnet:

〖FOMC〗^MT=〖TC〗_FOMC/E,

wobei TCFOMC die gesamten fixen Betriebs- und Wartungskosten des Standardkraftwerks wiedergibt, berechnet auf der Grundlage der Investitionsrate (Dong/kWp), der gesamten installierten Kapazität des Standardkraftwerks und des Verhältnisses der fixen Betriebs- und Wartungskosten zu den gesamten Investitionskapitalkosten für jeden Kraftwerkstyp, basierend auf Daten, die von seitens EVN beauftragten Beratern zur Verfügung gestellt wurden.

2. Schrittweises Verfahren zur Bekanntmachung von Tarifspannen

Schritt 1: Bis zum 1. November eines jeden Jahres muss EVN (i) die Auswahl der Standardkraftwerke vorschlagen, (ii) Berechnungen durchführen oder ein Beratungsunternehmen beauftragen, um eine Reihe von Parametern auszuwählen und den Höchstpreis zu berechnen, (iii) ein Antragsdossier erstellen und dieses bei der vietnamesischen Elektrizitätsregulierungsbehörde (ERAV) einreichen.
Schritt 2: Nach Erhalt des Dossiers von EVN prüft die ERAV diese innerhalb von fünf Werktagen auf Gültigkeit und Eignung. Gegebenenfalls fordert die ERAV die EVN auf, den Inhalt des Antrags zu ändern, zu ergänzen oder zu erläutern. EVN hat innerhalb von 15 Werktagen nach Aufforderung durch die ERAV einen Erläuterungsbericht zu übermitteln. Die ERAV beurteilt innerhalb von 20 Werktagen nach Erhalt des Dossiers die von EVN empfohlenen Tarifspannen, sofern das Dossier rechtmäßig und die Erläuterungen angemessen sind. Bei Bedarf kann die ERAV betroffene Parteien (z.B. betroffene Solar- oder Windkraftanlagenbetreiber) oder einen vom MOIT eingerichteten Beirat konsultieren.

Schritt 3: Die ERAV schlägt dem MOIT die Genehmigung der Tarifspannen für das folgende Jahr vor und veröffentlicht diese innerhalb von 15 Werktagen nach dem Datum der Bewertung auf ihrer Website. Die letzten Tarifspannen können vorübergehend in Kraft bleiben, wenn die Tarifspannen für das folgende Jahr nicht rechtzeitig veröffentlicht werden.

3. Schlussfolgerung und empfohlener Aktionsplan

Das erklärte Ziel des Rundschreibens 19 des MOIT ist es, ein klares und methodisches Verfahren für die Festlegung von Preisrahmen für die Erzeugung von Wind- und Solarenergie im Rahmen des Einspeisevergütungssystems (FiT) zur Verfügung zu stellen. Ziel des Rundschreibens 19 ist die Sicherstellung von Nachhaltigkeit, Effizienz und Gerechtigkeit beim nationalen Ausbau von Projekten im Bereich Erneuerbare Energien. Das Rundschreiben soll eine solide Grundlage für eine nachhaltige Entwicklung der vietnamesischen Solar- und Windenergieindustrie schaffen, indem es klare Regeln und Prozesse definiert. Obwohl dies lobenswerte und wichtige Ziele sind, besteht weiterhin Handlungsbedarf, um die Entwicklung von Greenfield-Projekten zu erleichtern, insbesondere im Hinblick auf die Beschränkungen bei der Auswahl von Investoren und die Bedingungen von Stromlieferverträgen (PPAs).

In Bezug auf Investitionen in den vietnamesischen Energiesektor wird Investoren dringend empfohlen, so bald wie möglich die notwendigen Schritte einzuleiten, um in den Genuss der Vorteile des PDP 8 und des dazugehörigen Leitdokuments, des Rundschreibens 19, zu kommen. Hinsichtlich des Schutzes ausländischer Investitionen gegenüber der vietnamesischen Regierung wird durch das sog. Investor-Staat-Streitbeilegungsverfahren (ISDS) ein Höchstmaß an Rechtssicherheit, Durchsetzbarkeit und Schutz für ausländische Investoren in Vietnam gewährleistet. Wir empfehlen ausländischen Investoren eine sorgfältige Auswahl der Zweckgesellschaft (Special Purpose Vehicle – SPV), die ihre Investitionen in Vietnam vertritt, um schließlich von der Rechtssicherheit zu profitieren, die durch den ISDS-Mechanismus im Rahmen des Umfassenden und Fortschrittlichen Abkommens über die Transpazifische Partnerschaft (Comprehensive and Progressive Agreement for Trans-Pacific Partnership – CPTPP) geboten wird. Nach dieser Bestimmung des CPTPP haben Investoren bei Investitionsstreitigkeiten das Recht, das Gastland im Rahmen eines internationalen Schiedsverfahrens zu verklagen. Die Schiedsverfahren werden im Streitfall aus Transparenzgründen öffentlich verhandelt.

Zudem sind sämtliche Entscheidungen des Schiedspanels in Vietnam und im Ausland gegenüber Vietnam unmittelbar vollstreckbar. Damit wird ein Maß an Rechtssicherheit erreicht, das es in Vietnam bisher nicht gab, und ein entscheidender Faktor für die Bankfähigkeit von Transaktionen darstellt. Durch die Gründung von Gesellschaften, die unter den Schutz des ISDS-Mechanismus im Rahmen des CPTPP fallen, können Investoren bei Investitionen im vietnamesischen Energiesektor den umfassenden Rechtsschutz des CPTPP genießen.

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Bei Fragen können Sie gerne Dr. Oliver Massmann unter omassmann@duanemorris.com kontaktieren. Dr. Oliver Massmann ist geschäftsführender Direktor von Duane Morris Vietnam LLC.

VIETNAM – LEGAL ALERT ON CIRCULAR PROVIDING REGULATIONS ON METHOD TO FORMULATE POWER GENERATING TARIFF RANGES

On 1 November 2023, the Ministry of Industry and Trade (MOIT) issued Circular No. 19/2023/TT-BCT providing regulations on the method to formulate power generating tariff ranges for solar and wind power plants (Circular 19). In general, Circular 19 outlines guidelines for determining annual electricity generation price frameworks for ground-mounted and floating solar power plants and onshore, nearshore and offshore wind power plants (not including transitional power projects) and lays out the steps for creating and implementing the tariff ranges and outlines the responsibilities of investors, regulatory bodies, and pertinent parties like Vietnam Electricity (EVN). Circular 19 came into force on 19 December 2023 and, accordingly, the first tariff ranges should be promulgated by the MOIT by the end of 2024 for year 2025.

While Circular 19 is one of the set of rules the MOIT is working on to put the Power Development Plan VIII (PDP 8) to life, the MOIT and the Government are still working hard on the same. More specifically, on 1 March 2024, the MOIT, again, submitted another draft on the Implementation Plan for the Power Development Plan 8 as requested by the Government on 29 February 2024 under Report No. 1346/TTr-BCT. It is worth noting that the draft is still structured with two phases implementation which the Government rejected before. At the (almost) same time, On 4 March, MOIT signed a Decision to set up the Drafting Committee and Editing Team for the Electricity Law revision. The Draft Amended Law on Electricity (Draft Law) is on track for public consultation by the end of March 2024. Once reviewed by MOJ, the Draft Law will be submitted to the Government for consideration and decision whether to submit the finalized the Draft Law to the National Assembly. As statted in the MOIT’s work plan, the submission of the Draft Law to the Government is scheduled to happen in July 2024. This submission, if endorsed by the Government, must occur no later than 30 days before the opening of the 8th session of the 15th National Assembly, which takes place in October 2024. It is expected that all of the relevant regulations under the Circular 19 and the PDP 8 will become much clearer and enforceable after the issuance of the Implementation Plan and the Amended Law on Electricity.

For further details, Circular 19 regulates the following key provisions:

1. Methods for determining pricing framework

Circular 19 lays out the formula for determining the upper limit of the tariff range (the “Ceiling Price”). Every year, the MOIT will establish and publish Ceiling Price for every category of power plant, using a formula specified in Circular 19. Overall, the method for solar and wind power plants follows the same general structure: the Ceiling Price will be determined by applying the Standard Power Plant’s generation cost, which will be determined using either actual or hypothetical data and the methodology specified in Circular 19. In which:
· Standard Power Plant is regulated as a solar or wind power plant (i) being implemented in line with the Power Development Plan; (ii) has investor(s) selected for the project; (iii) has common capacity; (iv) has not entered into any Power Purchase Agreement; (v) is representative of the relevant technology/system. Since Circular 19 is silent on the definition of “common” or “representative” for the aforementioned purposes, it is likely up to EVN’s judgment. EVN is tasked under Circular 19 with choosing Standard Power Plants.
· Tariff range: There will be separated tariff ranges for each region of Vietnam with regard to solar power projects developed by reference to the average irradiation levels in each different region. Every year, the MOIT will develop and publish official tariff ranges. The most recent tariff ranges may be temporarily in effect if the tariff ranges for a certan year are not published in a timely manner.
· Ceiling Price: The Ceiling Price is calculated with the formula as below
P = FC + FOMC
In which:
P: power generating tariff (Dong/kWh);
FC: average fixed costs (Dong/kWh); and
FOMC: fixed O&M costs (Dong/kWh).
while
I. Average Fixed Costs (FC): Circular 19 introduces a formula for determining the average fixed costs of a Standard Power Plant. This component serves the purpose of investment recovery and is derived from annual converted investment capital and the projected average electrical energy delivered by the Standard Power Plant over time.

Generally, FC is calculated according to the (not including VAT) for construction of the Standard Power Plant, calculated per year (in Vietnamese Dong) (TC) and the average projected delivered power for a number of years of the Standard Power Plant (E) as follows:
TC
FC = ————
E
and
II. Fixed Operation and Maintenance Costs (FOMC): This element, serving to recover major repair costs and annual operation and maintenance expenses, is determined through a formula considering the fixed total cost for operation and maintenance of the power plant and the average forecast annual electrical energy delivery.

FOMC are calculated in accordance with the following formula:
TCFOMC
FOMCMT = ————
E
whereby TCFOMC is the total fixed O&M costs of the Standard Power Plant is calculated based on the investment rate (Dong/kWp), the total installed capacity of the Standard Power Plant and the ratio of the fixed O&M costs over the total investment capital costs for each type of power plant, based on data provided by consultants engaged by EVN.

2. Step-by-step procedure for promulgation of tariff ranges

Step 1: By 1 November each year, EVN must (i) propose the selection Standard Power Plants; (ii) carry out calculation or hire a consulting firm to select a set of parameters and to calculate the Ceiling Price; (iii) set up an application dossier and submit the same to the Electricity Regulatory Authority of Vietnam (ERAV).

Step 2: After receiving the dossier from EVN, ERAV has five working days to review it for validity and appropriateness. If required, ERAV will submit a request for EVN to amend, add to, or clarify the application’s content. EVN is required to provide an explanatory report as requested by ERAV within 15 working days of the request date. ERAV will arrange for an evaluation of the tariff ranges that EVN has recommended if the dossier is legitimate and the explanatory report is adequate, and this will happen within 20 working days of the dossier’s arrival. If required, ERAV may confer with the impacted parties (such as pertinent solar or wind power facilities) or an advisory board formed by the MOIT.

Step 3: ERAV is required to suggest that the MOIT take into consideration approving the Tariff Ranges for the following year and post them on ERAV’s website within 15 working days after the appraisal date. The most recent tariff ranges may be temporarily in effect if the tariff ranges for the next year are not announced in time.

3. Conclusion and recommended action plan

The stated goal of MOIT Circular 19 is to offer a clear and methodical process for establishing pricing frameworks for wind and solar power generation after the FiT regime. The goals of Circular 19’s standards are to guarantee sustainability, efficiency, and justice in the nation’s growth of renewable energy projects. The Circular seeks to lay a strong basis for the sustained expansion of Vietnam’s solar and wind power industries by defining precise rules and processes. Although these are admirable and significant objectives, there is still much to be decided in order to facilitate the development of greenfield projects, most notably regarding investor selection restrictions and PPA conditions.

With regard to investment into the power sector of Vietnam, it is highly recommended that investors make necessary moves as soon as possible to reap benefits from the PDP 8 and its guiding documents, i.e. Circular 19. Regarding foreign investment protection vis-a-vis Vietnam Government, the Investor State Dispute Settlement (ISDS) will ensure highest standards of legal certainty and enforceability and protection for foreign investors in Vietnam. We recommend foreign investors to carefully select the special purpose vehicle (SPV) to represent its investment in Vietnam to enjoy the legal certainty given by the ISDS mechanism since it is going to be applied under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Under such provision of the CPTPP, for investment related disputes, the investors have the right to bring claims to the host country by means of international arbitration. The arbitration proceedings shall be made public as a matter of transparency in conflict cases.

In addition, all decision of the ISDS tribunal is directly enforceable in Vietnam and offshore against Vietnam. That is a level of legal certainty that never existed before in Vietnam. It is a game changer for bankability of transactions. By setting up entities falling under the protection of ISDS mechanism under the CPTPP, investors can enjoy maximum legal protection from the CPTPP while investing in power sector in Vietnam.

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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com if you have any questions or want to know more details on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Vietnam’s National Energy Development Strategy – Key Highlights

The Prime Minister of Vietnam has approved the National Energy Development Strategy of Vietnam to 2030, with a vision to 2045. Please kindly find below our key highlights.
On March 1, 2024, the Prime Minister issued Decision No. 215/QĐ-TTg approving the National Energy Development Strategy of Vietnam until 2030, with a vision to 2045 (“Decision 215”). This decision is to implement the Politburo of the Communist Party of Vietnam’s Resolution No. 55- NQ/TW dated 11 February 2020 on orientation of the National Energy Development Strategy of Vietnam to 2030, with a vision to 2045 (“Resolution 55”). It is worth noting that the celebrated Vietnam’s National Power Development Plan 8 (“PDP8”) was known to be prepared in line with orientations and directions in relation to power sector under Resolution 55. Thus, we believe that upcoming Plan for Implementation of PDP8 and other guidelines of PDP8 would be carefully structured and adopted in line with the National Energy Development Strategy of Vietnam under Decision 215.
Development Perspective
In brief, Decision 215 aims at (i) ensuring the national energy security for socio-economic development, (ii) prioritizing fast and sustainable energy development, (iii) adapting to climate change and aligning with the net zero emissions target by 2050; and (iv) using energy efficiently, and environmentally friendly which deemed as an important national policy and the responsibility of the whole society.
Key Goals
– Satisfy domestic energy demand, serve the objective of the 10-year Socio-Economic Development Strategy 2021 – 2030, with primary energy supply reaching about 150 – 170 million tons of oil equivalent (TOE) by 2030 and about 260 – 280 million TOE by 2045.
– Achieve the proportion of renewable energy in the total primary energy supply is 15 – 20% by 2030 and 65 – 70% by 2045.
– Build a smart, efficient electricity system, capable of safely connecting to the regional power grid; ensure safe power supply, meet criteria N-1 for important load areas and N-2 for especially important load areas.
– Oil refining facilities could satisfy at least 70% of the country’s petroleum demand; encourage for petroleum reserves to reach 75 – 80 days of net import after 2030.
– Have sufficient capacity to import liquefied natural gas (LNG) of about 15 – 20 billion m3 in 2030 and about 10 – 15 billion m3 in year 2045. \
– Reduce greenhouse gas emissions from energy activities compared to the normal development scenario by 15 – 35% by 2030, up to 70 – 80% by 2045.
Legal Implementation
Decision 215 has assigned the Ministry of Industry and Trade to coordinate with relevant ministries, agencies and localities to study and propose mechanisms and policies to implement the National Energy Development Strategy. The ministry will closely monitor the balance of energy supply and demand and the implementation of key energy programs and projects; and propose mechanisms and policies to encourage development of renewable energy projects.
Key policies and legislation are proposed for implementation of the above strategy:
– Develop a synchronous and interconnected energy market between electricity, coal, oil and gas and renewable energy sub-sectors, connecting with regional and world markets.
– Review, adjust and complete policies on land, site clearance compensation, water surface use, etc. Innovate financial policies in the direction of encouraging and strongly attracting foreign investment capital sources government;
– Encourage energy investment projects in the form of public-private partnerships (PPP).
– Amend and complete specialized laws on oil and gas, electricity, economical and efficient use of energy, and legal documents related to the energy industry in accordance with international practices and the development situation.
– Research, develop and supplement content on renewable energy in the Electricity Law (amended) to create a solid, transparent and favorable legal foundation to create momentum for the sustainable development of new and renewable energy.
– Issue regulations on authority to decide investment policies for offshore wind power projects, hydrogen/ammonia production projects using offshore wind power, and offshore wind power export projects.
– Promulgate a pilot, moving towards officially building a direct power purchase contract mechanism between renewable energy power producers and consumers in synchronization with amendments to the Electricity Law and roadmap for implementing the electricity market compete.
– Research and develop fee collection regulations for direct power purchase contracts (DPPA).
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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com if you have any questions or want to know more details on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Anwalt in Vietnam Dr. Oliver Massmann Corporate Sustainability Due Diligence Directive (CSDDD oder das EU-Lieferkettengesetz): Umfassende Analyse und Ausblick auf die Auswirkungen auf Unternehmen in Vietnam

In den letzten Jahren wurde dem Thema Nachhaltigkeit in der Europäischen Union eine immer höhere Priorität eingeräumt und dessen Schlüsselrolle bei der Bewältigung globaler Herausforderungen erkannt. So wurden verschiedene gesetzliche Rahmenbedingungen geschaffen, um Aspekte aus den Bereichen Umwelt, Soziales und verantwortungsvolle Unternehmensführung (ESG) in Unternehmensstrategien zu integrieren, darunter die Richtlinie zur nichtfinanziellen Berichterstattung (NFRD), die EU-Offenlegungsverordnung (SFDR), die EU-Taxonomie-Verordnung, die Richtlinie über die Nachhaltigkeitsberichterstattung von Unternehmen (CSRD) usw.
In jüngster Zeit haben auch einzelne EU-Mitgliedstaaten eigene Lieferkettengesetze erlassen, welche in Umfang und Rechtswirkung voneinander divergieren. In dem Bestreben, eine gemeinsame Grundlage für alle Mitgliedstaaten zu schaffen, will der europäische Gesetzgeber den bestehenden regulatorischen Flickenteppich durch die Richtlinie über die Sorgfaltspflichten von Unternehmen im Hinblick auf Nachhaltigkeit (CSDDD), gemeinhin als das EU-Lieferkettengesetz bezeichnet, ablösen.
Die Richtlinie, über die momentan in der EU intensiv diskutiert wird, soll einen umfassenden Rahmen für die Sorgfaltspflicht von Unternehmen schaffen, um negative Auswirkungen auf Menschenrechte, Umwelt und verantwortungsvolle Unternehmensführung in der gesamten Lieferkette zu erkennen, zu verhindern und zu mildern. Die CSDDD wird voraussichtlich ein breites Spektrum von Unternehmen abdecken und Auswirkungen auf verschiedene Branchen und Sektoren haben.
Trotz der Unwägbarkeiten, die mit der Umsetzung verbunden sind, würde die CSDDD – im Falle ihres Inkrafttretens – Unternehmen, einschließlich derer, die in Vietnam tätig sind, erhebliche Verpflichtungen in Bezug auf die Einhaltung ihrer Bestimmungen sowie die wirksame Durchsetzung der Sorgfaltspflicht auferlegen. Da sich die Gesetzeslandschaft ständig ändert, sollten Unternehmen wachsam bleiben und sich auf mögliche Änderungen ihrer Sorgfalts- und Nachhaltigkeitspflichten einstellen.
CSDDD – Überblick
Aktueller Stand
Die Umsetzung der Richtlinie ist in der Schwebe, da mehrere Mitgliedstaaten, allen voran Deutschland, Bedenken hinsichtlich des damit verbundenen bürokratischen Aufwands und einer drohenden Beeinträchtigung der Wettbewerbsfähigkeit europäischer Unternehmen haben. Die ursprünglich für den 9. Februar 2024 geplante, dann auf den 14. Februar und schließlich auf den 28. Februar 2024 verschobene Abstimmung im Europäischen Rat ist indes gescheitert. Nach diesem jüngsten Rückschlag erscheint eine Verabschiedung der Richtlinie vor den Europawahlen im Juni 2024 unwahrscheinlich.
Anwendungsbereich (Pflichtenadressaten)
Sollte die Richtlinie in Kraft treten und von den Mitgliedstaaten umgesetzt werden, wären Pflichtenadressaten Unternehmen unabhängig von ihrer Rechtsform, einschließlich KMU sowie bestimmte in der Richtlinie näher aufgeführte beaufsichtigte Finanzunternehmen.
Im Einzelnen werden Unternehmen erfasst, die nach dem Recht eines Mitgliedstaats gegründet wurden und eine der folgenden Voraussetzungen erfüllen („Kategorie 1“):
• Das Unternehmen hatte im letzten Geschäftsjahr, für das ein Jahresabschluss erstellt wurde, im Durchschnitt mehr als 500 Beschäftigte und einen weltweiten Nettoumsatz von über 150 Mio. EUR.
• Das Unternehmen erreichte die o.g. Schwellenwerte nicht, hatte aber im letzten Geschäftsjahr, für das ein Jahresabschluss erstellt wurde, im Durchschnitt mehr als 250 Beschäftigte und einen weltweiten Nettoumsatz von über 40 Mio. EUR, sofern mindestens 50 % hiervon in einem oder mehreren der folgenden Sektoren erwirtschaftet wurden:
o Herstellung von Textilien, Leder und verwandten Erzeugnissen (einschließlich Schuhe) sowie Großhandel mit Textilien, Bekleidung und Schuhen;
o Landwirtschaft, Forstwirtschaft, Fischerei (einschließlich Aquakultur), Herstellung von Lebensmittelprodukten und Großhandel mit landwirtschaftlichen Rohstoffen, lebenden Tieren, Holz, Lebensmitteln und Getränken;
o Gewinnung mineralischer Ressourcen unabhängig davon, wo sie gewonnen werden (einschließlich Rohöl, Erdgas, Steinkohle, Braunkohle, Metalle und Metallerze sowie aller anderen, nichtmetallischen Mineralien und Steinbruchprodukte), Herstellung von Grundmetallerzeugnissen, sonstigen Erzeugnissen aus nichtmetallischen Mineralien und Metallerzeugnissen (ausgenommen Maschinen und Ausrüstungen) sowie Großhandel mit mineralischen Rohstoffen, mineralischen Grunderzeugnissen und Zwischenerzeugnissen (einschließlich Metalle und Metallerze, Baustoffe, Brennstoffe, Chemikalien und andere Zwischenprodukte).
Darüber hinaus sollen die Verpflichtungen auch für nach den Rechtsvorschriften eines Drittlandes gegründete Unternehmen gelten, welche eine der folgenden Voraussetzungen erfüllen („Kategorie 2“):
• Das Unternehmen erzielte im Geschäftsjahr vor dem letzten Geschäftsjahr in der Union einen Nettoumsatz von mehr als 150 Mio. EUR.
• Das Unternehmen erzielte im Geschäftsjahr vor dem letzten Geschäftsjahr in der Union einen Nettoumsatz von mehr als 40 Mio. EUR, aber nicht mehr als 150 Mio. EUR, sofern mindestens 50 % seines weltweiten Nettoumsatzes in einem oder mehreren der o.g. Sektoren erwirtschaftet wurden.
Inhalt – Was Unternehmen mit Sitz in Vietnam wissen müssen?
Hauptpflichten
Unternehmen sollen ihre Sorgfaltspflicht durch die folgenden Maßnahmen erfüllen und zu diesem Zweck Ressourcen und Informationen mit ihrer jeweiligen Unternehmensgruppe im Einklang mit dem geltenden Wettbewerbsrecht austauschen:
• Einbeziehung der Sorgfaltspflicht in ihre Unternehmenspolitik: Dies beinhaltet insbesondere die Aufnahme einer jährlich zu aktualisierenden Strategie zur Erfüllung der Sorgfaltspflicht, die den (langfristig) verfolgten Ansatz, einen von Beschäftigten und Tochterunternehmen einzuhaltenden Verhaltenskodex sowie eine Beschreibung der diesbezüglichen Verfahren und Überprüfungsmaßnahmen umfasst.
• Ermittlung tatsächlicher oder potenzieller negativer Auswirkungen auf die Menschenrechte und die Umwelt, die sich aus den Tätigkeiten des Unternehmens (einschließlich aus jener seiner Tochtergesellschaften und – sofern sie mit ihren Wertschöpfungsketten im Zusammenhang stehen – aus ihren etablierten Geschäftsbeziehungen) ergeben, durch „geeignete Maßnahmen“. Für Unternehmen der 2. Kategorie beschränkt sich die Verpflichtung auf den jeweils relevanten Sektor, während Finanzunternehmen die Auswirkungen bereits vor Erbringung der betreffenden Dienstleistung ermitteln sollen. In jedem Fall sollen Unternehmen die Möglichkeit haben, auf angemessene Ressourcen zuzugreifen sowie Konsultationen mit potenziell betroffenen Arbeitnehmern/Interessenträgern zwecks Informationssammlung durchzuführen.
• An die Ermittlung schließt sich ein abgestuftes Regelungskonzept an, welches der Unterscheidung zwischen „potenziellen“ und „tatsächlichen“ negativen Auswirkungen Rechnung trägt:
o Potenzielle negative Auswirkungen sollen mithilfe geeigneter Maßnahmen primär vermieden und — wenn dies nicht (unmittelbar) möglich ist — angemessen abgeschwächt werden. Dies schließt ggf. die folgenden Verpflichtungen ein:
 Entwicklung eines „Präventionsaktionsplans“ mit angemessenen und klar festgelegten Zeitplänen für Maßnahmen sowie qualitativen und quantitativen Indikatoren zur Messung von Verbesserungen;
 Einholung vertraglicher Zusicherungen von direkten Geschäftspartnern — und von deren Partnern, soweit ihre Tätigkeiten Teil der Wertschöpfungskette des Unternehmens sind (sog. Vertragskaskaden) — bezüglich der Einhaltung des Verhaltenskodex des Unternehmens und erforderlichenfalls der Sicherstellung eines Präventionsplans;
 Tätigung notwendiger Investitionen in diesem Zusammenhang;
 Gezielte und verhältnismäßige Unterstützung von KMU, mit denen das Unternehmen eine etablierte Geschäftsbeziehung unterhält, sofern die Einhaltung des Verhaltenskodex oder des Präventionsaktionsplans die Tragfähigkeit des KMU gefährden würde;
 Zusammenarbeit mit anderen Unternehmen im Einklang mit den Unionsrecht zwecks Verbesserung der Fähigkeit des Unternehmens zur Behebung negativer Auswirkungen, insbesondere wenn keine anderen Maßnahmen geeignet oder wirksam sind;
 Bemühungen des Unternehmens zum Abschluss von Verträgen mit indirekten Partnern für den Fall, dass die Vermeidung/Abschwächung der Auswirkungen nicht möglich ist, und Flankierung der vertraglichen Zusicherungen durch geeignete Maßnahmen zur Überprüfung ihrer Einhaltung. Zur Erleichterung von KMU sieht die Richtlinie vor, dass die angewandten Bedingungen fair, angemessen und nichtdiskriminierend sein müssen und die Überprüfungskosten durch das Unternehmen zu tragen sind;
 Tragen die o.g. Maßnahmen zu einer Vermeidung/Abschwächung nicht bei, darf das Unternehmen mit dem direkten/indirekten Partner, von dem die Auswirkungen ausgehen, keine neuen Beziehungen eingehen bzw. bestehende ausbauen; sofern dies gesetzlich vorgesehen ist und zu erwarten ist, dass gleichzeitige Bemühungen zur Vermeidung/Abschwächung kurzfristig erfolgreich sein werden, sind die Geschäftsbeziehungen mit diesem vorübergehend auszusetzen bzw. — bei schwerwiegenden Auswirkungen — zu beenden. Abweichend hiervon sind Finanzunternehmen nicht zur Kündigung bestehender Kredit-, Darlehens- oder Finanzdienstleistungsverträge verpflichtet, wenn dies nach vernünftigem Ermessen zu einem erheblichen Schaden für den Dienstleistungsempfänger führen würde.
o Tatsächliche negative Auswirkungen sollen primär behoben und — wenn dies nicht möglich ist — in ihrem Ausmaß minimiert werden. Dies umfasst ggf. die nachfolgenden Verpflichtungen:
 Neutralisierung/Minimierung der Auswirkungen durch Zahlung von Schadensersatz/finanzieller Entschädigung an die betroffenen Personen/Gemeinschaften;
 Entwicklung und Umsetzung eines Korrekturmaßnahmenplans mit angemessenen und klar festgestellten Zeitplänen für Maßnahmen, für den Fall, dass dies aufgrund der fehlenden (unmittelbaren) Behebung der Auswirkungen notwendig ist;
 Vertragliche Zusicherung eines direkten Partners bei etablierter Geschäftsbeziehung (sowie seiner Partner bei sog. Vertragskaskaden) zur Sicherstellung der Einhaltung des Verhaltenskodexes und ggf. des Korrekturmaßnahmenplans, flankiert von geeigneten Maßnahmen zur Überprüfung. Zur Erleichterung von KMU sieht die Richtlinie vor, dass die angewandten Bedingungen fair, angemessen und nichtdiskriminierend sein und die Überprüfungskosten durch das Unternehmen getragen werden müssen;
 Tragen die o.g. Maßnahmen zur einer Behebung/Minimierung nicht bei, darf das Unternehmen mit dem direkten/indirekten Partner, von dem die Auswirkungen ausgehen, keine neuen Beziehungen eingehen oder bestehende ausbauen. Abweichend hiervon sind Finanzunternehmen nicht zur Kündigung bestehender Kredit-, Darlehens- oder Finanzdienstleistungsverträge verpflichtet, wenn dies nach vernünftigem Ermessen zu einem erheblichen Schaden für den Dienstleistungsempfänger führen würde.
• Darüber hinaus müssen Unternehmen künftig eine in einem EU-Mitgliedstaat niedergelassene bzw. ansässige natürliche oder juristische Person als Bevollmächtigten benennen, um eine effektive Zusammenarbeit mit der – für die Überwachung der Einhaltung von Verpflichtungen zuständigen — mitgliedsstaatlichen Aufsichtsbehörde zu gewährleisten. Auch in Vietnam niedergelassene Unternehmen sollen künftig der aufsichtsbehördlichen Überwachung mit der Maßgabe unterliegen, dass für diese die Aufsichtsbehörde des Mitgliedstaats zuständig ist, in dem das Unternehmen eine Zweigstelle unterhält. Hat das Unternehmen keine Zweigstelle in einem Mitgliedstaat oder befinden sich seine Zweigstellen in verschiedenen Mitgliedstaaten, so ist die Aufsichtsbehörde des Mitgliedstaats zuständig, in dem das Unternehmen den größten Teil seines Nettoumsatzes in der Union in dem Geschäftsjahr erzielt hat, das dem letzten Geschäftsjahr, einem durch die Mitgliedstaaten näher bestimmten Zeitpunkt oder dem Zeitpunkt, an dem das Unternehmen erstmals die Kriterien der Kategorie 2 erfüllt, vorangeht, je nachdem, welcher Zeitpunkt der spätere ist. In diesem Zusammenhang soll es – im Falle einer relevanten Umstandsänderung – möglich sein, die Aufsichtsbehörde auf Antrag des Unternehmens zu wechseln.
Sonstige Bestimmungen
Die Richtlinie sieht unter anderem folgende weitere Bestimmungen vor:
• Einrichtung und Aufrechterhaltung eines Beschwerdeverfahrens durch die Mitgliedstaaten. Personen und Organisationen, die berechtigte Bedenken hinsichtlich tatsächlicher oder potenzieller negativer Auswirkungen von Unternehmen, ihren Tochterunternehmen oder Wertschöpfungsketten haben, können sich demnach bei dem Unternehmen beschweren, angemessene Folgemaßnahmen fordern und — zur Erörterung dieser Auswirkungen — mit Unternehmensvertreter auf geeigneter Ebene zusammentreffen. Das Vorliegen negativer Auswirkungen soll im Falle einer begründeten Beschwerde als ermittelt gelten.
• Überwachung der Wirksamkeit von Strategien und Maßnahmen zur Erfüllung der Sorgfaltspflicht: Unternehmen sollen mindestens alle zwölf Monate — jedenfalls aber bei begründetem Anlass zur Annahme, dass erhebliche neue Risiken im Hinblick auf negative Auswirkungen auftreten können — Bewertungen ihrer eigenen Tätigkeiten und Maßnahmen, derjenigen ihrer Tochterunternehmen oder ihrer etablierten Geschäftsbeziehungen durchführen und ihre Strategie zur Erfüllung der Sorgfaltspflicht entsprechend aktualisieren.
• Unternehmen, die nicht bereits Berufspflichten nach der Bilanz-Richtlinie (2013/34/EU) unterliegen, sollen – bis zum 30. April jedes Jahres für das vorangegangene Kalenderjahr – einen jährlichen Bericht über ihre Sorgfaltspflicht, die potenziellen und tatsächlichen negativen Auswirkungen sowie die ergriffenen Gegenmaßnahmen auf ihrer Website in einer in der internationalen Wirtschaftswelt gebräuchlichen Verkehrssprache veröffentlichen. Inhalt und Kriterien der Berichterstattung sollen durch die EU-Kommission weiter konkretisiert werden.
• Künftig werden die geplanten Leitlinien der EU-Kommission zu freiwilligen Mustervertragsklauseln, zu bestimmten Sektoren und speziellen negativen Auswirkungen zu berücksichtigen sein.
• Darüber hinaus sollen die Mitgliedstaaten zwecks Unterstützung der Unternehmen und ihrer Partner begleitend Websites, Plattformen und Portale einrichten und betreiben. Besonderes Augenmerk wird dabei auf KMU gelegt, denen die Mitgliedstaaten unbeschadet der geltenden Vorschriften für staatliche Beihilfen finanzielle Hilfe gewähren sollen.
• Die Mitgliedstaaten sollen zudem sicherstellen, dass Unternehmen, bei denen der Klimawandel als ein Hauptrisiko oder eine Hauptauswirkung ihrer Tätigkeit ermittelt wurde bzw. hätte ermittelt werden sollen, Emissionsreduktionsziele in ihre Pläne aufnehmen.
• Des Weiteren sollen Aufsichtsbehörden von Amts wegen oder bei begründeten Bedenken – im Falle drohender Beeinträchtigung der Wirksamkeit des Untersuchungserfolgs sogar ohne vorherige Warnung des betreffenden Unternehmens – Untersuchungen einleiten dürfen, gegebenenfalls im Hoheitsgebiet eines anderen Mitgliedstaates im Wege der Amtshilfe. Ergibt die Untersuchung das Vorliegen eines Verstoßes, so soll dem Unternehmen nach Möglichkeit eine angemessene Abhilfefrist eingeräumt werden, wobei etwaige von der Aufsichtsbehörde angeordnete Abhilfemaßnahmen die Verhängung verwaltungsrechtlicher Sanktionen oder eine zivilrechtliche Haftung im Schadensfall nicht ausschließen. Aufsichtsbehörden sollen in diesem Zusammenhang auch die Beendigung von Verstößen und die Unterlassung jeglicher Wiederholung anordnen, finanzielle Sanktionen verhängen und vorläufige Maßnahmen treffen dürfen. Spiegelbildlich dazu sieht die CSDDD vor, dass das Recht natürlicher Personen auf einen wirksamen gerichtlichen Rechtsbehelf gegen sie betreffende rechtsverbindliche Entscheidungen sichergestellt werden soll.
• Natürliche und juristische Personen, die einen auf objektive Umstände gestützten Grund zur Annahme haben, dass ein Unternehmen gegen die CSDDD-Vorgaben verstößt, sollen ihre begründeten Bedenken künftig vor jeder Aufsichtsbehörde geltend machen dürfen und über das Ergebnis der Prüfung jener Bedenken und der aufsichtsbehördlichen Entscheidung informiert werden. Zur Überprüfung der verfahrens- und materiell-rechtlichen Rechtmäßigkeit aufsichtsbehördlicher Entscheidungen, Handlungen oder Unterlassungen soll natürlichen und juristischen Personen der Zugang zu nationalen Gerichten oder anderen unabhängigen öffentlichen Stellen eröffnet werden.
• Die Meldung von Verstößen richtet sich nach der Whistleblower-Richtlinie und den jeweiligen mitgliedstaatlichen Umsetzungsgesetzen.
Sanktionen
Die Mitgliedstaaten sollen künftig Vorschriften über Sanktionen erlassen, wobei diese nach den Vorgaben des europäischen Gesetzgebers „wirksam, verhältnismäßig und abschreckend“ sein sollen und dabei Bemühungen des Unternehmens zur Erfüllung angeordneter Abhilfemaßnahmen, etwaige getätigte Investitionen, geleistete Unterstützung bzw. Zusammenarbeit mit anderen Stellen bei der Beseitigung negativer Auswirkungen innerhalb der Wertschöpfungsketten gebührend berücksichtigen. Wenn die Sanktionen finanzieller Natur sind, sollen sie sich ferner am Umsatz des jeweiligen Unternehmens richten.
Ein rechtliches Novum stellt die vorgesehene zivilrechtliche Haftung von Unternehmen dar, die ihren Verpflichtungen zur Vermeidung potenzieller und Behebung tatsächlicher negativer Auswirkungen nicht nachkommen und dadurch negative, schadensstiftende Auswirkungen verursachen, die hätten ermittelt, vermieden, abgeschwächt, behoben oder minimiert werden können. Dennoch sollen Unternehmen, die entsprechende Maßnahmen ergriffen haben, nicht für Schäden haften, die durch Tätigkeiten eines indirekten Partners im Rahmen einer etablierten Geschäftsbeziehung verursacht wurden, es sei denn, es wäre im Einzelfall unangemessen zu erwarten gewesen, dass die ergriffenen Maßnahmen im Hinblick auf die negativen Auswirkungen geeignet wären. Zu beachten ist jedoch, dass die Haftung des Unternehmens nicht diejenige seiner Tochterunternehmen oder direkter/indirekter Geschäftspartner ausschließt.
Auswirkungen einer möglichen Umsetzung der CSDDD auf Unternehmen mit Sitz in Vietnam
Sollte die CSDDD in Kraft treten und umgesetzt werden, werden EU-Unternehmen der 1. Kategorie ihre Sorgfaltspflichten auf ihre Geschäftspartner – auch im EU-Ausland – ausdehnen. Damit würden indirekt auch Unternehmen mit Sitz in Vietnam, die eng in die Wertschöpfungsketten dieser EU-Unternehmen eingebunden sind, in die Pflicht genommen. Indes beschränkt sich die CSDDD nicht auf indirekte Auswirkungen, sondern dehnt ihren Anwendungsbereich ausdrücklich auf Unternehmen mit Sitz in Drittländern aus. Entsprechend wären vietnamesische Unternehmen oder Unternehmen mit Niederlassungen in Vietnam direkte Adressaten der Verpflichtungen der Kategorie 2.

Von (in)direkter Relevanz für vietnamesische Unternehmen wären darüber hinaus die von den Mitgliedstaaten zu erlassenden Sanktionsvorschriften sein.
Investitionen in und die Einführung von nachhaltigen Technologien und Praktiken sowie juristische Beratung zu geeigneten Strategien in diesem Zusammenhang und zur Risikominimierung wären deshalb unverzichtbar. Von entscheidender Bedeutung wäre auch die Einhaltung der von den Aufsichtsbehörden zu erlassenden Leitlinien.
Unsere Kanzlei steht Ihnen bei diesen Fragen gerne zur Verfügung und unterstützt Sie bei der Entwicklung geeigneter Strategien.
CSDDD und EVFTA
Dennoch stehen vietnamesische Unternehmen den CSDDD-Vorgaben – angesichts ihrer bestehenden Verpflichtungen im Rahmen des EVFTA, welche die Einhaltung von CSR-, Umweltstandards, Klimaprotokollen sowie den Schutz der Biodiversität umfassen – nicht völlig unvorbereitet gegenüber. Im Kapitel 13 des EVFTA wird die nachhaltige Entwicklung zu einem grundlegenden Element der bilateralen Handelsbeziehungen mit der EU erklärt. Im Lichte der EVFTA-Verpflichtungen ist Vietnam bestrebt, durch seine Gesetzgebung und Politik ein hohes Umwelt-, Arbeits- und Sozialschutzniveau zu gewährleisten und zu fördern und bemüht sich ständig um Verbesserungen. Was die Verfahrensgarantien betrifft, so unterliegen – im Gegensatz zu anderen im EVFTA erörterten Themen – alle Streitigkeiten, die sich aus Kapitel 13 über Handel und nachhaltige Entwicklung ergeben, einschließlich arbeitsrechtlicher Fragen, nicht den allgemeinen Streitbeilegungsverfahren nach Kapitel 15, sondern können vielmehr nur durch Konsultationen auf Regierungsebene oder durch Einschaltung einer Sachverständigengruppe, wie in Kapitel 13 vorgesehen, beigelegt werden.
In Bezug auf Arbeitsnormen schafft das EVFTA keine neuen Standards, sondern betont die Umsetzung der Verpflichtungen, die Vietnam und die EU als Mitglieder der IAO im Rahmen der Erklärung über grundlegende Prinzipien und Rechte bei der Arbeit und deren Folgemaßnahmen eingegangen sind, insbesondere: i) die Vereinigungsfreiheit und die wirksame Anerkennung des Rechts auf Kollektivverhandlungen, ii) die Beseitigung aller Formen der Zwangs- oder Pflichtarbeit, iii) die wirksame Abschaffung der Kinderarbeit und iv) die Beseitigung der Diskriminierung in Beschäftigung und Beruf. Bereits vor Inkrafttreten des EVFTA hat Vietnam seine Gesetze, Vorschriften und Politiken verabschiedet und angepasst, um sie mit den international anerkannten Arbeitsnormen in Einklang zu bringen. Dieser Prozess setzt sich im Zuge der Erfüllung der Verpflichtungen Vietnams im Rahmen des CPTPP und des EVFTA fort; Letzteres zeigt insbesondere die Änderung des Arbeitsgesetzbuchs im Jahr 2019.
Im Bereich des Umweltschutzes enthält das EVFTA neben Kapitel 13 ein eigenes Kapitel über nichttarifäre Handels- und Investitionshemmnisse im Bereich der Erzeugung erneuerbarer Energie. Es enthält sektorspezifische Regelungen (i) zur diskriminierungsfreien Behandlung im Allgemeinen (Genehmigungs-, Zertifizierungs- und Zulassungsverfahren), (ii) zum sog. „Local Content“ und (iii) zur Verwendung internationaler Standards.
Relevante Initiativen aus jüngster Zeit sind u.a. die Entscheidung Nr. 876/QD-TTg, die Entscheidung Nr. 500/QD-TTg zur Genehmigung des Energieentwicklungsplans VIII, das Umweltschutzgesetz Nr. 72/2020/QH14 und Der Strategische Rahmen für die Zusammenarbeit zwischen der Regierung der Sozialistischen Republik Vietnam und den Vereinten Nationen im Bereich der nachhaltigen Entwicklung für den Zeitraum 2022-2026 (“One Strategic Framework for Sustainable Development Cooperation between the Government of the Socialist Republic of Vietnam and the United Nations for the Period 2022-2026”). Daraus ergibt sich nicht zuletzt die Verpflichtung für in Vietnam tätige Unternehmen, diese Standards und die lokalen Anforderungen zu erfüllen.
Fazit
Die CSDDD enthält Verpflichtungen für Unternehmen in Bezug auf tatsächliche und potenzielle negative Auswirkungen auf Menschenrechte und Umwelt im Zusammenhang mit ihren eigenen Aktivitäten, denen ihrer Tochtergesellschaften und denen ihrer Partner in der Wertschöpfungskette, mit denen sie Geschäftsbeziehungen unterhalten. Diese Verpflichtungen, die von den Mitgliedstaaten umgesetzt werden müssen, gelten auch für Unternehmen, die in Vietnam tätig sind und deren Geschäftstätigkeit direkt oder indirekt mit der EU verbunden ist. Ob die CSDDD jedoch schließlich umgesetzt wird, erscheint derzeit jedoch fraglich.

ANWALT IN VIETNAM DR OLIVER MASSMANN MÖGLICHE RATIFIZIERUNG DES ÜBEREINKOMMENS 87 DER INTERNATIONALEN ARBEITSORGANISATION (IAO) DURCH VIETNAM

Einführung und Vietnams Bekenntnis zu den IAO-Grundprinzipien

Im Jahr 2023 kündigten Vertreter des Ministeriums für Arbeit, Invaliden und Soziales (MOLISA) bei einem Treffen mit ausländischen Experten die wahrscheinliche Ratifizierung des IAO-Übereinkommens Nr. 87 über die Vereinigungsfreiheit und den Schutz des Vereinigungsrechtes (Übereinkommen 87). Die Ratifizierung des Übereinkommens wird voraussichtlich im Oktober 2024 stattfinden.

Als IAO-Mitglied ist Vietnam zur Einhaltung der Kernarbeitsnormen gemäß der IAO-Erklärung über grundlegende Rechte bei der Arbeit aus dem Jahr 1998 verpflichtet. In jener Erklärung wird das Übereinkommen 87 als eines der zehn Kernübereinkommen benannt. Im Oktober 2022 hatten bereits 157 der 187 Mitgliedstaaten der IAO das Übereinkommen 87 ratifiziert; auch wurde Vietnam von anderen Mitgliedstaaten wiederholt ermutigt, dem Übereinkommen baldmöglichst beizutreten.

Grundlegende Bestimmungen des Übereinkommens 87

Hervorzuheben ist, dass das Übereinkommen 87 die folgenden grundlegenden Rechte festschreibt:

(i) Vereinigungsfreiheit der Arbeitnehmer: Die Arbeitnehmer haben das Recht, frei und ohne vorherige Genehmigung Gewerkschaften ihrer Wahl zu gründen und ihnen beizutreten.

(ii) Gewerkschaftsautonomie: Gewerkschaften haben das Recht auf unabhängige Regelung ihrer internen Angelegenheiten. Dazu gehören die Ausarbeitung von Satzungen und die Umsetzung interner Vorschriften, die Wahl von Vertretern sowie die Ausarbeitung und Umsetzung von Arbeitsplänen.

(iii) Recht auf Mitgliedschaft in übergeordneten Organisationen: Die Gewerkschaften haben das Recht, übergeordneten Gewerkschaftsorganisationen beizutreten, die ihren beruflichen und regionalen Tätigkeitsbereich abdecken, sowohl auf nationaler als auch auf internationaler Ebene. Diese übergeordneten Organisationen haben die gleichen Rechte wie die Basisgewerkschaften.

(iv) Schutz vor staatlichen Eingriffen: Arbeitnehmerorganisationen haben das Recht, ihre Tätigkeit auszuüben, ohne eine Auflösung oder Suspendierung durch die zuständigen Regierungsbehörden befürchten zu müssen.

Fazit
Zusammenfassend ist die zu erwartende Ratifizierung der Konvention 87 durch Vietnam ein Zeichen für das Engagement des Landes zur Wahrung der grundlegenden Arbeitnehmerrechte und zur Angleichung an die internationalen Arbeitsnormen.

Wir werden Sie über alle relevanten Informationen zu diesem Thema auf dem Laufenden halten, sobald sie vorliegen.

Corporate Sustainability Due Diligence Directive (CSDDD or the EU Supply Chain Law): A Comprehensive Analysis and Review of its Implications on Vietnam-based Companies

In recent years, the European Union has increasingly prioritized sustainability, recognizing its fundamental role in addressing global challenges. Various legislative frameworks have been put in place to integrate environmental, social, and governance (ESG) considerations into corporate strategies, including the Non-Financial Reporting Directive (NFRD), the Sustainable Finance Disclosure Regulation (SFDR), the EU Taxonomy Regulation, the Corporate Sustainability Reporting Directive (CSRD) etc.
Recent developments have also seen individual EU Member States enact their own supply chain laws, varying in scope and legal consequences. Seeking to establish a common baseline across Member States, the European legislator aims to complement existing regulations with the Corporate Sustainability Due Diligence Directive (CSDDD), commonly referred to as the “EU Supply Chain Law”.
The directive, currently under discussion within the EU, aims to establish a comprehensive due diligence framework, requiring companies to identify, prevent, and mitigate adverse impacts on human rights, the environment, and good governance throughout their supply chains. The CSDDD is anticipated to cover a broad spectrum of entities, impacting various industries and sectors.
Despite the uncertainties surrounding its implementation, the CSDDD, if enacted, would impose substantial responsibilities on companies, including those operating in Vietnam, necessitating compliance with the directive’s provisions and engaging in effective due diligence practices. As the legislative landscape evolves, companies should remain vigilant and be prepared for potential changes to their sustainability and due diligence obligations.
CSDDD – Overview
Status
The implementation of the directive is at risk of collapsing due to the concerns of several Member States, led by Germany, about the bureaucratic burdens involved and the potential impact on the competitiveness of European companies. The European Council vote, originally scheduled for 9 February 2024, then postponed to February 14 and finally held on 28 February 2024, failed. With this latest setback, it seems unlikely that the Directive will be adopted before the European Parliament elections in June 2024.
Scope (Addressees of Obligations)
If the directive comes into effect and is implemented by the Member States, the obligated entities would include companies, irrespective of their legal form and size, including SMEs and certain regulated financial undertakings outlined in the directive.
The obligations set out in the directive should apply to companies established under the laws of a Member State meeting the following criteria (“Category 1”):
• The company had, on average, more than 500 employees and a global net turnover of more than EUR 150 million in the last financial year for which annual financial statements have been prepared; or
• The company did not meet the above thresholds but had, on average, more than 250 employees and a global net turnover of more than EUR 40 million in the last financial year, with at least 50% of it generated in one or more of the following specific sectors:
o the manufacture of textiles, leather and related products (including footwear), and the wholesale trade of textiles, clothing and footwear;
o agriculture, forestry, fisheries (including aquaculture), the manufacture of food products, and the wholesale trade of agricultural raw materials, live animals, wood, food, and beverages;
o the extraction of mineral resources regardless from where they are extracted (including crude petroleum, natural gas, coal, lignite, metals and metal ores, as well as all other, non-metallic minerals and quarry products), the manufacture of basic metal products, other non-metallic mineral products and fabricated metal products (except machinery and equipment), and the wholesale trade of mineral resources, basic and intermediate mineral products (including metals and metal ores, construction materials, fuels, chemicals and other intermediate products).
In addition, obligations apply to companies established under the laws of a third country fulfilling one of the following conditions (“Category 2”):
• The company generated a net turnover in the EU of more than EUR 150 million in the financial year preceding the last financial year; or
• The company generated a net turnover in the EU of more than EUR 40 million but not more than EUR 150 million in the financial year preceding the last financial year, with at least 50% of its global net turnover generated in one or more of the above mentioned sectors.
Content – What Vietnam-based Companies Must Know?
Key Obligations
Companies are expected to fulfill their due diligence obligations through the following measures and exchange resources and information with their respective groups of companies and with other legal entities in accordance with applicable competition law:
• Integration of due diligence into their corporate policy, including an annually updated due diligence policy containing a description of the company’s approach (in the long term), a code of conduct (CoC) for employees and subsidiaries, and a description of related processes and measures taken to verify compliance with the CoC and to extend its application to established business relationships.
• Identification of actual or potential adverse human rights and environmental impacts arising from the company’s operations (or those of their subsidiaries and – where related to their value chains – from their established business relationships) through “appropriate measures.” For Category 2 companies, the obligation is limited to the relevant sector, while financial entities should identify impacts before providing the relevant service. In any case, companies shall, where relevant, also carry out consultations with potentially affected groups including workers and other relevant stakeholders to gather information on actual or potential adverse impacts.
• A tiered regulatory concept follows the identification, distinguishing between potential and actual adverse impacts:
o Potential adverse impacts should primarily be prevented and – if not (immediately) possible – adequately mitigated. This may include:
 the development of a “prevention action plan” with defined timelines and indicators for measuring improvement;
 obtaining contractual assurances from direct business partners within an established business relationship – and from their partners, to the extent that their activities are part of the company’s value chain (contractual cascading) – ensuring the compliance with the company’s CoC and and, as necessary, a prevention action plan;
 necessary investments;
 targeted and proportionate support for SMEs with which the company has an established business relationship, where compliance with the CoC or the prevention action plan would jeopardise their viability;
 collaboration with other entities compliant with Union law for the purpose of increasing the company’s ability to bring the adverse impact to an end, in particular where no other action is suitable or effective;
 efforts to conclude contracts with indirect partners accompanied by appropriate measures to verify compliance, in case the potential adverse impacts could not be prevented/mitigated by the measures listed above; to facilitate SMEs, the CSDDD stipulates that the terms used shall be fair, reasonable and non-discriminatory and costs of verification measures shall be borne by the company;
 If the measures stated above are ineffective, the company shall refrain from entering into new or extending existing relations with the partner in connection with or in the value chain of which the impact has arisen; the company shall – insofar as it is entitled to do so and there is reasonable expectation of a short-term-success – temporarily suspend connections with the partner in question or – in the event of severe impacts – terminate the business relationship. Financial entities shall not be obliged to terminate existing credit, loan, or financial service contracts when this can be reasonably expected to cause substantial prejudice to the entity to whom that service is being provided.

o Actual adverse impacts should be primarily brought to an end or – if not possible – minimized in their extent. This may involve:
 neutralizing/minimizing the extent of impacts, including through payment of damages /financial compensation to affected individuals/communities;
 developing and implementing a corrective action plan with reasonable and clearly defined timelines, if the adverse impact cannot be immediately brought to an end;
 obtaining contractual assurances from direct business partners within an established business relationship – and from their partners in case of contractual cascading – ensuring the compliance with the company’s CoC and, as necessary, a prevention action plan; to facilitate SMEs, the CSDDD stipulates that the terms used shall be fair, reasonable and non-discriminatory and costs of verification measures shall be borne by the company;
 If those measures are ineffective, the company shall refrain from establishing new relations or expanding existing ones with the partner causing the impacts. Financial entities shall not be obliged to terminate existing credit, loan, or financial service contracts when this can be reasonably expected to cause substantial prejudice to the entity to whom that service is being provided.
• Companies must also designate a legal or natural person established or domiciled in an EU Member State as an authorized representative to facilitate effective cooperation with the supervisory authority responsible for monitoring compliance obligations. Companies established in Vietnam will be subject to supervisory scrutiny, with the competent authority being that of the Member State in which the company has a branch. If the company has no branch in a Member State or has branches in different Member states, the authority of the Member State in which the company generated most of its Union net turnover in the financial year preceding the last financial year, preceding a certain date to be specified by the Member States or the time when the company first met the Category 2 criteria, whichever comes last, will be responsible. In the event of a significant change in circumstances, the company may request to change the competent supervisory authority.
Other Provisions
The directive includes the following additional provisions:
• Member States must establish and maintain a complaints procedure. Individuals and organizations with legitimate concerns about the actual or potential adverse impacts of a company’s operations, operations of its subsidiaries and value chains can submit complaints to the company, demand appropriate follow-up actions, and meet with company representatives for discussions. In the case of a well-founded complaint, the adverse impact that is the subject matter of the complaint is deemed to be identified.
• Monitoring the effectiveness of the company’s own operations and measures, those of their subsidiaries and, where related to the value chains of the company, those of their established business relationships regarding the identification, prevention, mitigation, bringing to an end and minimization of the extent of human rights and environmental adverse impacts; the assessments shall be carried out at least every 12 months and whenever there are reasonable grounds to believe that significant new risks regarding adverse impacts may arise. The company shall update its due diligence policy accordingly.
• Companies not subject to reporting requirements under the Accounting Directive (2013/34/EU) shall submit an annual statement on due diligence, potential and actual adverse impacts, and actions taken on those on their website in a language customary in the sphere of international business, by April 30 of each year. The EU Commission will further specify the content and criteria for reporting.
• Planned guidelines by the EU Commission will include model contract clauses and specific sectors or adverse impacts.
• Member States shall, furthermore, establish and operate websites, platforms, or portals to support companies and their partners as accompanying measures. The focus of this support, especially for SMEs, is emphasized, with Member States expected to financially support SMEs without prejudice to applicable State aid rules.
• Member States shall ensure that companies include emission reduction targets in their plans if climate change is or should have been identified as a principal risk for or impact of their business activities or should have been identified as such.
• Supervisory authorities should be able to initiate inspections – without prior warning to the company where this hinders the effectiveness of the inspection – on their own motion or upon substantiated concerns. Inspections may even be conducted in the territory of another Member State through mutual assistance. If a violation is found, the company shall be given an appropriate remedy period, and measures imposed by the supervisory authority do not preclude administrative sanctions or civil liability in case of damage. In this context, the supervisory authorities shall be empowered to order the cessation of infringements, the abstention from any repetition, impose pecuniary sanctions and adopt interim measures. Inversely, the directive aims to ensure the right of individuals to an effective judicial remedy against legally binding decisions by supervisory authorities concerning them.
• Natural and legal persons with objective grounds to believe that a company is violating national provisions adopted pursuant to the CSDDD shall be able to submit their substantiated concerns to any supervisory authority and be informed of the outcome of the examination and the supervisory decision. Access to national courts or other independent and impartial public bodies shall be granted to review the procedural and substantive legality of supervisory decisions, acts or failures to act.
• The reporting of breaches and the protection of reporting persons shall follow the Whistleblower Directive and the respective national implementation laws.
Sanctions
Member States shall enact rules on sanctions, complying with the European legislator’s directive for them to be “effective, proportionate, and dissuasive”. Efforts by the company to comply with any required remedial actions, any investments made, targeted support provided, as well as collaboration with other entities in mitigating adverse impacts within value chains should be duly taken into account. If financial sanctions are imposed, they shall also be based on the company’s turnover.
A legal novelty is the proposed civil liability for companies that fail to fulfill their obligations to prevent potential and remedy actual adverse impacts that could have been identified, avoided, mitigated, remedied, or minimized in their extend, resulting in damaging consequences. However, companies that have taken appropriate actions shall not be liable for damages caused by an adverse impact arising from activities of an indirect partner in the context of an established business relationship unless it was be unreasonable to expect that the actions taken regarding the adverse impacts are adequate. It should be noted that the company’s liability does not exclude that of its subsidiaries or direct/indirect business partners.
Implications of the Potential Implementation of the CSDDD on Vietnam-based Companies
In the event of the CSDDD coming into effect, EU companies falling under Category 1 will extend their due diligence obligations to their business partners, including those overseas. As a result, even companies based in Vietnam closely linked to the value chains of these EU entities, would be indirectly held accountable. However, the CSDDD does not limit itself to indirect effects but explicitly extends its scope to companies based in third countries. Thus, Vietnamese companies or companies with branches in Vietnam would be direct addressees of Category 2 obligations.
Moreover, the rules on sanctions to be adopted by Member States will also be (in-)directly relevant for Vietnamese companies.
Therefore, investment in and adoption of sustainable technologies and practices, coupled with legal advice on appropriate strategies, will be critical in this context and for risk mitigation. Going forward, it will also be essential to comply with regulatory guidelines issued by the supervisory authorities.
Our firm is ready to assist and guide you in these matters and to help you develop appropriate strategies.
CSDDD and EVFTA
Nevertheless, Vietnamese companies are unlikely to be caught completely off guard by these commitments. Given their existing commitments under the EVFTA, encompassing CSR and environmental standards, climate protocols and biodiversity protection, they are not entirely unprepared. Chapter 13 of the EVFTA integrates sustainable development as a fundamental component of the bilateral trade relations with the EU. In light of the EVFTA commitments, Vietnam is striving to ensure and promote a high level of environmental, labor and social protection through its legislation and policies, and is constantly seeking to improve. Regarding procedural guarantees, unlike other topics discussed within the EVFTA framework, any dispute arising from Chapter 13 relating to trade and sustainable development, including labor, is not subject to the general dispute settlement procedures under Chapter 15. Discussion on labor issues can only be settled through government-to-government consultations or panel of expert as stipulated under Chapter 13.
In terms of labor standards, the EVFTA does not create any new standards, but emphasises the implementation of commitments that Vietnam and the EU made to as members of the ILO and it’s Declaration on Fundamental Principles and Rights at Work, and its follow-up, specifically: i) the freedom of association and the effective recognition of the right to collective bargaining, ii) the elimination of all forms of forced or compulsory labor, iii) the effective abolition of child labor; and iv) the elimination of discrimination in respect of employment and occupation. Prior to the entry into force of the EVFTA, Vietnam had already adopted and adjusted its laws, regulations, and policies to be in line with internationally recognized labor standards. This process continues as Vietnam fulfils its obligations under both the CPTPP and the EVFTA, notably the amended Labor Code in 2019.
In terms of environment protection, in addition to Chapter 13, the EVFTA also contains a dedicated chapter on Non-tariff Barriers to Trade and Investment in Renewable Energy Generation. It covers specific rules for the renewable energy sector (i) on non-discriminatory treatment in general (licensing and authorization procedures), (ii) on local content in particular, and further (iii) on the use of international standards.
Relevant recent initiatives include Decision No. 876/QD-TTg, Decision No. 500/QD-TTg on the issuance of the Power Development Plan VIII, Law No. 72/2020/QH14 on Environmental Protection, and the “One Strategic Framework for Sustainable Development Cooperation between the Government of the Socialist Republic of Vietnam and the United Nations for the Period 2022-2026”, among others. These necessarily imply a number of obligations for companies operating in Vietnam to adhere to these standards and local requirements.
Conclusion
The CSDDD sets out obligations for companies concerning actual and potential adverse impacts on human rights and the environment related to their own activities, those of their subsidiaries, and their partners in the value chain with whom they maintain established business relationships. These obligations, potentially to be implemented by the Member States, also extend to companies operating in Vietnam with business activities directly or indirectly linked to the EU. At present, however, the chances of the CSDDD being enacted seem uncertain.
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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com if you have any questions on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

POTENTIAL RATIFICATION OF CONVENTION 87 OF THE INTERNATIONAL LABOUR ORGANIZATION (ILO) BY VIETNAM

Introduction and Vietnam’s Commitment to ILO Standards

In 2023, during a meeting with foreign experts, officials-in-charge from the Ministry of Labour, War Invalids and Social Affairs (MOLISA) announced the anticipated ratification of Convention No. 87 (Convention 87) of the ILO concerning Freedom of Association and Protection of the Right to Organise. This ratification is expected to occur in October 2024.

As a member of the ILO, Vietnam is obligated to uphold the core labour principles outlined in the 1998 ILO Declaration on Fundamental Principles and Rights at Work. This declaration designates Convention 87 as one of the ten essential conventions. As of October 2022, 157 out of the ILO’s 187 member states have ratified Convention 87, and Vietnam has faced persistent encouragement from other member countries to join suit as soon as feasible.

Key provisions of Convention 87

It is worth noting that Convention 87 establishes the following fundamental rights:

(i) Employee Right to Unionize: Employees have the right to freely establish and join trade unions of their choosing without seeking prior permission.

(ii) Trade Union Autonomy: Trade unions have the right to conduct their internal affairs independently, including the issuance of charters and the implementation of internal regulations, electing representatives, and developing and implementing work plans.

(iii) Right to Join Higher-Level Organizations: Trade unions have the right to join higher-level labor organizations, aligned with their occupational and regional spheres, both domestically and internationally. These higher-level organizations enjoy the same rights as grassroots unions.

(iv) Protection from Government Interference: Labor organizations have the right to operate without being dissolved or suspended by the government’s competent authorities.

Conclusion

In summary, the anticipated ratification of Convention 87 by Vietnam signifies their commitment to upholding core labor rights and aligning themselves with international labor standards.

We will keep you updated on any relevant information on this subject as it becomes available.

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Please do not hesitate to contact Dr. Oliver Massmann under omassmann@duanemorris.com or any other lawyer listed in our office list if you have any questions on the above. Dr. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Anwalt in Vietnam Dr. Oliver Massmann – SCHLÜSSELAUFGABEN VOM PREMIERMINISTER FÜR DAS JAHR 2024 UND DER STATUS VIETNAMS ALS SCHWELLENMARKT – WAS SIE WISSEN MÜSSEN

Am 15. Februar 2024 hat Premierminister Pham Minh Chinh die Richtlinie Nr. 06/CT-TTg über die Umsetzung vonSchlüsselaufgaben nach dem Mondneujahr 2024 (“Richtlinie 06”) erlassen. In der Richtlinie 06 würdigt der Premierminister die Bemühungen der zuständigen Ministerien, Ortschaften und der Bevölkerung zur Vorbereitung und Organisation des Mondneujahrsfestes 2024. Da das Mondneujahrsfest 2024 jedoch bereits vorbei ist, weist der Premierminister darauf hin, dass bestehende Probleme gelöst und Arbeiten unmittelbar nach dem Fest ohne Verzögerung durchgeführt werden müssen. Dementsprechend müssen die zugewiesenen Aufgaben und Lösungen im Zusammenhang mit der Produktions- und Wirtschaftsförderung, der Schaffung von Arbeitsplätzen sowieder Sicherung des Lebensunterhalts der Bevölkerung weiterhin zügig umgesetzt werden. Im Rahmen der Richtlinie 06 wird den zuständigen Behörden dringend nahegelegt, folgende Schlüsselaufgaben zu erfüllen:
(i) Beschleunigung des Baufortschritts wichtiger nationaler Verkehrsinfrastrukturprojekte wie der östlichen Nord-Süd-Autobahn, der Autobahn Dong Dang (Lang Son) – Tra Linh (Cao Bang), der Autobahn Ninh Binh – Nam Dinh – Thai Binh – Hai Phong, der Ringstraßen Nr. 4 in Hanoi und Nr. 3 in Ho-Chi-Minh-Stadt, des internationalen Flughafens Long Thanh, des Terminals 3 des internationalen Flughafens Tan Son Nhat, der 500-kV-Übertragungsleitung von Quang Trach (Quang Binh) nach Pho Noi (Hung Yen) usw.;
(ii) Beschleunigung der Vorbereitung des 5-Jahres-Landnutzungsplans für den Zeitraum 2021-2025, welcher dem Ministerium für Naturressourcen und Umwelt vorzulegen ist;
(iii) Beschleunigung der Vorbereitung eines Personalentwicklungsprojekts in der Halbleiterindustrie für den Zeitraum 2024-2030 zur Ausbildung von ca. 50bis 100 Tausend Halbleiterchip-Ingenieure;
(iv) Führung einer angemessenen und zielgerichteten Expansionspolitik. Fokussierung auf die effektive Erfüllung der staatlichen Finanz- und Haushaltsaufgaben im Jahr 2024; strikte Verwaltung von Einnahmequellen, gründliche Einsparungen, insb. bei wiederkehrenden und nicht dringenden Ausgaben gemäß dem Beschluss 01/NQ-CP der Regierung und der Richtlinie Nr. 01/CT-TTg des Premierministers; Vorlage eines Plans zur Nutzung der Quelle für die Erhöhung der zentralen Haushaltseinnahmen im Jahr 2023;
(v) Zusammenarbeit zwischen dem Finanzministerium, der Staatsbank von Vietnam und dem Ministerium für Planung und Investitionen, um dringend offene Fragen im Zusammenhang mit der Aufwertung des Aktienmarktes von einem Grenzmarkt zu einem Schwellenmarkt zu klären. Das Ergebnis soll dem Premierminister bis zum 30. Juni 2024 vorgelegt werden. In diesem Kontext hat Duane Morris Vietnam LLC am 6. April 2023 einen Artikel über die Position und das Potenzial Vietnams auf dem Weg zum Schwellenmarkt veröffentlicht, in welchem der Aktionsplan für Vietnam detailliert dargelegt wurde. Bitte lesen Sie dazu unseren Artikel „Vietnam From a Frontier Market to an Emerging Market – What You Must Know” (Vietnam Vom Grenz- zum Schwellenmarkt – Was Sie wissen müssen). Es sei darauf hingewiesen, dass Vietnam mit Erlangung des Status eines Schwellenlandes in Zukunft Milliarden von Dollar anziehen wird;
(vi) Eindämmung des Kreditwachstums auf 15 Prozent im Jahr 2024 mit entsprechenden Anpassungen an die makroökonomische Entwicklung, die Inflation und den Kapitalbedarf in der Wirtschaft, und
(vii) Ressortübergreifende Zusammenarbeit bei der Ausarbeitung von Richtlinien und Rundschreiben zum novellierten Gesetz über Immobiliengeschäfte.
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Bei Fragen können Sie gerne Dr. Oliver Massmann unter omassmann@duanemorris.com oder eine/n andere/n in unserer Kanzleiliste aufgeführte/n Rechtsanwältin/Rechtsanwaltkontaktieren. Dr. Oliver Massmann ist geschäftsführender Direktor von Duane Morris Vietnam LLC.

© 2009- Duane Morris LLP. Duane Morris is a registered service mark of Duane Morris LLP.

The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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