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VIETNAM – BOOM TIME – The Trans Pacific Partnership Agreement now becomes the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership – What is next?

 

Overview on the Trans Pacific Partnership Agreement (TPP) – now the Comprehensive and Progressive Agreement for the Trans-Pacific Partnership (CPTPP)

The TPP was originally known as the Trans- Pacific Strategic Economic Partnership concluded in 2006 among Singapore, New Zealand, Chile and Brunei (P-4 agreement) as a means to promote trade liberalization in the Asia- Pacific Region. As its name indicates, the original purpose of the agreement was only to address economic issues. As the number of participating countries in the P-4 agreement increased, starting with the United States in September 2008 and other countries to follow being Australia, Peru, Vietnam, Malaysia, Canada, Mexico and Japan until July 2013, the agreement is agreed to be “a comprehensive, next-generation regional agreement that liberalizes trade and investment and addresses new and traditional trade issues and 21st-century challenges” by TPP Trade ministers. In June 2015, the United States approved the trade promotion authority for President Obama. The Agreement finally becomes as it is today through tough negotiation rounds, while the last round in Atlanta in September 2015 was considered the most intensive one. The TPP was already concluded on 06 October 2015. However, in January 2017, right after President Trump took his office, the United States formally expressed its withdrawal from the agreement, leaving other 11 parties with the decision to continue the agreement without the United States or not. In November 2017, during APEC meeting in Da Nang, Vietnam, ministers from 11 countries decided to push ahead with the TPP with its new name – CPTPP with only 20 items suspended out of an around 5000-page document, mainly in the Intellectual Property chapter.

CPTTP will help Vietnam make good use of international cooperation opportunities, balance relationships with key markets, approach larger markets including Japan and Canada, boost import-export, reduce import deficit, and attract foreign investment. In addition, CPTTP will also help Vietnam’s economy allocate its resources more effectively, enabling active supports to the processes of restructuring, innovation and improving regulations, and improve administrative reforms.

What makes CPTPP the template for next-generations trade agreements – What are beyond the WTO?

Freer trade zone

Commitments in Trade in goods

Tariff and non-tariff barriers are reduced and removed substantially across all trade in services and goods under the CPTPP. Import tariffs are reduced for 100% goods traded among member states, with more than 90% being eliminated immediately when the Agreement takes effect. The CPTPP also covers issues which have never been addressed in the WTO, including export duties, import duties for re-manufactured goods, market access for re-furbished goods, stricter regulations on import and export licensing, monopolies and goods in transit.

Lower tariff barriers from the CPTPP will give Vietnam greater access to large consumer markets in Japan, Canada and Australia. The potential positive effect on trade could be transformative, with estimates that the CPTPP will boost Vietnam’s exports by over 37% until 2025.

Commitments in Trade in services and Investment

All 11 member states give consent to a liberalized trade in this area. More sectors are opened in the CPTPP compared with the WTO, such as telecommunications, distribution and manufacturing sectors.

In addition, besides incorporating basic WTO principles (national treatment (NT), most-favored nation treatment (MFN), market access, and local presence), the CPTPP takes a negative approach, meaning that their markets are fully open to service suppliers from other CPTPP Parties, except otherwise indicated in their commitments (i.e, non-conforming measures). In order to make such reservations, the member state must prove the necessity of such preservation and negotiate with other member states. If approved, the non-conforming measures are only limited to such list, except for measures in certain sensitive sectors which are included in a separate list. Member states are only allowed to adopt policies that are better than what they commit (ratchet principle). The CPTPP also includes obligations on removal of performance requirements (i.e., no conditions on local content requirements, export conditions, use of certain technology, location of the investment project, etc.) and reasonable requirements on senior management and board of directors. Notably, the CPTPP Chapter on Investment for the first time makes it very clear and transparent concerning the MFN principle, that countries operating in multi-state regime must give foreign investors the best investment conditions of all states, regardless of the state where the investment takes place. Investors are also allowed to petition against the Government from the investment registration stage.

Textiles

Textiles are among Vietnam’s core negotiating sectors. According to suggestions by the United States, negotiations on textiles were conducted separately from negotiations on market access for other goods. To be qualified for CPTPP preferential tariff treatment, the CPTPP applies the yarn-forward principle, meaning textile products must be produced in CPTPP countries from yarn forward. However, the CPTPP includes exceptions that allow (i) certain materials to be sourced from outside CPTPP (“Short supply list”), (ii) certain manufacturing phases (for example, dying, weaving, etc.) to be conducted outside CPTPP; and (iii) one country to be able to use non-CPTPP materials in exchange for its export of certain textile goods to another country.

Government procurement

The CPTPP makes a list of government entities and agencies whose procurement of a particular̉ goods and services at a particular amount must be subject to public tender. This chapter includes NT and MFN principles, removes tender conditions favoring local tenders such as using local goods or local suppliers, conditions on technology transfer or two-way trade and investment, etc. These rules require all parties, especially Vietnam, in the context of China’s bidders predominantly win the bids with cheap offer price but low-quality services, to reform their bidding procedures and protect their own interests by disqualifying tenders with poor performance and low capacity.

Investor-State Dispute Settlement

The CPTPP aims at protecting investors and their investment in the host country by introducing requirements on non-discrimination; fair and equitable treatment; full protection and security; the prohibition of expropriation that is not for public purpose, without due process, or without compensation; the free transfer of funds related to investments; and the freedom to appoint senior management positions regardless of nationality. For the first time investors may sue the Government for its violation of investment-related commitments.

CPTPP also includes procedures for arbitration as means of settling disputes between investors and the host state. It covers new provisions compared with existing agreements such as transparency in arbitral proceedings, disclosure of filings and arbitral awards, and participation of interested non-disputing parties to make amicus curiae submissions to a tribunal. Arbitral awards are final, binding and fully enforceable in CPTPP countries.

Application of the CPTPP and older/ existing agreements

Member states of the CPTPP acknowledge existing rights and obligations of each member under existing international agreements to which all CPTPP member states are parties (for example, the WTO Agreement, NAFTA, or bilateral agreements) or at least two member states are parties. In case there is any consistency between a provision of the CPTPP and a provision of another agreement to which at least two CPTPP member states are parties, these parties will consult with each other to reach a mutually satisfactory solution. Please note that the case where an agreement provides more favourable treatment of goods, services, investments or persons than that provided for under the CPTPP is not considered as an inconsistency.

Implementation deadline of the CPTPP

Brunei, Canada, Malaysia and Vietnam still have some outstanding issues, so further negotiations are necessary. Canada and Japan will also have to agree on auto rules in the CPTPP. However, negotiators have set the goal of signing the CPTPP in the first quarter of 2018. After that, all 11 countries will have to ratify it before it can come into effect.

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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. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

 

THANK YOU !

 

 

Lawyer in Vietnam Oliver Massmann WTO Dispute Shrimp Case Agreement reached

On 18th July 2016, the United States (US) and Vietnam reached an Agreement on the Imposition of Anti-dumping Duty on Certain Frozen Warm-water Shrimp from Vietnam to resolve two long standing WTO disputes brought by Vietnam: United States – Anti-dumping Measures on Certain Shrimp from Vietnam (DS404) and United States – Anti-dumping Measures on Certain Shrimp from Vietnam (DS429).

The history of these disputes could be traced back to 31st December 2003, after the very first anti-dumping case against Vietnam carried out by the U.S. in June, 2002 when the Vietnamese fishing industry had to confront another anti-dumping petition against certain frozen and canned warm-water shrimp imported into the U.S. by the U.S Shrimp Trade Action Committee, an ad hoc representative of the U.S. Southern Shrimp Alliance.

In this case, Vietnam was not the only respondent but there were five other countries including Brazil, Ecuador, India, Thailand and China. The case was investigated by the US Department of Commerce (DOC) and the US International Trade Commission (ITC). According to the ITC, shrimp imports account for eighty-seven percent of the one billion pounds of shrimp consumed in the U.S. annually.[1] Of that, shrimp imports from the six countries in the petition make up seventy-five percent of the total shrimp imports into the U.S. market. According to the petitioner, the alleged dumped products from these countries caused the price of the U.S. shrimp harvest to decrease by fifty percent from 2000 to 2002, falling from $1.25 billion to $560 million;[2] thus the U.S. shrimpers could not compete, leading to nearly 70,000 job losses in the shrimp industry within the eight states.[3] The DOC then initiated its dumping investigation on 8 January, 2004.

The DOC again upheld its conclusion from the Catfish case that Vietnam is a non-market economy (“NME”) after examining six criteria prescribed in the Tariff Act of 1930 in determining whether a country operates on market economy principles. Upon determining that Vietnam is a NME, in order to determine the normal values and export values of Vietnamese fish, the DOC had to find “an economically comparable ME that is a significant producer of comparable merchandise”[4] that could substitute for Vietnam’s costs of production. In this case, Bangladesh was chosen as a surrogate country.

The US utilized zeroing method to determine dumping margin in the case at hand. As a matter of general understanding, zeroing referred to the practice of some WTO Members in calculating dumping margin by comparing weighted-average normal value to individual export prices. Under this methodology, the difference between normal value and export price was calculated per transaction. Positive margins, i.e., the export price is lower than the normal value, were taken as is. However, negative margins, i.e., the export price is higher than the normal value, were counted as zero. Zeroing drops transactions that have negative margins, thus resulting in higher overall dumping margins and as a matter of fact, higher applied anti-dumping duty.

In contrast with the E.U.’s prospective zeroing system, under the U.S. retrospective system, the anti-dumping duty imposed at the end of the original investigation following the calculation of the dumping margin only serves as a temporary estimation for future liability.[5] The actual payment of anti-dumping duties will be determined during the annual administrative or duty assessment reviews. As mentioned above, zeroing increases the level of dumping margin. When used in the retrospective system, the impact of zeroing is amplified as it adds an element of uncertainty. The importer of goods subject to anti-dumping order only has an estimate of its extra duty. He will be unwilling to import goods from the subject exporter because of the possibility of a higher duty when the U.S. authority conducts the administrative review.[6]

During the process, several companies were investigated. The mandatory defendants were Minh Phu Seafood Corporation, Kim Anh Limited Company, Minh Hai Joint Stock Seafoods Processing Company and Camau Frozen Seafood Processing Import – Export Corporation (Camimex). Some voluntary defendants that could be mentioned are Cai Doi Vam Seafood Import Export Company, Can Tho Agriculture and Animal, Products Import Export Company; Can Tho Animal Fisheries Product Processing Export Enterprise, Cuu Long Seaproducts Company, Danang Seaproducts Import Export Company. However, Kim Anh Limited Company, one of the compulsory defendants, refused to cooperate due to abundant amount of data that needs to be collected, resulting it being subject to the very high country-wide rate.

Eventually, after over a year of investigation, ITC announced that Vietnamese shrimp are sold at dumping prices and the import of this shrimp is detrimental to the shrimp industry of the US. As a result, Vietnamese shrimp were subjected to anti-dumping duties at varying rates depending on the results of the investigation. In the second and third administrative reviews, the DOC decided to impose an insignificant duty rate of 0-0.01 percent on mandatory respondents, but not on voluntary respondents. These voluntary respondents were subject to the initial rate of 4.57 percent. The country-wide rate was the same as in the initial determination, i.e., 25.76 percent.

These results have raised a lot of controversial responses. Beside Vietnamese companies whose rights and benefits were directly affected by this decision, some US parties have also shown disagreements towards this announcement. Mr. Adam Sitkoff, Executive Director of Amcham Vietnam in Hanoi, stated during his interview with VnExpress that the duties applied on Vietnamese shrimp were unreasonable as Vietnam, similar to other shrimp exporters, utilized the most advanced shrimp production methods, something that American shrimp providers did not have. As a result, the Vietnamese shrimp prices became lower, which is not a sign of dumping.

For fear that the DOC would continue using the same calculation methodology used in the second and third administrative reviews, resulting in unfair treatment for Vietnamese enterprises in the fourth administrative review, the Vietnam Association of Seafood Exporters and Producers (“VASEP”) and the Vietnam Chamber of Commerce and Industry (“VCCI”) recommended the Government to initiate the WTO dispute settlement mechanism by first holding consultation with the U.S. on this matter on 01 February 2010. The consultation failed and the Government of Vietnam requested the establishment of a panel on 07 April 2010. Vietnam challenged, inter alia, “(i) the application of zeroing to individually-investigated respondents in the second and third administrative reviews, and its continued application in the subsequent reviews; (ii) the U.S zeroing methodology ‘as such’; and (iii) the use of the zeroing methodology to calculate the “all others” rate in the second and third administrative reviews.”[7] On 11 July 2011, the Panel issued its report of the case.

The Panel ruled in favor of Vietnam that the DOC’s zeroing methodology in determining dumping margin for mandatory respondents in the second and third administrative reviews was inconsistent with Article 2.4 of the Anti-Dumping Agreement (“ADA”). Moreover, the Panel also ruled that the using of zeroing in any administrative review constituted a violation under Article 9.3 of the ADA and Article VI:2 of the GATT 1994.[8]

This ruling of the Panel is considered to be consistent with the decisions of other WTO panels and Appellate Body in previous cases regarding the U.S. zeroing methodology. Although the US never opposed to this decision, they did continue applying zeroing methodology for subsequent administrative reviews and the first sunset review.

The case would not have been a success without the active participation of several associations, including VASEP and the VCCI. From the very beginning, these associations did evaluate the case from Vietnam’s viewpoint and in accordance with international practice. Then, they recommended the government to start the proceedings based on convincing arguments, as well as propaganda to gain support from the public. VASEP and VCCI also contributed a lot to the success of the case by proposing experienced international trade lawyers.

Although the case is among more than 480 WTO disputes since 1995, US – Shrimp marks a significant and critical change in Vietnam’s use of WTO dispute settlement mechanism, leaving a lot of lessons learned by Vietnamese enterprises and associations.

On 20th May 2016, upon Vietnam’s request, the DOC has implemented procedures to comply with the WTO Panel’s decision. Eventually, on July 18th, 2016 Vietnam and the US finally signed an agreement, according to which a Vietnamese exporter of frozen warm-water shrimp – Minh Phu Group – will no longer be subject to the antidumping duty order.  In addition, certain domestic litigation will be resolved and duty deposits will be refunded to the Minh Phu Group.  The antidumping duty order will remain in place for all other exporters of warm-water shrimp from Vietnam.

This move shows negotiation efforts of Vietnam and the US’ goodwill to respect its WTO obligations. It also reflects the US’s goodwill to strengthen its multi-faceted cooperation with Vietnam, especially in the context that the two countries participate in the Trans-Pacific Partnership (TPP) agreement.

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

THANK YOU !

 

 

[1] U.S. Slaps Tariffs on Shrimp from China, ‘Vietnam: Commerce Department Acts after Complaints from American Harvesters’, Chicago Sun Times, 2004, p. 62.

[2] Burnett, Richard, ‘Struggling U.S. Shrimpers File Anti-dumping Petition: An Industry Group Says Six Countries Sold Shrimp at Artificially Low Prices’, 2004, http://articles.orlandosentinel.com/2004-01-01/news/0401010416_1_shrimp-petition-industry).

[3] Southern Shrimp Alliance, Press Release: Shrimpers Hail Finding of Dumped Shrimp from China and Vietnam, 30 November 2004, http://www.shrimpalliance.com/Press%20Releases/ 11-30-04%20DOC%20Final.pdf.

[4] Section 773(c)(4), Tariff Act of 1930.

[5] Chad P. Bown and Thomas J. Prusa, US Anti-dumping – Much Do about Zeroing, 2010, p.30.

[6] Ibid., p.33.

[7] http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds404_e.htm.

[8] Panel Report, US – Shrimp, para. 8.1.

Lawyer in Vietnam Oliver Massmann Trans Pacific Partnership Agreement – Ratification and Key Impact for Vietnam

If the TPP is ratified and goes into effect, what do you see as the key areas of impact on Vietnam and its economic future?
Answer: Vietnam would be the largest beneficiary of this trade pact. Statistics show that by participating in the TPP, Vietnam’s GDP would add an additional increase of 13.6% to the baseline scenario. According to the World Bank and other institutions, Vietnam’s GDP in 2020 will increase by USD 23.5 billion and USD33.5 billion in 2035. Export value will also increase by USD 68 billion in 2025. Vietnam’s real income by 2025 is also forecast to increase by 10.5%, leaving Malaysia’s as the second highest income rising country out of the TPP members far behind at 5.6%.
TTP will help Vietnam balance relationships with key markets, approach larger markets including the U.S, Japan, Canada, boost import-export, reduce import deficit, and attract foreign investment. In addition, TTP will also help Vietnam’s economy allocate its resources more effectively, enabling active supports to the processes of restructuring, innovation and improving regulations, and improve administrative reforms.

What industries do you see within Vietnam would benefit the most, and where do you see major risks to established industries if the TPP is ratified?
Answer: The TPP will have significant positive impact on Vietnam’s exports in textile, footwear, agriculture, forestry and fisheries sectors. This is due to major reduction in import duties for goods from Vietnam, especially in Japan and the United States. Supply chain established after the effectiveness of the TPP will also bring Vietnam a lot of new opportunities. Recently, many big corporations have chosen Vietnam as a part of their production chain of high tech products. The TPP will help to develop this trend.
The livestock industry will suffer from fierce competition as a result of the TPP. In Vietnam, the livestock industry is still small, not modernized, mainly household scale with participation of small and medium enterprises. Products have certain difficulties in meeting high quality and sanitary standards.
Textile industry is also a sector which bears negative impact from the TPP. The yarn-forward rule of origin makes Vietnam’s textile products difficult to be entitled with preferential import duties, as the domestic weaving industry has not well developed. Vietnam still has to import cloth and fabrics from non-TPP countries (for example, China). The textile industry sees this as an opportunity to re-structure the whole industry and improve the supply chain.

In your view, if the US does not ratify the TPP, do you see the RCEP as a replacement for Vietnam? And if so, what do you see as the major impacts (positive or negative) on Vietnam, as a result of implementing the RCEP without having a TPP?
Answer: I take a positive view that the TPP will sooner or later be ratified. However, in the unlikely worst scenario that the TPP will not be materialized, Vietnam will lose a great opportunity to integrate its economy deeper in the Asia- Pacific Region. RCEP has a lower level of trade liberalization and smaller commercial scale. RCEP does also not take a single-package approach, or in other words, it is not a comprehensive trade agreement which covers new issues of the era such as labour and environment standards, competition, SOEs, government procurement, IP rights, etc.) as the TPP. Thus, RCEP’s positive impacts on transforming Vietnam’s economy will not be as large as the TPP’s. Without the TPP, Vietnam will face strong competition from China – which is not a party to the TPP and this is Vietnam’s advantage over China. RCEP will put Vietnam in a disadvantaged situation in its relationship with China as a result of more liberalized and preferential bilateral trade from RCEP. Vietnam will no longer benefit from RCEP due to the similarities in the export structure between Vietnam and China.

If the TPP is ratified and goes into effect, do you see any effect with Vietnam – China trade? Especially given that there is already a trade agreement in place as part of the ACFTA.
Answer: Vietnam’s participation in the TPP will not harm Vietnam – China trade. I note that Vietnam has great trade deficits with China. However, while China is the biggest trading partner of Vietnam in terms of two-way trade, the United States is still Vietnam’s largest market. By being part of the TPP, Vietnam can take advantage of this opportunity to access to other TPP members’ market, improve its competitive capacity, thus reducing its reliance on China. Vietnam – China trade relations will then be improved towards better balance, stability and for mutual benefits.
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Please contact the author Oliver Massmann under omassmann@duanemorris.com if you have questions on the above. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Lawyer in Vietnam Oliver Massmann Labour requirements in the Trans-Pacific Partnership Agreement and their impact on Vietnam’s legal system

Together with the globalization process, content and coverage of free trade agreements (FTAs) have been further expanded to not only include traditional commercial matters such as reduction of tariff barriers (tariffs, quota, customs) but also include labour and environment which are not directly related to traditional trade.
Regarding labour, many recent FTAs include labour requirements as they view globalization has certain negative impacts on labour environment, especially in countries in pursuing of low production cost by maintaining low labour standards, wages and working conditions, thus resulting in unfair competition among parties in their commercial relations. This is an approach taken by many recent concluded trade agreements. The number of FTAs regulating labour matters has been increasing from 4 in 1995 to 72 up to January 2015.
Being touted as the 21st century trade agreement, the Trans-Pacific Partnership (TPP) includes the strongest provisions on labour in history. In total 14 FTAs to which Vietnam is a party, the TPP is also its first FTA including labour provisions. If TPP is fully implemented, it will help improve on-the-ground labour conditions in its member countries by adopting binding and fully enforceable obligations to, among other, freely form unions and bargain collectively. The TPP also creates a chance for member countries, especially Vietnam, to improve living standards and work quality for its own workers. The following section assesses the current situation in Vietnam on the right of collective labour bargaining, freedom of association as well as analyses how the TPP transforms Vietnam’s labour practices.
Current collective labour bargaining and freedom of association situation in Vietnam
Collective labour bargaining
Collective bargaining means debate and negotiation between the labour collective representative and the employer to (i) formulate a harmonious, stable and progressive labour relationship; (ii) establish new working conditions to provide the basis for signing a collective labour agreement; and (iii) resolve problems and difficulties in exercise of rights and implementation of obligations of each party to the labour relationship.[1]
Periodic collective bargaining is conducted once a year and the time lapse between two collective bargaining sessions must not exceed 12 months.[2]
One result of collective bargaining process is a collective labour agreement (“CLA”), which is defined as an agreement between the labour collective and the employer on working conditions, labour usage, rights and obligations of each party in their employment relationship.[3] The agreement must be reached based on voluntary, fair and transparent basis. It must include more favourable provisions for workers than what are required in the law but not in violation of labour related documents.[4] It serves as the basic document detailing legal requirements in accordance with business nature of each enterprise and grants workers the chance to negotiate with their employer better labour terms than statutory terms. As such, a CLA is legally critical in an employment relationship to ensure lawful rights and obligations of each party.
Trade Union (TU) plays the role of representing and protecting the rights and legitimate interests of trade union members and employees; participate in negotiating, signing and supervising the implementation of CLA, wage scales and wage tables, labour norms, wage payment regulations and bonus regulations, internal labour regulations, democracy regulations in an enterprise; participates in and assists the settlement of labour disputes; holds dialogues and cooperates with an enterprise to build harmonious, stable and progressive industrial relations in an enterprise.
Given the importance of a CLA, most enterprises in Vietnam have prepared and implemented it. Content of such agreement all ensures justifiable rights and obligations for workers, some agreements even include better treatment for workers than that in laws. However, some enterprises have such document in place only to temporarily deal with pressure from the authorities and include terms contrary to or less favourable than statutory requirements. Reasons are leader of the workers as well as the workers themselves lack awareness of procedures, understanding of legal requirements and weak negotiation skills.
Freedom of association
Vietnam is not a party to Convention No. 87 of the International Labour Organization on freedom of association but has acceded to the 1966 International Covenant on Civil and Political Rights, in which mentions the right of freedom of association.
Vietnam also agreed with the United States in a TPP side agreement called consistency plan where Vietnam is required to remove its ban on independent unions and allow all independent unions the same rights as those affiliated with the government. These independent unions must also be allowed to affiliate with each other to form a broader national federation. This process is called “cross-affiliation.” This consistency plan must be passed before Vietnam may export to the United States under the terms of the TPP.
However, the current Law on Trade Union in Vietnam has not ensured the right to freely establish and join TU of the workers. For example, Article 1 of the Law on Trade Union states that “a TU is a socio-political organization of working class and labourers, […], a member in a political system of Vietnam, under the direction of Vietnam’s Communist Party, […].” As such, Vietnam has not recognized TU pluralism regime. In other words, Vietnam has not allowed workers to establish, or join a TU that they think could benefit and protect their interests during their employment. Instead, they can only join the only TU in the Vietnam’s TU system and under the direction of Vietnam’s Communist Party. Meanwhile, TU has not played its role well as an organization representing and protecting the rights and legitimate interests of trade union members and workers. We have barely seen the presence of TU in demonstrations and strikes for social insurance or payment when an enterprise is closed. Due to the lack of representability, operation of a TU is very limited. In essence, members of the Vietnam General Confederation of Labour from district levels onwards are all government officials instead of workers. Therefore, an independent TU with representability and without association is what workers really need.
How TPP transforms Vietnam’s labour practices
In the TPP, Vietnam has made a critical commitment, i.e., establishment of organization representing workers at grass-root level being independent of the Vietnam General Confederation of Labour. Differently speaking, the TPP has laid a foundation for TU pluralism. If independent TUs are established in Vietnam, workers’ living standards and rights will be much more improved as their TU will be one which can speak their voice.
Notably, in the side agreement mentioned above with the United States, a separate enforcement mechanism independent of the TPP will apply if the United States is dissatisfied with Vietnam’s implementation.
Therefore, Vietnam must amend the current TU regulations towards international labour standards. The principles, which are in nature the schedule for Vietnam to materialize its commitments are already indicated in the side agreement with the United States as follows:
Principle 1: Right of workers to freely form and joint a labour union of their choosing
Principle 2: Ability of labour unions to administer their affairs with autonomy
Principle 3: Worker representation in non-unionized workplaces
Principle 4: Representability in selection of union officials
Principle 5: Non-interference of employers in organizational activity of labour unions.
We are optimistic to say the TPP will definitely bring positive changes to the labour environment in Vietnam in the next five years. Again, to really grasp such benefits, Vietnam must urgently take actions to reform the current domestic system, for a better civil society.

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

THANK YOU VERY MUCH!

________________________________________
[1] Article 66, Labour Code 2012.
[2] Article 3, Circular No. 29/2015/TT-BLDTBXH.
[3] Article 73.1, Labour Code 2012.
[4] Article 73.2, Labour Code 2012.

The Trans Pacific Partnership Agreement – Commitments above WTO Level – An Analysis

Overview on the Trans Pacific Partnership Agreement (TPP)
The TPP was originally known as the Trans- Pacific Strategic Economic Partnership concluded in 2006 among Singapore, New Zealand, Chile and Brunei (P-4 agreement) as a means to promote trade liberalization in the Asia- Pacific Region. As its name indicates, the original purpose of the agreement was only to address economic issues. As the number of participating countries in the P-4 agreement increased, starting with the United States in September 2008 and other countries to follow being Australia, Peru, Vietnam, Malaysia, Canada, Mexico and Japan until July 2013, the agreement is agreed to be “a comprehensive, next-generation regional agreement that liberalizes trade and investment and addresses new and traditional trade issues and 21st-century challenges” by TPP Trade ministers. In June 2015, the United States approved the trade promotion authority for President Obama. The Agreement finally becomes as it is today through tough negotiation rounds, while the last round in Atlanta in September 2015 was considered the most intensive one. The TPP was already concluded on 06 October 2015.
The successful conclusion of the TPP negotiations adds Vietnam to a club of 12 nations accounting for 40% of world’s GDP (about $US28.1 trillion, $39.1 trillion), one-third of global trade ($US11 trillion) and about 800 million consumers.
Vietnam would be the largest beneficiary of this trade pact. Vietnam’s GDP would add an additional increase of 13.6% to the baseline scenario. According to the World Economic Forum, Vietnam is predicted to have the most significant change in GDP in 2025 (i.e., 28.2%) compared with other TPP economies, RECP economies and RCEP-only economies. Vietnam’s real income by 2025 is also forecast to increase by 10.5%, leaving Malaysia’s as the second highest income rising country out of the TPP members far behind.

TTP will help Vietnam make good use of international cooperation opportunities, balance relationships with key markets, approach larger markets including the U.S, Japan, Canada, boost import-export, reduce import deficit, and attract foreign investment. In addition, TTP will also help Vietnam’s economy allocate its resources more effectively, enabling active supports to the processes of restructuring, innovation and improving regulations, and improve administrative reforms.

What makes the TPP the template for next generation trade agreements – What commitments are beyond the WTO Level ?
Freer trade zone
Commitments in Trade in goods
Tariff and non-tariff barriers are reduced and removed substantially across all trade in services and goods under the TPP. Import tariffs are reduced for 100% goods traded among member states, with more than 90% being eliminated immediately when the Agreement takes effect. The TPP also covers issues which have never been addressed in the WTO, including export duties, import duties for re-manufactured goods, market access for re-furbished goods, stricter regulations on import and export licensing, monopolies and goods in transit.
Lower tariff barriers from the TPP will give Vietnam greater access to large consumer markets in the US, Japan, Canada and Australia. The potential positive effect on trade could be transformative, with estimates that the TPP will boost Vietnam’s exports by over 37% until 2025. Notably, Vietnam in August also concluded FTA with the EU, putting it on course to complete free trade agreements with three of its four largest export destinations – the EU, Japan and the US.
Commitments in Trade in services and Investment
All 12 member states give consent to a liberalized trade in this area. More sectors are opened in the TPP compared with the WTO, such as telecommunications, distribution and manufacturing sectors.
In addition, besides incorporating basic WTO principles (national treatment (NT), most-favored nation treatment (MFN), market access, and local presence), the TPP takes a negative approach, meaning that their markets are fully open to service suppliers from other TPP Parties, except otherwise indicated in their commitments (i.e, non-conforming measures). In order to make such reservations, the member state must prove the necessity of such preservation and negotiate with other member states. If approved, the non-conforming measures are only limited to such list, except for measures in certain sensitive sectors which are included in a separate list. Member states are only allowed to adopt policies that are better than what they commit (ratchet principle). The TPP also includes obligations on removal of performance requirements (i.e., no conditions on local content requirements, export conditions, use of certain technology, location of the investment project, etc.) and reasonable requirements on senior management and board of directors. Notably, the TPP Chapter on Investment for the first time makes it very clear and transparent with regards to the MFN principle, that countries operating in multi-state regime must give foreign investors the best investment conditions of all states, regardless of the state where the investment takes place. Investors are also allowed to petition against the Government from the investment registration stage.

Textiles
Textiles are among Vietnam’s core negotiating sectors. According to suggestions by the United States, negotiations on textiles were conducted separately from negotiations on market access for other goods. To be qualified for TPP preferential tariff treatment, the TPP applies the yarn-forward principle, meaning textile products must be produced in TPP countries from yarn forward. However, the TPP includes exceptions that allow (i) certain materials to be sourced from outside TPP (“Short supply list”), (ii) certain manufacturing phases (for example, dying, weaving, etc.) to be conducted outside TPP; and (iii) one country to be able to use non-TPP materials in exchange for its export of certain textile goods to another country.
Government procurement
The TPP makes a list of government entities and agencies whose procurement of a particular̉ goods and services at a particular amount must be subject to public tender. This chapter includes NT and MFN principles, removes tender conditions favoring local tenders such as using local goods or local suppliers, conditions on technology transfer or two-way trade and investment, etc. These rules require all parties, especially Vietnam, in the context of China’s bidders predominantly win the bids with cheap offer price but low-quality services, to reform their bidding procedures and protect their own interests by disqualifying tenders with poor performance and low capacity.

Investor-State Dispute Settlement
The TPP aims at protecting investors and their investment in the host country by introducing requirements on non-discrimination; fair and equitable treatment; full protection and security; the prohibition of expropriation that is not for public purpose, without due process, or without compensation; the free transfer of funds related to investments; and the freedom to appoint senior management positions regardless of nationality.
TPP also includes procedures for arbitration as means of settling disputes between investors and the host state. It covers new provisions compared with existing agreements such as transparency in arbitral proceedings, disclosure of filings and arbitral awards, and participation of interested non-disputing parties to make amicus curiae submissions to a tribunal.

Application of the TPP and older/ existing agreements
Member states of the TPP acknowledge existing rights and obligations of each member under existing international agreements to which all TPP member states are parties (for example, the WTO Agreement, NAFTA, or bilateral agreements) or at least two member states are parties. In case there is any consistency between a provision of the TPP and a provision of another agreement to which at least two TPP member states are parties, these parties will consult with each other to reach a mutually satisfactory solution. Please note that the case where an agreement provides more favourable treatment of goods, services, investments or persons than that provided for under the TPP is not considered as an inconsistency.

Implementation deadline of the TPP
Trade ministers will meet in New Zealand on 04 February 2016 to sign this Agreement for it to be ratified in each member states as the next step before the Agreement officially takes effect. The TPP will not take effect unless at least six countries accounting for 85% of the GDP of the bloc ratify it. According to Minister of Vietnam Ministry of Industry and Trade Mr. Vu Huy Hoang, the TPP would promisingly take effect in 2018.

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

Vietnam Wind Energy – Eurocham Legal Sector Committee – Meeting with Chairman of EVN Mr Duong Quang Thanh – Presenting Major Legal Issues for Getting Deals Done

On 18 December 2015, Mr. Oliver Massmann, the Managing Partner of Duane Morris Vietnam LLC, Chairman of the Legal Sector Committee of Eurocham, attended the conference “EVN-HCMC Dialogue with Korean, American and European enterprises” held by EVN HCMC.

Besides the presentation on how to improve the quality of power supply in Vietnam of EVN HCMC, Mr. Massmann had an opportunity to give a speech in Vietnamese and raise major issues in relation to wind power energy projects in Vietnam, including:
– The Government offers low FiT rate in comparison to the investment of the investors;
– Power Purchase Agreement (PPA) is required to follow a specific template, which is not bankable;
– The PPA template is unclear whether it is a “take or pay” agreement;
– There is no clear guidance and procedure to obtain the approval for the amendment of the PPA template.

The speech received the sympathy from many foreign investors in the conference. Mr. Duong Quang Thanh, the Chairman of the Members’ Council of EVN, well received the comments with positive feedback and personally congratulated Mr. Massmann for the successful speech after the event.

Followings are the brief analysis of the issues and the response from Mr. Thanh to each issue.
1. Low FiT rate
– Mr. Massmann raised the concern that the FiT, as regulated in Decision No. 37/2011/QD-TTg, is 7.8 cents USD/kWh, equivalent to 1,614VND/kWh, is very low compared to the investment capital of the investors in the projects. Accordingly, such purchase price cannot ensure the profits for the investors. Therefore, instead of fixing the price, the Government can regulate the ceiling price and give the parties the rights to negotiate the price. In addition, it would be appreciated if EVN can share information about the exact timeline that the new FiT would be published.
– As discussed by Mr. Thanh, EVN understood the concern of the investors on the low FiT. The Government is considering the issue. However, Mr. Thanh could not say exactly when the new FiT will be published.
2. The PPA template is not bankable
– Mr. Massmann recommended to enhance the bankability of the PPA, such as to clearly define force majeure events (Articles 5.1 and 5.3 of the template PPA) and distinguish the natural force majeure event and force majeure event due to political issue; to clearly define events of default of either Seller and Buyer (Articles 6.2 and 6.3 of the template PPA).
– In response, Mr. Thanh explained that the purpose of PPA template is to cut down the negotiation process between the parties. EVN noted the comments and will propose to amend the template.
3. The PPA template is unclear whether it is a “take or pay” agreement
– Mr. Massmann suggested that in order to secure and ensure the profits and revenue of the project, it must be clear that it is a “take or pay” agreement. Because under the current template, EVN will be released from the obligation to purchase the power in specific circumstances.
– Said by Mr. Thanh, for the time being, it is difficult to make clear that this is a “take or pay” agreement as the power generated from the wind power projects will depends on many factors, such as speed and force of the wind. However, EVN noted the comment and will consider to amend the PPA template.
4. No clear procedure to obtain approval for amendment of PPA
– Mr. Massmann addressed that in practice, the parties will need to agree on the additional agreements suitable for each project. Therefore, although the template PPA is compulsory, in case the parties are willing to amend, there must be a clear procedure to obtain the approval for the amendment of the PPA.
– On behalf of EVN, Mr. Thanh noted the comment and will consider to propose appropriate changes.

Although the issues raised by Mr. Massmann could not be addressed in details during the conference, Mr. Thanh said that EVN would do their best to cooperate and would research on the appropriate solution and propose to the Government for amendment in the future.
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Please do not hesitate to contact Oliver Massmann under omassmann@duanemorris.com if you have any questions or want to know more details on the above. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Lawyer in Vietnam Oliver Massmann EU-VIETNAM FREE TRADE AGREEMENT OFFICIALLY SIGNED

On 02 December 2015, after nearly 3 years with 14 rounds of negotiations, the Minister of Industry and Trade of Vietnam, H.E. Vu Huy Hoang and the European Commissioner for Trade, H.E. Cecilia Malmström have signed the Vietnam-EU Free Trade Agreement (FTA). Both parties will finalize the ratification process as soon as possible for the FTA to take effect from the beginning of 2018.
The FTA is considered one of the most comprehensive and ambitious trade and investment agreements. It is the second agreement in the ASEAN region after Singapore and it will intensify the bilateral relations between Vietnam and the EU.
The agreement has separate chapters on Trade of Goods, Rules of Origin, Customs and Trade Facilitation, Sanitary and Phytosanitary measures and Technical Barriers to Trade, Trade in Services, Investment, Trade Remedies, competition, State-Owned Enterprises, Government Procurement, Intellectual Property, sustainable Development, Cooperation and Capacity Building, Legal and Institutional Issues.
Nearly all customs duties – over 99% of the tariffs will be eliminated. The small remaining number is mainly due to the transition period. Vietnam will liberalize 65% of import duties on EU exports to Vietnam at entry into force and the remaining duties will be eliminated due to the next ten years; EU duties will be eliminated over a seven year period. The market will be opened for most of EU food products, i.e. wine, spirits and frozen pork meat will be liberalized after seven years and dairy products after a maximum of five years. The EU will eliminate duties for some sensitive products in the textile and footwear sector. The EU has offered access to Vietnamese exports via tariff rate quotas (TRQs), because some sensitive agricultural products will not be fully liberalized. Furthermore, the agreement will contain an annex with provisions to address non-tariff barriers in the automotive sector. Vietnamese exports of textile, clothing and footwear to the EU are expected to more than double in 2020 as a result of the FTA.
The FTA will help to increase quality of investment flows from EU, accelerate the process of sharing expertise and transfer of green technology and the creation of more employment activities.
The real wages of skilled laborers may increase by up to 12% while real salary of common workers may rise by 13%. The macro economy will be stable and inflation rate is controlled. Vietnam’s business activities will be booming in the next few years once the EU- Vietnam FTA officially comes into force and Government’s policies as well as institutional reforms start showing their positive effects.
Vietnam’s GDP is expected to increase by 0.5% annually, increase in exports is 4-6% per year. If this trend continues until 2020, Vietnam’s exports to EU will increase by USD 16 billion. Until 2025, the FTA is estimated to generate an additional 7-8% of GDP above the trend growth rate.
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Please do not hesitate to contact Oliver Massmann under omassmann@duanemorris.com if you have any questions or want to know more details on the above. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

Lawyer in Vietnam Oliver Massmann the Trans Pacific Partnership Agreement will drive Foreign Direct Investment into Vietnam

1. How does TPP drive FDI inflow into Vietnam ?

Commitments by TPP members on trade in goods and services will have a positive impact on improving the investment environment and attracting more foreign investment in Vietnam. Participating in the TPP will offer Vietnam the chance to continue creating institutions — like market economy, support for reform of Vietnam’s economic growth model and economic restructure. Vietnam, as being part of the TPP game, must also follow its strict principles, including transparency and regulatory coherence, to improve the business environment in a way to make it transparent and more predictable. Vietnam’s commitments on other fields such as intellectual property, environment, labor, government procurement, etc., will also create an attractive environment in Vietnam.

2. Besides textile and garment sectors, in your opinion, what are the sectors that Vietnam could boost FDI inflow thanks to the TPP?

Footwear and seafood are sectors that also receive many benefits. These products have been largely exported to the U.S, Japan and Canada. With reduction and elimination of import tariffs in these countries as a result of the TPP, exports value will gain breakthroughs and contribute to an increase in the national export value.

3. What will TPP mean for Vietnam’s FDI inflow in the long term?

There would be a diversion of FDI from China to Vietnam as companies move factories to the low-wage country and low labor costs. FDI from other countries to Vietnam would increase to take advantage of TPP preferential treatment. In the long term, a new trend of FDI would be formed in Vietnam as a result of the TPP. How the trend would be needs detailed analysis on the content of the agreement and how it works in practice.

4. What has been driving the growth of FDI inflow into Vietnam? Will they last?

Transparency, predictability and stability of the investment environment, the strengthening of protection for intellectual property rights, improved quality of the workforce, clearer and better investment legal framework are among factors that boost FDI growth in the upcoming time.

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

Lawyer in Vietnam Oliver Massmann BREAKING NEWS The Trans Pacific Partnership Agreement VIETNAM WILL REAP HUGE BENEFITS

Trade ministers reached an agreement on the TPP on Monday (05 October 2015) after five days of intensive talks, following their failure to reach consensus in Hawaii in late July.
The TPP is one of the largest trade agreements ever to be negotiated, involving some of the largest nations in the world with an annual gross domestic product of nearly $28 trillion that represents roughly 40 percent of global GDP and one-third of world trade. Countries participating in the negotiations include those throughout the Asia- Pacific region, namely Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam. The TPP is touted to be the 21st century trade agreement, set a template for regional and global trade and investment and incorporate next-generation issues.
The TPP addresses a number of rising trade issues which have been stumbling blocks to global trade recently, such as e-commerce, financial services and cross-border electronic communications. Other cross-cutting issues are also covered, such as role of state-owned enterprises in the economy, government procurement, and other topics.
Vietnam would be the largest beneficiary of this trade pact as a result of its strong trade ties with the United States, and its highly competitive positions in industries such as manufacturing where China is gradually losing its competitive advantage. Vietnam is also considered as one of the countries among Japan, Malaysia, Brunei, New Zealand that the United States would like to establish formal trade agreements. Statistics shows that by participating in the TPP, Vietnam’s GDP would add an additional increase of 13.6% to the baseline scenario.

Some major points in the TPP are as follows:
Free trade zone: tariff and quotas have been long used as trade measures to protect domestic industries from cheap overseas goods and efficient sources of collecting revenue for the states, especially for developing ones. However, tariff and quotas have been used less compared with other non-tariff measures in the past years. With the TPP, tariff and non-tariff barriers are even reduced and removed more substantially across all trade in services and goods. TPP Parties, especially Vietnam, would gain many benefits from the upcoming business opportunities and open market access resulting from the trade pact.
Trade in goods
With tariff and non-tariff reduction and elimination on industrial goods, high quality- jobs will be supported and trade in a 800-million people market will increase. Most tariff elimination will be implemented immediately, with tariff on some other products will be reduced over a committed period of time. For elimination and reduction of restrictive policies on agricultural goods, food security will be enhanced. Vietnam’s agricultural products will have more opportunities to be exported to other TPP members and gain their competitive advantage due to cheap labors and natural endowments.
Trade in services
Trade in services is of utmost importance to all TPP Parties. Thus, all 12 countries give consent to a liberalized trade in this area. Besides incorporating basic WTO principles (national treatment, most-favored nation treatment, market access, and local presence), the TPP takes a negative approach, meaning that their markets are fully opened to service suppliers from other TPP Parties, except otherwise indicated in their commitments.
Comprehensive trade: The TPP includes commitments that seek to encourage participation and development of businesses of all levels and sizes. Small-and medium-sized businesses, which are quite popular in Vietnam, will receive assistance from other countries to understand the agreement, take advantage of their opportunities, build their own trade capacity to grow fast in the future.
Government procurement: All TPP parties commit to ensure transparent, predictable and non-discriminatory government procurement markets. National treatment and non-discrimination are core principles. Governments undertake to timely publish information on tender, allow sufficient time for bidders to prepare for and submit bids, maintain confidentiality of tenders. The TPP also requires its Parties assess bids based on fair and objective principles, evaluate and award bids only based on criteria set out in notices and tender documentation, create an effective regime for complaints and settling disputes, etc. These rules require all Parties, especially Vietnam, in the context of China’s bidders predominantly win the bids with cheap offer price but low-quality services, to reform their bidding procedures and protect their own interests by disqualifying tenders with poor performance and low capacity.
State-owned enterprises: Vietnam and Malaysia have many state-owned enterprises. The United States and others have some as well which are involved in public services and other activities. TPP negotiators have place emphasis on how to regulate operation of such enterprises, preferential treatment granted to these enterprises, non-discrimination of the state-owned enterprises against other countries’ goods and services. Participating in the TPP would then be a driving force for Vietnam in its privatization process of 432 state-owned enterprises in the 2014-2015 period. The remaining Vietnamese state-owned enterprise will also need to undergo strict reform procedures to meet standard requirements in the TPP.
Transparency and anti-corruption: The TPP includes rules on goods governance, bribery and corrosive anti-corruption, which have long been considered as one of the factors that discourage investors when deciding their business expansion, especially in countries like Vietnam with corruption index ranking Number 119 out of 175 countries globally according to Transparency International. The TPP Parties have agreed on adopting or maintaining laws criminalizing corruption behaviors by a public official affecting international trade or investment. Parties also commit to effectively enforce their anticorruption laws and regulations. As part of the TPP, Vietnam’s business environment in terms of transparency and “cleanliness” would be much improved, paving the way for more foreign investment in the upcoming time.
Other important trade and trade-related issues are covered in 30 chapters of the TPP, ranging from customs and trade facilitation; sanitary and phytosanitary measures; technical barriers to trade; trade remedies; investment; intellectual property; labor; environment; dispute settlement; etc. All TPP parties are conducting procedures to release the text of the agreement, which would then have to be approved domestically in each country member.
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Please do not hesitate to contact Oliver Massmann under omassmann@duanemorris.com if you have any questions or want to know more details on the above. Oliver Massmann is the General Director of Duane Morris Vietnam LLC.

BREAKING NEWS – EU – Vietnam Free Trade Agreement: In-principle agreement reached – Vietnam to benefit from greater market access for its goods and services – WHAT YOU MUST KNOW:

The Minister of Industry and Trade of Vietnam, H.E. Vu Huy Hoang and the European Commissioner for Trade, H.E. Cecilia Malmström agreed in principle on the Vietnam-EU Free Trade Agreement (FTA).
After a teleconference on the 4th August 2015 and three years of negotiations with commitments taken by both sides the FTA is considered one of the most comprehensive and ambitious trade and investment agreement. The legal text will be negotiated after the summer break and both sides are aiming to sign and ratify the agreement within this year. It is the second agreement in the ASEAN region after Singapore and it will intensify the bilateral relations between Vietnam and the EU.
The agreement will comprises of Trade of Goods, Rules of Origin, Customs and Trade Facilitation, Sanitary and Phytosanitary measures and Technical Barriers to Trade, Trade in Services, Investment, Trade Remedies, competition, State-Owned Enterprises, Government Procurement, Intellectual Property, sustainable Development, Cooperation and Capacity Building, Legal and Institutional Issues.
The FTA is considered to bring a positive impact for both sides especially for the Trade and Investment Sectors.
Nearly all customs duties – over 99% of the tariffs will be eliminated. The small remaining number is mainly due to the transition period. Vietnam will liberalize 65% of import duties on EU exports to Vietnam at entry into force and the remaining duties will be eliminated due to the next ten years; EU duties will be eliminated over a seven year period. The market will be opened for most of EU food products, i.e. wine, spirits and frozen pork meat will be liberalized after seven years and dairy products after a maximum of five years. The EU will eliminate duties for some sensitive products in the textile and footwear sector. The EU has offered access to Vietnamese exports via tariff rate quotas (TRQs), because some sensitive agricultural products will not be fully liberalized. Furthermore, the agreement will contain an annex with provisions to address non-tariff barriers in the automotive sector.
Regarding the investment sector, the FTA will be able to ensure an open and conductive business and investment environment, particularly will it help to promote the capital flow from the EU and gives Vietnam the opportunity to become a hub whilst connecting the EU’s trade and investments with the region. Both sides have achieved a lot, but the provisions concerning the investment protection and dispute settlements are still being negotiated.
The commitments made concerning investment, trade in service, government procurement, intellectual property rights, etc. will ensure an overall balance between both sides. Even Vietnam has to adapt new regulations. Those adjustments are in content with the Vietnamese attempt of administrative reforms to strengthen the country. Moreover Vietnam will achieve a grade of transparency and procedural fairness.
In the context of Intellectual Property Rights Vietnam has itself committed to standards which go beyond those of the WTO TRIP agreement and is creating a safer environment for EU innovations and brands and a stronger enforcement of those provisions.
Signing the FTA will have a broad impact on Vietnam, i.e. create more jobs and stabilize the welfare for Vietnam. Furthermore, there will be many opportunities to get access to modern technology and sharpen management skills.
There will be a framework within the FTA to resolve any future disagreement which may follow about the understanding and implementation of the agreement.

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

THANK YOU VERY MUCH!