Workers at Global Mechanical Engineering Company, Giang Dien Industrial Park, Trang Bom District (Dong Nai). Illustration photo: Hong Dat/Vietnam News Agency.

Through synthesizing feedback from businesses and associations, the Vietnam Chamber of Commerce and Industry (VCCI) believes that the draft reflects quite comprehensively the contents of Resolution 68/NQ-CP of the Government regarding the program for reducing and simplifying regulations related to business activities during the 2020 - 2025 period. It accurately identifies the existing issues in the implementation and enforcement of this resolution, while also providing useful recommendations for policymakers when developing long-term policies to improve the business investment environment.

However, alongside the positive points, Mr. Dau Anh Tuan, VCCI Deputy Secretary General and Head of the Legal Department, noted that the sections on evaluating the mid-term results of the Regulatory Reform Program 2020 - 2025 should be revised.

Accordingly, the draft report states that in the 2020 - 2023 period, "circulars and decrees are the most commonly used tools, accounting for 31% and 66% of the total, respectively. This is expected as most changes relate to the implementation of current legal regulations." In practice, to implement Resolution 68, ministries and sectors will develop plans to reduce and simplify business regulations in their management areas. The report presents figures of 31% and 66% for the circulars and decrees that have been amended, asserting that "this is expected as most changes relate to the implementation of current legal regulations." According to VCCI, this assessment lacks insight, as the actualization of reduction and simplification plans will involve 100% amendments to existing legal regulations.

The ratio of 97% of amended documents being at the circular and decree level suggests that the main changes in these documents are directly applicable to business operations. Therefore, when amending regulations at this level, they can be implemented immediately in practice without waiting for guiding documents. On the other hand, this ratio indicates that proposals for amendments at the legislative level account for less than 3%, which raises concerns. There are many issues and obstacles arising from legal regulations. Decrees and circulars, even if they aim to reform or reduce, are constrained by legal provisions and cannot exceed them. Thus, VCCI believes that without amendments to the law, in some cases, proposals for reduction and simplification may lack breakthrough potential.

According to VCCI's observations, among the proposals for reducing and simplifying regulations related to administrative procedures, the main suggestions include: eliminating the requirement to provide certain documents in the application process that the authorities can verify through state information databases (the most frequently removed document requirement is the submission of a business registration certificate); reducing the number of documents required; shortening the processing time; and adding more methods for conducting procedures electronically. While these proposals will somewhat facilitate the process for those involved, they do not truly represent a breakthrough or reform. Businesses not only expect simplifications regarding investment conditions but also stronger reform measures in the administrative procedures, such as completely eliminating the requirement for a heritage restoration certificate instead of merely proposing to shorten the review time from five working days to three and adding online processing options.

Regarding the mid-term evaluation of the Regulatory Reform Program 2020-2025 in Vietnam, the draft report states that “especially, Article 7 of the Investment Law refers to Appendix IV, which lists 227 ‘conditional business sectors’ that are restricted and must be licensed beforehand.” Mr. Tuan noted that this statement may not be entirely accurate. Conditional business sectors under the Investment Law are managed either through prior licensing or do not require licensing, provided they meet business conditions. Not all sectors need to obtain a license before they can operate. For example, while “real estate business” is classified as a conditional business sector, in certain sub-sectors, businesses do not need to obtain a business license but must meet conditions when engaging in real estate activities.

Representing VCCI, Mr. Tuan proposed clarifying the content regarding “developing management strategies that consider both pre- and post-control measures (inspections). This will ensure a stringent approach to business regulations, allowing economic activities to be consistently managed based on the risks they pose to regulatory objectives…” This proposal raises the question of whether, for low-risk activities, the government will not conduct prior inspections (applying a pre-control mechanism) and instead implement post-inspections for these business activities. Additionally, regarding the content about “clarifying the list of conditional business activities in the Investment Law,” the review process for the business conditions of conditional sectors is already quite clear, and the Investment Law mandates public disclosure. The business conditions are specified in sector-specific legislation, not in the Investment Law. Therefore, the notion that determining conditional business sectors in the Investment Law will facilitate regulators in checking licensing requirements for these economic activities may not be entirely appropriate.