Further improvement needed in work permit issuance

	Pilot customs clearance for passengers using passports and entry and exit permits across Bac Luan II Bridge
	Banks permitted to sell investment-linked insurance products

European businesses make recommendations at the first Policy Dialogue 2024 program held in Ho Chi Minh City last weekend. Photo: T.H

Flexibility in regulations will attract talent

At the first Policy Dialogue 2024 held in Ho Chi Minh City last weekend, Mr. Colin Blackwell, Head of Human Resources, Vietnam Business Forum (VBF) shared feedback from more than 200 European businesses in the EuroCham Business Confidence Index survey showing that the work permit process continues to be a challenge, especially for businesses looking to relocate executives and experts to Vietnam.

According to Mr. Colin Blackwell, although Decree No. 70/2023/ND-CP amending and supplementing a number of articles of Decree No. 152/2020/ND-CP dated December 30, 2020 of the Government has brought about some improvements, only 3% of the surveyed enterprises reported significant changes in the work permit issuance process. EuroCham believes that there is an opportunity to streamline regulations on foreign labor management in Vietnam to make the process more efficient and more in line with global standards, closer to the way human resources departments in multinational companies operate.

According to Mr. Colin Blackwell, for high-tech and green growth industries, European businesses want flexibility in the documents required for work permits. These industries are developing rapidly and may not have standard qualifications and certifications available in Vietnam. Flexibility in regulations on documents proving qualifications and experience in these fields will help Vietnam attract top talent in emerging fields. In addition, the current regulations requiring workers to apply for work permits at the place of intended work and updating each work location when workers are assigned to work in different localities is impractical in many cases.

Although Vietnam has stipulated that a single work permit must be issued for multiple work locations when applying for a work permit at the Ministry of Labor, War Invalids and Social Affairs, this provision is difficult to implement in many specific cases due to the lack of detailed guidance. Therefore, companies have been facing many challenges when seeking guidance and approval for work permits. Therefore, EuroCham believes that it is more effective and practical to issue a single work permit at the business registration location of the enterprise and to report when an employee is sent on a business trip of 30 days or more to another locality.

Additionally, expedited processing of work permit applications is a priority for high-impact projects, especially those with investments or projects with good compliance records. Providing expedited processing options for work permit applications can help reduce wait times and allow executives and professionals to start work quickly.

Simplify business licensing procedures

According to experts, Vietnam is on a strong development path, and streamlining the process of granting work permits, visas and temporary residence cards, adjusting visa procedures, and supporting the development of training centers can enhance the country's attractiveness to foreign investors. Streamlining these processes will help businesses operate more efficiently and contribute to Vietnam's sustainable development in the long term. At the same time, reviewing other administrative processes is also urgent, especially the consistency of visa and temporary residence card procedures between provinces and cities. Consistent interpretation of laws between provincial agencies will ensure that delays in the operations of businesses in many localities are minimized.

In addition, simplifying the procedures for granting Vietnam Business Licenses can significantly promote foreign investment by simplifying and streamlining the procedures for applying for and renewing Business Licenses. This is especially important for foreign investors.

Citing the procedures for applying for a Business License under Decree 09/2018/ND-CP (Decree 09), businesses said that the licensing procedures and time for foreign-invested enterprises to apply for a Business License for sectors including retail, equipment rental activities and e-commerce companies from the Ministry of Industry and Trade are still complicated and time-consuming.

Typically, this involves multiple rounds of filing and answering questions from the Ministry of Industry and Trade and the Department of Industry and Trade and can take up to 12 months. According to Decree 09, the statutory time limit depends on the specific activity and the application for a Business License from the Department of Industry and Trade is 13 working days. If the department needs to seek advice from the Ministry of Industry and Trade, it takes an additional 28 working days to wait for a response. However, in practice, in most cases, approval and advice from the Ministry of Industry and Trade is required regardless of whether the activity is listed in Article 5.1 and Article 8.3 of Decree 09. This time can be extended to 3 months for each internal process between the Department of Industry and Trade and the Ministry of Industry and Trade. If there are 2 to 3 rounds of questions and/or requests for additional information from the Ministry of Industry and Trade, it can take up to 9 - 12 months to complete. “We know of cases where it took a year to obtain a wholesale lubricant distribution business license,” said a EuroCham representative.