Vietnam law is mostly compatible with TPP commitments in investment

Source: Internet

The WTO and integration center (Vietnam Chamber of Commerce and Industry of -VCCI) in collaboration with the British Embassy organized a consultative workshop " Review Vietnam Law with the TPP commitments in investment: Results of review and suggestions for improving the law from the perspective of business interests " in Hanoi.

TPP is expected to help Vietnam attract FDI with high value and higher technology. At the same time, the developing the economy and the implementation of commitments will help Vietnam accelerate restructuring and renewal of the growth model and perfect the legal system in line with international practice and the development of the market economy.

Ms. Nguyen Thi Thu Trang, Director of the Centre for WTO and integration said that TPP will influence all investors and administrative decisions that State agencies and local authorities take in dealing with investors, and is committed to include the principles of open markets, and removal of barriers to investment.

In particular, the requirements of national treatment is non-discrimination between investors from TPP and domestic investors. The government must not interfere in business operation as well as senior personnel of investors from TPP, etc. In addition, investors from TPP also apply other requirements under asset protection principles and autonomy of investors.

Before the above requirements are in place, the review results showed that Vietnam has legislation which is compatible with the majority of TPP investment commitments, especially fundamental principles such as open markets, removal of barriers, senior personnel,etc.

However, the TPP commitments on compensation in the event of armed conflict and divesting ownership are only partly compatible due to the lack of detail in provisions about compensation for divesting ownership, etc.

Notably, the report pointed out the law of Vietnam was not compatible with the TPP commitments on transfer of assets abroad and investor-state dispute settlement mechanisms (ISDS). The reason is that the majority of the ISDS terms are not regulated by the law of Vietnam.

From the above results, Ms. Nguyen Thi Thu Trang proposed that the legislation which is compatible should continue to be implemented effectively. For some points which are not compatible, depending on each case, it can be fixed through common legal documents; with regard to specific sectors, individual documents and resolutions should be issued in order to implement its own TPP investment commitments.

Moreover, to enhance the compatibility of Vietnam Law with TPP commitments, according to Mr Dzung Pham, Operating Lawyers of Law firm Rajah & Tanh LCT Lawyers Ltd., the legal system should be reviewed and focus on the principle of open market cases related to FDI, intellectual property, recognition and enforcement of arbitration rulings in foreign countries, etc. This is also required of itself to improve the law.

Despite having to check to find out which points of the system are not compatible with legislation, Ms. Nguyen Thi Thu Trang also indicated that there are many "exceptions" in the commitments that Vietnam can take advantage of.

Typically, Vietnam may maintain the open market and discriminate against some investors in some specific areas that have been outlined in the commitments. Besides that, there are exceptions to all countries that they could discrimite in favor of investors in public procurement when it necessary.