Contents of Vietnam's FDI Policy Framework:

due to the impact of the regional financial crisis (80%), then gradually loosened this rate. Enterprises can buy foreign currency with the permission of the State Bank. The law stipulates: completely abolish the approval of export plans of FDI enterprises; improve import and export procedures for goods to consider the origin of imported and exported goods.

Tax incentives: Exemption from import tax on equipment, machinery, specialized transportation, raw materials, etc.; exemption from import tax for enterprises investing in priority sectors and priority areas in the first 5 years of operation. Exporting enterprises are exempt from import tax on raw materials for exporting products. Furthermore, enterprises supplying input products to exporting enterprises are also exempt from import tax on intermediate raw materials at the corresponding rate.

c. Period 2000-2004

In 2001, for the first time, the foreign-invested economic sector was recognized as an economic component with the role of "export-oriented, building economic and social infrastructure, associated with attracting modern technology, creating more jobs..."19. At the 9th Party Central Committee Conference (9th tenure), the Communist Party of Vietnam set out the task of "creating fundamental changes in attracting foreign direct investment"20. Accordingly, the policy of attracting FDI in the coming time will focus on improving the quality of FDI flowing into Vietnam by attracting more transnational corporations to invest in important industries and sectors of the economy, especially high-tech and source technology sectors. Changes in the Party and State's perception and viewpoints on the foreign-invested economic sector are an important basis for the Government to amend and perfect legal documents and policy mechanisms to attract FDI capital and the operations of FDI enterprises in recent years.

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The amended law has improvements compared to the 1996-1999 period. It stipulates: Issuing a list of FDI enterprises that can register for business without needing a license; eliminating the FDI investment registration fee regime.

Regarding investment, the law stipulates: Issuing a list of projects calling for FDI investment for the period 2001 - 2005; expanding the fields allowing FDI investment in housing construction. Furthermore, investment forms are more diverse; FDI enterprises are allowed to buy shares of domestic enterprises.

FDI enterprises are allowed to mortgage assets attached to land and land use rights; to buy foreign currency at commercial banks to meet transaction needs according to the law. The law abolishes the requirement for approval when transferring capital; reduces the fee for transferring profits abroad; reduces the foreign exchange rate from 80% to 50% to 30% and 0%; and at the same time abolishes the regulation requiring FDI enterprises to set aside a reserve fund.

Continue to reform the tax system, gradually narrowing the tax gap between domestic and foreign investment.

d. Period 2005 to present

In 2005, Vietnam issued a new investment law, with many important amendments compared to the old law. In particular, the registration procedure became easier: projects with domestic investment capital of less than 15 billion VND and not included in the list of conditional investments do not have to go through investment registration procedures. For projects with a scale of 15-300 billion VND and not included in the list of conditional investments, investment registration procedures must follow the form. In the investment field, investors are only allowed to merge and acquire companies and branches.

Issue new regulations on land, according to which: in case investors lease land from land users to whom the State has allocated land, investors are responsible for organizing compensation and site clearance themselves.

The law also stipulates that investors are allowed to buy foreign currency to meet capital transactions and other transactions as prescribed by law. The Government ensures balance or support.

foreign currency balance for some important projects in the fields of energy, transport infrastructure, waste treatment.

Investors are not required to export goods or services at a certain rate or import in quantity and value corresponding to the quantity and value of exported goods or to balance foreign currency from export sources to meet import needs.

At the same time, investors are entitled to tax incentives for the income distributed from capital contribution and share purchase activities in economic organizations according to the provisions of tax law after that economic organization has fully paid corporate income tax.

The policy of attracting FDI capital in Vietnam has been implemented since Vietnam carried out economic reforms and was institutionalized through the promulgation of the Foreign Investment Law in 1987. Up to now, the Foreign Investment Law has been amended and completed 4 times in 1990, 1992, 1996 and most recently in 2000. The above table summarizes the important changes in FDI attraction policy through the amendments of the Foreign Investment Law in Vietnam. The general trend of Vietnam's policy changes is to increasingly expand rights, create more favorable conditions for foreign investors and narrow the difference in investment policies between foreign investment and domestic investment. These changes demonstrate the Government's efforts to improve and create a common investment environment in line with Vietnam's integration trend. In addition to developments in FDI attraction and the practical operations of the FDI sector, changes in Vietnam's FDI attraction policy over the past 17 years have also come from three other factors, namely: (1) changes in the Party and State's awareness and views on the FDI sector; (2) FDI attraction policies of countries in the region and the world, creating competitive pressure on FDI capital flows into Vietnam; and (3) Vietnam's international commitments on foreign investment. The following analysis will address each factor.

At the same time, it raises challenges for continuing to improve policies and laws on FDI in Vietnam in the coming years.

3. Contents of Vietnam's FDI policy framework:

3.1. Laws and regulations related to FDI

3.1.1 Investment procedures

The Investment Law and Decree 108 empower provincial People's Committees and Management Boards of Industrial Parks, Export Processing Zones, High-Tech Parks and Economic Zones (hereinafter referred to as Management Boards) to issue Investment Certificates as well as manage investment activities, while reducing the number of projects that must be submitted to the Prime Minister. If submitted, the Prime Minister will only approve in principle a number of important projects that are not yet included in the planning or do not have a planning yet. For projects that are included in the approved planning and meet the conditions prescribed by law and international treaties, the provincial People's Committees and Management Boards will issue Investment Certificates without having to submit them to the Prime Minister for decision on investment policy. The remaining projects will be decided by the provincial People's Committees and Management Boards themselves and will issue Investment Certificates.

For investment projects that are not included in the planning approved or authorized by the Prime Minister or projects that do not meet the market opening conditions stipulated in international treaties to which Vietnam is a member, the investment certificate granting agency shall preside over and consult the sector management ministry, the Ministry of Planning and Investment and relevant agencies to submit to the Prime Minister for decision on adjustment or supplementation of the planning or decision on market opening. For investment projects in areas where there is no planning, the investment certificate granting agency shall consult with relevant agencies to submit to the Prime Minister for decision on the investment policy.

The new point of the Law is that the investment procedures are designed to be simple and convenient for investors. Accordingly, projects are divided into two types: investment registration and investment appraisal.

For domestic investment projects under 15 billion VND and not in the conditional investment sector, investors do not have to carry out investment registration procedures and are not granted an Investment Certificate.

For domestic investment projects with an investment scale of 15 billion VND to less than 300 billion VND that are not in the conditional investment sector, investors only need to register for investment according to the form before implementing the project without having to have an Investment Certificate. In case the investor has a need, the state investment management agency will issue an Investment Certificate.

For foreign investment projects with capital scale of less than 300 billion VND and not in the conditional investment sector, investors only need to register investment according to the form to be granted an Investment Certificate within 15 days from the date of receiving a valid registration.

Projects subject to appraisal apply to both domestic and foreign investment. Accordingly, projects in the list of conditional investment sectors or projects with a capital scale of VND 300 billion or more must go through investment appraisal procedures. The appraisal contents only include: (1) conformity with technical infrastructure planning, land use planning, construction planning, mineral and other resource use planning; (2) land use needs; (3) project implementation progress; (4) environmental solutions. For projects in the list of conditional investment sectors, only the conditions that the project must meet are examined.

The Investment Law stipulates that foreign investors investing in Vietnam for the first time must have an investment project. In case an economic organization has been established and there is a need to carry out a subsequent investment project, there is no need to establish a new economic organization. For domestic investment, when establishing an economic organization

No project is required. This is the difference between domestic investment and foreign investment, this difference is necessary because foreign investment needs to follow the market opening roadmap in international treaties of which Vietnam is a member.

In order to implement administrative reforms in investment activities, the Decree stipulates that in case an investment project is associated with the establishment of an economic organization, the investment procedures are carried out simultaneously with the business registration procedures. The Investment Certificate includes the business registration contents as prescribed by the Law on Enterprises. In this case, the Investment Certificate is also the Business Registration Certificate and is also sent to the business management agency for general management of business registration.

Regarding the adjustment of investment projects, the Investment Law and Decree 108 stipulate that when adjusting investment projects related to the objectives, scale, location, form, capital and implementation period of the investment project, investors must complete procedures at the dossier receiving agency to complete procedures for adjusting the Investment Certificate. The adjustment of investment projects is carried out according to the procedures for registering investment project adjustments or examining investment project adjustments.

3.1.2 Investment form

Compared to the previous Law on Foreign Investment and Law on Encouragement of Domestic Investment, the Investment Law and Decree 108 stipulate more clearly the forms of investment such as: establishing economic organizations with 100% capital of domestic investors or 100% capital of foreign investors; establishing joint venture economic organizations between domestic investors and foreign investors; investing in the form of BBC contracts, BOT contracts, BT contracts; investing in business development; purchasing shares or contributing capital to participate in management of operations.

investment; and investment in mergers and acquisitions of enterprises. Investors are allowed to invest to establish economic organizations with 100% of their own capital, 100% foreign-invested enterprises established in Vietnam are allowed to cooperate with each other and/or with foreign investors to invest in establishing new 100% foreign-invested enterprises in accordance with the provisions of the Law on Enterprises. Investors can also invest in establishing joint venture economic organizations between domestic investors and foreign investors, the above joint venture enterprises are allowed to continue to enter into joint ventures with domestic investors and foreign investors to invest in establishing new economic organizations in accordance with the provisions of the Law on Enterprises and relevant laws.

Regarding investment activities to establish economic organizations to implement investment projects, the Investment Law and Decree 108 stipulate: domestic investors with investment projects associated with the establishment of economic organizations shall carry out business registration in accordance with the provisions of the Enterprise Law, relevant laws and carry out investment procedures in accordance with the provisions of the Investment Law and Decree 108.

In addition, the Investment Law and Decree 108 also stipulate that foreign investors investing in Vietnam for the first time must have an investment project and carry out investment procedures to be granted an Investment Certificate; the Investment Certificate is also the Business Registration Certificate. Another point different from the previous regulations, considered a very open and new point for foreign investment activities, is: for foreign investors who have been granted an Investment Certificate in Vietnam, if the investor has a new investment project without establishing a new legal entity, they only need to carry out investment procedures to be granted an Investment Certificate according to the provisions of the Investment Law and Decree 108; if the investor has a new investment project associated with the establishment of a new legal entity, they will carry out

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