Economic concentration: trends and issues in Vietnam

large state-owned enterprises operating in the monopoly sector (such as PetroVietnam, VNPT, EVN, etc.) to protect smaller enterprises and consumers. Therefore, it is necessary to expand the authority of the Competition Management Department to handle cases; organizationally, the Competition Management Department belongs to the Ministry of Industry and Trade, but when making decisions, it should be completely independent, not an agency assisting the Minister of Industry and Trade in state management of competition.

1.2.4 Strengthening international cooperation

The Vietnam Competition Authority needs to strengthen cooperation with international competition authorities to exchange information related to cross-border economic concentration. With the increasing trend of cross-border economic concentration, international cooperation between competition authorities is very important. Currently, there are many multinational corporations operating in Vietnam and have a relatively large market position, so through international cooperation, the Competition Authority can be more proactive in monitoring the economic concentration activities of this group of enterprises.

In addition, other relevant state management agencies need to have close coordination in controlling economic concentration. In order for state management of business registration and control of economic concentration to be effective, it is necessary to establish a coordination mechanism between the competition management agency and the business registration agency and specialized state management agencies. Currently, only Article 38 of Decree 116/2005/ND-CP regulates this issue by the responsibility of the competition management agency in sending a response to the notification of economic concentration to the business registration agency. As for the Law on Enterprises, although the principles in controlling economic concentration according to the Law on Competition have been initially used, in the procedures for business registration, mergers, capital and share transfers, there are no appropriate provisions for the effective connection between the procedures for notifying economic concentration and the corresponding procedures. In principle, in cases where notification is required under the Competition Law, an enterprise may only carry out economic concentration after receiving a written response from the competition authority confirming that the case is not prohibited. In that case, in the business registration dossier,

Enterprises, merger and consolidation dossiers, etc. need additional written responses from the competition management agency. However, the provisions in the Enterprise Law and Decree 88/2006/ND-CP of the Government dated August 29, 2006 on business registration do not stipulate this. The above situation certainly makes the coordination between relevant agencies even looser. At that time, the control of economic concentration is difficult to bring high efficiency. There needs to be an information channel to exchange databases related to business information, which must be reported to the competent authorities between the competition management agency and specialized agencies such as the General Statistics Office, the Ministry of Finance, the State Securities Commission, the State Bank, and industry regulatory agencies. Local business registration agencies (Departments of Planning and Investment) also noted that businesses carrying out procedures to change their business registration must comply with the provisions of the law on competition to avoid cases where businesses continue to proceed but will be forced to implement sanctions at a very high level (can be fined up to 10% of total revenue of the fiscal year before the violation and along with additional remedial measures).

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2. Recommendations for businesses

In principle, the implementation of economic concentration is the right of enterprises. From an economic perspective, this is the right to freedom of business that is recognized and protected by law. It is very difficult for an enterprise to grow immediately because they will have to accept fierce competition both domestically and internationally. Economic concentration is one of the effective ways to help enterprises improve their competitiveness, restructure the management system and organizational apparatus, so it should be considered by enterprises as one of the long-term development strategies. Enterprises need to make efforts to find and negotiate with truly capable partners for mutual development.

Although the Competition Law of countries in general and of Vietnam in particular does not eliminate economic concentration from the market, it is still necessary to control economic concentration activities to avoid the risk of enterprises forming a dominant market position or monopoly, affecting competition. Therefore, enterprises themselves need to strictly comply with the regulations on concentration.

economic concentration, must not go beyond the provisions of the law; at the same time, the level of sanctions for these violations is also very large (including fines in cash calculated based on revenue and other remedial measures). Enterprises should research and prepare full information as required by law, consult with competent authorities before conducting economic concentration (especially regarding notification procedures, exemption procedures, market shares of participating enterprises, etc.) and cooperate with the investigation agency when an incident occurs that affects the competitive environment.

Enterprises need to build channels to control information and transparency in business activities in general and economic concentration activities in particular. Because in economic concentration activities, information on prices, brands, markets, market shares, governance, etc. is very necessary for the participating parties. If information is not controlled and transparent, it can cause a lot of damage to the parties, and at the same time greatly affect other markets such as goods, securities, and banking. Because, like other markets, the economic concentration market operates in a chain reaction, if a large economic concentration fails or has fraudulent elements, the consequences for the economy are very large because the stocks, bonds, business activities, investments, etc. of that enterprise in particular and related enterprises may be affected.

The economic concentration market is a market that requires the participation and consultation of many experts with in-depth experience in different fields such as law, finance, branding... Therefore, there needs to be training programs to have a good team of experts, brokers, consultants for both buyers and sellers, and at the same time, the best information providers about the market. Only then can economic concentration in Vietnam operate better and more professionally 25 .

25 Competition Management Department - Ministry of Industry and Trade, Report on economic concentration in Vietnam: Current status and forecast , Hanoi, January 2009.

CONCLUDE

Economic concentration in Vietnam has been quite active in recent times and tends to develop as a strategy for normal business organization innovation of enterprises. Forms of economic concentration mainly include mergers, consolidations, acquisitions, joint ventures between enterprises and other forms as prescribed by law, in which mergers and acquisitions are the most commonly used. As a very strong trend in the world, economic concentration on the one hand brings efficiency, enhances competitiveness for participating enterprises, on the other hand can distort the competitive environment, and create imbalances in the market. The problem is how to promote the positive aspects of these activities and limit their negative impacts.

The process of trade globalization, increased competition arising from economic liberalization, market opening and increased technology investment costs are the reasons that make economic concentration an objective phenomenon due to the development needs of enterprises. Increasingly, enterprises

They are not only concerned with direct competition but also with the means by which they can ensure their superiority. In this competition, economic concentration allows to shorten the time, enhance the network effect and thereby accelerate the investment turnover.

The current context of international economic integration requires lawmakers to both exercise the function of controlling economic concentration and at the same time create conditions for enterprises to operate in a transparent, fair and competitive environment; comply with Vietnam's international commitments according to the principle of both protecting the effective competitive structure of the market and not infringing on the freedom of enterprises to innovate their business organization forms.

Studying the current situation and trends of economic concentration activities in Vietnam, and at the same time proposing some solutions to further strengthen the control of economic concentration are all the contents that the thesis wants to aim for. Referring to international practical experiences to flexibly apply them to the case of Vietnam is really important in finding solutions to both enhance the competitiveness of domestic enterprises, adapt to rapid changes from the pressure of integration into the World Trade Organization WTO, and ensure effective implementation of regulations on economic concentration control.

LIST OF REFERENCES

A. Vietnamese documents

1) Doan Trung Kien (2008), Competition law in Vietnam in the process of trade liberalization, Journal of Law, No. 10, Hanoi Law University.

2) Bui Thanh Lam (2008), Conditions for building and developing the market for business mergers and acquisitions in Vietnam, Journal of Law , No. 4, Hanoi Law University.

3) Dinh Thi My Loan (2008), Economic concentration under the provisions of Competition Law , Conference documents.

4) Pham Duy Nghia (2004), Economic Law Monograph , Hanoi National University Publishing House.

5) Tang Van Nghia (project leader) (2007), Some issues arising in the implementation of the Competition Law , State and Law Journal , No. 7 (231), Hanoi.

6) Tang Van Nghia (2007), Issues and solutions for effective implementation of the Competition Law in practice , Ministry-level scientific research project, Hanoi.

7) Tang Van Nghia (2008), Learning materials for Competition Law , Foreign Trade University - Faculty of Business Administration, Hanoi.

8) Phan Thao Nguyen (2007), Some theories on economic and commercial groups , Information and Communication Technology Magazine .

9) Nguyen Ngoc Son (2006) , Controlling economic concentration under competition law and issues in Vietnam, Journal of Legislative Studies, No. 7, Office of the National Assembly.

10 ) Le Viet Thai (2005), Research topic on economic concentration behavior. Topic: Competition institutions in Vietnam under the conditions of market economy development , Institute of Trade Research.

11) Nguyen Nhu Y (editor) (1998), Vietnamese Dictionary , Culture and Information Publishing House, Hanoi.

12) Competition Management Department - Ministry of Industry and Trade (2009), Report on economic concentration in Vietnam: Current status and forecast , Hanoi.

13) Competition Management Department - Ministry of Industry and Trade (2007), Controlling economic concentration - International experience and practice in Vietnam , National Political Publishing House, Hanoi.

14) Hanoi Law University (2006), Commercial Law Textbook , volume 1, People's Police Publishing House, Hanoi.

15) Hanoi Law University (2006), Journal of Law, Competition Law Special Issue, No. 6

16) Vietnam Economic Times (2009), Establishing new economic groups: no specific regulations on ownership, No. 113

17) National Committee for International Economic Cooperation (2005), Competition Law Policy and Practice of the French Republic , Volume 1, National Political Publishing House, Hanoi.

18) Central Institute for Economic Management. Information and Documentation Center,

Vietnam Economic Group: Current status and development trends.

B. English documents

19) C uts HRC ( 2008), Competition Law in Vietnam: A Toolkit, Hanoi

20) Michael Craig, 50 Best & Worst Business Deals of All Time

21)Berin Mihai, Economic concentration in the context of the world economic globalization, University of Oradea, Faculty of Economic Sciences, Romania.

C. Some websites:

- www.vcad.gov.vn (Website of the Competition Management Department)

- www.mof.gov.vn (website of Ministry of Finance)

- www.mofa.gov.vn (website of Ministry of Foreign Affairs)

- www.vibonline.com.vn (Vietnam Business Forum)

- www.vhdn.vn (Vietnam Business Culture Electronic Newspaper)

- www.vnmedia.vn (Managing agency: Vietnam Posts and Telecommunications Group)

- www.vnexpress.net

- www.vneconomy.vn

- www.muabancongty.com

- www.sanmuabandoanhnghiep.com

- www.tinnhanhchungkhoan.vn

- www.atpvietnam.com

- www.saga.vn

- Brand Merger: www.lantabrand.com

- www.nguoidaibieu.com.vn (Managing agency: Office of the National Assembly)

- Annual periodic reports on M&A of global data firm Thomson (at website www.thomson.com), auditing firm Pricewater house Coopers' (website: www.pwc.com)

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