National Assembly Debates Legislative Reform
The fifth session of the 15th National Assembly (“NA”), taking place in June, debated a wide range of legal reforms with the potential to impact international investors and foreign enterprise in Vietnam.
One notable legislative debate centered on the amended Law on Cooperatives. The amended Law includes 12 chapters and 115 articles, and outlines provisions on the development of cooperatives and cooperative unions, including their establishment, membership, and administration.
In total, 94 per cent of NA legislators voted in favour of the amended law, which also includes provisions on the establishment of the infrastructure and equipment required for cooperative groups and unions to perform production and enterprise; to adapt to climate change; to create value chains; and for investment activities.
Of particular interest to international companies, the amended Law on Cooperatives also includes regulations on enterprises with foreign-invested capital and on foreign investors who wish to join a cooperative. Further, the amended law also removes previous provisions on the transfer of capital contributions of cooperative members. This is designed to ensure that the sale of such capital reflects its true nature.
The amended Law on Cooperatives entered into force on 1 July 2023.
Meanwhile, the fifth session of the 15th NA also approved the amended Law on Bidding. The amended law contains three fewer articles than its earlier iteration, and is designed to create a more unified and effective legal framework to guide procurement and the use of state funding.
In particular, the amended Law includes regulations for healthcare establishments purchasing drugs and medical equipment as well as for those who elect to make independent procurement decisions.
The fifth session of the 15th NA came before the June meeting of the government’s regular law-building session. Opening the meeting, Prime Minister Pham Minh Chinh remarked that Vietnam remains focused on removing institutional obstacles and improving the legal framework.
He praised the progress made to date in this regard, but highlighted that challenges remain. These include a lack of resources and slow progress in some departments. He emphasised that draft legislation must be relevant, feasible, and remove bottlenecks. The Prime Minister added that draft laws must focus on investment, consumption, and export – the three drivers of economic growth.
For more information on the amended Law on Cooperatives or the amended Law on Bidding, and how either could impact foreign enterprises, please contact our office on: email@example.com