Government --------- No: 10/1998/ND-CP

SOCIALIST REPUBLIC OF VIETNAM Dated: January 23, 1998 Independence- Freedom- Happiness ******

 Decreeon a number of measures to encourage and guarantee Foreign Direct Investment activities in Vietnam *****

THE GOVERNMENT

Pursuant to the Law on Organization of the Government of September 30, 1992;

Pursuant to the Law on Foreign Investment in Vietnam of November 12, 1996;

In order to encourage and create a favorable environment for the attraction of foreign direct investment capital and to enhance the effectiveness of foreign investment activities;

At the proposal of the Minister of Planning and Investment,

DECREES

Chapter I

GENERAL PROVISIONS

Article 1.

1. The Government of Vietnam guarantees to implement a persistent and long-term policy on foreign direct investment in Vietnam; and, at the same time, to amend and supplement the foreign direct investment policy on the principle of creating more favorable conditions for investors.

2. The Government of Vietnam encourages and gives special preferences to investment projects which produce goods for export and use high technologies and to investment projects on the list of projects where investment is specially encouraged and the list of geographical areas where investment is encouraged, which are provided for in Appendix 1 attached to this Decree.

3. In cases where any new provisions of law adversely affect the interests of foreign-invested enterprises and parties to business cooperation contracts (hereafter referred to as enterprises) which have been already stipulated in the investment licenses, such provisions shall not apply to the already licensed investment projects.

If new and more preferential provisions are issued after the enterprises have been granted investment licenses, the investment license- granting agency shall make adjustments so that the enterprises can benefit therefrom in accordance with the provisions of this Decree.Article 2.

1. The ministries, the agencies attached to the Government, the People's Committees of the provinces and cities directly under the Central Government (hereafter referred to as provincial People's Committee) shall have to guide foreign investment activities in the fields and territories under their respective management; improve their managerial work, revise investment procedures so as to ensure simple and rapid investment procedures on the principle of "one door" and "one stop."

The heads of the concerned agencies shall have to supervise, inspect and take responsibility for the activities of the agencies and personnel under their management and promptly handle all violations in accordance with the provisions of law.

2. Before issuing legal documents relating to foreign direct investment activities, the ministries, the agencies attached to the Government and the provincial People's Committees should consult the Ministry of Planning and Investment; any diverse opinions should be promptly reported to the Prime Minister.

Chapter II

FORMULATION OF INVESTMENT PROJECTS

Article 3.

Apart from the fields on the list where investment licenses shall not be granted and the fields where investment is conditional as specified in Appendix I attached to this Decree, foreign investors are entitled to select investment projects , form of investment, location, percentage of legal capital contribution and outlets for their products.

Foreign investors are entitled to select partners from any economic sector of Vietnam for investment cooperation.

Article 4.

For investment projects with 80% or more of their products being for export and those in a number of other fields to be announced by the Ministry of Planning and Investment, foreign investors shall register dossiers according to the form is sued by the Ministry of Planning and Investment; the investment license granting agency shall decide to grant investment licenses within 15 days after receiving the valid dossiers.

Article 5.

For the business fields and lines which, as provided for, require business licenses or practicing licenses, enterprises shall only have to register with a competent State agency for starting their business activities according to the objectives and lines stated in the investment license without having to apply for a business license or a practicing license.