Legal news on Apr 2014

I. REAL ESTATE
Regulations on housing sale contracts of real estate companies and apartment purchase contracts entered into with investor.

On February 20, 2014, the Ministry of Construction issued Circular No. 03/2014/TT-BXD amending Article 21 of Circular No. 16/2010/TT-BXD dated 1 September, 2010 of the Ministry of Construction on the implementation of the Government’s Decree No. 71/2010/ND-CP dated June 23, 2014 on the implementation the Law on Housing. Accordingly:

Housing sale contracts of real estate companies must be made into 04 (four) copies and such contracts will have validity to determine the buyers’ rights and obligations throughout the management and use of the purchased houses, even in case buyers have been issued Certificate of land use rights, ownership of house and other assets attached to land.

For apartment purchase contracts entered into with investors, beside the contents provided for at Article 93 of Law on Housing, Civil Code, Article 63 of Decree No. 71/2010/ND-CP, both parties must add the following contents and comply with the sample contract:

- The commonly owned, used area, the private area of the apartment owner;
- The built-up floor area of the apartment;
- The usable area (carpet area) of the apartment to calculate the purchase price of the apartment;
- The maintenance fee at 2% of the price of the apartment;
- The management fee and rules for adjusting the management operation fee while a management board of the apartment building has not been established yet.
This Circular takes effect from April 8, 2014.

II. LABOR
Regulations on licensing for using the foreign workers.
On January 20, 2014, the Ministry of Labor, Invalids and Social Affairs issued Circular No. 03/2014/TT-BLDTBXH guiding the implementation a number of articles of the Government’s Decree No. 102/2013/ND-CP dated September 5, 2013 detailing a number of articles of Labor Code on foreign workers in Vietnam.

According to the regulations of this Circular, the employers (except for contractors) must report and explain on their demand for using foreign workers to the Departments of Labor, Invalids and Social Affairs where the employers’ head offices are located at least 30 days before the estimated date of the recruitment of foreign workers. In case the employers have been accepted for using foreign workers but need to change their demand for using foreign workers, the employers must directly submit the reports to explain the adjustment and supplementation at least 30 days before the estimated date of new recruitment, additional recruitment or recruitment for replacing the foreign workers to the Departments of Labor, Invalids and Social Affairs where the employers’ head offices are located.

The Departments of Labor, Invalids and Social Affairs will notify their acceptance of using foreign workers within 15 days from the date of receiving the employers’ report on explanation or the report on explanation for adjustment, supplementation of demand for using the foreign workers.

In addition, this Circular details the dossier for issuing, re-issuing work permits.
This Circular takes effect from March 10, 2014, replaces Circular No. 31/2011/TT-BLDTBXH dated November 3, 2011 of the Ministry of Labor, Invalids and Social Affairs.

III. INVESTMENT
Regulations on opening and using the indirect investment capital accounts to perform transactions relating to foreign indirect investment activities in Vietnam

On 12 March, 2014, the State Bank of Vietnam issued Circular No. 05/2014/TT-NHNN guiding the opening and use of indirect investment capital accounts for implementing foreign indirect investment activities in Vietnam, replacing the State Bank of Vietnam’s Circular No. 03/2004/TT-NHNN dated 25 May, 2014 guiding the foreign exchange control over the foreign investors’ contribution of capital, purchase of shares from Vietnam enterprises.

According to the regulations of this Circular, all the foreign investors’ indirect investment activities must be implemented in Vietnam dong. Transactions relating to the foreign investors’ indirect investment activities in Vietnam must be implemented via 01 (one) indirect investment capital account opened at 01 (one) permitted bank (commercial bank or branch of foreign bank permitted for business and operating in rendering foreign exchange services in accordance with the provisions of laws).
Indirect investment capital accounts will be used for implementing the income - expenditure transactions relating to foreign indirect investment activities in Vietnam. Any balance in such foreign investors’ accounts cannot be transferred to termed deposit or savings account in credit institutions or foreign bank branches.

This Circular is applied to foreign investors being non–residents that carry out indirect investment activities in Vietnam and organizations and individuals relating to indirect investment activities in Vietnam. This Circular is not applied to organizational and individual foreign investors being residents.

This Circular will take effect from 28 April, 2014. Within 90 days from the effective date of this circular foreign investors shall be responsible for converting the indirect investment capital accounts as provided by law to continuously carry out the indirect investment activities in Vietnam.

IV. FINANCE - BANK
New provisions on interest rates of deposits in Vietnam dong of organizations and individuals at credit institutions.

On 17 March, 2014, Governor of the State Bank of Vietnam issued Circular No. 07/2014/TT-NHNN providing for interest rates of deposits in Vietnam dong of organizations and individuals at credit institutions.

Accordingly, interest rates of Vietnam dong deposits of organizations and individuals at credit institutions, applied from 18 March, 2014, will be as follows:

- For non – term deposits, deposits with term of less than one month and deposits with term from one month to six months: interest rates that do not exceed the maximum interest rates for each correspondent form of deposit provided by Governor of the State Bank of Vietnam within each period and for each form of credit institution will be applied.

- For deposits with term of six months or longer: interest rates based on the capital demand – supply basis of the market will be applied.

The maximum interest rates for deposits as provided by this Circular include promotional expenditures in any forms; applicable to the method of payment of interest in arrears and other methods of payment of interests that will be converted to the method of payment of interests in arrears.
This Circular will take effect from 18 March, 2014. Interest rates of deposits in Vietnam dong with fixed terms of organizations and individuals at credit institutions arising before the effective date of this Circular will be carried out until the expiry of the terms, at the expiry of the agreed terms, if deposits are not withdrawn by organizations or individuals, credit institutions will apply interest rates of deposits prescribed by this Circular.
This Circular replaces Circular No. 15/2013/TT-NHNN dated 27 June, 2013 of the Governor of the State Bank of Vietnam providing the maximum interest rates for deposits of organizations and individuals at credit institutions, branches of foreign banks.




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