Unblocking the flow of legal policies - Lang Son Electronic Newspaper

According to the Vietnam Business Law Flow Report 2023 recently released by the Vietnam Federation of Commerce and Industry (VCCI), reform activities, simplification of administrative procedures, and cost reduction for businesses are being strongly promoted.

Solar panel production at JA Solar Vietnam Co., Ltd. in Viet Yen Industrial Park, Bac Giang province. (Photo: DUY LINH)

The Government, together with ministries, sectors and localities, have made great efforts to remove obstacles for businesses. However, there are still some legal "bottlenecks" that cause many businesses to incur costs and reduce their competitiveness.

The business community hopes that the Government will identify and soon "unblock" the flow of legal policies to support businesses, creating a favorable investment and business environment for businesses to develop in the new period.

Legal barriers

According to VCCI, in 2023, central agencies issued 16 laws, 98 decrees, 33 decisions, 510 circulars; including a number of major policies such as the Land Law, Housing Law, Draft Law on Special Consumption Tax, etc., which received great attention and response from people and businesses.

In addition, nearly 100 problems and inadequacies from businesses' reflections on regulations affecting investment and business activities were sent by VCCI to relevant agencies. Most of these recommendations received feedback, were acknowledged, and there were plans to review and amend them to remove obstacles for businesses in administrative procedures, costs, etc. In particular, the thinking in drafting policies as well as in the implementation process of management agencies has improved a lot, creating more favorable conditions for business entities.

However, there are still some problems in the issuance of construction standards on fire prevention and fighting, inspection of transit goods, ceiling on interest costs in transactions with banks, etc. that have not been thoroughly resolved or there is no consensus on views between management agencies and enterprises. VCCI Chairman Pham Tan Cong said that the reduction and simplification of business conditions has been implemented very vigorously, but recently it is not as strong as in the previous period.

There is a paradox that when drafting new legal documents or amending and supplementing existing documents, unreasonable business regulations and conditions appear or are incorporated in the form of sub-licenses in technical standards or expressed in the form of certificates, creating additional burdens for businesses. Therefore, with the constant movement of economic activities, state management agencies must remove this "bottleneck", and at the same time change their reform thinking towards creating transparent institutions, substantial and drastic reforms, in order to introduce more suitable and favorable policies for businesses in production and business.

Chairman of the Vietnam Contractors Association Nguyen Quoc Hiep shared that administrative procedures for investment in Vietnam are very complicated and complicated. To meet investment regulations, it is necessary to have more than 30 seals, causing businesses to waste a lot of time and money. Therefore, legal procedures need to be thoroughly streamlined, with clear judicial regulations on responsibilities in handling administrative procedures and there must be drastic participation from all levels of government for the reform to be truly effective.

Real, effective cuts

In fact, over the past years, the State has taken many measures to overcome policy shortcomings through activities of reviewing and amending cumbersome regulations. The Government Office's report on administrative procedure reform shows that from 2021 to 2023, 2,770 regulations in 224 legal documents out of a total of 15,801 business regulations were updated and made public on the Business Regulation Consultation and Lookup Portal, which were reduced and simplified.

However, according to experts, these activities are only to solve the situation, to fix some shortcomings at the "tip" without considering the overall "root" of the problem in the legal system. The number of business conditions cut is very small or only cut business conditions that are not meaningful, not really creating favorable conditions for businesses. In addition, the number of regulations considered to be cut and simplified is mainly compiled according to administrative reports, there is no assessment of the quality of reform. Therefore, in reality, the compliance costs of businesses have decreased but not much.

Dr. Nguyen Minh Thao, Head of the Business Environment and Competitiveness Department of the Central Institute for Economic Management (CIEM), said that since 2019, especially since 2020, the issue of reforming the business environment and reducing business conditions has tended to stagnate. Business conditions are still general and unclear, creating many barriers, limiting business freedom, posing risks and creating additional compliance cost burdens for businesses.

The results of the 2023 review by CIEM show that there are still some shortcomings when the reduction of conditional business investment sectors is not substantial and not in line with the spirit of reform. There are unnecessary, unreasonable, meaningless and ineffective business conditions in terms of state management that still exist; some shortcomings have lasted for many years but have not been resolved to date. For example, shortcomings in regulations on fire prevention and fighting have been reported by businesses since 2020, but are still at the draft guidance stage because they set too strict requirements and require 100% consensus from ministries and branches.

To improve the business environment as directed by the Government, Dr. Nguyen Minh Thao recommended that ministries and branches should make efforts to review and drastically reform to reduce administrative procedures and compliance costs for businesses. The reform must be detailed, specific, transparent, easy to understand, easy to identify and consistent in implementation as well as with current laws. In addition, before amending and reforming, it is necessary to increase consultation and get opinions from businesses to ensure that business conditions are specific, transparent, clear, easy to understand and feasible. For business conditions that are not suitable for practice or deeply interfere with the investment and business activities of businesses, it is recommended to abolish or amend them in the direction of simplification, reduce compliance costs and not interfere too deeply with the operations of businesses. Only then can we create more confidence among investors and businesses, increase the attractiveness of the business environment and clear "bottlenecks" in the flow of legal policies for businesses in the coming time.

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