VCCI recommends replacing the subject of recording the fourth-level industry code when registering to establish a business

According to current regulations on business registration, the business founder or enterprise chooses a level four economic sector in the Vietnamese Economic Sector System to record the business sector in the business registration dossier.

No recommendation to remove the fourth-level industry coding, but to change the implementing entity

VCCI does not recommend removing the requirement to record the fourth-level industry code when registering to establish a business, change or add an industry, because determining the industry in the business registration procedure is to serve state management goals, VCCI emphasized in a document sent to the Ministry of Planning and Investment for comments on the Draft Decree on business registration.

According to Article 7 of the Draft Decree on business registration, the business founder or enterprise chooses a level four economic sector in the Vietnamese Economic Sector System to record the business sector in the business registration dossier.

This is not a new regulation, inherited from current legal documents. In fact, during the process of drafting Decree 78/2015/ND-CP, Decree 108/2018/ND-CP, Decree 01/2021/ND-CP, VCCI has repeatedly reported on the inadequacies of the regulation, even proposed to abolish this industry coding, but it has not been recorded.

In this revision, VCCI expressed a more moderate view. Specifically, VCCI proposed to maintain the regulation on recording the level 4 industry code when registering to establish a business, and at the same time, identify the subject that must perform this industry code recording as the state management agency instead of requiring the business.

Explaining this proposal, VCCI said that state agencies can rely on the industries that businesses register to determine appropriate groups and subgroups to serve statistical purposes or other management purposes.

Moreover, VCCI also made it clear that regardless of whether a business registers for an industry that is included or not in the Vietnam Economic Sector System, as long as it is not a prohibited industry, the business will be allowed to do business according to the provisions of law. Therefore, from the perspective of the business, determining the industry code at the time of business registration is of little significance.

Therefore, VCCI also recommends that if the Drafting Committee continues to not take note of this recommendation, Article 7 of the Draft needs to be clearly defined in the regulations to minimize possible barriers from implementation when carrying out business registration.

Unknown case of registering an industry without a name

Specifically, VCCI does not fully agree with the content of Clause 5, Article 7 of the Draft, which stipulates: “For business lines that are not included in the Vietnamese Economic Sector System and are not yet regulated in other legal documents, the Business Registration Authority shall consider recording these business lines in the National Database on Business Registration if they are not prohibited from investment and business, and at the same time notify the Ministry of Planning and Investment (General Statistics Office) to add new business lines”.

The question is, in this case, will the business registration agency record the business line in the database first before the enterprise can register its business, or will the business registration agency allow the enterprise to register its business line in this new business line before recording it in the database?

In fact, the enterprise reflected that it was instructed by the business registration agency to: Temporarily remove the registered business line from the registration/change dossier so that the business registration agency can record it in the National Database, notify the Ministry of Planning and Investment, then the enterprise can return to make the addition. However, this implementation has greatly affected the business registration activities and the spirit of reform, creating favorable conditions for enterprises when carrying out this procedure.

To ensure transparency and freedom of business, VCCI proposes that the Drafting Committee amend the provisions in Clause 5, Article 7 in the direction that the business registration agency will register business according to the business line and profession at the request of the business and record this business line and profession in the National Database.

This is the content that many businesses are interested in and have expressed their opinions. Recently, in the Workshop to collect comments on the Draft organized by VCCI and the Ministry of Planning and Investment, many businesses continued to reflect on the difficulties, even arbitrariness in implementing the above regulations in cases where businesses register for business lines and occupations that are not included in the Vietnamese Economic Sector System and are not yet regulated in other legal documents.

According to Ms. Tran Thi Thanh Huyen, Member Lawyer, NHQuang and Associates Law Firm, whether or not it is approved depends largely on the viewpoint of the local business registration authority. “In fact, this problem is a “painful” issue for businesses, in the context of the Enterprise Law stipulating: businesses are free to do business in industries and professions that are not prohibited by the Law,” Ms. Huyen said.

This is also the reason why Ms. Huyen does not support the Draft supplementing the provisions in Clause 8 on recording the business lines of branches and business locations of enterprises (according to the rules for recording the business lines of enterprises).

“This additional content is unnecessary and may cause confusion for businesses during implementation. Article 44 of the 2020 Enterprise Law stipulates that the branch's business lines must be consistent with the enterprise's business lines and the business location is where the enterprise conducts specific business activities. Therefore, in reality, businesses are recording the branch's business lines and business locations as consistent with the licensed enterprise's business lines and without any problems. It is proposed to remove the additional content in Clause 8, Article 7,” Ms. Huyen suggested to the Drafting Committee.

VCCI also agrees with this proposal, noted in the written comments sent to the Ministry of Planning and Investment.

Source: https://baodautu.vn/vcci-kien-nghi-thay-chu-the-ghi-ma-nganh-cap-bon-khi-dang-ky-thanh-lap-doanh-nghiep-d221327.html