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Business registration in Vietnam has indeed been greatly
facilitated by recent reforms. However, it is still necessary to
further improve complex and time-consuming post-registration and
operations-related administrative procedures. For example, the
requirement that only the managing director of a firm can amend
its business registration license at the relevant agency
whenever there is any change either in the firm's business areas
or in its investment capital is quite rigid. It is a waste of
time for the busiest person in a company. The new Unified
Enterprise Law further improves the business registration
process, but a fundamental issue may not be resolved: the
requirement that a business has to register all areas of
operations at the time of its establishment or face amending its
business registration license afterwards. In my opinion, it is
more convenient that a business just declare what areas it is
going not to operate in; this would allow it to do business in
all other areas without having to amend its business license all
the time.
A recent survey conducted by Vision & Associates for CIEM/GTZ
found that administrative procedures are the biggest barriers to
an entrepreneur's chances of turning a business idea into a
reality. While the business registration process has become
easier, post-registration procedures, such as getting business
licenses for conditional business fields, complying with tax
codes, purchasing VAT invoice books, obtaining factory
construction permits, etc., are still cumbersome. Moreover, it
takes time, resources and additional informal charges to
ultimately get entrepreneurs through such processes. Take the
example of the VAT invoice book–enterprises are only allowed one
at a time. Businesses must return to the tax office and submit
supporting documents to prove that they have used up the old
books before they can purchase a new one. Some firms have to
dedicate one full-time person just to take on this role.
Finally, while the cost of setting up a business in Vietnam is
still higher than in other countries, I don't think this is the
main issue for entrepreneurs. For them, it is more important
that they do not waste a lot of time and do not have to incur
high informal fees and other costs.
Mr. Pham Nghiem Xuan Bac, Partner,
Vision & Associates
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 It
is critical to continue simplifying post-registration procedures
by allowing, for example, the business registration code to be
used as the tax code (since a citizen needs only one ID number),
and by strengthening the level of collaboration and
information-sharing among administrative agencies so that they
can serve businesses more effectively. Entrepreneurs currently
report that they have to visit and provide the same information
to a range of state agencies; this clearly indicates that the
current degree of coordination and information-sharing between
state authorities is unsatisfactory. Take another example of
unnecessary administrative procedures - the VAT invoice book.
Invoices should be issued by firms themselves rather than by the
Ministry of Finance; this would eliminate the incentive for
"ghost" firms to sell invoices.
Mdm. Pham Chi Lan,
Prime Minister's Research Commission
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