THE BUSINESS INFORMATION CENTER AT THE VIETNAM CHAMBER OF COMMERCE AND INDUSTRY

No.15 (18) Aug 2006

   

About the Bulletin
 

Registration & Feedback
 

Issue No. 22
Access to land
:: Article  :: Viewpoints
 

Issue No. 21
The state capital
investment corporation
:: Article  :: Viewpoints
 

Issue No. 20
Streamlining the
business startup process
:: Article  :: Viewpoints
 

Issue No. 19
Effective Implementation of the new Enterprise and Investment Laws
:: Article  :: Viewpoints
 

Issue No. 18
Starting a business in Vietnam
:: Article  :: Viewpoints
 

Issue No. 17
Streamlining
Business Licensing
:: Article  :: Viewpoints
 

Issue No. 16
Women's entrepreneurship
:: Article  :: Viewpoints
 

Issue No. 15
Private Credit Bureaus
:: Article  :: Viewpoints
 

Issue No. 14
Efforts in improving business environment
:: Article  :: Viewpoints
 

Issue No. 13
Corporate governance
:: Article  :: Viewpoints
 

Issue No. 12
The common investment law
:: Article  :: Viewpoints
 

Issue No. 11
Private sector firms
:: Article  :: Viewpoints
 

Issue No. 10
The unified enterprise law
:: Article  :: Viewpoints
 

Issue No. 9
Investment incentives
in Vietnam
:: Article  :: Viewpoints
 

Issue No. 8
Business Environment in Vietnam - Overview 2004
:: Article  :: Viewpoints
 

Issue No. 7
Business Development Services
:: Article  :: Viewpoints
 

Issue No. 6
Local governance
& Economic growth
:: Article  :: Viewpoints
 

Issue No. 5
SOE Valuation
:: Article  :: Viewpoints
 

Issue No. 4
Corp. Social Responsibility
:: Article  :: Viewpoints
 

Issue No. 3
Trademark protection
:: Article  :: Viewpoints
 

Issue No. 2
The stock market
:: Article  :: Viewpoints

 

Issue No. 1
The revised draft Land Law
:: Article  :: Viewpoints

 

 

VIEWPOINTS
 
A "one stop" approach for the three startup processes (business registration, company seal and tax code registration) could contribute to effective reform  
of business procedure  

  • Businesses in Hanoi and Vinh Phuc are recommending that the government regularly review and further simplify the existing business entry regulations and procedures so that more businesses are encouraged to register their operations. The government should authorize the Business Registry, which is under the Department of Planning and Investment, to act as the ”single-door” for processing business registration and to coordinate registration requirements from the provincial level Departments of Public Security and Taxation. In the long run, it is recommended that the business registration number be integrated with the tax code so that the Government's source of revenue from business enterprises is predictable and efficiently managed The national business information database should also be upgraded to facilitate the name-checking process nationwide.

Mr. Nguyen Anh Tuan, Managing Partner,
Bizconsult


  • Under Decision No. 233/2004/QÐ-UB of the Lao Cai People's Committee, the Business Registry of Lao Cai DPI has been authorized as the single door to receive and process business establishment applications. According to this Decision, the Business Registry is also responsible for helping businesses register their seals at the Public Security Department and get tax codes at the Tax Department. The greatest benefit of this model is that it reduces the time to start up a business. It now takes only seven to eight days for businesses to get all the necessary documents (one day for the business registration certificate, five days for the company seal and seven days for the tax code) as some steps can be undertaken simultaneously. The second benefit is that businesspeople do not have to repeatedly visit many places. The third benefit is that thanks to regular communication among public agencies, especially between DPI and the Tax Department, it is easy for both agencies to track businesses. This is a good starting point for putting into place an efficient post-registration monitoring system.

Mr. Vu Kim Quy, Head of Business Registry,
Department of Planning and Investment, Lao Cai province


  • We need to distinguish between simplifying administrative procedures and reforming public administration. In my opinion, simplifying administrative procedures means abolishing overlapping steps required by different administrative agencies; citizens and businesses should not need to provide the same information repeatedly to different agencies. Rather, public agencies should communicate and share such information. In public administration reform, it is critical to review the functions and responsibilities of each agency so that overlaps and bureaucracy in the whole administrative mechanism can be eliminated.

    In the short term, it is advisable to combine the three administrative steps (business registration certificate, seal-making and tax code registration) to further simplify business establishment procedures but not take major steps like combining the business registration number and the tax code. It is too early to do this as it would affect the operations of each agency, which are difficult to adjust in the short term.

    One of the strengths of our business information database is its nationwide coverage, which enables better tracking and controlling of businesses. In the long run, our database is ready for linkage with the business registration database, so that businesses face reduced bureaucracy and public agencies operate more efficiently.

Ms. Nguyen Thi Thuan, Deputy Director,
Center for Information Technology and Statistics, General Department of Tax


  • Under Decision No.1551/2006 of the Hai Phong People's Committee, the Department of Planning and Investment (DPI) has been coordinating with the Tax Department and Public Security Department to plan and implement a streamlined “one-stop shop” (một cửa liên thông) for business establishment procedures. This one-stop shop will reside within DPI, and its coordination is based on a number of fundamental principles. First, businesses only have to visit a single place for advice on, to apply for, and to obtain their business registration certificates, register their company seals, and get their tax codes. Second, there should not be any conflict between the existing functions and responsibilities of the three agencies. Third, the staff appointed to work at this streamlined one-stop shop should be professional and have sufficient capacity and expertise to advise businesses on the whole process of business establishment.

    However, in order to effectively implement this streamlined one-stop shop, four major issues must be taken into account. First, some questions related to its structure must be resolved such as: which agency should be authorized to manage this single door; and what kind of communication should there be between this door and the back office functions of relevant agencies? Second, what is the best and most efficient way of allocating human resources to this one-stop shop? In this case, how should the Tax and Public Security Departments assign their staff to be on duty at DPI? A police official normally spends only 25% of his time working on seal registration; is it efficient if he has to stay at the one-stop shop for 8 hours a day, as staff of the Business Registry usually do? Third, a national legal framework governing this coordination will definitely enable more effective implementation at the local level. Fourth, the success of this model depends on the customer-oriented attitude of public servants and on their willingness to cooperate with staff across public agencies.

    Finally, this linked one-stop shop is just a short-term solution. In the long run, public agencies must use information technology (email, LAN, intranet, etc.) to communicate with each other so that public services, especially those for businesses, are handled in the fastest and most cost-efficient way.

Mr. Dang Van Hai, Head of Business Registry,
Department of Planning and Investment, Hai Duong City


  • It should be noted that in order to simplify administrative procedures for businesses, we should simplify not only market entry procedures, but also those procedures that encompass the overall life cycle of businesses, such as licensing for conditional businesses (“baby licenses”), resolution of internal conflicts of interest, registration of any change in the business registration dossiers, dissolution, and bankruptcy.

Mr. Nguyen Dinh Duong, Deputy Director,
Department of Planning and Investment, Hanoi


  • In modern public administration, the government should treat citizens, businesses and investors as real customers. When entrepreneurs need any service from the state, such as a business registration certificate, a construction permit or an environmental license, it would be ideal if they only had to visit a single place where all procedures are simple and transparent. In conjunction with the effort to computerize business registration services in some provinces, the model of a streamlined “one-stop shop,” where businesses can deal directly and at once with the authorized public servants from the DPI, Tax and Public Security agencies for the first three steps of business establishment procedures, is a good initiative and should be implemented to further simplify provincial-level market entry. In addition to having a single access point for these three services, it is necessary to review and streamline each administrative agency's back office procedures so that businesses can be established within ten days.

    If leaders of a province are truly determined to reform business registration procedures and consider such change as a breakthrough step in the local public administrative reform agenda, this may help speed up reforms in other administrative areas, improve the province's image and enhance its competitiveness.

Mr. Vu Quang Thinh, Partner,
Management Consulting Group (MCG),
Consultant to IFC-MPDF Provincial Simplification Project


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Publisher: Dao Tuan Dung - Director of BIZIC - VCCI
Office: 5th floor - International Trade Center - No. 9 Dao Duy Anh Str., Hanoi
Tel: (84-4) 574 3084 - Fax: (84-4) 574 2773 - E-mail: vcci@hn.vnn.vn