4 Government Resolutions and the 'battle' awaiting the Ministers

The Government has consecutively issued 4 Resolutions requesting the removal of unreasonable and restrictive business conditions...

Recently, Prime Minister Nguyen Xuan Phuc expressed his impatience to members of the Government: “There are a lot of business licenses, people complain a lot, they need to be checked again. This is also the step that gives rise to many complicated problems.”

Government's determination

In particular, the Prime Minister emphasized that there is not much evidence that licensing costs have decreased. “The Minister sees that businesses have to queue for a long time, so he must review the Ministry’s working style. Unreasonably imposed business conditions must be eliminated,” the Prime Minister stated.

The government has called for OECD standards to be applied to eliminate secondary licenses that hinder businesses.

Since the beginning of July, the Government has issued four consecutive resolutions requiring ministries to review and eliminate unreasonable business conditions. These are the resolutions of the regular meetings in June, July, and August, and the resolution of the Government's special meeting on law-making on August 22. Also at this special meeting, the Government focused on discussing business conditions.

In which, the July Resolution clearly assigns tasks to the Ministries: Reviewing business conditions according to OECD market principles, proposing to abolish conditions restricting competition.

The Prime Minister was also very thorough in continuously issuing official dispatches showing that he was listening to every suggestion from businesses and experts, such as requesting ministries to review reports from the Central Institute for Economic Management (CIEM) and the Vietnam Chamber of Commerce and Industry (VCCI).

In response to the press opinion of Mr. Nguyen Tuong, Deputy General Secretary of the Vietnam Logistics Business Association, that many business conditions are still constraining the development of businesses in this industry, the Prime Minister also assigned the Ministry of Industry and Trade to preside over and coordinate with relevant agencies to inspect and promptly remove them.

Not only stopping at directional instructions, in fact, recently the Government has also carefully considered business conditions in the process of drafting legal documents.

For example, when giving opinions on the draft Law amending and supplementing the Law on Physical Training and Sports, the Government agreed not to stipulate that sports business households must be granted a certificate of eligibility as with enterprises. Instead, it only stipulates post-inspection to facilitate and reduce administrative procedures for these households.

These are proofs of the Government's efforts, but on the other hand, they are also examples of a comment by Dr. Nguyen Si Dung, former Deputy Head of the National Assembly Office: Ministries and branches propose many business conditions and the Government and the National Assembly have to evaluate many of them to filter.

In fact, the business community has also noted many reform moves by the Ministries in recent times. Most notably, the Ministry of Industry and Trade has proposed to amend and abolish a series of conditions in the fields of rice export, gas trading, alcohol trading, etc. It is also very welcome that the Ministry of Finance has proposed to abolish the entire Decree 104 of 2007 on debt collection business, meaning that all business conditions for this industry will be abolished.

However, the business community has not seen strong movements from many other ministries and sectors. As Lawyer Tran Huu Huynh, Chairman of the Vietnam International Arbitration Center (VIAC), said, “I have participated in discussing this issue since my hair was green, and now my hair is gray, but the story still has to be discussed over and over again.”

The battle awaits the Ministers

"Conditional business and business registration are still a battle, not updated, it is impossible to accurately count how many conditions there are because these conditions change every day, every hour," Mr. Phan Duc Hieu, Deputy Director of CIEM, worried.

Explaining the reason why the Ministries are slow to move, Dr. Nguyen Dinh Cung, Director of CIEM, said that first of all, it is because there has not been a change in thinking and awareness.

“State management of business is still following the old way, still following the mindset of control and pre-audit. There is confusion between regulations on scale, quantity and effectiveness of state management. Advisory and drafting agencies have not boldly researched, innovated and switched to applying other more effective management measures, more suitable to the development of society, science and technology to replace the 'traditional' regulations on business registration. Current regulations on business registration are basically the same as those issued many years ago,” Mr. Cung stated.

Similarly, Lawyer Tran Huu Huynh said that eliminating “sub-licenses” is an arduous battle that requires real determination from agencies. “But I have yet to see the determination from the agencies. In the reviews and surveys, I have not seen any members from the ministries and branches participating, or in the workshops, I have not seen the active participation of the ministries and branches,” Mr. Huynh commented.

Representing the business community, Chairman of VCCI Vu Tien Loc commented that although the Government's policy is to continuously review and reform business registration, the ministries are almost "inactive". People and businesses are constantly complaining but the solutions are quite slow. To do this, Chairman of VCCI said that first of all, we must change our mindset as the Prime Minister has repeatedly reminded.

Commenting that “many business conditions protect the interests of ministries and sectors”, Dr. Vu Thanh Tu Anh (Fulbright University), a member of the Prime Minister’s Economic Advisory Group, expects that OECD standards will be like a “sword of honor” to help Vietnam cut off unreasonable business conditions that are harmful to the business environment.

“If we strictly use OECD standards, I think we can cut up to two-thirds of the current business registration requirements,” Dr. Vu Thanh Tu Anh told VCCI newspaper.

According to Director Nguyen Dinh Cung, reforming business conditions “will be very easy and also very difficult”. It will be very easy if the Ministers agree and support, because if we just stop at strong commitment, it is not enough, we must take decisive action, follow through, and pursue responsibility to create pressure on the intermediary level to change the management method, to accompany, share and support the Prime Minister in the reform efforts. Otherwise, reform will be very difficult.

On the Government side, the Ministry of Planning and Investment has been requested to develop a Decree on controlling business registration and submit it to the Government before December this year. This Decree is expected to help stop unreasonable and unnecessary business registrations that create unreasonable barriers for businesses./.

According to VOV