7 managers manage 1 sausage, businesses say "hard to breathe"

Business representatives shared that in the process of importing and exporting production materials, there is no step that does not have envelopes.

This concern of enterprises was shared by Mr. Mai Huy Tan - Vietnam Association of Enterprise Directors, Chairman of the Board of Directors of Duc Viet Food Joint Stock Company, Chairman and General Director of Viet Duc Bridge Consulting Company at the workshop on the revised Enterprise Law. The workshop was organized by the Vietnam Chamber of Commerce and Industry this morning (July 29) in Hanoi.

Machine management and "mainly action"

According to Mr. Mai Huy Tan, the revised Enterprise Law has a greater impact on the establishment of new enterprises. “But I think we should pay attention to how it will impact the half million enterprises currently operating, how it will make it easier for them to breathe. The revised Law is to create a more open and transparent legal corridor for enterprises. But it is not just about amending the law, but also many other things that must be amended so that enterprises can breathe easier,” said Mr. Tan.

Mr. Mai Huy Tan shared at the workshop

Citing his own company, Mr. Tan said that just one sausage of ours now has 7 management departments (Ministry of Agriculture, Rural Development and Rural Development, Ministry of Health, Ministry of Finance, Ministry of Natural Resources and Environment, Ministry of Science and Technology, Ministry of Industry and Trade, and Ministry of Public Security). Recently, the environmental police came to inspect our company. We invested billions in the environmental treatment system, the indicators are very good. But in the end, an environmental police officer discovered that our waste area was in a blue bin with the red words "Garbage collection". According to the law, waste collection must be in a red container. The inspection team recorded in the violation record "The container is not the right color".

From this story, Mr. Mai Huy Tan believes that the mechanical and “mainly administrative” nature of the management agencies, 7 ministries for 1 sausage is too much. Because in the US or Germany, there is 1 agency, the FDA (Food and Drug Administration), that does this job. “Therefore, amending the law is important, but we also have to amend the business environment, including many different contents” – Mr. Mai Huy Tan reiterated.

Another content mentioned by Mr. Tan is that the law pays much attention to the convenience of enterprise registration, but the death certificate is equally important. Accordingly, the conditions for terminating operations for enterprises to stop operating and dissolve must also be very simple and clear. In reality, there are many enterprises that have stopped operating but cannot be dissolved.

Telling his own story, Mr. Tan said: 7 years ago, I saw an opportunity and planned to build a pig farm to supply meat for my company's sausage processing factory. However, after that, the business conditions were no longer suitable (because Hung Yen did not have any planned areas for raising pigs). Since then, I have not implemented that project anymore and Duc Viet Livestock Joint Stock Company was established without invoices, did not do anything else but could not complete the dissolution procedures. The management agencies still manage the enterprises on paper. Every year, we still receive tax notices... related to Duc Viet Livestock Joint Stock Company. We have completed all the procedures to stop operations but cannot dissolve. “We propose that the law should be able to exclude businesses that are established and then dissolved to buy and sell invoices or for some other reason, and should be strictly controlled. In general, people establish companies because they see a business opportunity. But this opportunity does not last forever, it will pass and then be dissolved. In this case, the procedures to dissolve a company are extremely difficult and take a long time.”

A story about “sharing” when doing import procedures was also shared by Mr. Mai Huy Tan. We want to import a container of spices to produce mustard, we have to go through many stages and there is no stage where the envelope is not lost. We ensure that it is completely clean, without unreasonable rationalization, the documents are exactly as they are. Therefore, there cannot be documents stating how much the envelope is for Mr. A today, how much is for Mr. B, so we have to take from the dividends and profits of shareholders and put them into a fund for operations to spend, keep the company's books clean and have only one book. This decision of mine is worth billions, not millions.

“Here I want to share that we have to deal with many headaches every day. Almost, the enthusiasm for development and investment has decreased a lot. How can the Vietnamese business community develop if there is no more enthusiasm for investment? The State must think about developing the business community in a healthy way. When business people do not want to develop and do not want to invest anymore, does Vietnam's economy have a future?” – Mr. Tan expressed his concerns.

There are still many unreasonable issues.

According to lawyer Vu Xuan Tien, Head of the Policy Consulting and Review Board of VACD, the current draft Law on Enterprises (amended) still has some points that do not keep up with practical life.

For example, the provisions on partnerships. The draft law stipulates that “in addition to general partners, a partnership may also have capital contributors” and “capital contributors are only responsible for the company’s debts within the scope of the capital contributed to the company”. In addition, the draft also stipulates that “a partnership has legal entity status”.

In the eyes of a jurist as well as a lawyer who has consulted on the operations of many businesses, Mr. Vu Xuan Tien affirmed that the regulation of having members contributing capital in a partnership company is not feasible in practice. This regulation even creates a type of "bipolar" enterprise, which is not in accordance with the provisions on legal entities under Article 84 of the Civil Code.

According to the reality that lawyer Vu Xuan Tien gave, he currently knows of 7-8 partnerships that do not have any capital contributing members and in fact has not yet found a partnership that has any capital contributing members.

Therefore, the lawyer believes that it is necessary to revise the draft law in the regulation on partnerships without the above 3 issues.

In addition, Mr. Vu Xuan Tien also said that the regulation that economic groups have their own charter of organization and operation as in the draft law is incorrect because groups do not have legal status because the Civil Code only regulates charters for legal entities.

Two other issues that, according to lawyers, are important but have not been included in the draft are regulations related to joint stock companies and post-audit.

Regarding joint stock companies, Mr. Tien said that the draft needs to have one or several provisions regulating the types of joint stock companies depending on the level of "socialization" of shareholders.

Accordingly, there should be three more types of companies: internal joint stock companies, public joint stock companies and joint stock companies listed on the stock market, of which, internal joint stock companies are to suit many family businesses today.

Regarding post-inspection, Mr. Tien proposed to add Clause 2, Article 217 of the draft law with the content that post-inspection is carried out for enterprises after one year from the date of receiving the Certificate of Business Registration in the form of an inter-sectoral inspection decided to be established by the People's Committee of the province or centrally-run city. The post-inspection is not to impose administrative penalties on enterprises, except in cases of serious violations of the law. The Government shall stipulate the content, order and procedures for post-inspection.

According to Mr. Vu Xuan Tien, the reason for including the regulation on post-audit in the draft is because in the Enterprise Law 2000 and Enterprise Law 2005, the issue of pre-audit has been "opened" but there is no regulation on post-audit, which has allowed some enterprises to take advantage of loopholes to violate the law.

According to VOV