SME support law approved

Tuesday, Jun 13, 2017 10:20

Frozen seafood production at Saigon Food Joint Stock Company in HCM City. — VNA/VNS Photo An Hieu

With 83.5 per cent approval, the National Assembly yesterday approved the Law on Support for Small- and Medium-sized Enterprises (SMEs).

The law regulates principles, contents and resources to support SMEs, as well as responsibilities of agencies, organisations and individuals relating to the support for SMEs.

Under the law, SMEs include micro-enterprises and small- and medium-sized enterprises with fewer than 200 salaried employees. These enterprises must meet one of the following criteria: total investment capital not exceeding VND100 billion (US$4.4 million) or the total revenue of the previous year not exceeding VND300 billion.

Support for SMEs includes access to credit; tax incentives; production space; technology application and transfer; market expansion; provision of information, consultancy and legal aid; and human resources development.

The law requires that the support for SMEs respect market rules and fall in line with international treaties of which Viet Nam is a member. The support must be transparent in terms of contents.

The law will take effect from January 1, 2018.

SMEs accounts for around 97 per cent of the firms in Viet Nam.

Supervision work

The NA also approved a Resolution on its 2018 supervision agenda, with 88.8 per cent of the votes.

In 2018, at the fifth session of the 14th NA, the NA will review the Government report on implementation of the socio-economic development plan and State budget of 2017; implementation of the socio-economic development plan and State budget of the early months of 2018; and report on the the State budget balance in 2016 and other related reports.

At this session, the NA will supervise implementation of policies and laws on managing and using State capital and assets at State enterprises, and the equitisation of State-owned enterprises from 2011 to 2016.

Foreign trade management

Also yesterday, the NA adopted the Law on Foreign Trade Management.

The law regulates foreign trade management and development measures and deals with disputes relating to the application of foreign trade management measures.

Under the law, the State will manage foreign trade activities in line with Vietnamese laws and international treaties of which Viet Nam is a member.

Foreign trade management must ensure transparency, equality and administrative simplification; ensure the rights and legitimate interests of the State and business people from all economic sectors and help promote domestic production and export.

The law will take effect on January 1, 2018.

Draft on bad debts

Lawmakers also discussed a draft Resolution on irrecoverable debt relief by credit institutions.

The resolution’s 18 articles cover legal lenders’ rights, debt market development, guaranteed assets settlement and other areas of interest.

The deputies said bad debt was an urgent problem. Although the banking sector has invested great efforts, a lack of essential mechanisms made it hard to deal with bad debt resolutely.

They agreed with the Government on the need for the Resolution to help create legal conditions to tackle difficulties relating to the settlement of bad debts.

However, some regulations of the Resolution still need to be made clearer or adjusted, including those relating to the concept of bad debt, mechanism to settle bad debts, and procedures and processes to seize guaranteed assets in case of dispute.

Some deputies expressed concern that the Resolution would help absolve those people responsible for bad debts and suggested the Resolution require violators to take responsibility for causing bad debts, even those that are eventually recovered.

According to an SBV report, by the end of 2016 total uncollectible loans accounted for 5.8 per cent of all loans and investments. If hidden debts are also taken into consideration, the total is 10.08 per cent of the entire economy’s outstanding debts. — VNS

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