Are household business allowed to lower sale prices on goods that are about to expire in Vietnam?

Hello, Lawnet would like to answer as follows:

1. What is a household business?

In Article 79 of the Law on Enterprises 2020, regulations on business households are as follows:

- A household business is established by an individual or family household members that shall take responsibility for business operations of the household business with all of their property. If a household business is established by members of a family household, one of them shall be authorized to act as the representative of the household business. The individual applying for registration of household business or the person authorized by the family household members to act as the representative of the household business shall be the owner of the household business.

- Households engaged in agriculture, forestry, aquaculture, salt production, street vendors, nomadic or seasonal businesspeople, and service providers earning low revenues are not required to apply for establishment of household businesses, except for conditional business lines. The provincial People’s Committees shall specify the low revenues applied within their provinces.

Thus, a household business is established by an individual or family household members that shall take responsibility for business operations of the household business with all of their property

2. Are household business allowed to lower sale prices on goods that are about to expire in Vietnam?

According to the provisions of Clause 6, Article 11 of the Law on Price 2012, lowering sale prices of goods or services but not be considered violation of law on competition and law of fighting dumping for import goods, and simultaneously must post public the old price level, the new price level, time limit of price lowering at the transaction place in the following cases:

a) Fresh goods;

b) Inventory goods;

c) Seasonal goods or services;

d) Goods or services for promotion as prescribed by law;

dd) Goods or services of enterprises in cases of bankruptcy or dissolution; changing locations, business/production trades;

e) Goods or services upon performing policy on price stabilization of the State.

From July 1, 2024, the Law on Price 2023 officially takes effect, thereby regulating the rights of organizations and individuals trading in goods and services as follows:

Article 8. Suppliers of goods and services may:

4. Lower the sale prices of goods and services without being considered violating laws on competition and laws on anti-dumping of imported goods. Old prices, new prices, and discount periods must be publicly listed for:

a) Fresh goods;

b) Inventory goods;

c) Seasonal goods and services;

dd) Goods and services for promotion as prescribed by laws;

dd) Goods and services of enterprises in cases of business suspension, bankruptcy, dissolution, or changes to business locations or professions;

e) Goods and services upon the implementation of price stabilization policies of the State.

Thus, compared to current regulations, the Law on Price 2023 has additional provisions for the case of "Goods and services of enterprises in cases of business suspension".

It can be seen that the law does not prohibit business households from lowering product prices. However, business households discounting goods that are about to expire are not considered violating competition laws and anti-dumping laws in the following cases:

+ Fresh goods;

+ Inventory goods;

3. Obligations of household businesses in Vietnam under the Law on Price

According to the provisions of Article 12 of the Law on Price 2012, the obligations of business or production organizations, individuals in Vietnam are as follows:

- Making price plan for goods or services which they manufacture, business in the List of goods or services defined prices by the State and submitting to authorities for decision.

- Complying with decisions on prices, measures of price stabilization of competent State agencies.

- Registering sale prices or buying prices for goods or services being subject to register price and taking responsibility for exactness of registered price level as prescribed by law.

- Declaring sale prices or buying prices for goods or services and taking responsibility for exactness of declared price level for goods or services be subject to declare prices under provisions of Government.

- Posting up prices:

+ For goods or services being defined prices by the State, the production or business organizations, individuals must post up prices exact with prices stipulated by competent State agencies and exactly buy, sell under posted prices;

+ For goods or services not in the List of goods or services being defined prices by the State, the production or business organizations, individuals shall decide prices for posting up and not permitted to buy, sell with prices higher than posted prices;

- Publicity of information on prices of goods or services within their authority of determining prices as prescribed in this Law.

- Timely, exactly, completely supplying relevant figures, documents at the requirement in written of competent State agencies in cases prices being determined by the State, measures of price stabilization for goods or services of the production or business organizations, individuals being applied.

- Solving timely all complaints on prices of goods or services which they manufacture, business. Compensating for acts violating law on prices as prescribed by law.

Thus, according to the Law on Price 2012, business households have a number of obligations such as: complying with the State's price regulations, registering/declaring prices, etc.

Best regard!

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Key word: price | in Vietnam | goods | sale prices | household business |

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