Which business lines are banned from business investment in 2024 in Vietnam?

Which business lines are banned from business investment in 2024 in Vietnam?

Pursuant to Article 6 of the Investment Law 2020 regulating banned business lines:

Banned business lines

1. The business investment activities below are banned:

a) Business in narcotic substances specified in Appendix I hereof;

b) Business in chemicals and minerals specified in Appendix II hereof;

c) Business in specimens of wild flora and fauna specified in Appendix 1 of Convention on International Trade in Endangered Species of Wild Fauna and Flora; specimens of rare and/or endangered species of wild fauna and flora in Group I of Appendix III hereof;

d) Prostitution business;

dd) Human trafficking; trade in human tissues, corpses, human organs and human fetuses;

e) Business activities pertaining to asexual human reproduction;

g) Trade in firecrackers.

h) Provision of debt collection services.

2. The Government’s regulations shall apply to production and use of the products mentioned in Points a, b, and c Clause 1 of this Article during analysis, testing, scientific research, medical research, pharmaceutical production, criminal investigation, national defense and security protection.

According to this Article, industries banned from business investment in 2024 in Vietnam include:

- Business in narcotic substances specified in Appendix 1 issued with the Investment Law 2020.

- Business in chemicals and minerals specified in Appendix 2 issued with the Investment Law 2020.

- Business in specimens of wild flora and fauna specified in Appendix 1 of Convention on International Trade in Endangered Species of Wild Fauna and Flora;

- Business in specimens of rare and/or endangered species of wild fauna and flora in Group I of Appendix III issued with the Investment Law 2020.

- Prostitution business;

- Human trafficking; trade in human tissues, corpses, human organs and human fetuses;

- Business activities pertaining to asexual human reproduction;

- Trade in firecrackers;

- Provision of debt collection services.

Which business lines are banned from business investment in 2024 in Vietnam? (Image from the Internet)

How much is penalty for organizations doing business in prohibited business investment fields in planning and investment activities in Vietnam?

Pursuant to Article 16 of Decree 122/2021/ND-CP regulating violations against regulations on conditions for business investment in Vietnam:

Violations against regulations on conditions for business investment in Vietnam

1. A fine ranging from VND 80,000,000 to VND 100.000.000 shall be imposed for contributing capital to, purchasing stakes or purchasing shares of a business organization without satisfying the prescribed conditions.

2. A fine ranging from VND 100,000,000 to VND 200,000,000 shall be imposed upon:

a) any investor that transfers part or whole of their investment project without satisfying the prescribed conditions; or

b) any foreign investor or business organization specified in Point a, Point b or c Clause 1 Article 23 of the Law on Investment 2020 that receives part or whole of an investment project without satisfying the prescribed conditions.

3. A fine ranging from VND 200,000,000 to VND 300,000,000 shall be imposed for making business investment in banned business lines prescribed by law.

4. Remedial measures: The violator is compelled to terminate their business investment activities and return the illegal benefits obtained from the business investment in the banned business lines if the violation specified in Clause 3 of this Article is committed.

According to this Article, organizations doing business in sectors prohibited from investing in the field of planning and investment will be fined from 200,000,000 VND to 300,000,000 VND and forced to terminate their business investment activities and return the illegal profits obtained from business investment in prohibited business investment sectors in Vietnam.

Note: The above fine applies to organizations. For individuals who commit the same administrative violation, the fine for individuals is equal to 1/2 (one-half) of the fine for organizations. (Regulated in Clause 2, Article 4 of Decree 122/2021/ND-CP)

What are regulations on policies on business investment in Vietnam?

Pursuant to Article 5 of the Investment Law 2020, policies on business investment are stipulated as follows:

1. Investors are entitled to carry out business investment activities in the business lines that are not banned by this Law. Regarding conditional business lines, investors must satisfy business investment conditions as prescribed by law.

2. Investors may decide their business investment activities on their own and take responsibility therefor in accordance with this law and relevant laws; may access and make use of loan capital, assistance funds, land, and other resources as prescribed by law.

3. Any business investment activity of an investor shall be suspended, stopped or terminated if such activity harms or potentially harms national defense and security.

4. The ownership of assets, capital, income, other lawful rights and interests of investors are recognized and protected by the State.

5. The State shall treat investors equitably; introduce policies to encourage and enable investors to carry out business investment activities and to ensure sustainable development of economic sectors.

6. International investment-related treaties to which Socialist Republic of Vietnam is a signatory are upheld and implemented by the State.

Best regards!