What is a startup according to the law in Vietnam? What are forms of assistance for startups in Vietnam?

What is a startup according to the law in Vietnam?

Pursuant to Article 3 of the Law on providing assistance for small and medium-sized enterprises in 2017:

Definitions

For the purpose of this Law, the terms below shall be construed as follows:

1. “women-owned SME” means an SME (hereafter referred to as “SME”) having one or more women owns at least 51% of its charter capital and at least a woman is the executive director of this enterprise.

2. “startup” is an SME that is established to implement its business ideas based on the exploitation of intellectual property, technology and new business models and is able to grow quickly.

3. “value chain” is a set of activities that create and increase the value of products or services and include consecutive stages such as idea creation, design, production, and the distribution of finished products to customers.

4. “distribution chain” means a set of intermediate organizations (enterprises, investors, business organizations) distributing an SME’s products to customers.

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As regulated above, startup is an SME that is established to implement its business ideas based on the exploitation of intellectual property, technology and new business models and is able to grow quickly.

What is a startup according to the law in Vietnam? What are forms of assistance for startups in Vietnam? - image from internet

What are criteria for identification of SMEs in Vietnam?

Pursuant to Article 4 of the Law on providing assistance for small and medium-sized enterprises in 2017 stipulating criteria for identification of SMEs in Vietnam:

- An SME is either a micro-enterprise, small enterprise or medium-sized enterprise having the annual average number of employees who participate in social insurance is not greater than 200 and satisfying one of the following criteria:

+ The total capital is not greater than 100 billion dong;

+ The enterprise’s revenue of the previous year is not greater than 300 billion dong;

- Micro-, small and medium-sized enterprises are identified according to each industry such as agriculture, forestry, aquaculture; industry and construction and trade and services.

What are forms of assistance for startups in Vietnam?

Pursuant to Clause 2 Article 17 of the Law on providing assistance for small and medium-sized enterprises in 2017:

Assistance for startups

1. A startup may receive the assistance if the following conditions are fulfilled:

a) The startup has been put into operation for up to 05 years from the day on which its first ERC is issued.

b) The startup has not initiated public offering of its securities (in cases of a joint-stock company)

2. Such an SME mentioned in Clause 1 of this Article is entitled to the following forms of assistance:

a) Assistance in the application and transfer of technologies, use of equipment at the technical establishments, incubators and co-working spaces, provision of instruction on testing and completing new products, services and business models;

b) Assistance in advanced training in development of products, investment attraction, providing advice on intellectual property, carrying out the procedures related to technical regulations and standards, measurement and quality;

c) Assistance in communication, publicity, promotion, connection of startups and attraction of investment from venture capital funds;

d) Assistance in commercialization of the results of scientific research and technological development, exploitation and development of intellectual property;

dd) The Government shall introduce policies on interest rate subsidy on loans taken by startups. The subsidy on interest rate is provided by credit institutions.

3. The Government shall provide detailed guidance on this Article.

As regulated above, startups in Vietnam are entitled to the following forms of assistance:

- Assistance in the application and transfer of technologies, use of equipment at the technical establishments;

- Assistance in incubators and co-working spaces;

- Assistance in provision of instruction on testing and completing new products, services and business models;

- Assistance in advanced training in development of products, investment attraction, providing advice on intellectual property, carrying out the procedures related to technical regulations and standards, measurement and quality;

- Assistance in communication, publicity, promotion, connection of startups and attraction of investment from venture capital funds;

- Assistance in commercialization of the results of scientific research and technological development, exploitation and development of intellectual property;

- The Government shall introduce policies on interest rate subsidy on loans taken by startups. The subsidy on interest rate is provided by credit institutions.

Best regards!