Criteria for identification of startups in Vietnam

Criteria for identification of startups in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Criteria for identification of startups in Vietnam

A startup defined in Clause 2, Article 3 of the Law on providing assistance for small and medium-sized enterprises shall be identified according to one of the following criteria:

- Production, sale of products derived from inventions, useful solutions, industrial designs, integrated circuit (IC) designs, computer software, cell phone applications, cloud computing, new animal breeds, plant varieties, aquatic organism breeds.

- Production, sale of products that are created from trial production projects, prototypes and technology completion; production, sale of products that win national, international prizes for entrepreneurship, startups and science and technology prices in accordance with regulations of law on science and technology prizes.

- There are new technological solutions or business models that might increase the enterprise’s revenue by at least 20% in 02 consecutive years on the basis of analysis of market share, prospective development of the products and competitiveness of the enterprise.

(Article 20 of Decree 80/2021/ND-CP)

2. Method for selection of startups eligible for assistance in Vietnam

According to the criteria specified in Article 20 of of Decree 80/2021/ND-CP and the conditions specified in Clause 1 Article 17 of the Law on providing assistance for small and medium-sized enterprises, assisting organizations shall select eligible enterprises as follows:

- Select enterprises that won national or international prizes for startups or have startup-related products or projects, or are granted patents; or are granted science and technology enterprise certificate, high technology enterprise certificate or high technology-applying enterprise certificate.

- Select enterprises that have been invested in or will be invested in under commitment of startup investment funds; receive assistance or will receive assistance from co-working spaces, startup assistance organizations, service providers, incubation facilities, business promotion facilities, startup centers as prescribed by investment laws.

- Selection via a Council:

Assisting organizations may establish a Council to select eligible startups according to the criteria specified in Article 20 of this Decree following these principles:

= The quantity of members and working mechanism of the Council shall be decided by the establishing authority;

= At least 50% of the Council members shall be independent counselors. Other members shall be representatives of assisting organizations and work on a part-time basis;

= Operating budget of the Council shall be included in the budget for provision of assistance for SMEs of the assisting organization.

(Article 21 of Decree 80/2021/ND-CP)

3. Contents of assistance for startups in Vietnam

(1) Assistance in use of technical facilities, incubation facilities, co-working spaces

- Reimbursement of 100% of the cost of using equipment at technical facilities, incubation facilities, co-working spaces but not exceeding 20 million VND/year/enterprise;

- Reimbursement of up to 50% of the cost of leasing premises at incubation facilities, co-working spaces but not exceeding 5 million VND/year/enterprise for up to 03 years from the conclusion date of the lease contract.

(2) Counseling intellectual property, use and development of intellectual property

- Reimbursement of 100% of the value of the advisory contract for establishment, transfer, use and protection of intellectual property rights in Vietnam but not exceeding 30 million VND/contract/year/enterprise;

- Reimbursement of 100% of the value of the advisory contract for preparation of description of inventions, industrial designs, corporate visual identity system but not exceeding 30 million VND/contract/year/enterprise;

- Reimbursement of 100% of the value of the advisory contract for management and development of products and services with protected intellectual property rights in Vietnam but not exceeding 50 million VND/contract/year/enterprise.

- Reimbursement of up to 50% of the value of the advisory contract for establishment, transfer, use and protection of intellectual property rights in foreign countries but not exceeding 50 million VND/contract/year/enterprise.

(3) Assistance in completion of procedures relevant to technical regulations, standards, measurement, quality; testing, completion of new business models, products

- Reimbursement of 100% of the value of the advisory contract for development and application of internal standards but not exceeding 10 million VND/contract/year/enterprise; development and application of quality control system but not exceeding 50 million VND/contract/year/enterprise;

- Reimbursement of up to 50% of the cost of testing sample measurement instruments; cost of inspection, calibration, testing of measurement instruments, measuring standards; cost of issuance of quantity seals of pre-packed goods according to technical measurement requirements but not exceeding 10 million VND/year/enterprise;

- Reimbursement of up to 50% of the cost of testing new products at goods testing units or organizations but not exceeding 30 million/year/enterprise;

- Reimbursement of up to 50% of the value of the advisory contract for completion of new products, services, business models, technologies but not exceeding 50 million VND/contract/year/enterprise.

(4) Technological assistance

Reimbursement of up to 50% of the value of the advisory contract for search, selection, decryption and technology transfer that is appropriate for the enterprise but not exceeding 100 million VND/contract/year/enterprise.

(5) Assistance in advanced training

- Reimbursement of up to 50% of the cost of participation in advanced training courses in Vietnam by employees of enterprises regarding development, commercialization of products; development of e-commerce; capital raising; market development; connection of startup network with scientific research but not exceeding 5 million/employee/year and not exceeding 03 employees/enterprise/year;

- Reimbursement of up to 50% of the costs of short-term advanced training courses in foreign countries but not exceeding 50 million VND/employee/year and not exceeding 02 employees/enterprise/year.

(6) Assistance in information, trade promotion, connection of startup network

- Exemption of fees for access of domestic and international standards and regulations; inventions, technology information, scientific research findings; information about connection of startup network, attraction of investment from startup investment funds on SME Assistance Portal and websites of Ministries, ministerial agencies, governmental agencies and the People’s Committees of provinces;

- Reimbursement of up to 50% of the value of the advisory contract for registration of seller accounts on international e-commerce platforms but not exceeding 100 million VND/contract/year/enterprise;

- Reimbursement of up to 50% of the cost of maintenance of accounts on domestic and international e-commerce platforms but not exceeding 50 million VND/year/enterprise and for up to 02 years after the account is successfully registered on the e-commerce platform;

- Assistance in paying the cost of leasing location, design and construction of booths, transport of products for display, travel, stay of representatives of enterprises participating in trade promotion fairs but not exceeding 30 million VND/year/enterprise for domestic events and not exceeding 50 million VND/year/enterprise for overseas events;

- Reimbursement of up to 50% of the costs of participation in international startup competitions but not exceeding 30 million VND/competition/year/enterprise.

(Article 22 of Decree 80/2021/ND-CP)

Ho Quoc Tuan

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