Summary
According to a report by the local Vietnamese media "Vietnamnet" on June 6, Deputy Prime Minister Pham Binh Minh of the Vietnamese government signed and approved the "2021-2030 Foreign Investment Cooperation Strategy".
The specific goal of the strategy is to increase the proportion of registered investment capital in some countries and regions to more than 70% and 75% of the total foreign investment in the country respectively during the period of 2021-2025 and 2026-2030, including: Asia (South Korea, Japan, Singapore, China, Taiwan, Malaysia, Thailand, India, Indonesia, Philippines); Europe (France, Germany, Italy, Spain, Russia, UK) and Americas (US).
The strategy also plans to increase the number of Fortune 500 multinational companies operating in Vietnam to 50% by 2030, placing Vietnam among the top three in ASEAN and the top 60 in the world in the World Bank's Doing Business rankings.
The strategy outlines nine major solutions to improve the efficiency of foreign investment cooperation in Vietnam, including developing an innovation ecosystem, nurturing supporting industries, supporting domestic companies to establish joint ventures with foreign companies in high-tech fields, and assisting domestic companies to properly evaluate, selec and Accept overseas technology transfer, etc.
Brief comment
For a long time, Vietnam has taken labor-intensive industries as its main foreign market advantages, and has relied on foreign imported raw materials and components for processing and export. The new strategy of Vietnam is aimed at changing this situation and completing the industrial transformation as soon as possible. The strategy was proposed after the Vietnamese Deputy Prime Minister visited the Silicon Valley region of the United States last month, expressing the Vietnamese government's determination to transform into high-end industries and substantively integrate into the international supply chain.
One of the main goals of the strategy is to attract advanced technology and high value-added projects, actively link the global supply chain, give priority to new technologies and green technologies, encourage foreign investors to increase investment in priority areas of development in Vietnam, and propose Seven criteria are used to judge whether foreign investment is suitable, including investment benefits involved, labor force, process technology, technology transfer possibility, connectivity and radiation effects, environmental protection and national defense security. The strategy proposes to focus on reducing the waste of land resources and insufficient infrastructure caused by the concentration of labor, and strive to achieve the commitment of Vietnam on energy conservation and emission reduction made at the Conference of the Parties to the United Nations framework Convention on Climate Change last year. This strategy also hopes to restore and stabilize Vietnam’s economy and curb inflation in the post-pandemic era. Economic experts in Vietnam predict that industries such as e-commerce, financial banking, and information technology will become the fastest-growing economic sectors under the strategy.
China is currently one of Vietnam's largest suppliers of intermediate products and sources of imports. A large number of Chinese enterprises take advantage of Vietnam's labor force to develop processing industries and export trade locally. After the promulgation of the strategy, the Vietnamese government is expected to successively introduce specific transformation measures and incentive measures. For relevant Chinese companies, it is necessary to do a good job in pre-investment research and risk control, seize the preferential policy opportunities, and make full use of the opportunities for industrial transformation. Invest in popular fields; and related companies that already have local business may face problems such as difficulty in recruiting workers in low-income industries, further improvement of green standards, transfer of industrial preferential policies, etc., and have to face changes in the industrial chain, so they must be prepared in advance. Prepare, pay attention to the introduction of detailed rules, and reduce industrial risks.
URL
https://vietnamnet.vn/en/vietnam-approves-strategy-on-foreign-investment-cooperation-by-2030-2026688.html
European Parliament approves end of gasoline vehicle sales by 2035
Summary
According to Reuters, the European Parliament voted on June 8 local time to pass a resolution that the European Unio will ban the sale of new gasoline and diesel vehicles from 2035, paving the way for the development of zero-emission vehicles such as electric vehicles. Society's transition to electric vehicles is accelerating. The bill would also encourage automakers to invest heavily in electric vehicles and require countries to install millions of car chargers.
It is reported that some lawmakers proposed not to ban the sale of new gasoline and diesel cars completely by 2035, but to reduce the carbon dioxide produced by the sale of new gasoline and diesel cars by 90%, but this alternative plan was not adopted.
Behind the vote is a key target of the EU package to reduce net global-warming emissions by 55% from 1990 levels by 2030, a target that requires industry, energy and transport to accelerate emissions cuts .
Electric and hybrid vehicles accounted for 18 percent of new vehicle sales in the EU last year, according to data provided by the European Automobile Manufacturers Association. Although the new law has not yet officially entered into force, this resolution confirms the firm position of the European Parliament in the upcoming negotiations with EU countries on the final version of the law. At present, automakers including Ford, Volvo, and Volkswagen have expressed support for this bill.
Brief comment
In mid-May this year, the European Commission on Environment, Public Health and Food Safety adopted a five-package plan report for 2030, which is expected to reduce greenhouse gas emissions by 55% compared with 1990 levels by 2030, and according to the European Climate Act , achieve net zero greenhouse gas emissions by 2050. The release of the package, on the one hand, is to solve the serious environmental problems of the EU's fossil fuel pollution, but also to get rid of the dependence on Russian fuel imports. Under the guidance of the package, the European Parliament hopes to reform the emissions trading system, encourage industries to further reduce emissions and actively invest in low-carbon technologies, and call on member states to implement the EU carbon boundary adjustment mechanism more widely to prevent carbon pollution. The plan not only requires all EU member states to reduce greenhouse gas emissions, but also requires countries to increase transparency and flexibility in carbon emission quotas.
Guided by this policy objective, this resolution will focus on the auto industry whose carbon emission ratio exceeds one-fifth of the EU's total emissions, and set a deadline for stopping the sale of gasoline-powered vehicles, even including gasoline and electricity. The sales of hybrid vehicles and the rejection of milder alternatives, the determination and intensity of emission reduction can be said to be unprecedentedly strict. In addition to giving a deadline for the sale and registration of new fuel vehicles, this resolution also includes some supporting details, such as requiring member states to expand vehicle charging capacity, installing at least one charging point every 60 kilometers on major highways, increasing gasoline and diesel minimum tax rate, etc.
From the perspective of investment, Europe has announced a number of super battery factory projects, laying a foundation for promoting the development of the electric vehicle industry, and its demand for lithium batteries is bound to become a rigid demand, especially for battery machine manufacturing, lithium resource supply, positive and negative electrodes Material supply, electrolyte industry chain, etc. Relevant domestic enterprises can deploy in the European market as soon as possible, establish local production lines and supply chains, and further study and understand the EU’s carbon emissions trading system, carbon boundary adjustment mechanism, electric vehicle safety certification standards, battery and waste battery regulations, etc. Control and manage to reduce compliance risk.
URL
https://www.reuters.com/business/autos-transportation/eu-lawmakers-support-effective-ban-new-fossil-fuel-cars-2035-2022-06-08/
EU Parliament and Member State representatives agree on minimum wage directive
Summary
On June 7, local time, negotiators from the European Parliament, the governments of member states and the European Commission reached an agreement on the EU Minimum Wage Directive, determined an appropriate statutory minimum wage framework, and promoted member states to strengthen collective bargaining. The final text of the directive makes it clear that the statutory minimum wage can be considered fair and reasonable if it is set at a level of at least 60% of the median wage in a country or 50% of the average wage.
The governments of Denmark and Sweden oppose EU directives because they believe that Europe interferes with the well-functioning system of organizing and negotiating relations between employees and companies in both countries - in Denmark and Sweden, almost all work is done through employers' organizations and trade unios organized by collective bargaining. Although both countries oppose the directive, its high collective bargaining coverage is seen as a model for other EU countries to follow, which is why the directive requires all EU member states to have a collective bargaining coverage of at least 80%, which is not met of countries must develop national action plans to increase their collective bargaining coverage. The Directive stipulates that the statutory minimum wage should be updatd every two years in a process involving employers and trade unios, but this applies only to countries wher there is a statutory minimum wage requirement. Countries wher remuneration is determined entirely through collective bargaining are not obligated to introduce a statutory minimum wage. obligation.
In addition, the Directive is designed to help workers fully obtain the protections of collective bargaining and minimum wage systems, including oversight by labour inspectorates, easily accessible information on minimum wage protections, and the pursuit of non-compliant employers by law enforcement authorities.
Brief comment
The EU has stricter protection of labor, through the Employment Information Directive, the Civil Rights Directive, the Working Hours Directive, the Parental Leave Directive, the Pregnant Workers Directive, the Work Safety and Health Directive, the Regulations on the Application of Social Security Schemes, and the Occupational The Pension Institutions Directive, the Informed and Consultative Directive, and the Equal Treatment Directive have built a complete, comprehensive and detailed legal system for labor protection, giving labor the freedom and autonomy of employment contracts, and employees enjoying vocational training and social Security and other benefits, enjoy the right to free movement, and enjoy basic rights such as pensions, maternity/parental leave, occupational safety, paid leave, and equal pay for equal work. At the same time, the EU also requires the establishment of collective representation of labor, that is, to conduct collective bargaining and consultation on behalf of labor in a trade unio-like organization and form, strengthen dialogue with management, and protect labor’s rights; at the same time, labor can also to some extent Participate in the management of the company's affairs. There are also bills that specifically stipulate the priority that workers enjoy in special circumstances such as corporate restructuring, bankruptcy, and layoffs.
This proposal on the Minimum Wage Directive fills a gap in labor protection, but it must also be noted that the proposal does not intend to establish a common minimum wage standard across the EU and propose a one-size-fits-all minimum wage requirement, but to provide It provides a framework for judging compliance with minimum wages and in this way enhances the role of collective bargaining. This is in line with the fundamental right of workers to be informed and to express their opinions in a timely manner on matters pertaining to them, as mentioned above. For member states with high collective bargaining coverage, the will of labor itself can be fully expressed and valued, so these member states are not directly obliged to require minimum wages; while for collective bargaining coverage less than 70% For member states, labor rights can be protected through the minimum wage standard stipulated by law, and member states should establish specific judgment standards to assess the adequacy of the minimum wage, and update it regularly, or adjust it through an automatic indexation mechanism. On the other hand, member states must have appropriate controls and inspections over the implementation of the statutory minimum wage, and give workers the right to seek remedies and to demand penalties in the face of non-compliant employers. At the same time, member states are also required to report to the European Commission every two years, which should include the coverage rate of collective bargaining in the country, the level and judgment criteria of the legal minimum wage, and the proportion of workers covered by the legal minimum wage. The data will be analysed and reported to the Council of the European Unio and the European Parliament.
This "walking on two legs" policy approach is very flexible for member states, and each country can decide whether to introduce a statutory minimum wage standard by judging its own national conditions. once the proposal is formally adopted, member states will translate it into national law within two years. At that time, relevant enterprises, including foreign-funded enterprises, will also need to determine which set of standards to implement based on wher the company is registered or located.
URL
https://www.euractiv.com/section/economy-jobs/news/eu-parliament-and-member-state-negotiators-agree-on-minimum-wage-directive/
Tanzania waives tax arrears for 2021
Summary
According to a report released by local Tanzania media The Citizen on June 11, Tanzania President Hassan recently issued an order to the Tanzania Revenue Authority (TRA), requesting amnesty for taxpayers for unpaid taxes, interest and penalties by 2021 . The directive has been generally welcomed by the private sector, who believe the move will stimulate the country's business climate and economy. Confederation of Tanzania Industries chairman Paul Makanza said the change from the SAT to a "customer-friendly" agency since the current government took office was commendable. The move will incentivize the reopening of a large number of small and medium-sized businesses that have been shuttered because they couldn't pay huge taxes and fines.
However, Leonard Leopold, a partner at DKL Consulting, also expressed his concerns about the move: “This is a move that will benefit Tanzania’s economy. But if the move is to be authorized by law, there is no doubt that Some Tax Collection and Administration Acts have been amended.” Leonard Leopold further explained that the Tanzania Revenue Authority was established under an Act of Parliament and is responsible for assessing and collecting income as required by national law. Therefore, the tax office may not be able to fully implement the move without any legal backing. He hoped that the Tanzanian government could propose amendments to the Tax Administration Act when the country's 2022/23 budget is released to legalize the tax amnesty mandated by the President.
Brief comment
Currently, Tanzania implements a central and local taxation system. Direct taxation includes income tax and property tax, and indirect taxation includes consumption tax and international trade tax. Its main tax authority is the Tanzania Revenue Authority (TRA). The laws related to taxation are mainly the "VAT Act", "Tax Collection and Administration Act" and the "Tanzania Code" in the tax articles, as well as special taxation for motor vehicles, hotels, aviation, road fuel, income tax, port service tax and other industries. bill. The TRA has also promulgated the Tax-Related Operational Guidelines to ensure coherence in the implementation of the Tax Act.
Under the current Tanzania Tax Administration Act, Revised Chapter 438, the Commissioner of Inland Revenue has the power to publish in the Gazette the qualifications, deadlines and procedures prescribed by law if he deems that there are good reasons to waive interest or penalty imposed under any tax law waive all or part of the interest or penalty due. Therefore, in the amnesty of this presidential decree, the parts for interest and fines have legal basis, and there is no problem of lack of legal basis. However, there is no legal support for the amnesty of the principal part of the unpaid tax, which has also become a source of social concern. therefore,
From a legal point of view, whether the amnesty of the principal part of the unpaid tax can be finalized, there are still objections, and further clarification or revision of the relevant laws is required.
URL
https://www.thecitizen.co.tz/tanzania/news/national/what-next-after-samia-s-waiver-of-taxes-in-arrears--3845496
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[Source] Wolters Kluwer Group
