PM asks ministries to drastically cut red tape

This deadline is earlier than the previous cut-off date of October 30 as stipulated in a Government resolution dated January 1.

The plans must include procedures to remove or simplify regulations on at least half of the goods which are required to undergo special inspection. Each imported or exported product should be managed by a ministry or equivalent unit.

The management method may be changed from pre-check to after-check based on risk management and compliance with laws and regulations of organisations and inpiduals. Not every cargo will be subject to inspection, excluding those which are subjected to special quarantine.

The PM strictly prohibits ministries, agencies and people’s committees from setting business conditions and inspection procedures which are contradictory to laws.

Ministries and ministerial-level agencies in the course of project formulation or drafting of legal documents shall have to ensure rules are clear and easy to understand and implement. These should not create barriers to enter markets and should not force enterprises to incur costs.

The Ministry of Justice and the Governmental Office take responsibility for verifying legal documents that involve regulations and lists of goods that require special inspections. They will have to make timely reports to authorities to prevent the issuance of regulations that could increase firms’ costs.

Vu Tien Loc, chairman of the Việt Nam Chamber of Commerce and Industry (VCCI), agreed that there were big shortcomings in special inspections. Only 6 per cent of products were removed from the special inspection list. The average inspection time was 76 hours per procedure, three times higher than the average level in ASEAN-4 countries, even after reforms.

Lộc also said most reform plans simply reviewed and supplemented business regulations in current decrees, while there remain many unsuitable business conditions which should be removed or amended.

Ministries are required to report on the number and list of goods under special inspection as well as business conditions quarterly. Each quarter, they must explain whether business regulations have increased or fallen.

In addition, the PM asked ministries and agencies to announce the results of administrative procedure simplification and economic benefits after the removal.

The Ministry of Planning and Investment in co-operation with other ministries will review conditions to announce on the national information portal on business registration.

Earlier, on July 13th, Mai Tien Dung, Minister cum Chairman of the Office of Government, said the reforms have been slower than the Prime Minister requested.

There are still delays in implementing specific solutions to simplify administrative procedures and improve the business environment in ministries and agencies.

According to VCCI, as of June 20, only the Ministry of Industry and Trade (MoIT) had issued a decree guiding the cutting of business conditions under its management, while other ministries such as the ministries of Agriculture and Rural Development, Construction, Finance, Health and Natural Resources and Environment are still building the plans.

Specifically, the MoIT submitted a decree to cut 675 regulations out of a total of 1,200. The Ministry of Health submitted a decree on alternative food safety management, reducing the amount of imported cargo subject to food safety inspection by 95 per cent.

Throughout the VCCI’s survey, many businesses expressed that some proposals to reduce and simplify business conditions do not make much sense for businesses and their effect is negligible.

For example, most conditions relating to personal identity such as ‘have civil act capacity’ are proposed to be abolished. In fact, this condition does not have any effect because businesses only recruit people who have full civil act capacity.

Recently, seven associations including the Vietnam Association of Seafood Exporters and Producers (VASEP), Food and Foodstuff Association of HCM City, Vietnam Dairy Association, Food Transparency Association, Phú Quốc Fish Sauce Producing Association, American Chamber of Commerce in Việt Nam and the European Chamber of Commerce in Việt Nam sent recommendations related to the State management of product and service quality concerning the sector of health and healthcare, agriculture, science and technology to the Government.

The VCCI recommends within each ministry, ministers do not authorise departments that perform licensing to be the lead agency in drafting the administrative reform plan as these agencies will want to retain their power. The reform provisions should be assigned to independent units, responsible to ministers and consult with other relevant agencies.