You are using an outdated browser and your browsing experience will not be optimal. Please update to the latest version of Microsoft Edge, Google Chrome or Mozilla Firefox. Install Microsoft Edge

July 2, 2018

Vietnam Suspends Controversial Proposed Decree on Distribution Sector

Subscribe to Updates

Last week, Vietnam’s Ministry of Industry and Trade (MOIT) decided to suspend the drafting process for a controversial new decree that had been proposed on the development and management of the distribution sector (the “Draft Decree”). It was anticipated that the drafting process would be completed this summer and the Draft Decree would be submitted to the government for adoption in the fall.

The news of the suspension was welcomed by companies in the distribution sector who felt that the proposed decree would be a step backward in that it would require more approvals for businesses in the sector, and also contained various provisions that intervened too far into commercial issues.

The proposed Draft Decree would have added many requirements for trade centers, supermarkets, traditional markets, retail stores, and convenience stores, and touched on various aspects of distribution. For example, the new decree would have specified certain size requirements for supermarkets. A “supermarket” would be required to be at least 250 m2 in area, but less than 10,000 m2. Facilities 10,000 m2 or more in area would be considered “trade centers.” Signage would be required to correctly specify in the Vietnamese language if a facility was a supermarket (“sieu thi”) or trade center (“trung tam thuong mai”). Inappropriate use of English names such as “Hyper Market”, “Big Store”, or “Plaza” was specifically prohibited under the Draft Decree.

Other controversial provisions included:

  • Supermarkets and trade centers can only hold three sales per year, and during sales periods, 70% of all goods must be on sale. Sales periods must be pre-approved by authorities, and must extend at least 30 days, and be spaced no fewer than 30 days apart. No “buy-one-get-one-free” promotions are allowed for products on sale.
  • 30% of all goods in supermarkets must be sourced from small and medium-sized Vietnamese producers.
  • No fewer than 50% of employees must be Vietnamese citizens.
  • Supermarkets and trade centers must be open every day of the year, including holidays, and must be open until at least 10 p.m.

In view of the fact that the MOIT has recently eliminated many administrative burdens for businesses, the requirements proposed under the Draft Decree, which would have replaced Decree 2 of 2003 and Decree 114 of 2009, would have been a move in the opposite direction. Therefore, the scrapping of the proposed Draft Decree is a welcome sign for the retail sector in Vietnam. It remains to be seen if some of the provisions of the Draft Decree resurface under other legislation in the future.

Related Professionals

Practices

Corporate/M&A

Location

RELATED INSIGHTS​ 

August 31, 2026
Thailand has introduced a new regulatory framework that may expose foreign nationals who violate the Foreign Business Act (FBA) to deportation. The Regulation of the Office of the Prime Minister on Deportation B.E. 2569 was published in the Government Gazette on August 27, 2026. The regulation establishes an administrative process for referring foreign nationals for deportation where this is deemed necessary in the interests of public order or public morality. It does not create new substantive deportation powers, but it expressly identifies unlawful business conduct under the FBA—including nominee arrangements—as grounds for referral. Grounds for Deportation Referral The regulation sets out five grounds that may give rise to a referral to the relevant authorities: Unlawful entry into, or unlawful stay in, Thailand in violation of immigration laws. Unlawful employment or engagement in work in violation of laws governing the employment of foreign nationals. Carrying on business in violation of the FBA, including through the use of nominee arrangements. Forging official documents or using forged official documents. Committing an offense punishable by imprisonment of five years or more. The framework takes a broad approach, extending not only to the perpetrators of these acts but also to those who facilitate, instigate, or otherwise support such acts. Deportation Risk Following a Criminal Judgment Where a foreign national has committed any of the above offenses and has fully served the sentence imposed pursuant to a final judgment, the interior minister has the power to order deportation. This power also applies where a court has issued a final judgment sentencing a foreign national to imprisonment but has suspended the execution of the sentence, or has imposed a fine. A deportation order may also specify a period during which the foreign national is prohibited from reentering Thailand. FBA Noncompliance: Broader Consequences Noncompliance with the FBA—including
Read More
August 24, 2026
Myanmar’s Directorate of Investment and Company Administration (DICA) has published the guidelines it uses to assess and approve company names for registration in the country. The guidelines, which were published on May 18, 2026, explain how DICA determines whether a proposed name is identical or too similar to an existing name, and they identify words and expressions that may be prohibited or restricted. Businesses planning to incorporate in Myanmar should expect DICA to scrutinize proposed names more closely than it has in the past. Prohibitions on Company Names The Myanmar Companies Law prohibits company names that are identical or similar to existing company names, and DICA’s internal assessment guidelines explain how this rule applies in practice. Under the guidelines, DICA may reject a proposed company name if the proposed name: Is identical or nearly identical to an existing company name; Differs from an existing company name only in punctuation, capitalization, spelling, or transliteration; Only adds words such as “Group,” “Holding,” “International,” “Myanmar,” or “Family” to an existing company name; Merely rearranges the words in an existing company name; Is pronounced similarly to an existing name; Uses the same brand name as an existing company, even if the company carries out different business activities; or Uses an existing brand name together with an abbreviation of that brand name or a shortened form of the name or business description. DICA may also consider whether a proposed name could give the impression that two companies are related, even if they operate in different business sectors. In addition, DICA may review a company name even after registration. If it later determines that the name does not comply with the Myanmar Companies Law or is otherwise unsuitable, DICA may direct the company to change its name under section 26 of the Myanmar Companies Law.
Read More
August 20, 2026
Vietnam’s Law on Bankruptcy and Rehabilitation No. 142/2025/QH15, passed by the National Assembly on December 11, 2025, does something many regional counterparts do not yet attempt: it instructs parties and arbitral tribunals on exactly what happens to an arbitration once a debtor becomes insolvent. Together with the Law on Commercial Arbitration No. 54/2010/QH12, the new law improves upon what used to be an uncertain area of practice, now providing an explicit, mandatory sequence of procedures. Suspension and Termination of Arbitration Proceedings Under article 40(2) of the law, once a Vietnamese court accepts a bankruptcy petition, any arbitration that concerns the debtor’s financial obligations must be temporarily suspended as soon as the tribunal receives the court’s notification. If the court subsequently issues a decision commencing bankruptcy proceedings, article 59(2) takes a further step: the suspended arbitration is terminated outright, and the underlying case file is transferred to the court handling the insolvency for resolution. The two provisions work as a sequence: first suspension, then termination and transfer, rather than as independent triggers. Meanwhile, article 60(4) reinforces this effect by vesting the bankruptcy court with exclusive jurisdiction over all claims against the debtor from the date the petition is accepted. Notably, this mechanism operates automatically, without the need for the insolvency court to issue a separate anti-arbitration order. The tribunal simply suspends or terminates the proceeding by operation of law once notified; however, Vietnamese law currently provides no procedure by which a party can apply to the insolvency court for permission to continue the arbitration despite the statutory effect. Practitioners with a Vietnamese counterparty in arbitration should treat notification of a bankruptcy filing as something to flag to the tribunal immediately since continuing to arbitrate a claim that has become subject to article 40(2) or 59(2) risks producing an award vulnerable
Read More
August 20, 2026
Thai law contains no provision that speaks directly to what happens to an arbitration when one of the parties becomes insolvent. The interaction between arbitration and insolvency is derived instead from the general operation of two separately drafted laws: the Bankruptcy Act B.E. 2483 (1940) and the Arbitration Act B.E. 2545 (2002). Because Thai courts have had few opportunities to interpret how these two statutes apply together, the practical answer to many questions, such as who represents an insolvent party in arbitration, whether an award will be enforced, and what happens to a foreign proceeding, depends on inference from general principles of insolvency, arbitration, and procedural law rather than on settled rules. Liquidation and Restructuring The Bankruptcy Act governs both liquidation, which winds up a debtor’s affairs, and restructuring (rehabilitation), which aims to preserve a business. The consequences for arbitration differ accordingly. In liquidation, the debtor’s assets vest in the official receiver, who alone can conduct or continue any arbitration affecting the estate; the debtor loses the authority to act on its own behalf. In restructuring, the plan preparer or administrator takes over that role, but there is more room for the debtor to remain involved, since the objective of rehabilitation is to keep the business operational. Restructuring carries an automatic stay that takes effect once the Bankruptcy Court accepts the restructuring petition. This stay can halt an arbitration regardless of where it is seated. In contrast, liquidation does not work through a stay; instead, the debtor’s loss of authority over its own assets and disputes is what constrains the arbitration. Neither proceeding provides a party a formal route to apply for permission to continue arbitrating—the Bankruptcy Act contains no such mechanism—though in restructuring cases the Bankruptcy Court may allow proceedings to continue where doing so will not prejudice
Read More