Amended Enterprise Law will make it easier to set up business

Amendments to the Law on Enterprises will create favourable conditions for setting up businesses, Minister of Investment and Planning Bui Quang Vinh said at the 13th National Assembly session in Hanoi on May 26.

He said the amendments will protect the rights and interests of investors, shareholders and business members, in addition to improving management of foreign investment.

The draft amendments add 57 articles to the law, revise or supplement 99 and delete six.

The Ministry of Planning and Investment said the amendments will significantly cut costs for administrative procedures, business management, re-organisation and dissolution while reducing commercial and legal risks and helping businesses develop.

State management will also be enhanced thanks to more accurate and realistic data. The Ministry expects the country to rise about 50 points on the World Bank's market activeness index, putting Vietnam at position 60 out of 189 countries.

The investor protection index is forecast to increase 30 points, putting Vietnam at 120.

Bankruptcy Law

On the same day, deputies debated draft amendments to the Bankruptcy Law to overcome insolvency of businesses and co-operatives.

Deputies discussed how to identify businesses or co-operatives at risk of losing their payment ability and people with rights to petition for bankruptcy.

Most deputies agreed to keep regulations from the existing law and continue to allow firms to use bankruptcy procedures to recover their business activity. This will create conditions for businesses and co-operatives to repay their debts and escape from bankruptcy, they said.

Deputy Dang Cong Ly of Binh Dinh province said the criteria to identify businesses and co-operatives facing insolvency written in Article 42 were completely reasonable.

He noted that since late payments between businesses occurred regularly, it is important to clearly set out criteria for businesses and co-operatives that cannot repay their debts.

Deputy Nguyen Thanh Bo of Thanh Hoa Province agreed, saying the criteria should be both quantitative and qualitative.

Draft amendments to the Bankruptcy Law also stipulate a duration of 30 days from the date of handling a request to open bankruptcy proceedings, which the existing law fails to do.

Concerning those who have rights and obligations to submit petitions for bankruptcy proceedings, deputies mostly agreed with the regulation that lenders have the right to file a petition for bankruptcy proceedings for businesses or co-operatives which fail to pay their debts three months from the payment date requested by lenders.

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