When the number of business conditions becomes excessive while their quality remains low, it reflects a clear mindset of “if you can’t manage it, ban it.” This fosters a legal system skewed toward control instead of facilitation, opportunity creation, and development space.

Proposed amendments may undo the gains of Decree 15/2018/ND-CP

At a recent workshop discussing amendments to Decree 15/2018/ND-CP on food safety, a representative of a foreign-invested enterprise expressed frustration: “These draft regulations could undo the achievements of Decree 15/2018/ND-CP, and might even increase costs.”

To illustrate, he pointed out that the draft requires businesses to self-declare 31 items, compared to just 5 under the current Decree 15.

Additionally, while Decree 15 allows businesses to begin production immediately after submitting documents, the draft proposes that authorities will post submissions online within 7 days, followed by a 3-month review. This effectively means a business can only begin operating after 3 months and 7 days.

Let’s revisit the reform spirit behind Decree 15. Previously, Decree 38/2012/ND-CP under the Ministry of Health required companies to obtain a Certificate of Declaration Acceptance before commencing operations.

The Central Institute for Economic Management (CIEM) estimated that annually, 35,000 to 45,000 businesses had to undergo this process, which took around four months and cost approximately USD 400 for regular food and USD 1,200 for functional food per company.

These requirements, among many others, sparked long-standing discontent within the business community.

Following sustained government efforts, Decree 15/2018/ND-CP replaced Decree 38 and introduced a shift from pre-checks to post-checks in food safety management.

Under the new system, individuals and organizations could self-declare without prior approval. According to the European Chamber of Commerce in Vietnam (EuroCham), this reform cut administrative costs by 90%, saved 10 million workdays, and USD 146 million annually for businesses.

This story highlights how arduous institutional reform in food safety has been. Instead of navigating endless administrative procedures, businesses should be able to focus on research, development, market expansion, and improving competitiveness.

Business conditions disguised as standards

As discussed in the article “Protecting the right to do business,” business conditions have mushroomed rapidly. Many are hidden within technical standards and regulations.

Some technical standards require specific facilities or minimum production space, or demand professional certifications for certain staff involved in the manufacture or provision of goods and services.

Such disguised standards essentially act as business conditions. For example, proposals once called for regulations on floor space and facilities for mini-marts, convenience stores, and shopping malls. It's unclear how these regulations serve public administration, but their impact on investors and commercial entrepreneurs is obvious.

According to the Vietnam Chamber of Commerce and Industry (VCCI), around 20 laws, 150 decrees, and 600 circulars are issued annually. Thousands of executive documents, some containing legal norms, further complicate the legal landscape.

Excessive, overlapping, or ever-changing guidance creates unpredictability and discretionary enforcement, posing risks for businesses and citizens alike.

A critical question is whether repealed business conditions are being reintroduced, or new, unreasonable technical standards are being imposed - as seen in the draft Decree 15 - within this jungle of legal documents, thereby obstructing enterprise.

The General Secretary's vision for private sector-led prosperity

General Secretary To Lam emphasized in his article “Developing the private sector economy – a lever for a prosperous Vietnam” that private businesses must be the driving force in the new era, leading industrialization, modernization, and innovation, contributing up to 70% of GDP by 2030.

He stressed the need for a fundamental policy shift. The State must adopt market-friendly governance models that uphold freedom to do business, property rights, and fair competition. All discriminatory policies and interest-group influence must be eliminated to ensure fairness among private, state-owned, and foreign-invested enterprises.

It is vital to consistently uphold the principle that “everyone has the right to do business in sectors not prohibited by law.” Policies must inspire confidence among investors and entrepreneurs. Above all, the State must build strong trust with the private sector, encouraging bold investment and innovation in strategic sectors.

If domestic businesses and individuals continue to face overwhelming obstacles, how can they grow and become a major economic driver?

Pillars of reform for a new era

Citing Party Chief To Lam’s powerful assertions:

First, current institutional bottlenecks are the “bottleneck of bottlenecks” to development. Institutional reform is the “breakthrough of all breakthroughs.”

Second, we must abandon the mindset of “if you can’t manage it, ban it” in lawmaking, and adopt a results-based regulatory approach. Transitioning from pre-checks to post-checks will open up space and momentum for growth.

Third, the law must not merely regulate but also incentivize innovation, encourage development, and create opportunities for expansion.

Fourth, legal inconsistencies and overlaps must be swiftly addressed to build a stable, easy-to-follow legal framework. A single issue should be addressed in one law only. Enterprises should be free to do anything not expressly forbidden by law, while State agencies may act only as permitted by law.

Fifth, strong decentralization is necessary. Localities must make decisions, implement them, and bear responsibility.

Market principles must guide resource allocation, eliminating “ask-give” mechanisms and subsidy mindsets.

Upholding the right to do business

Business conditions are essentially market entry barriers. The more numerous and lower in quality they are, the greater the hindrance to fair competition, innovation, and development - particularly for the private sector.

The prevalence of low-quality business requirements clearly reflects the “ban what can’t be controlled” mindset, producing a control-oriented legal framework rather than one that empowers and fosters development.

Therefore, it is essential to remove bottlenecks in business regulations embedded within sector-specific laws to uphold the constitutionally enshrined right to do business: “Human and citizen rights may only be restricted by law when necessary for national defense, national security, social order and safety, social morality, or community health” (Article 14.2, Constitution 2013).

A comprehensive review is needed of all conditional business sectors and their corresponding requirements in the Investment Law and specialized legislation. Only sectors falling under Article 14.2 of the 2013 Constitution should remain, regulated through licensing or certification.

A “revolution” is needed to simplify laws, digitize and automate administrative procedures for citizens, businesses, and organizations. This initiative should leverage digital technology, AI, and big data to position Vietnam among the most business-friendly nations in Southeast Asia, with institutions as a standout competitive advantage.

Tu Giang & Lan Anh