What Are Responsibilities of the Seller for Inadequate Delivery of Goods?

Delivering and receiving goods are basic obligations of the parties when performing the Contract for purchase and sale of goods. Specifically, in accordance with the law, when buying and selling goods, the seller must deliver goods and relevant documents, as agreed in contracts on quantity, quality, packing and preservation modes and other contractual terms.

In cases where there is no specific agreement, the seller is obliged to deliver goods and relevant documents according to the provisions of the Law on Commerce. At the same time, the Buyer is obliged to receive the goods as agreed and perform reasonable actions to help the seller deliver the goods.

If the Seller fails to deliver insufficient goods, they must deliver the goods in accordance with the contract. In case the Seller fails to deliver the goods as agreed, the Buyer has the right to purchase the goods from another person for replacement according to the goods specified in the contract and the Seller must pay the difference and relevant expenses, if any; reserves the right to repair the defect of the goods by itself and the Seller shall pay actual and reasonable expenses for the rectification.

The Buyer has the right to request to apply for penalty if agreed in the contract. The penalty for a breach of a contractual obligation or the aggregate fine level for more than one breach shall be agreed upon in the contract by the parties but must not exceed 8% of the value of the breached contractual obligation portion.

In the contract, where a contract-breaching party delays making payment for goods or payment of service charges and other reasonable fees, the aggrieved party may claim an interest on such delayed payment at the average interest rate applicable to overdue debts in the market at the time of payment for the delayed period, unless otherwise agreed or provided for by law.

Thus, when the Seller fails to comply with the commitments as in the contract, the Buyer has the right to initiate a lawsuit requesting a court to force the Seller to return the received amount of goods equivalent for the goods not yet delivered, interest due to late payment, contract fines, compensation for damage as required. In case the parties do not agree to penalty for violation, the Buyer only has the right to claim damages. In case the parties agree to fine for violation, the Buyer has the right to apply both the sanction of the violation and the forced compensation for damage, unless otherwise provided by law.

For the determination of civil liability when violating the sale and purchase contract, according to law, each juridical person must bear civil liability for the civil rights and obligations established and performed in the name of the juridical person by its representative. Each juridical person must bear civil liability by recourse to its property; shall not bear civil liability for its members with respect to civil obligations established and performed by such members not in the name of the juridical person, unless otherwise prescribed by law. A member of a juridical person shall not bear civil liability of the juridical person for the civil obligations established and performed by such juridical person, unless otherwise prescribed by law. Therefore, if the Seller breaches the contract, the legal entity being the Seller is responsible to pay the Buyer and the legal person is not responsible for that legal entity.

It is important to engage lawyers at an early stage of the dispute for consultation on effective dispute resolution.  It is also advised, when entering into the Contract for purchase and sale of goods, the Seller needs to understand the basic legal provisions on its rights and obligations. The Buyer also needs to know clearly about the obligations of the Seller in order to be able to prevent the risk that arises when one of the parties breaches a fundamental contractual obligation.

ANT Lawyers is a law firm in Vietnam, recognized by Legal500, IFLR1000. We are an exclusive Vietnam member of Prea Legal, the global law firm network covering more than 150 jurisdictions. The firm provides a range of legal services to multinational and domestic clients. For advice or services request, please contact us via email ant@antlawyers.vn, or call us +84 24 730 86 529.

         

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What Are Tax Obligations of a Representative Office in Vietnam?

Vietnam-based representative office of a foreign trader means a dependent unit of the foreign trader, which is established under the provisions of Vietnamese law to conduct market survey and a number of commercial promotion activities permitted by Vietnamese law.

Representative office of foreign trader in Vietnam has the rights and obligations in accordance with the law of Vietnam. Foreign trader is responsible before the law of Vietnam for all operations of its representative office in Vietnam.

Accordingly, representative office in Vietnam is not allowed to conduct business activities, nor carry out other activities for profit-generating purposes. The representative office in Vietnam only performs the activities for the right purposes, scope and duration specified in the certificate to establish the representative office. Besides, the representative office in Vietnam has the right to rent the head office, rent and buy the facilities and materials necessary for the operation of the representative office; to recruit Vietnamese and foreign employees to work at the representative office in accordance with the provisions of Vietnamese law; to use an account in foreign currency, in Vietnam dong of foreign currency origin opened by a foreign trader at a bank licensed to operate in Vietnam and only use this account for the operation of the representative office; to have a seal bearing the name of the representative office according to the provisions of Vietnamese law. Representative office in Vietnam can sign contracts, perform transactions with partners when authorized by the enterprise.

Hence, due to the limited scope of activities, the tax liability of a foreign representative office in Vietnam is narrower than that of an enterprise.  As the representative office does not produce or trade in goods and services, it is not required to pay license fees as prescribed. Representative office of foreign trader in Vietnam is dependent unit of foreign trader, established to investigate the market and carry out some trade promotion activities permitted by Vietnamese law, does not carry out production and business activities, so it is not required to pay license fees.

The fact that the representative office has the right to recruit Vietnamese or foreign employees to work at the office is the basis for arising personal income tax obligation. At the same time, representative office of foreign organization is subject to personal income tax registration. For employees working at foreign representative office in Vietnam, the taxable incomes are based on salaries and wages. Declaring, with holding, paying taxes and settling personal income tax of employees working at foreign representative office is the responsibility of such representative office.

ANT Lawyers, a law firm in Vietnam with offices in Hanoi, Da Nang and Ho Chi Minh City could help client to set up representative office in Vietnam and advise on the compliance on regular basis.

         

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Notice of Application for Exemption from Trade Remedies for Fertilizers, Billet and Long Steel Product

On March 03rd, 2020, the Ministry of Industry and Trade issued Decision No. 715/QD-BCT on extending the application of safeguard measures to the goods which are imported DAP/MAP fertilizers bear the following HS codes: 3105.10.20; 3105.10.90; 3105.20.00; 3105.30.00; 3105.40.00; 3105.51.00; 3105.59.00; 3105.90.00.

   Notice of Application for Exemption from Trade Remedies for Fertilizers, Billet and Long Steel Product

On March 20th, 2020, the Ministry of Industry and Trade issued Decision No. 918/QD-BCT on extending the application of safeguard measures to the goods which are imported billet and long steel products bear the following HS codes: 7207.11.00; 7207.19.00; 7207.20.29; 7207.20.99; 7224.90.00; 7213.10.10; 7213.10.90; 7213.91.20; 7214.20.31; 7214.20.41; 7227.90.00; 7228.30.10; 9811.00.00.

On March 20th, 2020, the Ministry of Industry and Trade issued Decision No. 920/QD-BCT; on extending the application of measures to prevent evasion of trade remedies for imported coil and wire products which bear the following HS codes: 7213.91.90; 7217.10.10; 7217.10.29; 7229.90.99; 9839.10.00.

According to the regulation of Article 16.1.c Circular 37/2019/TT-BCT on November 29th, 2019, the Ministry of Industry and Trade specified some contents on trade remedy measures (Circular 37/2019/ TT-BCT) in detail. Whereby, the Trade Remedies Administration (PVTM) requests enterprises that meet the conditions to be exempted in submitting a dossier of application for exemption from the application of trade remedies in the three cases mentioned above, including: documents specified in Article 14 and Appendix 03 Circular 37/2019/TT-BCT.

According to the regulation of Articles 15 and Article 16.3 Circular 37/2019/TT-BCT, it is recommended that companies to submit their application for exemption online or directly to the Trade Remedies Department before 17:00 on October 6th, 2021.

If Client needs any more information or request for legal advice or potential dispute regarding trade remedies measures including, anti-dumping, countervailing duty and safeguard measures or international trade dispute matters, our competition, anti-dumping, and countervailing duty lawyers in Vietnam of International trade and tax practice at ANT Lawyers, a law firm in Vietnam always follow up anti-dumping cases and its development to update clients on regular basis.       

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The Ministry of Industry and Trade to Investigate the Dumping of Table and Chair Products Imported into Vietnam

On September 01^st, 2021 the Ministry and Trade issued the Decision No.2091/QD-BCT on investigation of application of anti-dumping measures for some table and chair products holding the HS Code: 9401.30.00; 9401.40.00; 9401.61.00; 9401.69.90; 9401.71.00; 9401.79.90; 9401.80.00; 9401.90.40; 9401.90.92; 9401.90.99; 9403.30.00; 9403.60.90; 9403.90.90 origin China and Malaysia (Case code AD16) (Decision No.2091).

On December 29^th, 2020 the Trade Remedies Authority of Vietnam received the required dossier of some domestic producers on applying anti-dumping measures of the products above. This dossier is confirmed that is valid on June 03^rd, 2021.

According to the regulation on Law on Foreign trade management, Decision No.2091, and related regulations, the period of anti-dumping investigation is 12 months from July 01^st, 2020 to June 30^th, 2021. And the investigation period for determining damage is 03 years from July 01^st, 2018 to June 30^th, 2021.

The requesting anti-dumping tax of the requesting parties is 35,20% for the table, and 21,40% for the chairs products from China. The requesting anti-dumping tax is 32,40% for table and 24,90% for chair products from Malaysia.

The Trade Remedies Authority will send an investigation questionnaire to relevant parties to collect information, analyze and evaluate the allegations, including: (i) dumping behavior of the exporting enterprises of China and Malaysia; (ii) damage to the domestic industry; and (iii) a causal relationship between dumping and damage to the domestic industry.

The related organizations, individuals having importing, exporting, trading, using the investigation products should register the related parties and provide the necessary information to the Trade Remedies Authority to ensure their rights and benefit according to the regulation of the laws.

If Client needs any more information or request for legal advice or potential dispute regarding trade remedies measures including, anti-dumping, countervailing duty and safeguard measures or international trade dispute matters, our competition, anti-dumping, and countervailing duty lawyers in Vietnam of International trade and tax practice at ANT Lawyers, a law firm in Vietnam always follow up anti-dumping cases and its development to update clients on regular basis.

      

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Performing Labor Contracts in the Period of Covid-19 Epidemic

The Covid-19 epidemic has seriously affected the development of the economy and society. The situation of businesses being spacing as well as suspension of production and service provision happens regularly in epidemic-affected localities, and that also seriously affects the life stability of employees. Because most enterprises’ financial situations get worse, so the businesses seem like they cannot guarantee income for employees. This is a force majeure and legal event, and the labor law has specific provisions to balance and ensure the interests of employees but also make the best support to enterprises.

 

Performing Labor Contracts in the Period of Covid – 19 Epidemic

Specifically, according to the provisions of Clause 3, Article 99 of the Labor Code 2019, specific instructions are provided in Official Dispatch No. 264/QHLĐTL-TL of Ministry of Labor – Invalids and Social affairs  about paying salary (known as “ stoppage salary”) for employees during the shutdown period related to the Covid-19 epidemic on July 15, 2021; direct instructions for businesses and employees during the epidemic period, in case of having to suspend work due to an incident that is not the fault of the employer such as a dangerous disease, the employee and the employer agree on the salary according to the following regulations.

In case of having to suspend work for less than 14 working days, the agreed stoppage salary shall not be lower than the minimum wage.

In case of having to suspend work for more than 14 working days, the stoppage salary shall be agreed upon by both parties but must ensure that that salary in the first 14 days is not lower than the minimum wage.

Accordingly, the labor relationship is a civil relationship as well as ensuring the agreement between the parties, however, it is also necessary to pay attention to ensuring the life quality  of the employee, thus stipulating the case of having to suspend work from under 14 days that the parties have the right to agree on a salary which is ensured not lower than the minimum wage; besides, in case of suspension for more than 14 days, this is undesirable in the labor relationship as the damage for the employee is not allowed to work as well as does not guarantee income, and this also for the employer that they are not able to guarantee the output of goods and services provided to the partner, as well as the normal operation of the business, etc. Therefore, the law allows the parties to agree on the stoppage salary in this case.

The epidemic is a force majeure. In the case of having to suspend work for too long as it is unable to judge the progress of the epidemic, to ensure the financial ability of the employer as well as the health and safety of employees, the parties may agree to suspend performing labor contract. The content specified at point h, Clause 1, Article 30 of the Labor Code 2019, allows the parties to agree to suspend the labor contract, therefore we can realize this is also an appropriate regulation in the current epidemic period. Currently, when suspended in performing a labor contract, the employee is not entitled to salary and other rights and benefits as agreed in the labor contract. However, the employee and the employer may have another agreement on employee benefits.

According to Article 31 of the Labor Code 2019, within 15 days after ending the suspension period of the labor contract, the employee must be present at the workplace as well as the employer must accept the employee’s return to resume work under the signed labor contract in case of the valid labor contract, unless otherwise agreed by the parties. Accordingly, the employee and the employer must fully agree on the contents related to the suspension of the labor contract, to avoid issues and disputes arising after ending the suspension period of the performing labor contract.

In addition, Point c, Clause 1, Article 36 of the Labor Law 2019 stipulates that the employer has the right to unilaterally terminate a labor contract in case of natural disaster, fire, dangerous epidemic, enemy sabotage or migration, relocation, or downsizing of production and business under the request of the competent state agency, and the employer has sought all remedies but can’t help reducing personnel. Therefore, in the situation of dangerous epidemics, termination of the labor contract with termination grounds is considered a non – illegal act of unilaterally terminating the labor contract.

However, the grounds for termination because of the dangerous epidemic that the employer has tried all measures to overcome but can’t help reducing the personnel are only necessary conditions that the employer needs to comply with, besides, Employers need to comply with the procedure for unilateral termination of labor contracts in terms of the notice period, as well as done allowances to employees when unilaterally terminating labor contracts according to regulations in law.

ANT Lawyers – A labour dispute law firm in Vietnam with international standard, local expertise and strong international network. We focus on customers’ needs and provide clients with a high quality legal advice and services. For advice or services request, please contact us via email ant@antlawyers.vn, or call us +84 24 730 86 529.      

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Investigation against Evasion of Trade Remedies for a Cane Sugar Products from Thailand

 On June 15^th, 2021, the Ministry of Industry and Trade issued the Decision No. 1578/QD-BCT on imposition of official anti-dumping and countervailing duties on cane sugar products imported from kingdom of Thailand (Case No.AD13-AS01). However, on August 25^th, 2021 the Ministry of Industry and Trade received the dossier on requesting investigation against evasion of trade remedies of 06 domestic sugarcane industries.

According to the Decision No.1578/QD-BCT, the goods on which the official anti-dumping and countervailing duties are imposed bear the following HS codes: 1701.13.00; 1701.14.00; 1701.91.00; 1701.99.10; 1701.99.90; and 1702.90.91. The official anti-dumping duty rate is 42.99% and the official countervailing duty rate is 4.65% will be applied for 05 years since June 16^th, 2021.

Until now, the exporting turnover of the products above of other countries in ASEAN (without Thailand) increases in value. The Ministry of Industry and Trade works with The Vietnam Sugarcane Association monitors the import situation and actively consults and supports the Vietnam Sugar Association as well as the domestic sugarcane industries in collecting information, data, and building request dossiers on requesting investigation against circumvention of trade remedies with cane sugar products to ensure compliance with the provisions of Vietnam’s trade remedy law.

Acts of evading trade remedies are often complex in nature, involving many matters, legal regulations and international commitments. The countries also have different regulations on this issue. In some cases, even though goods fully meet the rules of origin, they can still be considered circumvention.

According to the regulation of Article 81.1 Decree No.01/2018/ND-CP on guidelines for the law on foreign trade management on trade remedies, the Ministry of Industry and Trade confirmed that the dossier is valid. Within 45 days after the receipt of the valid dossier, the Minister of Industry and Trade shall consider the investigation based on the results of examination of dossiers of the investigating authority.

The investigation for prevention of evasion of trade remedies includes the following contents (i) Determination of actions aiming to evade trade remedies; (ii) The change of trade flows from the originating or exporting countries after the effective date of the decision on application of trade remedies and this change is the cause of such evasion; (iii) Damage to the domestic industry or the reduced effectiveness of the effective trade remedies.

The time limit for investigation of evasion of trade remedies shall not exceed 06 months since the issuance of the investigation decision.

If Client needs any more information or request for legal advice or potential dispute regarding trade remedies measures including, anti-dumping, countervailing duty and safeguard measures or international trade dispute matters, our competition, anti-dumping, and countervailing duty lawyers in Vietnam of International trade and tax practice at ANT Lawyers, a law firm in Vietnam always follow up anti-dumping cases and its development to update clients on regular basis.

Parties could consult with international trade dispute lawyers in Vietnam for assistance in responding to Vietnam authorities.     

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Anti-dumping Measures for H-Shaped Steel Products From Malaysia Remain in Place

On August 18th, 2021, the Ministry of Industry and Trade issued the Decision No. 1975/QD-BCT on the application of official anti-dumping tax on some H-shaped steel products originating from Malaysia (“Decision No. 1975/QD-BCT”). Accordingly, the anti-dumping measures against a number of H-shaped steel products originating from Malaysia continue to be maintained under Decision No. 1162/QD-BCT dated April 02nd, 2021 of the Minister of Industry and Trade.

Anti-dumping Law Firm in Vietnam

The Ministry of Industry and Trade started investigating the case on August 24^th, 2020, the investigation process was carried out in accordance with the laws. On the basis of information collected from related parties, the Ministry of Industry and Trade has carefully considered and assessed the level of dumping of H-shaped steel products imported from Malaysia, the damages to the domestic industry as well as to assess the socio-economic impacts, including impacts on downstream industries and consumers.

According to Decision No. 1975/QD-BCT, the anti-dumping tax rate for some H-shaped steel products originating from Malaysia, holding HS codes: 7216.33.11, 7216.33.19, 7216.33.90, 7228.70.10 and 7228.70.90 is 10.64%. This tax rate is lower than the tax rate applied to H-shaped steel imported from China (about 22% on average) and also much lower than the proposed tax rate of the domestic manufacturing industry (16.30%). This anti-dumping tax is effective from August 21^st, 2021 and has an application term of 05 years, the term above could be changed or extended in accordance with the laws.

In order to have a basis for determining the origin of imported goods subject to anti-dumping tax, the Customs authority will check the proofs of origin of goods, including:

(i) Certificate of Origin (C/O); or

(ii) Documents certifying the origin of goods in accordance with the provisions of:

-ASEAN Trade in Goods Agreement;

-Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP);

-Free Trade Agreement between the Socialist Republic of Vietnam and the European Union (EVFTA);

-Free Trade Agreement between the Socialist Republic of Vietnam and the United Kingdom of Great Britain and Northern Ireland.

The above information is the regulation on application of official anti-dumping tax on some H-shaped steel products originating from Malaysia, organizations and individuals producing and exporting the above goods from Malaysia and relevant organizations and individuals need to know and implement according to the laws.

ANT Lawyers, a law firm in Vietnam always follow the legal developments to update client.  Our international trade dispute lawyers in Vietnam  and consultants represent client in international trade disputes including anti-dumping cases at Vietnam authorities.

   

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