Capital Conditions in Air Transportation Business

  Air transportation is the conditional business line and conducted by air transportation enterprises. Air transportation business includes air transportation activity, advertising, marketing and sale of air transportation products on the market for the purpose of making profit.

Therefore, trading in this business line is subject to strict rules of law. The conditional business lines in the field of civil aviation are detailed in Decree 92/2016/ND-CP dated July 1st 2016.

Accordingly, in the field of air transportation, business must meet capital requirements as follows:

The minimum capital requirement to establish and maintain air transportation business:Operating up to 10 aircrafts: 700 billion VND for enterprises engaging in international air transportation; 300 billion VND for enterprises only engaging in domestic air transportation;

Operating between 11 and 30 aircrafts: 1,000 billion VND for enterprises engaging in international air transportation; 600 billion VND for enterprises only engaging in domestic air transportation;

Operating more than 30 aircrafts: 1,300 billion VND for enterprises engaging in international air transportation; 700 billion VND for enterprises only engaging in domestic air transportation;

The minimum capital requirements to establish and maintain general air transportation business: 100 billion VND.

Air transportation business that has foreign investment must meet the following conditions:The foreign parties take up less than 30% of charter capital;

Must have at least one Vietnam individual or legal entity hold the largest part of the charter capital. In case Vietnam legal entity has foreign investment capital, the foreign capital share should not exceed 49% of the charter capital of the legal entity.

The transfer of share and capital contribution of air transportation business without foreign investment to foreign investor shall be made only after 02 years from the date of issuance of the air transportation business license.

Enterprises have to send the share and capital transfer proposal to foreign investor to Civil Aviation Administration of Vietnam, which includes: The transferee, transfer condition, the number of transferring shares and capital contribution; Development plans for aircraft teams, business plan, development strategies referred to in Paragraph 1, Article 9 of the Decree 92/2016/ND-CP (if any).

Within 05 working days from the date of receiving the proposal from business, Civil Aviation Administration of Vietnam will report to the Ministry of Transportation the appraisal results.

Within 05 working days from the date of receiving the appraisal result report of the Civil Aviation Administration of Vietnam, the Ministry of Transportation will consider approval or disapproval and clearly state the reasons.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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What Goods Allowed to Be Imported into Vietnam?

   Foreign owned companies in Vietnam wishing to import and distribute physical goods into Vietnam must comply with many regulations. It is imperative that the right to conduct import business of foreign investors and FDI companies differ from the right of Vietnamese traders having no foreign direct investment capital because trading activities are considered conditional investment area.

1. General Principles of Imported Goods

In principle, as other countries, the importers have to follow the general rules when importing and distributing physical goods into Vietnam:

1. Not to import goods specified under the list of goods banned from import or suspended from import provided, published by Vietnam government;
2. Follow the guideline or import regulations and conditions required by ministries and ministerial-level agencies. There are specific conditions for importing certain goods which the importers have to follow i.e. certain medical equipment have to be approved by the Ministry of Health; Food, cosmetics products need to be testedReceiving and transmitting telecom equipment must be inspected by Ministry of Information and Communication; Books, CDs will be checked and scanned for contents to be approved by Ministry of Cultures, Sport and Tourism; Equipment must satisfy energy, environmental regulations to be inspected and labeled by Ministry of Science and Technology…
3. Implement other relevant laws, commitments of the Socialist Republic of Vietnam in treaties which it has signed or acceded to, and the roadmap announced by the Ministry of Industry and Trade.

2. Goods Prohibited to Be Imported into Vietnam

1. For the goods being banned to be imported and distributed in Vietnam, the importers have to follow strictly to avoid penalties:
2. Weapons, ammunitions, explosives (excluding industrial explosives), military technical equipment.
3. Assorted fireworks, sky lanterns, assorted devices causing interference to vehicle speedometers.
4. Used consumer goods: Textiles and garments, footwear, clothes; Electronic appliances; Refrigerating appliances; Home electric appliances; Medical equipment; Interior decoration goods;
5. Assorted publications banned from dissemination and circulation in Vietnam
6. Assorted cultural publications banned from dissemination and circulation or decided to be suspended from dissemination and circulation in Vietnam.
7. Right-hand drive means of transport; assorted automobiles and their spare parts which have their frame or engine numbers erased, modified or tampered with; Assorted motorcycles, special-use motorbikes and motorbikes which have their frame or engine numbers erased, modified or tampered with
8. Used supplies and vehicles
9. Chemicals in Annex III of the Rotterdam Convention.
10. Pesticides banned from use in Vietnam.
11. Wastes and scraps, refrigerating equipment using C.F.C.
12. Products and materials containing asbestos of the amphibole group
13. Schedule-I toxic chemicals; Chemicals on the list of banned chemicals

It is important for foreign trader wishing to establish a trading company in Vietnam to not only study the market demand in Vietnam but also the country’s law on import, export, customs law to ensure their compliance during the operation.  If doubted, the Client is suggested to reach out for help and advisory of law firms in Vietnam by qualified lawyers in the area of import, export and customs.

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Aviation and Aviation Support Service in Vietnam

Aviation services Law Firmin Vietnam

Foreign investors could promote and participate in aviation and aviation related services in Vietnam through setting up representative office, setting up company, engaged in business cooperation contract or joint venture.

Civil aviation industry in Vietnam has really developed in the last 20 years. Until now, many Vietnam domestic airlines provide aviation services such as Vietnam Airline, Vietjet Air, Jetstar Pacific, etc that brings more choices to customers as well as business and investment opportunities to Vietnam and foreign investors.

The foundation of aviation and aviation support services are governed under Civil Aviation Act 2006 which was amended in 2014.

The differences of aviation and aviation support service?

Most of us are aware of aviation throughout use them for our demand to travel or transport goods. Air transport operations include two type of air transportation business and general aviation business. In detail, air transport business is the transportation of passengers, baggage, cargo and postal items by air for the purpose of profit, and general aviation business is general aviation activities. Air transport service business is conditional business activity that requires plans to ensure availability of aircraft for operations, organizational apparatus, business plans, development strategies and capital requirements. Depending on the scale of business operation of air transport enterprise, capital requirements is significant. Because of the typical elements of aviation especially air transport service, participants in the air transportation business have to sufficient financial resources as well as capacity management and administration.On the other hand, aviation support service include air navigation service business; airport service business; aviation staff training, coaching and mentoring service business; services relating to design, manufacture, maintenance, testing of aircraft, engines, propellers and equipment thereof within Vietnam and so on. Those are also the conditional business activities depending on the type of service that requires different conditions for the strategic plan, organizational structure, capital requirement or foreign ownership of the charter capital. For example aviation staff training, coaching and mentoring service business requires investor to ensure requirements concerning the facilities, equipment, components and lecturers as well as about training courses, training or coaching materials.

Opportunities of aviation and aviation support service?

As a country with over 90 million people like Vietnam along with the development of economy and the increasing of Vietnamese’s life quality, the aviation service business is growing because of demand hence aviation support service business is also developing in natural way. Vietnam has increasingly created favorable conditions for not only organizations and individuals of Vietnam but also foreign investors to cooperate and invest in civil aviation.

The aviation support services have been fairly common in the world, but not really developed in Vietnam especially services relating to design, manufacture, maintenance aircraft therefore when domestic enterprises have demand, they frequently hire service abroad. Besides, aviation staff training, coaching and mentoring service requires foreign experts. There are significant opportunities for foreign investors who have knowledge, skill and experience in this field to access and provide aviation support services to domestic and international airlines in Vietnam.

Vietnam has been investing heavily in airport infrastructures expansion preparing for growing of airlines fleets and frequency which means more opportunities for aviation and aviation related services are opening. The law in aviation and aviation related services are continuously changing. ANT Lawyers in Hanoi, Da Nang and Ho Chi Minh City continue to follow and provide update to its clients in legal aspect of aviation and aviation related services in particular and transportation in general in Vietnam for the legal understanding, compliance and business cooperation and investment purpose in regulatory and policy research, contract review, dispute in transactions or employment matters, incorporation.

How ANT Lawyers Could Help Your Business?

ANT Lawyers is a law firm in Vietnam located in the business centers of Hanoi, Danang and Ho Chi Minh City. We provide convenient access to our clients. Please contact us to book your time in advanced to let us provide our best service.

Call us at +84 28 730 86 529 or send us email ant@antlawyers.vn

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Capital Conditions in Air Transportation Business

Aviation services lawyersin Vietnam

Air transportation is the conditional business line and conducted by air transportation enterprises. Air transportation business includes air transportation activity, advertising, marketing and sale of air transportation products on the market for the purpose of making profit.

Therefore, trading in this business line is subject to strict rules of law. The conditional business lines in the field of civil aviation are detailed in Decree 92/2016/ND-CP dated July 1st 2016.

Accordingly, in the field of air transportation, business must meet capital requirements as follows:

The minimum capital requirement to establish and maintain air transportation business:

Operating up to 10 aircrafts: 700 billion VND for enterprises engaging in international air transportation; 300 billion VND for enterprises only engaging in domestic air transportation;

Operating between 11 and 30 aircrafts: 1,000 billion VND for enterprises engaging in international air transportation; 600 billion VND for enterprises only engaging in domestic air transportation;

Operating more than 30 aircrafts: 1,300 billion VND for enterprises engaging in international air transportation; 700 billion VND for enterprises only engaging in domestic air transportation;

The minimum capital requirements to establish and maintain general air transportation business: 100 billion VND.

Air transportation business that has foreign investment must meet the following conditions:

The foreign parties take up less than 30% of charter capital;

Must have at least one Vietnam individual or legal entity hold the largest part of the charter capital. In case Vietnam legal entity has foreign investment capital, the foreign capital share should not exceed 49% of the charter capital of the legal entity.

The transfer of share and capital contribution of air transportation business without foreign investment to foreign investor shall be made only after 02 years from the date of issuance of the air transportation business license.

Enterprises have to send the share and capital transfer proposal to foreign investor to Civil Aviation Administration of Vietnam, which includes: The transferee, transfer condition, the number of transferring shares and capital contribution; Development plans for aircraft teams, business plan, development strategies referred to in Paragraph 1, Article 9 of the Decree 92/2016/ND-CP (if any).

Within 05 working days from the date of receiving the proposal from business, Civil Aviation Administration of Vietnam will report to the Ministry of Transportation the appraisal results.

Within 05 working days from the date of receiving the appraisal result report of the Civil Aviation Administration of Vietnam, the Ministry of Transportation will consider approval or disapproval and clearly state the reasons.

How ANT Lawyers Could Help Your Business?

ANT Lawyers is a law firm in Vietnam located in the business centers of Hanoi, Danang and Ho Chi Minh City. We provide convenient access to our clients. Please contact us to book your time in advanced to let us provide our best service.

Call us at +84 28 730 86 529 or send us email ant@antlawyers.vn

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