INNOVATION CREDITFORCE INTELLIGENT SOFTWARE FOR SMART COLLECTIONS MANAGEMENT — Intelligent Algorithms CreditForce V6 with Email Tracker is available now. Advancing the credit profession / www.cicm.com / <strong>May</strong> <strong>2020</strong> / PAGE 34
COUNTRY FOCUS In business meetings, silence may suggest trouble Silence is golden Part Two: Vietnam ONE of the reasons that Vietnam has risen higher in the World Bank’s ease of doing business ratings is because the government has been reforming what was once a complicated tax system. It’s of note that the Tax Department has issued regulations that have helped created favourable conditions for businesses. The country has also moved into the 21st century when it comes to tax reporting and electronic tax declarations were fully implemented late 2017. Income tax rates follow seven bands, based on income, and range from five percent (up to five million Vietnamese dong (VND)) to 35 percent (more than 80mn VND). On top of that are the usual taxes on business income (one- to five-percent), interest and dividends (five percent), sale of real estate (two percent) and inheritances/ gifts/prizes (ten percent) and more. A good advisor is essential given the remaining complexities. It’s quite telling that despite the advent of modern payment methods Vietnam is still one of the most cash-dependent economies in the world; more than 90 percent of all domestic transactions are done in cash as there is a lack of ATMs and trustworthy cashless systems. As The Travel Brief wrote: “While credit cards are accepted in many places in major cities like Hanoi and Ho Chi Minh City, you will still have a lot of trouble getting around without enough cash in hand.” The matter isn’t helped by Vietnamese who feel distrustful of corrupt local banks. As such, many Vietnamese businesses use wire transfers to send funds. Fintech Singapore reported in January 2017 that the government planned to make the country cashless by <strong>2020</strong>. The goal is to provide the infrastructure for such a system while increasing the fees on cash payments, and decreasing fees related to electronic payments. INTELLECTUAL PROPERTY Intellectual property rights are key for any business and while Vietnam, like other nations, offers protections, the enforcement of the law is very weak, and abuse remains a problem. The government is taking steps to address the problem, and has introduced new legislation to protect IP rights, including copyright, industrial property and plant varieties. It’s important to recognise that home IP protections will not apply in Vietnam. Foreign companies that want to register their intellectual ownership should file an application with the National Office of Industrial Property of Vietnam via an “While credit cards are accepted in many places in major cities like Hanoi and Ho Chi Minh City, you will still have a lot of trouble getting around without enough cash in hand.” authorised agent. The Copyright Office of Vietnam (COV) administers copyright protection law. Although copyright can be protected in Vietnam without any registration requirement, formal recordation of copyright at the COV is recommended. Vietnam is a part of the Patent Cooperation Treaty and the Madrid Agreement Concerning the International Registration of Marks. Patent and trademark applicants may use these international systems for filing international patent and trademark applications for requesting protection in Vietnam. OTHER MATTERS TO NOTE Despite reform in the country, corruption is still widespread in Vietnam and anyone doing business in the country is likely to encounter it or hear of it at some point. However, the Vietnamese government is fighting the problem and its Anti- Corruption Law 2005 is considered by the World Bank to be among the best anticorruption legal frameworks in Asia. BUSINESS CULTURE Vietnamese remains the dominant language and the Vietnamese appreciate foreigners trying simple phrases. A handshake and a slight bow of the head is given when saying hello and goodbye. Deals are rarely completed in a few encounters and person to person conversations are preferred over online communication and emails. Cold calling is not recommended. When giving or receiving business cards, do so with both hands and the card should be read; anything otherwise is deemed offensive; business cards ought to have both English and Vietnamese translations. Seniority and hierarchy are important in Vietnam, so giving the eldest person respect by giving them a business card first is appropriate. Similarly, documents should be translated into Vietnamese and agendas before meetings are welcomed. Silence means contemplation and interruptions are considered rude. Further, silence may be used when someone disagrees. Saying ‘yes’ may merely indicate understanding, rather than actual agreement so it’s best to follow up and confirm with a business partner to understand if a deal has actually been agreed. Vietnamese will ask questions that may seem personal to a foreigner – discussing family and personal life is normal and is seen as a sign of friendliness and interest. Lastly, as with many other Asian countries, a person’s reputation, dignity, and prestige – ‘face’ – is very important and unintentionally causing a loss of face due to their words or actions should be avoided… suggestions or challenges should be dealt with in private. Adam Bernstein is a freelance business writer. Advancing the credit profession / www.cicm.com / <strong>May</strong> <strong>2020</strong> / PAGE 35
Change language