What information matters in M&A transaction?

  Nowadays, in the field of business and investment, the term “Merger and Acquisition” (M&A) is a very common term. This is considered as one of the global investment methods, and is a business and development strategy applied by many businesses.  In conducting the M&A, beside information provided by the target company, other information are also important before the buyer stepping into negotiation with the seller of the target company.

Mergers and acquisitions are usually conducted through three main stages, that is: reviewing and evaluating target businesses, valuation and price negotiation, completing legal procedures. When participating in a business merger and acquisition, investor or buyer need to ensure high accuracy of inside information of the target business. It is extremely important for investor or buyer in determining the value of the deal as well as helping investors make decisions about whether to participate in the acquisition and merger of this business or not. The tasks to consider and evaluate the target business include searching information and evaluating the information on shareholders, investors, influential individuals, and further information i.e. financial statements, accounts receivable and payables, staffs, customers, business locations, facilities status, competitors, business registrations, licenses and business area divisions, company image, and potential disputes, or criminal records of relevant people of the target company.

In fact, not every country has specific regulations governing mergers and acquisitions, as does Vietnam, although it is mentioned in various legislations.  In many cases, the investors have to search information, and evaluate the situation themselves to learn various aspects of the business beside the information given by the target company for instance finding general information about a business, information about the legal representative, information about business manager or capital contributors of that business as well as other related information. In particular, the buyer might be interested to know if the owner or shareholders have other business similar to the target business or if any of those have criminal records.  Further, the buyer might wish to know the history or the target company with registration and changes of registration in the last three years.  Other information about business lines, subsidiary, child companies, dependent companies, charter capital, founding shareholders, seal specimen could also be of importance business intelligence.  Based on the information obtained, the buyer is able to reach some information conclusion about the business and the target beside official information provided by the target itself.

In conclusion, all relevant information about the business and people matters in M&A transaction, being corporate information or influential investors or stakeholders are important that the investor or buyer should pay attention to every details, and should attempt to search and evaluate such information such as part of their effort to evaluate market entry risks in investment through intelligence market entry risks analysis in Vietnam.

Vietnam Market Research

  Market research is an important operation. If the market research is well done, it provides accurate information to help marketers make an appropriate strategy and then, bring high efficiency in business. In other words, if the result of market research is inaccurate information and does not correctly reflect the actual market situation, marketing activities will be inefficient.

Companies would fail if underestimating the importance of market research before entering a new market.

Therefore, market research activity is so important for whomever needing success. Namely, the market research is considered an active approach to enter into the market. The market research also helps you understand the latest development in the target market, thereby making marketing decisions quickly. The international business environment is quite volatile, that‘s why you need a proactive approach like that and it is really your competitive advantage.

Through the market research, you can form the idea of developing a new product and choose the correct strategy for that product in each specific market. Through research, you also do not have to waste money and effort for the false hope, especially when you export the products to oversea for the first time. On the other hand, it should be noted that although the market research does not make sure success in business, it will help you avoid many wrong decisions.

Market research service can:

• Help find the biggest market for your products, the fastest growing market, trends and prospects of market, conditions, business practices and opportunities for your product on the market.
• Allow to make efforts effectively in a field or a certain range. After that, you can set the priority for a specific target market and plan for the future market.
• Help understand the competitors, including strengths and weaknesses, mistakes and their causes of success.
• Help find ideas to develop new products.
• Helps strengthen business relationships with partners.

Da Nang City to carry out investment promotion in 2022 in the direction of innovation, initiative, focus, and prioritize on strategic markets

  In 2022, Da Nang selected the theme as "Year of safe and flexible adaptation, effective disease control and socio-economic recovery and development". Accordingly, the city has built the Investment Promotion Program in 2022 in the direction of innovation, initiative, focus, prioritizing strategic markets for key fields (high technology, information technology, high-quality service, etc.) to attract foreign investors to invest and set up company in Vietnam in genenal and Da Nang in particular.

To achieve this goal, Da Nang city has promoted research, assessed potential markets and investment partners, built images, promoted, introduced the investment environment, potential policies, and opportunities for investment association and connection. Along with that, the city has supported and guided to create favorable conditions for investment activities of international investors, built a list of investment attraction projects, publications and documents for investment promotion, etc. in order to attract foreign investors into Vietnam to establish company for doing business.

Accordingly, in 2022, Da Nang will study and implement the project "Building Da Nang into a regional financial center"; Project "Development of industry and services related to yachts"; Project "Promoting investment attraction to Da Nang city in the period of 2021 - 2025, vision to 2030"; The overall project of economic diplomacy in Da Nang city in the period of 2021 - 2025; Project on implementation of research - development, incubation - start-up, innovation and training of high-quality human resources... At the same time, Da Nang City implement investment procedures and call for businesses to invest in key projects. Access and connect with venture capital funds, start-up experts, large-scale technology enterprises, innovative start-up infrastructure investors, innovative start-ups. The City is focusing on promoting key investment projects, promoting projects in high-tech zones, concentrated IT zones, etc.

Besides, Da Nang City is organizing investment promotion conferences in the form of face-to-face and online to key markets such as the US, Korea, Japan, Europe, Taiwan, Singapore...; organize connection activities, promote private investment, event Route Asia Development Forum 2022 is held in Da Nang city.

The city will also increase proactive contact with high-level contacts with large corporations (belonging to Forbes 500), businesses in developed countries (G7, G8, OECD...), business associations, and big banks of other countries. The country is having the policy to shift investment capital to focus on calling for investment in Da Nang. Da Nang city is implementing the promotion of ODA projects, projects in the form of public-private partnership (PPP) ...

In Da Nang Hi-Tech Park and Industrial Parks, in order to effectively implement the 2022 Investment Promotion Program of the City People's Committee, the Management Board of Da Nang High-Tech Park and Industrial Parks has built and issued implementing investment promotion programs in the direction of innovation, prioritizing strategic markets for key fields such as high technology, information technology, high-quality services....

Through these activities, Da Nang City hopes that in 2022, many international investors will make investments in Da Nang to set up business, in order to create a vibrant and effective investment environment, taking advantage of the strengths, investment incentives from the city, thereby bringing high profits for their investment activities.

Risk of disputes from transactions through social networks in Vietnam

  Social networks have become popular and become an indispensable part of modern life. Along with the development of the internet, social networking applications are also used by many people as a transaction method to exchange and conclude contracts or business transaction with each other.   When a dispute occurs, it is difficult for the parties to prove the transactions and the parties involved. Hence, it is important to conduct background check on the business counterparts from financial, operational aspects instead of blind belief in the exaggerated advertising or discounted offer from them.

In fact, many individuals and organizations have reported that their partners have denied purchase and sale transactions through social networks and caused huge damages. However, the evidence provided is only messages, icons ... stored in social networking applications that carry many meanings and are easily confused in interpretation. These are quite common electronic transaction disputes today, but there is no strict legal corridor to protect parties with legitimate interests.

The legal system has not kept up with the strong development of the internet business. As a result, it raises a number of complicated issues, beyond the control of legal regulators and creates many difficulties and challenges when business disputes occur over social networks.

Specifically, many individuals engage in commercial activities but does not have a fixed location and do not register business with any authorities.  They might advertise over the internet with buying and selling goods and services without having to be responsible for any consequences for fake products or inadequate delivery of quantity or maybe even scam.

It can be seen that the lack of business registration makes it difficult to determine the truthfulness of the transaction and the competent authorities do not know the information of individuals and organizations transacting on social networks authentication of transaction status on social networks when participating in business.

According to the law, electronic data messages are expressed in the form of electronic data exchange, email and other similar forms according to the provisions of the law on electronic transactions. Electronic is also a source of evidence used as a basis to determine the validity of a transaction. Therefore, it can be seen that in fact transactions via social networks are also a form of electronic transactions with legal value. However, these transactions present a lot of potential risks because it is difficult to prove to the authorities when dispute arise.

Because these accounts can be easily disabled, communications can be deleted or hidden, and the name of the account holder is easy to change. Moreover, when transacting and exchanging via social networks, the parties cannot control whether the person being exchanged is an authorized person or not. The violating party will rely on the above reasons to deny all the content discussed with the partner.

Transactions through social network platform are thriving and are expected to bring value. However, in order to contribute to promoting the sustainable and safe development of this type of business, more legal regulations governing related issues are needed. In addition, in order to limit disputes and risks in these transactions, individuals and businesses need to carefully check the partner information, from authenticity, adverse media, reputation online or engage third party consulting company to verify business registration, search business shareholders information, visit office or operation site for audit, undertake background check, criminal record for protection of interest if the dispute occurs.

Nothing Can Stop Investors Coming to Vietnam

  Many foreign investors have once again affirmed the attractiveness of Vietnam as an investment destination.

It is no coincidence that the Vietnam Intensive Online Conference, recently held within the framework of Standard Chartered Bank's ASEAN-focused investment attraction series, took the theme “Vietnam - Rising star".

A survey showed that 38% of enterprises surveyed said that they would consider expanding their supply chain in Vietnam. This is the highest rate among ASEAN countries.

With strong fundamentals such as a young, dynamic and tech-savvy population, a growing domestic market, a growing middle class and an open economy, Vietnam continues to deliver attractive investment opportunities.  However, it is equally important to manage risk especially in understanding business partners through corporate intelligence investigation, background studying, adverse media search.

Many multinational corporations have been interested in establishing business investments in Vietnam in order to take advantage of the close geographical distance and the ability to connect with ASEAN to promote business activities.

According to data provided by the Japan Trade Promotion Organization (JETRO), more than 40% of the total of 3,500 Japanese enterprises surveyed said they were considering expanding operations in Vietnam, to set up company within the next three years.

A Memorandum of Understanding (MOU) has just been signed between the Foreign Investment Agency (Ministry of Planning and Investment) and JETRO. The agreement was awarded in the witness of Vietnam Prime Minister on September 7^th 2020, confirming the great efforts of both the Foreign Investment Agency and JETRO in implementing measures to promote Japanese investment in Vietnam.

Risk Management Necessity in Vietnam?

  As Vietnam further integrates into the world business, more investors are eyeing Vietnam for investment. As part of investment due diligence, risk management are always well considered before foreign investors decide to do business with Vietnam partners.

In any parts of the world including Vietnam, risk is an inevitable factor in business operation activities; higher return is always accompanied by higher risks. Coping and managing risk is an integral part of any business in order to make profit and create value to shareholders in import export transaction, investment, or merger and acquisition activities in Vietnam.

However, in our daily consulting practice, we have seen a number of businesses whom do not manage risk effectively and furthermore not fully understand about the risks that they are facing.

Typical risks in developing countries like Vietnam are political risks, policy risks, regulations risks, credit risks, bribery and corruptions, and organized crimes.

On daily transaction in trading, according to Vietnam Ministry of Industry and Trade, there are situations a number of corporate scams between Vietnam and foreign enterprises are reported. In particular, foreign companies sell goods or provide services to partners in Vietnam and in return the Vietnam partner fail to pay.

On a larger scale in FDI through business formation or M&A origination and execution, businesses that do not improve the risk management process will have to face with a lot of different types of risks: serious financial losses, adversely affecting cash flows and the value of shares, decreasing prestige with customers, employees and investors.

Many business leaders often put heavy emphasis on the business activity, profit, and revenues instead of concentrating more on risk management especially understanding business partners through corporate intelligence investigation, background studying, adverse media search through professional consultants in Vietnam whom understand languages, cultures, legal environment and business practices. Further searches could help foreign investors to understand the company itself, owners, shareholders, members of board of directors of partner companies whom make daily decisions of the business.

In the period that global crisis has been predicted that almost bottom out and start to show signs of recovery, although the recovery process can occur with different speed and characteristics depending on sector and location of the business, the fully preparation of business in all aspects including process and risk management strategy could helps business not falling into the passive and also have more possibilities to take advantage of growth opportunities after the recession.

Recently in Vietnam with the impact of high inflation rate and economic recession caused by the global financial crisis, enterprises are increasingly concern about risk management activities. Many experts believe that an effective and well organized risk management system will help businesses withstand and overcome fluctuations.

Tips to reduce risks when purchasing medical supplies from Vietnam

  As the Covid 19 pandemic is still occurring in many countries around the world, a large number of medical equipment or accessories being Personal Protective Equipment (PPE) such as N95 respirator masks, surgical masks and other items essential to protecting doctors, nurses, others on the front lines of the pandemic are required to be purchased and sold from many different countries to meet the demand for treatment disease globally.

Vietnam is a country that has many enterprises producing medical supplies such as medical gloves, medical masks, which are the focal points supplying goods to many businesses around the world. However, buying and selling quickly, and without researching their partners has caused many businesses to face many risks when purchasing of medical supplies in Vietnam. Here are some tips for buying and selling medical equipment in Vietnam safely and effectively.

Searching for a partner is the necessary work. Currently, to meet the increasing demand for buying and selling medical supplies, many companies switch to the medical supplies business as the broker to take opportunities in this field. It will help the buyer finding a selling partner more convenient because more brokers reach out to buyers.  However, there are many sellers who do not have a valid business registration or are not able to supply the goods, however, they still approach the buyer and guarantee to deliver the goods on request. Many buyers have been deceived by businesses that are not capable of doing business with the deposits, failure to deliver goods, deliver the wrong quality, quantity, ... Therefore, searching for the seller carefully, and undertaking due diligence on the seller with the help of local risk management company will help buyers to avoid the risks of buying the wrong goods.

In terms of product prices, when buying medical supplies from a third party (not directly from the manufacturer), the price of the equipment could increase many times compared to the price offered by the manufacturer.  Sometimes, the brokers could not fix the price because their offering price depend on the buying price they receive from manufacturers or traders while the supply of goods are not guaranteed.  This could create problems for the buyer if the delivery and price have been committed to final clients oversea with hefty fine clauses if breaching the contract.

There are potential medical supplies without origin, or quality assurance, being purchased and sold to the market, therefore the buyer needs to ensure the seller provides qualified goods as their request.

When trading with an unqualified seller, there is a risk that the seller cannot meet the required quantity of the goods, especially in the case of the sellers are not the manufacturer. Because the number of goods produced could not meet the demand, in fact, many manufacturing companies in Vietnam have stopped accepting orders for some time from many customers.  However, many the third-party continue to receive orders from buyers, resulting in an inability to deliver on time or inability to meet the required quantity. When having a request for delivery from the buyer, these sellers will not answer the buyer's questions, refuse to receive phone calls, emails, ... leading to the buyer being inaccessible to the seller at this time which affects the business of the buyer.

Especially in the difficult situation when limited traveling between countries are allowed due to the pandemic, the discussion via electronic means such as Email or social network platforms, ... will help the parties can discuss in an easy way. However, discussion or exchange of information via electronic means, will meet potentially risk when the buyer exchange with another third party (who may not be representative of the seller). In many cases, the parties exchange messages via regular messaging apps, which cannot determine if the subject exchanging is exactly the seller or not. In the event of a dispute when buying or selling goods, this proof is that the message which cannot determine the sender shall not be enough to prove the wrongdoings. Therefore, when exchanging communication, the parties should take precaution steps to verify the other parties ensuring the exchange is carried out properly with the authorized person.

In addition, to ensure the rights in the purchase and sale of medical supplies, signing the sale and purchase contracts is extremely important.  The contracts should be in written and duly signed and stamped by parties.  Trusting in business should be accompanied with legal documents for sustainable business.   When performing the contract in accordance with the regulations of the law will help the parties to limit risks and this is considered as specific legal evidence that forces the parties to comply with regulations and ensure their rights when buying and selling goods, especially international sale goods.

Finally, with significant transaction, the buyer could minimize risks through the helps of local risk management company in Vietnam to undertake due diligence on the seller’s business registration certificate, business location, real operation at site, adverse media check for past wrongdoings and general personal or corporate reputation.

Vietnam and Denmark promote clean energy development

 Recently, the Ministry of Industry and Trade of Vietnam has cooperated with Denmark on clean energy development. Denmark has contributed to provide an important foundation for economical and efficient use of energy in Vietnam.

Another important cooperation content of the Vietnam - Denmark Energy Partnership Cooperation Program is the biennial publication of the Vietnam Energy Outlook Report. This report emphasizes energy efficiency as a cost-effective tool for Vietnam's green transition to 2030 and 2050 and recommends investment in energy-saving technologies because of this technology will be more cost effective due to the significant savings in fuel costs. Economical and efficient use of energy has many benefits, including major benefits to society such as reducing environmental pollution and enhancing national energy security.

Vietnam is a country with the potential to develop clean energy such as wind energy, solar energy, tidal energy, ... with the advantage of being a country adjacent to the sea, near the equator, with high hours of sunshine in a year, these are enough for Vietnam to become a country with a sustainable clean energy base. However, due to many objective factors, Vietnam has not been able to make good use of this resource. The limitation in science, technology, engineering and finance makes the clean energy sector in Vietnam not really focused on development.

Denmark is a European country with many years of experience in clean energy development. After many years of researching the clean energy market in Vietnam, many Danish investors have found the benefit and the ability to develop this field. With the goal of developing clean energy, providing energy efficient and safe platforms. Meanwhile, Denmark has many companies in wind and solar power and is very interested in market entry into Vietnam market through setting up company, or manufacturing in Vietnam.

In addition, Danish investors also promote development, investment cooperation, building smart city in Vietnam, apply science and technology applications and clean energy to build and develop a sustainable way. Therefore, this is an opportunity for Vietnam to attract energy investment from Denmark and also an opportunity for Danish investors to invest in Vietnam. In the coming time, Vietnam hopes to have more investors from Denmark implementing energy development projects in Vietnam so that they can reap high returns for both investors and Vietnam in the future.

How to minimize risks buying from Vietnam sellers in the new era?

  Currently, the purchase and sale of international goods are very popular from Vietnam and around the world, taking the advantage of Vietnam the signing a number of Free Trade Agreements (FTAs), and the application of technology 4.0 in the business helping the international transaction of goods just got easier.  However there are many risks involved in the meantime for international buyer purchasing goods from Vietnam sellers if due diligence on the seller, whether being corporates or individuals are not under taken.

In the international goods sale and purchase using technology, the best benefits are that, the parties in the transaction do not need to meet, negotiate, and check goods before buying. All of the international goods purchase and sale activities are done via the internet means such as Website, Email, Social media,... which help parties save time and costs when doing the purchase. However, the use of digital technology in the goods sale and purchase transactions still has many hidden risks that the buyer cannot foresee.

Specifically, in the process of discussion of the purchase and sale of international goods, there are many cases where the Vietnam seller does not provide the expected quantity of goods or the goods are meet the minimum quality requested by the buyer, but the seller still signs the contract and require the buyer make the deposit/payment before delivery.  Some time, all the transactions are conducted via social media and there is no contract at all.  Unless the transaction is small, it is always suggested a proper contract to be properly signed with the envision of potential disputes might arise.

Further, there might be fraudulent activities involved taking advantage of the urgent needs of buyers whom skip the process of verifying the business partner for business existence, reputation, financial capability, bad history, and potential fraudulent acts.  In some cases, the seller could go further to forge legal documents, quality certificates, ... to create confidence for the buyer in performing the contract. Some lure buyers by creating fake websites, fake contracts, fake phone numbers, ...using alias names to avoid being traced when taking fraudulent activities.

With significant transaction, the buyer could minimize risks through the helps of local partner on the ground to check the seller's legal documents including corporate documents to be able to trace back the and if the seller does not perform, at least they could be located for legal action.  The buyer could send people to physically check the seller's office, factory to ensure that the seller operates at the registered address.   Before making a deposit, the buyer could check if the beneficiary's account matches the seller's registered account.  The more information about the partner, the better.  The buyer needs to thoroughly check the information that their partners provide including phone numbers, emails, bank accounts, business registration certificate, and other legal documents ... If involved significant transactions, more emphasis on risk management especially understanding business partners through corporate intelligence investigation, background studying adverse media search on company, owners, shareholders, business managers through professional background check consultants in Vietnam whom understand languages, cultures, legal environment and business practices could help.

Singaporean Investors Increase Capital in Finance and Technology

  In addition to the real estate sector, Vietnam has recently been considered a key market for many financial and technology enterprises from Singapore.

Investment capital flows of Singaporean businesses are flowing strongly into southern provinces to welcome opportunities when Vietnam joins many free trade agreements (FTAs).

According to a report by Ho Chi Minh City Statistics Office, in the first 9 months of 2020, out of 111 countries and territories having investment projects in the City, businesses from Singapore contributed 813.5 million USD, accounting for 25 % of total foreign direct investment (FDI) in Ho Chi Minh City.

Broadly, according to recent statistics, out of 106 countries and territories having investment projects in Ho Chi Minh City, Singapore is ranked first with 1,100 projects with a total investment of 10.73 billion USD. Up to now, there have been many investors, large corporations of Singapore such as Keppel Land, Capital Land... having large-scale projects in Ho Chi Minh City.

In Binh Duong, from the beginning of the year up to now, Singapore businesses have invested the third largest investment capital among countries and territories investing in this locality, with a total registered capital of 198 million USD, accounting for 16% of the total investment capital.

According to the Singapore Consulate General in Ho Chi Minh City, up to now, this country has invested in Dong Nai more than 70 projects with a total registered capital of about 3.6 billion USD, ranking 4th among countries and territories investing in this province. Singapore businesses invest in Dong Nai quite successfully, so many businesses are researching and planning to continue to invest.

A month ago, when receiving the project investment certificate of SG Logistics Joint Stock Company with an investment of more than 80 million USD in Tan Phu Trung Industrial Park, the CEO of BW Group said that this was the third project of this business in Ho Chi Minh City to prepare for investment waves.

In fact, businesses from Singapore operating in the field of industrial real estate soon had projects in Binh Duong, Ho Chi Minh City, Dong Nai... and had outstanding successes.

According to experts, with the impact of FTAs ​​and the movement of capital into Vietnam, industrial real estate and logistics are the fastest growing segments recently. In particular, investors from Singapore, having an early presence in Vietnam, actively preparing many large land banks in the strongly developed industrial areas, are considered to have many advantages.

In addition to the real estate sector, Vietnam has recently been considered a key market for many financial and technology enterprises from Singapore to set up company and enter the market. According to Chairman of Bankograph Pte Limited, a Singapore's fintech company, Vietnam stands out as a leading destination for foreign investors, not only in the financial sector, but also in many other sectors.

The wave of Singapore's technology enterprises participating in investment and cooperation in Vietnam has been more strongly developed in the past two years. For example, Finaxar cooperates with Indovina Bank Vietnam to provide suitable financial support solutions for small and medium enterprises...

With the above handshakes, Vietnamese companies and financial institutions will benefit in cooperation with Singapore's fintech company. At the same time, cooperation between businesses of the two countries is expected to create an ecosystem in the fields of finance and technology.

Vietnam attracts Korean investment in research and development

  In recent times, the investment shift out of China is being carried out by many international investors. Vietnam is a country that has enough factors to receive investment shift, especially in the manufacturing sector with low-cost labor and low expenses. However, at present, Vietnam has changed its method of attracting FDI, instead of taking advantage of low expenses and low-cost labor, Vietnam now aims to take advantage of highly skilled workers and many incentives in research and development activities.

Recently, many Korean investors have plans to change production lines, invest in research and development (R&D) company in Vietnam. Previously, Korean businesses mainly invested in industries such as apparel, bags, and footwear, however, recently many Korean investors have made investments in industries such as high electronics, information technology, automotive and construction equipment, distribution and service industries.

Currently, Korea is the leading country in the list of countries investing in Vietnam. Previously, a joint venture between Korean and Vietnamese businesses proposed to the Dong Nai province government to invest and build a Vietnam-Korea Hi-Tech Park with an area of ​​300 hectares, total investment capital of 150 million USD. The project aims to attract high-tech enterprises from Korea as well as other developed countries to set up company in Dong Nai in order to create quality product values ​​in the fields that shape the industrial revolution 4.0. The project is expected to attract 2 to 3 billion USD of investment capital in about 6 - 9 years after it is put into operation.

In addition, Korean investors have also cooperated with Vietnamese partners to build a Science and Technology Industrial Park with an area of ​​900 hectares in Binh Duong. In addition, many Vietnamese investors have actively worked with high-tech manufacturing partners to promote the participation of key partners as well as prepare the first customers.

With the policy of attracting investment in high technology and in particular the Investment law 2020, there are special investment incentives for newly established investment projects (including the expansion of the establishment project), the centers for innovation, research and development centers with total investment capital of 3,000 billion VND (about USD 150 million) or more, disbursing at least 1,000 billion VND within first 03 years from the date of issuance of the Investment Registration Certificate or the approval of the investment policy; a national innovation center established by decision of the Prime Minister; Investment projects in sectors or trades specially given investment incentives with an investment capital of VND 30,000 billion (about USD 1.5 billion) or more, with a minimum disbursement of VND 10,000 billion within 03 years from the date of issuance of the Investment Registration Certificate or the approval of the investment policy” will be given special incentives in accordance with the provisions of corporate income tax and land law.

As the investment attraction and investment shift preparation of Korean R&D enterprises, Vietnam hopes to become an investment destination for Korean high-tech enterprises in the future to establish company.

Why should you need to research the partner before signing the contract?

  It is important to find and work with a capable and long-term partner to build confidence doing business in a safely and effectively way for all parties, and avoid potential risks. In order to be guaranteed their legitimate rights and interests, individuals and organizations conducting business need to have a clear understanding of their partner before cooperating, in order to start their business cooperation most effectively.

In cooperation with a partner lawfully established in Vietnam, individuals and enterprises could find out information that has been registered at the competent state agencies. Accordingly, information about the owner, legal representative, business lines, head office address, tax code, charter capital, founding shareholder, business registration certificate, corporate history of the last three to five years, the latest business registration information, etc. could be checked on the National business registration information system. The registered information is the official information, valuable to determine the authority, position and responsibility of organizations and individuals if there is a mistake in the operation.

In addition, to find out if an individual is an owner, manager or capital contributor of one or more enterprises in Vietnam, organizations and individuals can also check the information registered in the National business registration information system. If an individual owns, manages, or contribute capital to any business lawfully established in Vietnam within 3 years, it will be recorded. This is the information which helps the organization and individual to verify the truth of information provided by their partner.

In addition, information related to the protection of trademarks of enterprises that have been protected in Vietnam, enterprises and individuals can also be found on the website of NOIP before cooperating.

The information that has been registered at the competent authority, these are basic and public information, so businesses and individuals can search. However, in the course of operation, a number of enterprises have been carrying out illegal activities that are not recorded on the registered information. Therefore, fact checking or finding out at other sources of information for an enterprise is essential to avoid cooperating with a party who is not capable of doing business.

Many businesses and individuals neglect their partner information before signing contracts. During the implementation of the contract, these partners were not able to continue to perform the contract, leading to many negative impacts on the business of the business. In addition, there are partners that commit fraud, provide inaccurate information, in order to appropriate assets of businesses and individuals through the signing of sales contracts. This makes businesses and individuals take a lot of time and effort to reclaim lost assets, affecting their business.

Searching the information of the partners before cooperating is very essential when doing business in any case so that businesses and individuals can cooperate in a long term. Cooperation with a good partner can help businesses and individuals achieve economic benefits, save time and costs in business, thereby bringing the best profit for themselves.

Trade cooperation between Vietnam and Germany and potential future

  After 45 years of establishing diplomatic relations between Vietnam and Germany (from 1975 to 2020), Germany and Vietnam have had cooperation programs in many fields such as culture, economics, education, and health. Especially, after the Vietnam-EU Free Trade Agreement (EVFTA) came into effect, the commercial cooperation relationship between the two countries has developed.

EVFTA is an opportunity for Vietnamese businesses to expand their markets to European countries, including Germany. On the contrary, this is also an opportunity for German businesses to invest in Vietnam to set up company thanks to policies to attract and preferential investment commitments.

Germany is the world's leading technologically developed country and an integral part of the global supply chain. Germany also has many strict requirements on the quality of goods and the environmental friendliness of products, which requires Vietnam to improve production quality and use environmentally friendly products/materials. With the signing of the EVFTA, Vietnam and Germany will have more favorable conditions for technology exchange and investment, which will help trade cooperation between the two countries more developed.

Before 2014, Vietnamese goods exported to Germany were the least polluted category, including agricultural products, wood products, processed foods, beverages, garments, footwear and glassware. Since 2014, the export of machinery and equipment to Germany began to increase and became the item with the highest export turnover. After EVFTA, Vietnam will increase exports of footwear, textiles and agricultural products such as coffee, tea, pepper and rubber and will import many products related to processing, pharmaceuticals, chemicals.

In addition, in order to improve product quality to meet import criteria into Germany and Europe, Vietnam also attracts foreign investment to develop sustainably economic sectors such as pharmaceuticals and chemicals, in order to create quality products that are qualified for domestic use and import to many countries around the world.

Currently, the number of investment projects of German investors implementing in Vietnam is not high compared to other countries such as Japan, Korea, Singapore, etc. This requires Vietnam to re-examine its strengths and weaknesses in order to meet the investment needs of German investors. The implementation of EVFTA, Investment Law 2020, Enterprise Law 2020 is an opportunity for international investors, including German investors to easily access Vietnam market when expanding their investment.

With many cooperation efforts between Vietnam and Germany in recent years, Vietnam hopes that in the coming years, Vietnam will be the leading destination in investment for German investors and help improve furthermore good relationship between the two countries in the future.

Da Nang cooperates with the Netherlands in the field of high-tech agriculture

  On November 18, 2020, representatives of Da Nang city and experts, Dutch farming enterprises organize an online seminar "Promotion and cooperation of high-tech agriculture in Da Nang- Netherlands" to develop hi-tech agricultural cooperation relations between the two countries.

The Netherlands is a country with developed agriculture and high technology application in Europe and is also a country that is known to apply technologies to cope with the impacts of climate change on agriculture. Similarly, Vietnam is also an agricultural country affected by climate change, but Vietnam's agriculture has not had the conditions to apply high technology to improve the quality of agriculture.

Currently, the high-tech agriculture is a priority for Da Nang to thrive in order to meet the needs of use and export to many countries around the world.  The creation of quality and safety products is the city's top goal. At present, Da Nang is concentrating on solutions, promulgating supportive and encouraging policies to attract investment to set up company in the field of hi-tech agriculture, completing the detailed planning of 3 agricultural regions which applying high technology. Although the land reserve for agricultural production is limited, the city always gives priority to the development of hi-tech agriculture.

Not only investing in production, planning and application of high-tech science, Da Nang hopes to receive Dutch help in choosing applied technology, export standards as well as how to use the agricultural land effectively, avoid wasting resources. In addition, attracting Dutch investors with financial ability and business experience in the field of high-tech agriculture will help Da Nang learn how to manage effectively and meet demand of the city and providing food for millions of visitors to Da Nang each year. Besides, in the future, Da Nang hopes to combine high-tech agriculture and tourism to create the highest economic efficiency for the city.

With its efforts, Da Nang hopes that in the future there will be more Dutch investors investing in the city through setting up company in Da Nang, Vietnam or cooperate with local company in the field of high-tech agriculture, thereby bringing the highest economic efficiency to the investors and the city.

Da Nang and Korea cooperate in investment

  On December 3, 2020, the representative of Da Nang city held an online investment promotion conference called "Investing in Da Nang" for Korean investors and businesses. The conference with the participation of more than 100 Korean investors and businesses has helped investors and businesses have a new view in their investment implementation in Da Nang market.

The conference has promoted and introduced the business environment and cooperation opportunities investment in Da Nang in the fields of high technology, information technology, services, and smart city support. Recently, in the context of investment capital inflows from Korea tends to shift to Southeast Asia due to the influence of the Covid-19 epidemic and the US-China trade war, Vietnam is considered to be a country which meet enough political, economic, labor and technological conditions to make the shifting investment in an easy way.

At the conference, representatives of Da Nang city affirmed that foreign investment is one of the important resources for the socio-economic development of the city. For many years, the city has always set the goal of attracting investment as the top target, in addition, the city has actively improved the investment environment, issued many preferential policies and supported foreign investors who invest in the city.

In 2020, despite the impact of the Covid-19 pandemic, there are still many investment projects of Korean investors making investments in Da Nang. Until November 2020, Korea is the country which has the most number of projects in Da Nang with 232 projects, and ranked 4th in terms of capital, with a total registered investment capital of more than 376 million USD, episode medium in the fields of services, real estate, industrial production and information technology.

In the current period, with the selection of a politically stable investment location, high quality labor, reasonable investment costs and good disease control ability, Vietnam is the top destination for Korean investors to set up company, set up factory, and make investment in Vietnam. Currently, many large enterprises in Korea have signed Memorandum of understanding with Da Nang city as the first step of cooperation and investment development in Da Nang in the coming years.

Vision to develop logistics services in Da Nang

  Da Nang, with its favorable geographical location, lies on the arterial North-South traffic axis in terms of road, rail, sea and air, is an important traffic gateway of the Central - Central Highlands and is the end point on the East-West Economic Corridor running through Vietnam - Laos - Myanmar - Thailand, converging types of transport from air, seaport, railway, expressway, especially with deep water ports. Therefore, Da Nang has a great potential to develop into a maritime transport center, an important logistics hub to countries in the region.

In the economic development orientation and in the Politburo's Resolution No. 43-NQ/TW dated January 24, 2019 on Da Nang construction and development to 2030, a vision to 2045 defines: Danang will focus on exploiting advantages to soon become a marine economic center, forming logistics service supply chains for the Central and Central Highlands.

To comply with the Resolution, currently, in parallel with the expansion of the port, Da Nang is also actively calling for investment in logistics centers. Of which, 20 hectares in Hoa Vang district, 2 hectares in the north of Da Nang airport, 9.1 hectares in the High-Tech Park. At the same time, promote the early operation of highways Da Nang - Quang Ngai, La Son - Tuy Loan... to awaken potentials, promote trade links, connect industrial zones, economic zones in the region, thereby becoming the driving force to promote the city's logistics services industry.

In addition, Da Nang will build a new Lien Chieu port as a transport port, Tien Sa port will be a tourist port in order to promote the central role of the international seaport city and urban seaport. According to the Department of Planning and Investment of the city, the Lien Chieu port project is currently completing the environmental impact assessment report, submitting for appraisal and approval of the subdivision planning project 1/2,000. City leaders suggested early appraisal of capital sources and capital balancing capabilities, and proposed to allocate central budget capital to support projects. In the next phases, Lien Chieu port will attract investors in logistics items. This is an important premise for Da Nang to promote the role of a key maritime route in the Central region and a logistics center in the region.

With the above orientation, it is expected that in the coming time, the market of transport services and logistics in the city will develop more vibrantly, raising the quality of services not only in the city but in the region.  It is hoped that more companies will invest, set up company and apply for investment certificate in Da Nang in the area of logistics and logistics support.

Why do we have to undertake background check before recruitment?

 Recruitment is the process of screening and recruiting qualified people to meet a job in an organization in general and in particular business. Recruitment plays a very important role in business development. Effective recruitment will provide businesses with a team of skilled, active, creative employees and provide human resources in accordance with the business performance of the business. Only when doing well the recruitment stage can we do well in the next stages. Therefore, businesses need to recruit the right people right the first time as well as arrange them in an important position.

Most of the information that enterprise has is provided by the employee and there is no verification of the information. And if the enterprise only relies on the information provided by the employee, it is likely that the employee is dishonest, or causes mistakes and avoid responsibility. To recruit “right employee, right job”, enterprise needs to check the applicant’s background.

Checking employee's background is to create trust between enterprise and employee. The background check includes: Verify Identification; Verify at home; Verify qualifications and certificates; Verify employment history at old jobs; Verify criminal records in Vietnam.

Verification of the background helps to know personal information, origin, hometown, criminal status of the employee. Thereby, background check will minimize commercial risks; preventing fraud and internal theft better; increase security of data and documents in the enterprise. In particular, for important positions in the enterprise, the confidentiality of enterprise document information is extremely necessary.

Verifying employment history at past jobs is to understand working process and the reason for job termination; obtain an objective view of the necessary competencies, skills and work experience. From there, enterprise could save time in searching for suitable employees as well as saving labor training costs.

In addition, background check improves business efficiency, developes a team of integrity to meet the business requirements of the enterprise. Because recruiting well means finding out people to perform the job with the capabilities and qualities to complete the assigned work, then effective recruitment helps the enterprise perform well its business goal and improve profitability.

Currently, the situation of fraud, diploma trading, or dishonesty in recruitment, many enterprises cannot control and verify all the information that employees provide. Enterprises need to check applicant's background when recruiting to prevent fraud, internal theft; increasing security of data and documents in enterprises; decrease recruitment time and training costs. Besides, creating trust between businesses and employees; increase employee productivity and product quality as well as increase business profits.  It is suggested to consult with professional background check service company with proven track record in Vietnam to help with the local service.

The cooperation between Da Nang and EU strengthen

  On November 26^th, 2020, representatives of Da Nang city meet and work with the delegation of EU countries to work in the city. The year 2020 marks the 30th anniversary of the establishment of Vietnam-EU diplomatic relations, which is also an opportunity for Da Nang to promote cooperation with EU partners in the coming time.

In recent years, Da Nang has established relationships with many countries in the EU. Many cooperation programs and projects on socio-economic development of the city are coordinated with localities of many countries in the fields of environment, education, information technology, and tourism. Besides, the implementation of the EVFTA has helped the countries have more opportunities to cooperate, especially in the fields of investment and trade.

In addition, Da Nang city also commits to create the most favorable conditions for European investors to invest in Da Nang to set up company in the fields of environment, tourism, high technology, and building smart city.

The head of the delegation of the European Union said that economic activities towards green approaches and areas that focus on attracting investment in Da Nang such as high technology, digital transformation, responding to climate change etc. are also the areas that the European investors are interested in and prioritize towards. This is a great potential and opportunity for cooperation between the countries. With the advantage of European investors is the use of modern technology, digital transformation into production and business, this is completely suitable for Da Nang's goal of attracting investment in this time.

At the meeting, the representatives of European countries highly appreciated Da Nang's development efforts in recent years. The implementation of the Memorandum of Understanding with European countries, as well as many policies to attract European investment as well as administrative reform, helps create an open investment environment and create the best conditions for investors to do business, establish company, obtain investment certificate in Da Nang.

In the coming time, with many policies on investment and economic development cooperation between Europe and Da Nang, Da Nang city hopes that have many European investors will choose the city as their investment destination when expanding their investments in Vietnam.

Market entery into Vietnam market through merger and acquisition

  Over the past 10 years, Vietnam has always been one of the leading M&A destinations in Southeast Asia. Many international investors have chosen Vietnam as their place of business destination to set up company and apply for investment registration certificate under direct investment or acquiring shares or capital contributions through M&A.

M&A activities enable international businesses to take advantage of the existing business platforms of Vietnamese businesses to continue making investments. This helps international investors to timely grasp the changing trend of technology, legal policies, and facilities to do business, instead of rebuilding from scratch, it will take more time and effort.

Recently, the M&A market in Vietnam has been active and attractive to many investors around the world, especially in the retail and financial sectors. Many international investors have undertaken significant M&A deals in Vietnam over the years and achieved significant profits in their business.

There are many reasons for investors to choose Vietnam as a place to do business, but some of the main factors that make Vietnam attractive are political stability and its economic growth, despite the effects of the Covid-19 epidemic. In addition, with a population of 100 million people, this is considered a large consumption market, along with an abundant and high-quality labour source.

Currently, with the trend of moving production out of China, many investors have chosen Vietnam as the location of setting up company for manufacturing facilities. Rebuilding factories from scratch also makes investors time consuming and costly, therefore taking advantage of Vietnamese factories will help investors not to interrupt their production, and operate the business in a best way.

However, to be able to perform M&A activities in Vietnam, foreign businesses need to understand the Vietnamese market and partners before performing M&A. This will help investors understand the partners' strengths and weaknesses, and outline a suitable business path after implementing M&A. In addition, to avoid unnecessary risks relating to the transaction and to the business itself, investors need to find a reputable and experienced professional consulting company that could help with market research, background check, management criminal record check, business certificate verification, corporate and individual reputation to build up confidence in doing M&A deal in Vietnam.

UKVFTA- the cooperation between Vietnam and UK

 On December 29^th, 2020, representatives of Vietnam and the United Kingdom signed the free trade agreement negotiation between the Socialist Republic of Vietnam and the United Kingdom of Great Britain and Northern Ireland (UKVFTA) in London, United Kingdom. It would open up opportunities for flow of goods and that investors from UK to make investment in Vietnam through setting up company, and manufacturing facilities.

After December 31^st, 2020, the Vietnam - EU free trade agreement (EVFTA) will no longer apply to the UK due to Brexit, so the implementation of the signing of a free trade agreement between the two countries is essential to sustaining and developing economic cooperation. The UKVFTA is expected to help reduce import duties on goods from the UK to Vietnam and vice versa. In addition, the commitments in the Agreement will help develop trade and investment between the two countries in the coming time.

In recent years, the UK is a major trading partner of Vietnam in Europe, the import-export turnover between the two countries has increased significantly, especially products of seafood, garments, wood products, agricultural products etc. Besides opportunities to promote exports, improve business investment environment, expand commodity supply, the UKVFTA also poses certain challenges in meeting the quality of goods to qualify for pressure tax incentives in the Agreement.

In order to make the most of the economic effects from the UKVFTA, there are UK investors to invest and produce products that meet the quality and demand conditions for the UK market is essential for Vietnam. Besides, in addition, the advantages of British investors such as finance, pharmaceuticals, chemicals…will benefit Vietnam. Investing in Vietnam in this industries will enable investors to take advantage of highly skilled labor, perfect facilities as well as investment attraction policies in Vietnam to bring the best benefits for investors. On that basis, Vietnam also learn the operations, management and experience from British investors, thereby helping to develop the domestic market. In addition, Vietnam also needs to import raw materials for UK manufacturing industries such as textile materials and leather to ensure compliance with the rules of origin in order to make the best use of incentives from the Agreement.

With the negotiation of the Agreement, this is a new beginning for the economic relationship between the two countries Vietnam and the UK during a period of many difficulties due to epidemics and economic crisis. In addition, this is a step towards further developing the diplomatic, cultural and educational relationship between the two countries in the future.