Vietnam Issues Draft Decree on Retail Services

Vietnam’s Ministry of Industry and Trade released its draft decree on retail services last week tackling the Economic Needs Test (ENT), which acts to restrict foreign investment entry in the retail industry.

Following the provisions of the ENT, setting up of retail establishments in excess of the first retail establishment of a foreign-invested enterprise will be evaluated on the following criteria: number of retail establishments; market stability; and inhabitant density.

The number of retail establishments will be assessed based on the total number of shops; the number of shops of the same level; the number of shops trading the same goods; and the number of small and medium scale markets and shops existing in a region of the level of city, district or village.

Moreover, market stability is the stable operation of an existing retail system on the basis of identifying the impacts of a retail shop if established on trading the same goods in the same region of the level of city, district, or village.

The number of retail establishments on inhabitant density in a region must not exceed five times the rate of the number of retail establishments on inhabitant density in the region or province.

Authorities will be accepting suggestions on the draft until September 17. A copy of the draft can be downloaded here.

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