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VIETNAM: Upcoming New Labour Code and Amendments to Immigration Law

Amendments to the Law on Entry, Exit, Transit and Residence of Foreigners will come into effect on 1 July 2020.

Furthermore, a new labour code will come into effect on 1 January 2021, replacing the labour code implemented in 2013.

Immigration Law Amendments

The new law allows in-country change of visa category in certain circumstances.

There will be some changes to visa categories as below:

  • The LS visa: Issued to foreign investors in Vietnam and foreign lawyers practicing in Vietnam.
  • The investor visa (DT) and Temporary Residence Card (DT) will be divided into 4 categories depending on the investment amount of the company in Vietnam. The visa or temporary residence card duration will vary between 1 to 10 years depending on the investment amount. However, dependents of foreign investors will be granted a visa or temporary residence card with a maximum of 3 years duration, renewable.
  • The DN visa is to be divided into 2 categories:
    • DN1: Issued to foreign nationals coming to collaborate with enterprises and organizations with legal status regulated by Vietnamese law;
    • DN2: Issued to foreign nationals coming to Vietnam to offer services, establish commercial presence or conduct other activities under international agreements to which Vietnam is a party.
  • The working visa (LD) be divided into 2 categories, for work permit holders and for work permit exemption certificate holders.

Foreign nationals entering Vietnam under the visa exemption scheme are only required to have a passport which is still valid for at least 06 months. More significantly, the 30 days cooling off period from the previous exit is no longer required.

The new Immigration law also provides a legal framework for the e-visa regulation implemented in 2017.

New Labour Code

Work permit exempt foreign nationals will include the following:

  • Owners or capital-contributing members of a limited liability company with capital contribution amounts that meet designated government requirements.
  • The Chairman of the Board of Directors or a member of the Board of Directors of a joint stock company with capital contribution amounts that meet designated government requirements.
  • Spouses of Vietnamese nationals resident in Vietnam.

The new investment threshold required for foreign investors to qualify as work permit exempt will be determined in upcoming decrees and /or circulars.

The term of an employment contract for foreign nationals working in Vietnam must not exceed the validity of the work permit. The employer and its foreign employee may enter into multiple definite-term employment contracts provided that a work permit is granted. This differs from employment contract rules for Vietnamese workers.

The term of a work permit may not exceed two years and can only be extended once for a maximum period of two more years. (It is not clear at this stage whether after four years of work in Vietnam, a foreign employee will be able to apply for a new work permit, the qualifying criteria for which may be different than for their previous work permit.)

A new decree on the management of foreigners working in Vietnam is expected during the course of 2020 (there is no draft at this stage) which should clarify the new labour code before it takes effect on 1 January 2021.

Our Advice

Employers who may be affected are encouraged to contact a Newland Chase immigration specialist for case-specific advice.

This alert was prepared with information provided by Resident Vietnam.

DISCLAIMER: The information contained in this immigration alert has been abridged from laws, court decisions, and administrative rulings and should not be construed or relied upon as legal advice. If you have specific questions regarding the applicability of this information, please contact Peregrine © 2019 Peregrine Immigration Management Ltd.