The workshop held by the Viet Nam Chamber of Commerce and Industry in co-operation with the British Embassy discussed an assessment report by the chamber and the Government Office on the implementation of Enterprise Law and related sub-legal documents.

The report proposed changes based on incidents emerging from law practice over the past few years.

One recommendation was to remove "legal competence" from an enterprise's official seal. The review team argued that the seal was just a sign to differentiate an enterprise from another but many people equated it with the enterprise's legal status.

"The seal is acting only as a tool of verification not a legal instrument. In fact, it's very easy to clone," chamber legal department head Tran Huu Huynh said.

Phi Dang Minh from the Banking Association said the removal would help Viet Nam move closer to international practice where enterprise seals were of little importance compared to signatures.

However, Do Chi Cong from Khai Phong law firm disagreed. He said as the legal awareness of the public and enterprises was still limited, the continued use of seals in the meantime would still be necessary as it was a conventional belief that a seal was attached to legal importance.

"Maintaining the use of official seals will help guarantee the validity of the enterprise transaction," he said.

Another recommendation was the adoption of non-discrimination – equal treatment applicable to both foreign and domestic investors instead of different procedures for each as occurred now. There should be only one term: Vietnamese enterprises establishing and operating in compliance with the Vietnamese legal system, the recommendation stated.

Do Gia Thang, from the Government Office's Legal Department, said it was not the right time to completely remove the discrimination mechanism, which was a protective barrier, because it would put Viet Nam, whose enterprises were mostly still small, at a disadvantage.

"The regulations to put a threshold on foreign investment are necessary to protect domestic enterprises and the national territories while keeping in compliance with international practice," he said.

"There may be a time when the world will achieve absolute free trade but I don't see it coming soon," Thang said.

The review team also suggested that there should be new provisions regulating on the mergers and acquisitions (M&A).

Lawyer Cong said international treaties required that M&A procedures in the capital market be clearly defined and made available so investors were informed of their rights.

Participants were divided when it came to business registration. The report recommended that the establishment of an enterprise, regardless of its business type, would be in compliance with the Enterprise Law only. Under the existing law, where the establishment, management and operation of an enterprise were regulated by another law, the provisions of the other law should apply in special cases which involved special type of business such as law firms or banking institutions.

Minh from the Banking Association, who is a former deputy head of the State Bank' Foreign Exchange Management Department, said precautions were needed because once this suggestion was approved, credit institutions would mushroom due to more relaxed requirements, which would translate into a threat to monetary security.

"Now the credit institutions are well managed because in order to establish they must meet strict requirements as stipulated in the Law on Credit Institutions and Law on the State Bank."

"I am not sure the competent agencies could handle it if it is easy to get a business registration to run a credit institution as suggested," Minh said.

The Enterprise Law came into effect in July, 2006.