Free Trade Agreement Of Vietnam

The TFUE provides for Vietnam`s commitment to the World Intellectual Property Organization (WIPO) as a means of preventing unauthorized access to creative works and protecting materials exchanged through digital networks, including the internet. In particular, Vietnam has committed to joining the WIPO Copyright Treaty (1996) and the Performance and Phonogram Contract (1996) within three years of the effective date of THE TUEFTA. According to reports, the Vietnamese government is in the process of completing its internal procedures and the necessary documents to accede to the two treaties. The TFUE also includes strict provisions for trademark protection, patents, designs, plant varieties and data protection (five years) for pharmaceutical, biological and agrochemical products. On 8 June, the Vietnamese National Assembly approved the agreements by an overwhelming majority, with 457 deputies for the free trade agreement and 462 for the IAP. According to some Vietnamese newspapers, the agreements could come into force in July. At the most fundamental level, the agreements will promote jobs and growth between Vietnam and the EU. The agreements will gradually reduce most tariffs, regulatory barriers and bureaucracy, and encourage EU entrepreneurs to do business and invest in Vietnam. The entry into force of TUEFTA comes amid growing global trade tensions with China. Combined with the ongoing COVID 19 pandemic, this has contributed to the growing trend of companies diversifying their supply chains, with Vietnam rapidly becoming the main beneficiary.

The EU is already Vietnam`s second -largest destination for products. EMU will give new impetus to this important trade route and is an important step towards ending the security of EU investors and other global companies wishing to establish or develop trade relations between Vietnam and the EU, as well as the basis for creating fair and effective trading conditions. The free trade agreement will consist of two parts, one for trade and one for investment, covering 95% and 5% respectively. In accordance with the opinion of the European Court of Justice on the EU-Singapore free trade agreement, it will probably be decided that the European Parliament will be solely competent in the trade field because of the European internal market and that, therefore, the trading part will enter into force immediately after ratification by the European Parliament. The investment part requires ratification by the European Parliament and all EU Member States. The effects of the investment part are applied on an interim basis, subject to the completion of the ratification process. It took more than eight years and a dozen rounds of dialogue for both sides to negotiate the EVFTA. Nicolas Audier, President of EuroCham in Vietnam, welcomed the results of the vote: ”The EVFTA is now more important than ever, as trade wars and a global pandemic disrupt normal affairs on an unprecedented scale. Free, fair and rules-based trade is the best roadmap for economic growth, and Vietnam will now have privileged access to an EU consumer market of around 500 million people who want to do business and invest with a strong, secure and prosperous nation in the heart of Asia.

The agreement has two important effects on EU FDI in Vietnam. The first is the EU-Vietnam Investment Protection Agreement (EUVIPA). The agreement includes a provision for the settlement of investor-state disputes, which aims, among other things, to protect EU investors from expropriation and lack of fairness and equal treatment.

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