VN still restricts foreign investment in cigarette industry

VGP – Việt Nam will continue to contain foreign investment in cigarette production in line with the Government’s Decree on tobacco production and trade, according to a circular of the Ministry of Industry and Trade (MIT).

February 14, 2011 3:13 PM GMT+7

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Under the new circular, only foreign enterprises forming joint ventures with domestic enterprises that have tobacco production licenses will be able to partake in the industry.

The tobacco joint ventures are forbidden to invest money more than licensed and have to ensure the ratio of State-owned charter capital.

The circular also stipulates the MIT will submit dossiers of applicant and recommendation documents within 30 days to the PM for approval.

Tobacco enterprises will have to send annual and half-yearly reports to the MIT on their performance, production, as well as information of raw materials.

Since Việt Nam became a member of the WTO, the country no longer prohibited foreign investment in tobacco industry. Tobacco production is listed as one of the conditional investment fields and subjected to business limitation to ensure the successful implementation of the programme on preventing the evils of smoking./.

By Kim Anh