Chapter I

GENERALPROVISIONS

Article 1.- Scope of application

This Decree details the implementation of the November 12, 1996 Law on Foreign Investment in Vietnam and the June 9, 2000 Law Amending and Supplementing a Number of Articles of the Law on Foreign Investment in Vietnam (hereinafter referred collectively to as the Foreign Investment Law).

Foreign investment in industrial parks, export processing zones and high-tech parks; foreign investment in the forms of Build-Operate-Transfer (BOT)contracts, Build-Transfer-Operate (BTO) contracts and Build- Transfer (BT) contracts;foreign investment in the fields of medical examination and treatment, education and training, and scientific research shall comply with this Decree and other relevant law provisions.

International credit activities, trade activities and other indirect investment forms shall not be governed by this Decree.

Article 2.- Subjects participating in investment cooperation

Subjects participating in investment cooperation under the Foreign Investment Law shall include:

1. Vietnamese enterprises:

a) State enterprises set up under the State Enterprises Law;

b) Cooperatives set up under the Cooperatives Law;

c) Enterprises of political organizations, socio-political organizations;

d) Limited liability companies, joint-stock companies, partnerships,private enterprises set up under the Enterprise Law.

2. Establishments for medical examination and treatment, education and training or scientific research, which satisfy the conditions prescribed by the Government.

3. Foreign investors.

4. Enterprises with foreign investment capital.

5. Overseas Vietnamese.

6. The State bodies competent to sign BOT, BTO and BT contracts.

Article 3.- Lists and selection of investment projects

1. Issued together with this Decree:

a) The list of projects where investment is especially encouraged;

b) The list of projects where investment encouraged;

c) The list of geographical areas where investment is encouraged;

d) The list of fields where investment is conditional;

e) The list of fields where investment is not licensed.

Basing itself on the socio-economic development planning andorientation in each period, the Ministry of Planning and Investment shall coordinate with the ministries and the People's Committees of the provinces and centrally-run cities(hereinafter referred to as the provincial-level People's Committees) in submitting to the Prime Minister for consideration and adjustment the above-said lists.

2. Investors may take initiative in selecting the investment projects,the investment partners, form of investment, geographical areas and duration of investment, markets for production consumption, the legal capital contribution percentages, in accordance with the provisions of the Foreign Investment Law and this Decree.

Article 4.- Governing laws

1. Subjects participating in investment cooperation prescribed in Article 2 of this Decree shall have to comply with the provisions of the Foreign Investment Law, this Decree and other relevant provisions of Vietnamese laws.

2. For any specific case of foreign investment in Vietnam which has notyet been prescribed by Vietnamese laws, the parties may agree in the contracts on the application of foreign laws if such foreign law application does not run counter to the basic principle of Vietnamese laws.

Article 5.- Useable language

The investment project dossiers and official documents forwarded to theVietnamese State bodies shall be made in Vietnamese language or in Vietnamese and a common foreign language.