Viet Nam

Viet Nam

New Criteria for Hi-tech Enterprises

30 Apr 2021

On 30 April 2021, the Decision No. 10/2021/QD-TTg, which details criteria for identifying hi-tech businesses, will take effect. The decision lists certain conditions that are applicable for businesses to be considered as hi-tech enterprises. While businesses need to satisfy conditions as stated in the Law on High Technology as well as the Law on Investment, in addition to this, Decision 10 lists specific conditions needed to qualify as a high-tech business. Conditions to be qualified as hi-tech include: - at least 70 percent of total annual net revenue derived from hi-tech products; - at least 0.5 to 2 percent of total annual net revenue allocated to research and development (R&D) activities, or at least 0.5 percent for enterprises with total capital over VND 6 trillion (US$260.87 million) and more than 3000 employees; - Businesses with total capital of VND 100 billion (US$4.35 million) and more than 200 employees must allocate at least 1 percent to R&D activities; and - All other businesses should spend at least 2 percent.
High-tech businesses are also required to hire employees that are educated at the college level or higher depending on the total number of employees. This ranges from 1 to 5 percent depending on the total investment and number of employees. However, employees with college-level degrees cannot exceed 30 percent of the total workforce for high-tech businesses. In Vietnam, businesses carrying out activities defined as hi-tech are eligible for tax incentives.