National treatment under general agreement on trade in services and assessment on implementation of national treatmemt in financial services under vietnamese regulation

MINISTRY OF EDUCATION AND TRAINING HO CHI MINH UNIVERSITY OF LAW THE MANAGING BOARD OF SPECIAL TRAINING PROGRAM  - HUYNH HUONG GIANG NATIONAL TREATMENT UNDER GENERAL AGREEMENT ON TRADE IN SERVICES AND ASSESSMENT ON IMPLEMENTATION OF NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER VIETNAMESE REGULATIONS BACHELOR’S THESIS Major in International Law HO CHI MINH CITY – 2014 HO CHI MINH UNIVERSITY OF LAW THE MANAGING BOARD OF SPECIAL TRAINING PROGRAM  - BACHELOR’S THESIS NATIONAL TREATMENT UNDER GENERAL AGREEMENT ON TRADE IN SERVICES AND ASSESSMENT ON IMPLEMENTATION OF NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER VIETNAMESE REGULATIONS STUDENT: HUYNH HUONG GIANG COURSE: 35 STUDENT CODE: 1055010070 SUPERVISOR: DR TRAN PHU VINH MAJOR: INTERNATIONAL LAW ` HO CHI MINH CITY – 2014 I hereby confirm that this thesis is a presentation of my original work and contains no material which was previously published or written by another person, except where due reference has been made in the text I give consent to this copy for being published and being made available for copying in the library of Ho Chi Minh University of Law, subject to provisions of Intellectual Property regulations The work was completed under the guidance of Professor Tran Phu Vinh, at Ho Chi Minh University of Law In my capacity as supervisor of the candidate‟s thesis, I certify that the above statements are true to the best of my knowledge Date: July 21, 2014 Acknowledgments Apart from the efforts of myself, the thesis is completed depending largely on the encouragement and support of many others This is opportunity to expressing my gratitude to all those people who have supported me and had their contributions to this thesis possible I express my deepest gratitude to my supervisor, Mr Tran Phu Vinh for his guidance and support to my thesis He has given me enough freedom during my research and substantial comments as well as encouragement, which helped me to coordinate the thesis Furthermore, I would like to thanks all professors in Ho Chi Minh University of Law for their guidance, remarks and encouragement through the learning process of my bachelor degree All the knowledge, experience I have acquired from the professors and other students in Ho Chi Minh University of Law are all contributions to materializing this thesis I also would like to acknowledge with much appreciation to the support from Audier and Partners LLC for giving me encouragement to finish the thesis during my training period Without the help from my mentor and staff of A&P, this thesis would not have been completed Last but not least, I express my deepest gratitude to all my friends and my family who have continually supported me throughout the entire process, your help was vital for the success of this thesis as well as my future career TABLE OF CONTENT INTRODUCTION CHAPTER I OVERVIEW ON NATIONAL TREATMENT UNDER THE GATS 1.1 Introduction 1.2 History background and structure of the GATS 1.2.1 The purpose and historical background of GATS 1.2.2 The substance and structure of the GATS 10 1.3 The substances of national treatment obligation under GATS 14 1.3.1 National treatment in general and the execution of this principle in the GATS 14 1.3.2 Descriptive analysis of national treatment under GATS 21 1.4 The relationship between national treatment obligation and market access 25 1.4.1 Market access under the GATS 25 1.4.2 The connection and intertwinement of market access and national treatment under Article XX:2 of the GATS 27 1.4.3 The approaches to address the overlap issue 29 1.5 Summary of Chapter I 32 CHAPTER II NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER THE GATS AND ASSESSMENT ON IMPLEMENTATION OF NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER VIETNAM LEGISLATIONS 33 2.1 Introduction 33 2.2 Specific national treatment rules in financial services and its exceptions 33 2.2.1 Specific national treatment obligation in financial services 33 2.2.2 Exceptions of national treatment related to financial services 35 2.3 Status of national treatment commitment of Vietnam in financial services sector 40 2.3.1 Commitment in Banking sector 40 2.3.2 Commitment in Securities sector 44 2.4 Assessment on Vietnam‟s implementation of national treatment commitment in financial services under domestic regulations 46 2.4.1 Vietnam legal framework for national treatment principle 47 2.4.2 Assessment on implementation of national treatment commitment in banking regulations 48 2.5 Assessment on implementation of national treatment commitment in securities regulations 52 2.6 Proposals for domestic regulation to be compatible with accession commitment of Vietnam 56 2.6.1 Confirmation on the position of international treaties in the hierarchy of domestic regulations 56 2.6.2 Strengthening the law enforcement mechanism 56 2.6.3 Providing more detail in implementation of WTO commitment 57 2.7 Summary of Chapter II 57 CONCLUDING REMARKS 59 BIBLIOGRAPHY i APPENDIX A COMMITMENT OF VIETNAM TO WTO IN BANKING SECTOR x APPENDIX B COMMITMENT OF VIETNAM TO WTO IN SECURITIES SECTOR xiii INTRODUCTION 1.1 Significance of the study The General Agreement on Trade in Services1 (“GATS”), which came into force on January 1, 1995 is a breakthrough of Uruguay Round trade negotiations, marking a giant step for liberalization for trade in services For the very first time, there is a comprehensive multilateral legal framework of disciplines for trade in services, with the join of more than 150 World Trade Organization (“WTO”) Members In order to ensure equal opportunities for foreign services and effective access to services market, the GATS use a three-pronged approach including market access, national treatment and disciplines on domestic regulations.3 National treatment is the commitment by a country to treat foreign competitors operating on its territory, but controlled by the national of another country, no less favorably than domestic counterparts in like situation This is just general definition of national treatment, in order to understand how national treatment applied to services, in particular financial services, and the difference of this principle applied to goods and services, a study about national treatment under the GATS is essential One of the characteristics of national treatment under the GATS is its complicated relationship with market access The clear demarcation between market access and national treatment with respect to trade in goods seems to blur in trade in services The relationship between national treatment and market access is complicated and confusing, and there is a viewpoint that researches or studies about this matter are just valuable in theory However, since the WTO dispute United States, China – Electronic Payment Services, the issue becomes a pressing one The Panel report although explained some question related to the GATS, it still shows the limited suitability of the current framework of the GATS and inadequate guidance regarding national treatment obligation and market access in financial services sector Therefore, it is essential to study about the national treatment and to identify the relationship between national treatment and its relationship with market access under GATS, helping WTO Members to define whether a measures shall be violate market access or national treatment obligation or not General Agreement on Trade in Services (Apr 15, 1994), Marrakesh Agreement Establishing the World Trade Organization, Annex 1B, The Legal Texts: The Results Of The Uruguay Round Of Multilateral Trade Negotiations 284 (1999), 1869 U.N.T.S 183, 33 I.L.M 1167 (1994) [hereinafter the GATS] WTO Agreement: Marrakesh Agreement Establishing the World Trade Organization, Apr 15, 1994, The legal texts: the results of the Uruguay Round of multilateral trade negotiations (1999), 1867 U.N.T.S 154, 33 I.L.M 1144 (1994) M Krajewski (2003), National Regulation and Trade Liberalization in Services, The legal Impact of the General Agreement on Trade in Services (GATS) on National Regulatory Autonomy, Kluwer Law International, pp 130 Furthermore, financial sector, being an important part of the world economy and having huge effect to other sectors and globalization and liberalization of trade all over the world, is a sensitive sectors for all governments Due to that fact, financial services has been provided specific regulations under the GATS, and domestic regulators have always been cautious towards introduction competition in financial sector due to policies to develop domestic financial industries and due to prudential concerns This issue is extremely crucial for developing countries when joining WTO, including Vietnam Vietnam has become a Member of WTO since January 1, 2007 and has been taking step-by-step to integrate to the world financial markets In the era of globalization and liberalization of trade, national treatment obligation together with market access affects directly to trade in services of nations However, as a WTO Member, Vietnam has its commitment to liberalization trade in services and still has to balance between its WTO obligation and the development of our young domestic financial sector The significance of the study is to provide in-depth knowledge about national treatment, to assess the regulations of Vietnamese law with the Accession Commitment of Vietnam to the WTO in financial services and to give possible solutions for more efficient operation of Vietnamese‟s legislation in financial services From the above reason, the author decides to write a bachelor‟s thesis on “National treatment under General Agreement on Trade in Services, and the assessment on implementation of national treatment in financial services under Vietnamese domestic regulations.” 1.2 Literature review to the topic of the thesis Study on national treatment obligation under the GATS and especially in financial services has received great attention from many scholars recently, mostly from international scholarly works 1.2.1 Foreign studies related to the topic First and foremost, as the GATS is the multilateral agreement between WTO Members, the Secretariat of WTO has published a guideline for Members to have an overview about the GATS namely “Guide to the GATS : An overview of issues for further liberalization of trade in services”, published by Kluwer law international in 2001 This guideline covers all the aspects of the GATS, however, as a guideline; this book does not specifically aim at studying on national treatment obligation or its application in any specific sector Besides, there are other scholarly works of many authors on national treatment obligation under the GATS such as, "National Treatment in the GATS: Corner- stone or Pandora's Box?" of Mattoo, Aaditya4; “A Comparative Analysis of GATS and GATT: A Trade in Services Departure from GATT„s MFN Principle and the Effect on National Treatment and Market Access” of Trachtman R5; “The Law and Policy of the WTO” of Peter Van D Bossche6, “National treatment and WTO dispute settlement: adjudicating the boundaries of regulatory autonomy” of Gaetan Verhoosel Nonetheless, these books mainly focus on national treatment obligation in general; there is no book cover national treatment in a specific sector such as financial services There are also papers and journals which focus on national treatment obligation in financial services such as “Market access and National treatment in ChinaElectronic Payment Services An illustration of the Structure and Interpretive Problem in GATS” of Rachel Block7; “National treatment in financial services in the context of the GATS/WTO” by Wei Wang8; etc., however, these journals or papers not compare National treatment under the GATT9 and the GATS and they not study on the regulation of financial services under Vietnamese regulations 1.2.2 Research status in Vietnam Regarding research status in Vietnam, there is a master thesis of Phạm Thị Nguyệt Sương on “Quy chế đối xử quốc gia nhà đầu tư nước tác động quy chế đầu tư nước” (National treatment to foreign investors and its affect to domestic investors).10 This thesis mainly focus on studying on national treatment and measures usually used by countries to protect domestic investors Although the thesis of author Phạm Thị Nguyệt Sương also focuses on national treatment obligation, there are differences on the scope and the purpose of researching with the current thesis The purpose of the current thesis is to research about national treatment in a specific sector and to deal with the complicated Aaditya Mattoo(1997), “National Treatment in the GATS: Corner-stone or Pandora‟s Box?”, 31 Journal of World Trade, Issue Ryan Teksten (2001), “A Comparative Analysis of GATS and GATT: A Trade in Services Departure from GATT„s MFN Principle and the Effect on National Treatment and Market Access”, Legal and Institutional Aspect of International Trade Peter Van den Bossche, Werne Zdouc (2013), The Law and Policy of the World Trade Organization, Text Cases and Materials, 3rded, Cambridge University Press Rachel Block (2013-2014), “Market access and National treatment in China-Electronic Payment Services An illustration of the Structure and Interpretive Problem in GATS”, Chicago Journal of International Law, Vol 14, No.2, pp 652-701 Wei Wang (2004), “National treatment in Financial Services in the context of the GATS/WTO”, International Financial Economy and Technology Law Review,pp.149-181 General Agreement on Tariffs and Trade 1994, Apr 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, The Legal Texts: The Results Of The Uruguay Round Of Multilateral Trade Negotiations 17 (1999), 1867 U.N.T.S 187, 33 I.L.M 1153 (1994) [hereinafter the GATT] 10 Phạm Thị Nguyệt Sương (2007), Quy chế đối xử quốc gia đầu tư nước tác động quy chế đầu tư nước (National treatment to foreign investors and its affect to domestic investors), Master thesis, Ho Chi Minh University of Law relationship between market access and national treatment in the GATS rather than focus on the domestic regulation of Vietnam related to foreign investment There is also bachelor thesis of Nguyễn Thị Tuyết Minh on “Hiệp định chung thương mại dịch vụ (GATS) pháp luật ngân hàng Việt Nam trình gia nhập” (General Agreement on Trade in Services (GATS) and Vietnamese legislation on banking in accession period).11This thesis‟ main aim is to provide an overview about the GATS and regulations on banking of Vietnamese It is different with the author‟s thesis as it does not study about national treatment and its implementation to Vietnamese regulation Additionally, there are book by Vũ Như Thăng on “Tự hóa thương mại dịch vụ WTO: Luật thông lệ” (Liberalization in trade in services of WTO: Law and common policy)12 or the journal of LLM Vũ Anh Thư: “Áp dụng nguyên tắc không phân biệt đối xử cam kết thương mại dịch vụ Việt Nam gia nhập WTO” (Application of national treatment of Vietnam in the accession commitment to WTO in trade in services) also study on National treatment in general These books and papers help the author to have better understanding and profound knowledge about the topic to provide accurate and adequate information for the purpose of the thesis However, as there is no research or any scholarly works focus on national treatment in financial services and the effect of national treatment to Vietnamese regulations on financial services, the thesis on this matter is not identical to any published scholarly works of any author 1.3 The purpose of conducting the thesis The thesis is conducted with two major purposes: Firstly, the aim of the research is to provide an overview about national treatment in GATS and how national treatment is adapted to characteristics of the trade in services Furthermore, by descriptively analyzing national treatment disciplines, the thesis shall clarify the interrelationship of national treatment and market access in GATS and provide possible approaches to address the overlap between national treatment and market access Secondly, by studying on specific national treatment in financial services and the exemption designated for this specific sector, the study shall specifically concern on the assessment of national treatment and market access in banking and securities 11 Nguyễn ThịTuyết Minh, Hiệp định chung thương mại dịch vụ (GATS) pháp luật ngân hàng Việt Nam trình gia nhập (General Agreement on Trade in Services (GATS) and Vietnamese legislation on banking in accession period), Ho Chi Minh University of Law, Bachelor thesis 12 Vũ Như Thăng (2007), Tự hóa thương mại dịch vụ WTO: Luật thông lệ (Liberalization in trade in services of WTO: Law and common policy), Ha Noi Publishing With respect to the assessment of the compliance of Vietnam to the commitment of WTO, up to date, Vietnam has complied with its commitment to WTO in relation to banking and securities sectors For example, regarding foreign bank‟s entry and its business in Vietnam, Vietnam has complied with its commitment, relatively impose same deposit and lending rules on domestic and foreign credit institutions as well as licensing process The legal framework in relation to banking and securities services has been significantly changing in accordance with international treaties and the change of the economy Such changing provides clearer guidance for regulatory bodies as well as investors in performing their business activities However, there are still imbalances in the implementation of such provision in practice The success of regulations depends on implementation, and in banking and securities, such implementation has so far been slower and less comprehensive In any events, it is crucial that national treatment obligation must be obliged both in the law and in practice 58 CONCLUDING REMARKS The GATS is a WTO Agreement which governs international merchandise in services has taken inspiration from the GATT with major changes to compromise with characteristics of services Therefore, national treatment under the GATS also subtly different compared to national treatment under the GATT National treatment under the GATS is not a general obligation but a special commitment of Members and only be granted to the extent that Members agrees to grant and applies to both services and service suppliers National treatment is stipulated in Article XVII of the GATS to ensure treatment to foreign services or service supplier shall be no less favourable than it accords to domestic “like” services and service suppliers In order to determine measures would violate national treatment commitment, such measures must affect trade in service and the determination of “like” services and service suppliers based on case-by-case basis The distinct of national treatment under the GATS is its overlap in application with market access as provided under Article XX:2 of the GATS One possible approach to address this overlap is to respect commitment of Members over the “Unbound” and to allow Members to grant measures to the extent that Members has scheduled those measures in its commitment (Approach 4) In relation to financial services, national treatment in financial services is generally similar to national treatment although it contains more exemptions such as Balance of Payment of Prudential Carve-Out Those exemptions set Members free from performing their national treatment commitment in the event that the criteria to invoke these exemptions are satisfied In consideration of the implementation of commitment of Vietnam to domestic regulations in banking and securities services, it is deemed that Vietnam has complied with most of its commitment Furthermore, Vietnam has been continually improving and amending legislation to be in accordance with the Accession Commitment and keep up to date with changes of economy However, in the meantime, there are still imbalance between the Accession Commitment and domestic legislations which need to be fulfilled Some proposals to accelerate the improvement in domestic regulations includes reconfirming the position of international treaties and its direct application without further guidance from the government, especially in provincial authority level Secondly, legal framework for activities which foreign service suppliers can provide should be more sufficient as up to date, there has been no guidance for implementing for those services such as money brokerage or auxiliary financial services Last but not least, the important of law enforcement mechanism should be recognized and strengthened to ensure the law compliance among investors 59 BIBLIOGRAPHY - Legal Instruments WTO Legal texts WTO Agreement: Marrakesh Agreement Establishing the World Trade Organization, Apr 15, 1994, The legal texts: the results of the Uruguay Round of multilateral trade negotiations (1999), 1867 U.N.T.S 154, 33 I.L.M 1144 (1994) General Agreement on Tariffs and Trade 1994, Apr 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1A, The Legal Texts: The Results Of The Uruguay Round Of Multilateral Trade Negotiations 17 (1999), 1867 U.N.T.S 187, 33 I.L.M 1153 (1994) General Agreement on Trade in Services, Apr 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1B, The Legal Texts: The Results Of The Uruguay Round Of Multilateral Trade Negotiations 284 (1999), 1869 U.N.T.S 183, 33 I.L.M 1167 (1994) Agreement on Trade-Related Aspects of Intellectual Property Rights, Apr 15, 1994, Marrakesh Agreement Establishing the World Trade Organization, Annex 1C, The Legal Texts: The Results Of The Uruguay Round Of Multilateral Trade Negotiations 320 (1999), 1869 U.N.T.S 299, 33 I.L.M 1197 (1994) Ministerial Declaration on the Uruguay Round: Declaration on 20 September 1986, para 101-102 Ministerial Declaration (1993), MTN.TNC/8, Volume III: Document 62, Terence P Stewart ed., Kluwer Law and Taxation Publishers, Part II:7(c) Schedule CLX – Viet Nam, Part II – Schedule of Specific Commitment in Services, WT/ACC/VNM/48/Add.2 Japan Schedule of Specific Commitments, GATS/SC/46/Suppl 3, 26 Feb 1998 Supplements WTO Notes and Reports Report of the Working Party on Border Tax Adjustments, p.102, paragraph 18, adopted on December 1970, BISD 188/97 i 3, 10 Note on the Meeting of 23-25 Feb.1987, 20 Mar 1987, MTN.GNS/7, para.29 11 Note on the Meeting of 17-21 July 1989, MTN.GNS24, para 214 12 Note on the Meeting of 23 July 1990, MTN.GNS/35, Article XVII 13 Council for Trade in Services, Note by the Chairman of the Committee on Specific Commitments (March 24, 2004), Consideration of issues relating to Article XX:2 of the GATS, S/C/W/237, pp.5 14 Council for Trade in Services, Communication from Switzerland: Consideration of Issues relating to Article XX:2 of the GATS, S/C/W/237 (Nov 27, 2003) 15 Report of the Working Party on the Accession of Vietnam (2006), WT/ACC/VNM/48, pp 27 16 WTO Secretariat, Service Sectoral Classification List, MTN.GNS/W/120, July 10, 1991 WTO Case law 17 Appellate Body Report, Canadian Periodicals: Canada - Certain Measures Concerning Periodicals, AB-1997-2, WT/DS31/AB/R, para 468 18 Appellate Body Report, Canada – Certain measures affecting the automotive industry (Canada – Autos), WT/DS139/AB/R, WT/DS142/AB/R, para.155, p.51 19 Appellate Body Report, European Communities – Measures affecting Asbestos and Asbestos containing products (EC-Asbestos), WT/DS135/AB/R, para.94, pp.36, para 100, pp 38 20 Appellate Body Report, Japan –Alcoholic Beverages WT/DS8/AB/R, WT/DS10/R, WT/DS11/AB/R, Section G, Section H1 (a) 21 Appellate Body Report, Japan – Alcoholic Beverages II, WT/DS8/AB/R, WT/DS10/R, WT/DS11/AB/R, Section H, pp.21, para 117, 118 pp.26, para 119, 120 pp.27 22 Appellate Body Report, Korea – Taxes on Alcoholic Beverages (Korea – Alcoholic Beverages), WT/DS75/AB/R, WT/DS84/AB/R, para 137, pp 39 ii 23 Appellate Body Report, Korean – Measures Affecting of Fresh Chilled and Frozen Beef (Korean – Various Measures), WT/DS161/AB/R, adopted 10 January 2001, para 133 24 Appellate Body Report, United States – Tax Treatment for Foreign Sales Corporation – Recourse to Article 21.5 of the DSU by the European Communities , (US-FSC (Article 21.5 - EC) , WTDS/108/AB/R, para 208-210, pp.65 25 Appellate Body Report, United States – Measures affecting the crossborder supply of gambling and betting services (US-Gambling), WT/DS285/AB/R, para.296-299, pp.100 26 Panel report in WT/DS363/R China – Publications and Audiovisual Products, n.8, paras 7.1219, 7.1348 27 Panel Report, European Communities – Regime for the Importation, Sale and Distribution of Bananas (EC- III), WT/DS27/R/ECU, para 7.285, pp.367 Vietnamese legislations 28 Law on the State Bank of Vietnam No 01/1997/QH10 dated December 12, 1997, as amended by the Law No 10/2003/QH11 dated June 17, 2003 and Law No.46/2010/QH12 dated June 16, 2010 29 Law on Credit Institutions No.02/1997/QH dated December 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Does it matter?, Journal of Industry, Competition and Trade 295, pp.296, 2697 82 Peter Morrison (1998), WTO Financial Services Agreement: A Basis for Further Liberalization in 2000, 4INT‟L TLR, pp.188, 190 83 Rachel Block, “Market access and National treatment in ChinaElectronic Payment Services An illustration of the Structure and Interpretive Problem in GATS”, Chicago Journal of International Law, Vol 14, No.2, pp 652-701 84 Sydney J.Key (1997), Trade Liberalization and prudential regulation: the international framework for financial services, International Affair 61-75, pp.67 85 Wei Wang (2004), “National treatment in Financial Services in the context of the GATS/WTO”, International Financial Economy and Technology Law Review, pp.149-181 86 Wei Wang (2012), “On the relationship between market access and national treatment under the GATS”, International Lawyer, Winter 12, Vol 46 Issue 4, pp 1045-1065 87 WTO Secretariat (2001), Market Access: Unfinished Business, Special Studies WTO, pp.103 Theses 88 Phạm Thị Nguyệt Sương (2007), Quy chế đối xử quốc gia đầu tư nước tác động quy chế đầu tư nước (National treatment to foreign investors and its affect to domestic investors), Master thesis, Ho Chi Minh University of Law 89 Nguyễn Thị Tuyết Minh, Hiệp định chung thương mại dịch vụ (GATS) pháp luật ngân hàng Việt Nam trình gia nhập (General Agreement on Trade in Services (GATS) and Vietnamese legislation on banking in accession period), Bachelor thesis, Ho Chi Minh University of Law Internet sources 90 http://unstats.un.org/UNSD/cr/registry/regcs.asp?Cl=9&Lg=1&Co=811 15, last visited at 25 June 2014 91 http://unstats.un.org/UNSD/cr/registry/regcs.asp?Cl=9&Lg=1&Co=811 16, last visited at 25 June 2014 viii 92 http://unstats.un.org/UNSD/cr/registry/regcs.asp?Cl=9&Lg=1&Co=811 17, last visited at 25 June 2014 93 http://unstats.un.org/UNSD/cr/registry/regcs.asp?Cl=9&Lg=1&Co=811 19, last visited at 25 June 2014 94 ANZ ATM list, updated as of June, 2014, retrieved at http://www.anz.com/vietnam/vn/Personal/Ways-Bank/atm/, last visited on June 28, 2014 95 Tri thuc tre, Ngân hàng lại giở chiêu vượt trần lãi suất, retrieved at http://vietnamnet.vn/vn/kinh-te/138491/ngan-hang-lai-gio-chieu-vuottran-lai-suat.html 96 The World Bank (2014), Ratio of services sector in GDP of the world, OCED National account data files, retrieved from http://data.worldbank.org/indicator/NV.SRV.TETC.ZS/countries/1W?d isplay=default: 97 Thuy Dung (2014), “3 năm đối xử bình đẳng, ngân hàng ngoại làm Việt Nam” (Three years since national treatment, performance of foreign bank in Vietnam), Overview of banking in Vietnam 2014, Securities Investment Journals, retrieved at http://tinnhanhchungkhoan.vn/tien-te/3-nam-duoc-doi-xu-binh-dangngan-hang-ngoai-da-lam-gi-o-viet-nam-95051.html, last visited on 18 July, 2014 ix APPENDIX A COMMITMENT OF VIETNAM TO WTO IN BANKING SECTOR Mode of supply (1) Cross-border supply Unbound except for: Unbound except for: - Provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services; and - Provision and transfer of financial information, and financial data processing and related software by suppliers of other financial services; and - Advisory, intermediation and other auxiliary financial services on banking activities, including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy - Advisory, intermediation and other auxiliary financial services on all banking activities including credit reference and analysis, investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy (2) Consumption abroad None (3) Commercial presence None, except for limitation on the form of establishment of foreign credit institutions and specific limitations for branches of foreign banks as follows: a Foreign Limitations on National treatment Limitations on Market access None Representative offices; commercial bank Commercial joint venture bank with foreign capital not exceeding 50% of chartered capital; x The conditions for the establishment of a branch of a foreign commercial bank in Viet Nam: - The parent bank has total assets of more than US$20 100% foreign invested bank (as of January 2012); billion at the end of the year prior to application Branches of foreign bank Besides, branches of foreign bank are not allowed to open other transaction points outside its branch office The conditions for the establishment of a joint venture bank or a 100% foreign-owned bank: - Furthermore, limitation of a foreign bank branch to accept deposits in Vietnamese Dong from Vietnamese natural persons with which the bank does not have a credit relationship to a ratio of the branch's paid-in capital according to the schedule below: - January 2007: 650% of legal paid-in capital; - January 2008: 800% of legal paid-in capital; - January 2009: 900% of legal paid-in capital; - January 2010: 1,000% of legal-paid-in capital; - January 2011: Full national treatment b Foreign finance and financial leasing companies Representative offices; Joint venture finance/financial leasing company; 100% foreign invested company The conditions for the establishment of a 100% foreign-invested finance company or a joint venture finance company, a 100% foreign-invested financial leasing company or a jointventure financial leasing company: - xi The parent bank has total assets of more than US$10 billion at the end of the year prior to application The foreign credit institution has total assets of more than US$10 billion at the end of the year prior to application c Equity participation Level of equity participation of foreign credit institution in Vietnamese state-owned banks to the same level as equity participation by Vietnamese banks For capital contribution in the form of buying shares, the total equity held by foreign institutions and individuals in each Viet Nam's joint-stock commercial bank may not exceed 30% of the bank's chartered capital, unless otherwise provided by Viet Nam's laws or authorized by a Viet Nam's competent authority (4) Presence of natural person Unbound, except as indicated in horizontal section Unbound, except as indicated in horizontal section Source: Adaption of the author based on the Accession Commitment to WTO of Vietnam xii APPENDIX B COMMITMENT OF VIETNAM TO WTO IN SECURITIES SECTOR Modes of supply Limitations on Market access Limitations on National treatment Cross-Border supply Unbound except Provision and Unbound transfer of financial information, and related software by suppliers of securities services and except Advisory, intermediation and other auxiliary securities-related including investment and portfolio research and advice, advice on acquisitions and on corporate restructuring and strategy Consumption abroad None None Commercial presence Limitations on forms of establishment as follows: None Natural person - representative offices and; - joint ventures with Vietnamese partners in which foreign capital contribution not exceeding 49%; - Branches of foreign securities institutions (as of January 1st, 2012); - 100% foreign invested company (as of January 1st, 2012) Unbound except as indicated in horizontal section Unbound, except as indicated in horizontal section Source: Adaption of the author based on the Accession Commitment to WTO of Vietnam xiii ... CHAPTER II NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER THE GATS AND ASSESSMENT ON IMPLEMENTATION OF NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER VIETNAM LEGISLATIONS 33 2.1 Introduction ... CHAPTER II NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER THE GATS AND ASSESSMENT ON IMPLEMENTATION OF NATIONAL TREATMENT IN FINANCIAL SERVICES UNDER VIETNAM LEGISLATIONS 2.1 Introduction There... 2.4.2 Assessment on implementation of national treatment commitment in banking regulations 48 2.5 Assessment on implementation of national treatment commitment in securities regulations