Ready, Set, Wait!

Before the movie becomes a blockbuster, there are numerous mountains of paperwork it has to jump over first

My wife and I are both European, she got a job in Ho Chi Minh City and this is the main reason I am also here. I have been involved in the entertainment industry for many years and been working on a movie script that I would like to produce and direct as an independent producer in Vietnam. It seems clear that to protect my interests I must first set up an independent production company and, at a later date, when the project is at a mature stage bring on board associates. Can I start a company on my own or do I have to bring in a partner, and if I do have to bring in a partner what percentage must that partner own by Vietnamese law?

Many would say that Vietnam prides itself for having been the location of some of the best movies ever. However, it seems that the Vietnamese potential for film production is untapped, one of the reasons being the absence of tax incentives. Another reason could be the complexity of licensing requirements. Your project is a very exciting one and I will try to guide you through the applicable local regulations. Following its accession to the World Trade Organization in January 2007, Vietnam has gradually opened the movie production sector to foreign investment. However, restrictions remain applicable on foreigners to produce a movie in Vietnam. In particular, you cannot avoid partnering with a Vietnamese company.

First of all, you should find a Vietnamese enterprise that could be a suitable partner. This does not only refer to its ability to support you in the movie production, but the Vietnamese company must be a film production company with a specific certificate from the Ministry of Culture, Sport and Tourism allowing it to operate in the field of movie production. This certificate is called the certificate of satisfaction of business conditions.

To give you an idea of the applicable requirements, the Ministry of Culture, Sport and Tourism will grant such certificate if the company complies with certain conditions: Among other things, the charter capital of the company must be at least VND1 billion (i.e. the company must be invested with VND1 billion upon its establishment) and its director must have experience in the field of movie production.

For ease of reference, I will refer in this paper to such Vietnamese companies which have been granted with a certificate to operate in the field of movie production as “authorized Vietnamese companies.”

As a foreigner (either an individual or a corporate entity), you have to partner with one or more authorized Vietnamese companies in order to produce a movie in Vietnam. There are two ways to do it: you may either enter into a cooperation contract with the authorized Vietnamese company(ies) or jointly set up a company with it (a joint venture film production company).

In the first case, you will have to conclude a contract with the authorized Vietnamese company on producing a movie in Vietnam. Under this option, you will not set up a local company. Your cooperation with the authorized Vietnamese company will only be contractual.

In the second case, you will have to partner with the authorized Vietnamese company(ies) to set up a joint venture company. You will only be allowed to own a maximum of 51% of the charter capital of this company (maximum foreign participation authorized) and the authorized Vietnamese company(ies) (your local partner(s)) will own the remaining charter capital. The joint venture company will produce the movie in Vietnam.

Before actually starting the movie production, however, the authorized Vietnamese company that is willing to produce the movie with you will have to obtain from the Ministry of Culture, Sports and Tourism a license allowing your partnership with it to produce the movie in Vietnam (under any one of the two options). The application file comprises the request for issuance of the license (according to the standard form of the Ministry) and the literary script of the movie in Vietnamese and in foreign language. In the first document (the request), it will be necessary to specify information such as the place or places where the shooting will take place, the movie production schedule and the list of main members of the team production (with their position in the team and personal identification information).

Please, be informed that the Ministry will check all information provided in the application file, in particular the script of the movie, and may have some questions or requests. If it has no such request or question, it will issue the license within 30 days from receiving the application file.

In addition to such license, your partnership with the authorized Vietnamese company will need to go through other formalities with the Vietnamese authorities. As a general requirement applicable to all foreign investors in Vietnam (in all sectors, not only movie production sectors), you will have to be issued with an investment registration certificate (or IRC). The IRC is a certificate granted by the department of planning and investment of the provincial People Committee (in Ho Chi Minh City, the People Committee of Ho Chi Minh City). The IRC allows you, as a foreigner, to have investment activities in Vietnam. As from submission of a complete and valid application file, the department of planning and investment shall issue the IRC within 15 working days.

Finally, in case you choose the second option (setting up of a joint venture company), the joint venture company will have to obtain for its own the certificate of satisfaction of business condition referred to above, meaning that it will have to be invested with a minimum of VND1 billion upon its establishment, nominate a director with experience in movie production and fulfil other conditions as defined in regulations. You will also have to register the joint venture company with the business registration office. The business registration office will issue an incorporation certificate for your joint venture company called the enterprise registration certificate within 3 working days.

Last thing to keep in mind: you are right to raise the point of intellectual (IP) protection of your work. You should know that the Vietnamese law on IP explicitly offers to cinematic works a copyright protection.

In principle, the author of a movie script is entitled to such protection without any obligation of registration or publication. However, I advise you to register copyright in order to facilitate court proceedings in case a conflict arises. You can register at the “Copyright Office” at one of its “Representative Offices” in Ho Chi Minh City or Danang or at the Department of Culture, Sport and Tourism of the People Committee of your location.

BIO: A member of the Paris Bar, Antoine Logeay has been practicing law first in France, mainly in litigation and arbitration, then in Vietnam for three years as an associate of Audier & Partners based at its Hanoi office. Audier & Partners is an international law firm with presence in Vietnam, Myanmar and Mongolia, providing advice to foreign investors on a broad range of legal issues.

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