By Frederick Burke*, Chi Anh Tran* and Thuy Duong Van* (Baker McKenzie Vietnam)
1. Domestic bribery (private to public)
1.1 Legal framework
In Vietnam, the subject of anti-corruption or anti-bribery is mainly governed by the Anti-Corruption Law1 and the Penal Code.2
The Anti-Corruption Law is considered as a “code of conduct” for persons who hold positions of responsibility and power, including state officials, public employees and other persons entrusted with state power (“Officials”). The Anti-Corruption Law forms the basis for the application of the Penal Code with respect to bribery offenses. It does not address the act of giving bribes nor does it provide specific sanctions for non-compliance. For non-compliant acts, the Anti- Corruption Law refers to the Penal Code, the Law on Cadres and State Officials3 and the Law on Public Employees4 for sanctions, depending on the seriousness of the violation.
With respect to bribery (private to public), the Penal Code addresses both (i) the persons holding “public” positions of responsibility and power; and (ii) those giving bribes or acting as intermediaries for bribery. The Penal Code sets out elements of corruption-related crimes and relevant criminal liabilities and punishments.
As of 1 July 2016, certain provisions of the new 2015 Penal Code (including certain bribery-related provisions) came into effect, according to Letter No. 276/TANDTC-PC of the Supreme Court.5 However, those provisions of the 2015 Penal Code, which extend their application to private sector bribery and bribery of foreign public officials and officials of public international organizations, have not yet taken effect.
1.2 Definition of bribery
The 2015 Penal Code distinguishes between “receiving bribes” from “giving bribes” in relation to persons holding positions of responsibility and power.
(a) Receiving bribes
Under Article 354 of the 2015 Penal Code, which came into effect on 1 July 2016, any person who abuses his or her position and/or power, and have accepted or will accept, directly or through an intermediary any of the following interests for himself or herself or for another person or an organizations in order to perform or not to perform certain official tasks for the benefit, or at the request of the bribe giver, shall be subject to criminal liability for the crime of “receiving a bribe”:
- Money, property or other pecuniary interest in any form worth VND 2 million (approximately USD 90) or more; or less than VND 2 million but where (i) the receiver has been previously disciplined for the same act; or (ii) the receiver has been previously condemned for corruption-related crimes specified under Section 1, Chapter XXIII of the 2015 Penal Code
- Any non-pecuniary interest
- Serious consequences are caused.
- The offender has been previously disciplined for similar acts.
- The offender has been previously sentenced for corruption crimes contained in Section A of Chapter XXI of the Penal Code.
(b) Giving bribes
Under Article 364 of the 2015 Penal Code, which came into effect on 1 July 2016, any person who, directly or through an intermediary, has given or will give money, property or other pecuniary interest in any form worth VND 2 million or more, or any non-pecuniary interest in order to induce the bribe receiver to do or not do certain official tasks for the benefit, or at the request, of the bribe giver, shall be subject to criminal liability for the crime of “giving a bribe.”
Currently, the four elements of the crime of “giving a bribe” that must be satisfied are as follows:
(i) The receiver of the bribe is holding a position of responsibility and power.
(ii) The money, property, other pecuniary interest or non- pecuniary interest must be given to the recipient (i.e., there must be an act of giving).
(iii) It must have been given to induce the bribe receiver to do or not do certain official task for the benefit, or at the request, of the bribe giver.
(iv) The value of the bribe (for pecuniary interest) must meet the threshold for criminal liability (i.e., VND 2 million). Otherwise, there must be proof that the receiver has been previously disciplined for receiving bribes or the receiver has been previously condemned for any corruption-related crime.
1.3 Definition of public official
Under Article 1.3 of the Anti-Corruption Law, Officials (or persons holding positions of responsibility and power) broadly include the following:
- Cadres, state officials, public employees
- Officers, professional soldiers, defence workers in agencies or units of the People’s Army; officers and non-commissioned officers, professional-technical officers and non- commissioned officers in agencies or units of the Public Security
- Leading, managerial officers in state-owned enterprises (SOEs); leading, managerial officers being representatives of the state’s contributed capital portions at enterprises
- Persons assigned tasks or official duties who, through the completion of such tasks or the fulfilment of such duties, have certain authoritative powers
The two main types of Officials are: (i) state officials; and (ii) public employees. The relevant definitions of “state officials” and “public employees” are as follows:
- “State officials” are Vietnamese citizens who are recruited; appointed to a rank, a post, or a title in public bodies; under the payroll of these public bodies; and receive salary from the state budget or from the salary fund of the public non-business unit if a state official is in the leading and managerial apparatuses of the non-business unit (Article 4, Law on Cadres and State Officials).
- “Public employees” are Vietnamese citizens who are recruited through examination or through selection in a public non- business unit, working under a labour contract signed with the head of the public non-business unit, and receive salary from the salary fund of the public non-business unit (Article 2, Law on Public Employees).
1.4 Consequences of bribery
Currently, the Penal Code only provides for individual criminal liability (not corporate liability). Therefore, only natural persons who have committed an offense or are found responsible may be held culpable for crimes involving a company.
An Official who commits a corrupt act, depending on the nature and seriousness of the breach, shall be subject to disciplinary action, or prosecution for criminal liability, in accordance with the Penal Code. In cases where he or she is sentenced for a corrupt act and the decision is legally enforceable, he or she will be dismissed. Those that receive bribes may be subject to criminal liability, up to and including the death penalty. Any properties, funds or other valuables used for corruption or bribery may be expropriated, in accordance with the applicable laws.
Those that give bribes or act as intermediaries for bribery will be subject to criminal liability, including fines and/or prison terms ranging from six months to 20 years. However, those who are coerced into giving bribes, but who take the initiative to report their actions before being detected, will not be considered guilty and will be entitled to receive back any property that they were coerced into giving as bribes. Bribe givers who, although not coerced, take the initiative to report their actions before being detected, may be exempted from criminal liability and may also receive back at least some of the property that they have given as bribes.
Once the rest of the 2015 Penal Code come into effect, commercial legal entities will be subject to criminal liability for committing certain crimes, which does not include corruption-related crimes, such as receiving bribes, giving bribes and acting as intermediaries for bribery. On the other hand, individuals of commercial legal entities who receive bribes may be subject to criminal liability, up to and including the death penalty, and those who give bribes may be subject to criminal liability, including fines and/or prison terms ranging from six months to 20 years.
1.5 Political contributions
Contributions to political parties are not specifically regulated by Vietnamese law. The Constitution of the Socialist Republic of Vietnam provides for just one political party – the Communist Party of Vietnam. However, independent candidates can and do run for elected positions.
1.6 Limitation applicable to hospitality expenses (gifts, travel, meals, entertainment, among others)
The Anti-Corruption Law establishes the following limitations on giving and receiving of gifts:
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- Agencies, organizations and units must not use state budget funds or properties as gifts, except in certain exceptional cases provided under the law.
- Cadres, state officials and public employees must not receive money, properties or other material interests of agencies, organizations, units and/or individuals involved in affairs that they are responsible for settling, or ones that fall under their respective management
- It is strictly forbidden to give or receive gifts as bribes, or to perform other acts meant to serve self-seeking interests.6
Decision No. 647 allow Officials to accept gifts under certain limited circumstances.8 Specifically, they may receive gifts:
- from relatives who themselves, in return, receive no benefits related to the public duties of the gift recipient (no specific limit on the value of the gift);
- from individuals or entities unrelated to the public duties/activities of the gift recipient (no specific limit on the value of the gift); and
- from individuals or entities if such recipient is ill or suffering from an accident, in mourning or celebrating a marriage, or if the gift is in connection with traditional festivals or the Lunar New Year (Tet). In these situations, the gift value must be less than VND 500,000 (approximately USD 23) and not given in connection with an official duty of the gift recipient, any benefits, purposes, or acts of corruption prohibited under the Anti-Corruption Law or the Penal Code.
Other than the abovementioned circumstances, an Official must report all gifts that he or she may receive to his or her immediate supervisor(s), and give the gifts to the supervisor(s) within five working days from the date of receipt.9
Because this reporting obligation is an internal one, there is no publicly available means of verifying the degree to which public officials comply with such requirement.
2. Domestic bribery (private to private)
2.1 Legal framework
Private sector bribery is currently not regulated under the Penal Code. As discussed in Section 1.3 above, leading officers and managers of SOEs, who are referred to as “persons holding positions of responsibility and power,” are subject to the Anti-Corruption Law and the Penal Code in relation to corruption-related crimes. Furthermore, if an employee of an SOE is individually assigned official tasks or duties and has certain authoritative power through the completion of such tasks or the fulfilment of such duties, such employee is also subject to the Anti-Corruption Law and the Penal Code, similarly to the state officials.
However, private sector bribery will be subject to criminal liability under Article 354 and 364 of the 2015 Penal Code once these sections of the 2015 Penal Code become effective. The effective date has not been determined by the National Assembly.
2.2 Definition of private bribery
Once the relevant provisions of the 2015 Penal Code come into effect, the current definition of bribery will also apply to private sector bribery.
2.3 Consequences of private bribery
Once the relevant provisions of the 2015 Penal Code come into effect, persons holding position in non-state-owned companies and organizations who receive bribes may be subject to criminal liability, up to and including the death penalty. Those who give bribes to persons holding positions in non-state-owned companies and organizations may be subject to criminal liability, including fines and/or prison terms ranging from six months to 20 years.
2.4 Limitation applicable to hospitality expenses (gifts, travel, meals, entertainment, among others)
N/A
3. Corruption of foreign public officials
3.1 Legal framework
Bribery of foreign public officials is currently not regulated under the Penal Code. However, foreign individuals, Vietnamese nationals or overseas companies bribing Vietnamese officials, regardless of where the act is committed, may be subject to criminal liability under the Penal Code.
Once the relevant provisions of the 2015 Penal Code come into effect, giving bribes to foreign public officials and officials of public international organizations will be subject to criminal liability.
3.2 Definition of corruption of foreign public officials
Once the relevant provisions of the 2015 Penal Code come into effect, the definition of bribery will also apply to bribery of foreign public officials and officials of public international organizations.
3.3 Definition of foreign public official
The 2015 Penal Code does not specifically provide a definition of foreign public official or official of public international organization.
3.4 Consequences of corruption of foreign public officials
Once the relevant provisions of the 2015 Penal Code come into effect, individuals who give bribes to foreign public officials and officials of public international organizations may be subject to criminal liability, including fines and/or prison terms ranging from six months to 20 years.
3.5 Limitation applicable to hospitality expenses (gifts, travel, meals, entertainment, among others)
N/A
4. Facilitation payments
Vietnamese law does not recognize facilitation payments. However, such payments could qualify as bribes if they fall under the definition of bribery in the Penal Code.
5. Compliance programs
5.1 Value of a compliance program to mitigate/eliminate the criminal liability for legal entities
Commercial legal entities are not subject to criminal liability for corruption-related offenses under Vietnamese law. However, companies are encouraged to implement anti-corruption measures for compliance purposes.
5.2 Absence of a compliance program as a crime
Absence of a compliance program would not be considered a violation of the Penal Code.
5.3 Elements of compliance program
(a) Legal framework
Vietnamese law does not provide for requirements or criteria of a compliance program.
(b) Recommended practice
Although there is no explicit legal requirement for compliance programs, adoption of a compliance program is highly recommended to limit the company’s exposure to bribery.
6. Regulator with jurisdiction to prosecute corruption
The People’s Courts are responsible for prosecuting all criminal cases in Vietnam, including corruption-related cases.
1 Law on Anti-Corruption No. 55/2005/QH11, which was passed by the National Assembly on 29 November 2005, came into effect on 1 June 2006, and amended in 2007 and 2012 (“Anti- Corruption Law”).- Back
2 Penal Code No. 15/1999/QH10, which was passed by the National Assembly on 21 December 1999, came into effect on 1 July 2000 and amended in 2009 (“Penal Code”). – Back
3 Law No. 22/2008/QH12 on Cadres and Civil Servants, which was passed by the National Assembly on 13 November 2008 and came into effect on 1 January 2010 (“Law on Cadres and State Officials”). –Back
4 Law No. 58/2010/QH12 on Public Employees, which was passed by the National Assembly on 29 November 2010 and came into effect on 1 January 2012 (“Law on Public Employees”). – Back
5 Penal Code No. 100/2015/QH13, which was passed by the National Assembly on 27 November 2015 and partially came into effect on 1 July 2016 according to Letter No. 276/TANDTC-PC of the Supreme Court dated 13 September 2016 (“2015 Penal Code”). – Back
6 Article 40, Anti-Corruption Law. – Back
7 Decision No. 64/2007/QD-TT dated 10 May 2007 of the Prime Minister promulgating the regulation on giving, receipt and hand-over of gifts by state budget- funded agencies, state officers (“Decision No. 64”).. – Back
8 Article 11 and Article 12.4 of the Regulations on Gifts attached to Decision No. 64. – Back
9 Article 12 of the Regulations on Gifts attached to Decision No. 64- Back
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