The Hanoitimes - The Ministry of Planning & Investment is drafting a decree to specify investment for innovation start-ups, which is expected to create a legal framework for innovation start-ups and supporting policies for this activity.
According to Ministry of Planning & Investment, in the context of industrial revolution 4.0, innovation start-ups is the driving force of the innovation start-up ecosystem. Unlike commercial enterprises and traditional manufacturers, innovation start-ups have a high level of technology research and creativity. As such, innovation start-ups are often related to risks, but if start-ups can overcome this factor, it will bring high economic value in return.
For a start-up to be successful, capital is always the prerequisite. In Vietnam, the number of local and foreign investment fund for innovation start-ups is increasing. Foreign investment funds such as Cyber Agent, 500 Start-ups, Golden Gate Venture, and others have opened representative offices or partners in Vietnam. Among local investment funds, only FPT Venture is focusing in start-ups investment. Many local investors such as big companies and private investors also express interests in investing for innovation start-ups.
Vietnam Silicon Valley Corner, a co-working space for startups where startups and investors can connect with each other.
As such, the creation of a legal framework for innovation start-ups investment, as well as supporting policies for this activity is necessary, which timely meets the current practical demands. Therefore, it is vital to have a decree to specify investment for innovation start-ups.
The Ministry of Planning & Investment said, the draft decree is aimed at the following objectives: identifying the legal status of investors for innovation start-ups, and investment fund for innovation start-ups, which has not been clearly stipulated in Vietnamese laws. As such, in addition to existing investment forms, the decree will create additional options for investors to carry out investment through innovation start-ups and investment fund for innovation start-ups.
Besides, the decree will set overall principles for related parties, such as: investors are individual or organization; innovation start-ups in investment; encourage and orient innovation start-ups, which is different to other investment activities, limiting illegal activities which can have negative impacts on the social public orders and prevent possible abuse to innovation start-ups.
Moreover, it will identify investors as innovation start-ups investment company, and investment fund for innovation start-ups, so that the government will have preferential treatment with regard to incorporated tax in accordance with Paragraph 3 – Article 18 of the Law to support medium and small enterprises (SMEs).
The draft decree is also aimed to find the financial resources for innovation start-ups through the encouragement of establishing innovation start-ups investment company, and investment fund for innovation start-ups; encouraging innovation start-ups in other way is to encourage the creation of high economic value and a steady stream of revenue for state budget.