Report on the Regulations on Competition in the Banking Sector in Vietnam

The purpose of this Report is to make an overview about (i) the competition regulations in Vietnam, (ii) the unfair-competition in the banking sector, (iii) issues need to be addressed in the to-be-issued-regulations on competition in the banking sector of the State Bank of Vietnam, (iv) the competition legal framework and experience of the People’s Bank of
China, and (v) suggestions for building a legal framework for competition regulations in the banking sector.

In the first part of this report, we summarized the major aspects of the existing law and regulations on competition in Vietnam.  

In part two, discuss about the current situation of competition in banking sector.

In part three, we analyze the existing regulations on competition in general and the application in the banking sector in particular.  We also discuss the possible explanation of some fundamental concepts such as “relevant market”, “dominant market position”, “market share” in the banking sector.  With respect to the regulation of the State Bank on competition, we suggest that the Bank, wherever possible, referring to the equivalent concepts already provided in other legal texts instead of developing a new whole system of concepts.  This would help to keep the regulation flexible and avoid potential conflicts with other legal texts.  

In part four, we summarize the experience of the People’s Bank of China which has to deal with unfair/unlawful competitive conducts.  We see the similarity of unfair competition between the banking sectors of the two countries.  While we suggest that the State Bank of Vietnam to consider the experience of its Chinese counterpart in dealing with particular unfair competitive activities, we still believe that the Chinese legal system on competition in banking sector is less comprehensive than that of Vietnam. 

Part five is our suggestions for building a legal framework for competition in the banking