Legal Market Overview
Vietnam remains a country of choice for foreign investors and has steadily maintained its GDP with predictions of further growth this year put by the World Bank. Against the backdrop of the COVID-19 pandemic, Vietnam has been generally successful in containing the coronavirus, having responded by closing its borders with neighbouring China at the start of February. The government has been vigorous in its test and trace strategy and had reported no locally transmitted cases, up until September of 2020 with Da Nang province in the centre of the country reporting an estimated 400 new cases.
Despite a short-lived economic downturn at the beginning of the year with a slowdown in M&A activity, the nation continues to have a thriving manufacturing industry, in part as a direct result of the Beijing-Washington tensions which has seen Vietnam become a central hub in the Asian markets and an alternative to manufacturing in China, with as one example the majority of Samsung Galaxy smartphones being manufactured in Vietnam.
Inbound Chinese investment has made it the third-largest investor in the country, with many projects coming in the renewable and conventional energy space. However, the longer-term effects of border restrictions and recession related to the pandemic remain to be seen on Vietnam’s tourism industry, which while not as large a share of the national economy as Thailand’s is certainly significant.
Domestic firms YKVN and VILAF win the lion’s share of mandates, with a range of international firms such as Allen & Overy LLP and Baker McKenzie also active locally representing foreign clients and undertaking cross-border work with offices across Southeast Asia, although these firms do vary. Also of note is that only locally-owned law firms can litigate under their own name. Respected Singaporean firm Allen & Gledhill LLP started operations in October 2020, taking the firm to its fifth ASEAN jurisdiction.