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Government issues new rules for businesses in transportation sector

Update: January, 21/2015 - 08:31

Dang Dinh Truong – Legal Assistant, Indochine Counsel

On September 10, 2014, the government issued Decree No 86/2014/ND-CP (Decree 86) on the transportation business and business conditions.

Decree 86 provides for the conditions of doing business in the domain of transportation. These include the transport of passengers by auto along fixed routes; the transport of passengers by bus and taxi; the transport of passengers under contract; and transport of tourists by auto; as well as the transport of goods by auto (including of overweight or overlong goods).

Some important points of the decree are pointed out below:

The taxi driver must print the invoice: From July 1, 2015, enterprises engaged in the transportation business involving vehicles with 10 seats or more must inform the transportation department, where transport licence was granted, of the itinerary, the number of guests, the pickup points and the duration of the contract before implementing a transportation or a travel contract. From July 1, 2016, the enterprises are required to attach invoice-printing devices to taxi meters and the taxi drivers have to print the invoices and give them to customers.

Regarding conditions for the auto transportation business, the enterprises must register the vehicle certificate, guarantee technical safety and install tracking devices in vehicles as regulated. The service staff must know about transport information, as per the transport law and relevant statutory regulations.

Additionally, the transportation enterprises must possess vehicles with tracking devices, install computers with Internet connections, supervise and handle information displayed in tracking devices and supervise traffic safety, among other things.

Limits to the duration of vehicle operations, including of converted cars

Under Decree 86, passenger vehicles with 10 seats or more are allowed to operate for 15 years for journeys of more than 300km (from January 1, 2016, converted vehicles are not allowed to carry passengers), and 20 years for journeys of 300km or less. For vehicles converted to passenger cars before January 1, 2002, the duration is 17 years.

Taxis are allowed to operate for eight years in special urban areas and 12 years in other localities. Tourist vehicles are permitted to operate for 15 years, while converted vehicles are not allowed to carry tourists.

Additionally, the business certificate may be revoked in cases where the transport enterprises do not perform services according to the business certificate; more than 50 per cent of the drivers breach the transport law causing serious accidents in a year; repeat an offence; and violate the transport law and the conditions for vehicle transportation, causing serious accidents.

Compensation in transport business

Where there is no law detailing the compensation for damaged, lost or deficient goods due to the mistake of the person transporting the goods under a contract, the said person will compensate the owner of the goods at the rate of VND70,000 (US$3.33) for 1kg of lost goods, unless otherwise decided by the court or arbitrator.

Decree 86 took effect on December 1, 2014, and replaced Decree No 91/2009/ND-CP regarding the business and business conditions of transportation by vehicles and its amendments.

Indochine Counsel

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