UNIVERSITY OF ECONOMICS – DA NANG UNIVERSITY

FACULTY OF INTERNATIONAL ECONOMICS



GROUP ASSIGNMENT REPORT

TOPIC: EU-VIETNAM FREE TRADE AGREEMENT (EVFTA)

Lecturer : Phạm Hồ Hà Trâm

Class : 47K01.4

Group : 7

Name of members : Trần Phạm Bảo Ngân

Lê Nguyễn Phương Nhi

Nguyễn Thị Minh Tâm

Phạm Thị Hoàng Vy

Hồ Ngọc Vĩ

Da Nang, April 20th,2023

Group 7 – 47K01.4 – International Economics
TABLE OF CONTENT
A. CONTENT...................................................................................................................1

I. Introduction..................................................................................................................1

II. The EVFTA: Key milestones......................................................................................1

III. Summary of content, commitments in the agreement, and incentives that Vietnam
receives........................................................................................................................2

1. Trade in Goods:...................................................................................................3

1.1 Commitment to open the EU and Vietnam commodity market:.......................3

1.2 Commitment on export tariff:...........................................................................3

1.3 Commitment on non-tariff barriers:..................................................................3

1.4 Appendix on pharmaceuticals:..........................................................................4

2. Trade in service and investment:.........................................................................4

3. Government procurement:...................................................................................4

4. Intellectual property:............................................................................................4

5. State-owned enterprises and subsidies:................................................................5

6. Trade and sustainable development:....................................................................5

7. Dispute settlement mechanism:...........................................................................5

IV. The impacts of EVFTA on trade flows between Vietnam and the EU:......................5

V. The impacts of EVFTA on the capital and labor flow between Vietnam the EU:......5

VI. Opportunities and challenges for Vietnam at the time of signing the EVFTA:..........5

B. CONCLUSION............................................................................................................5
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TABLE OF FIGURE
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A. CONTENT
I. Introduction

The EU-Vietnam Free Trade Agreement (EVFTA) is a new generation FTA

between Vietnam and the European Union ( a coalition of 27 countries after the UK
completed Brexit). It is a comprehensive and high-quality agreement which complies with
the provisions of the World Trade Organization (WTO) to ensure the balanced benefits
for both Vietnam and the EU, with consideration for the differences in development levels
between the two sides. The EVFTA was first ratified by the EU and then by the National
Assembly of Vietnam, in the midst of the Covid-19 pandemic. After the completed
ratification, the EVFTA entered into force on 1st of August 2020. The ratification of the
EVFTA marks a significant progress in the relations between Vietnam and the EU
while continuing to affirm Vietnam’s important role and geo-political position in
the region and the world. It is expected to forge a solid foundation for investment
and trade opportunities between the two sides and a huge boost to Vietnam's
exports, helping to diversify markets and exports, particularly agricultural and
aquatic products as well as Vietnamese products with competitive advantages.

The agreement includes 17 chapters, two protocols and several attached

memorandums, with main contents covering the following aspects: Trade in goods,
Rules of origin, Customs and trade facilitation, The sanitary and phytosanitary
measures (SPS), The technical barriers to trade (TBT), Trade remedies, Trade in
service, Investment, Competition, State-owned enterprises, Government
Procurement, Intellectual property, Trade and sustainable development,
Cooperation and capacity building, and Legal-institutional issues.

II. The EVFTA: Key milestones

 October 2010: Vietnam’s Prime Minister and the EU President agreed to launch
EVFTA negotiations.

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 June 2012: The two Parties announced the initiation of negotiation

 From October 2012 to August 2015: The two Parties conducted 14 official
negotiation rounds and many midterm negotiation sessions.

 December 1, 2015: The two Parties officially announced the concludsion of the
EVFTA negotiation.

 February 1, 2016: The announcement of the official document of EVFTA

 June 2017: Completion of legal review at the technical level.

 June 26, 2018: Vietnam and the EU officially agreed to separate the EVFTA into
two Agreements: the Vietnam-European Union Free Trade Agreement (EVFTA)
and the Investment Protection Agreement (EVIPA).

 October 17, 2018: The European Commission officially approved the EVFTA
and EVIPA

 June 30, 2019: Signing ceremony of the EVFTA and EVIPA in Hanoi.

 February 12, 2020: The European Parliament ratified the EVFTA and the
EVIPA.

 June 8, 2020: The National Assembly of Vietnam officially ratified EVFTA and
EVIPA.

 The EVFTA has officially come into effect from 1st August, 2020.

III. Summary of content, commitments in the agreement, and incentives that

Vietnam receives.
The EU-Vietnam Free Trade Agreement (EVFTA) is a win-win trade deal with
balanced benefits for the European Union (EU). It aims to enhance bilateral trade and
investment between the two parties through main keys commitments related to Trade in
Goods, Trade in Service and Investment, Government Procurement, Intellectual property,
State-owned Enterprises and Subsidies, Trade and Sustainable Development and Dispute

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Settlement Mechanism. Moreover, the EVFTA also covers other aspects including Rules
of origin, Customs and trade facilitation, The sanitary and phytosanitary measures, The
technical barriers to trade, Cooperation and capacity building, and Legal-institutional
issues.
1. Trade in Goods:
1.1 Commitment to open the EU and Vietnam commodity market:
Under the EVFTA, both the EU and Vietnam commit to liberalizing trade in
commodities. The Agreement provides for the elimination of tariffs on 99% or more of
most of the goods traded between the EU and Vietnam over a 10-year period, with the
majority of tariffs being eliminated immediately upon entry into force of the agreement.
This commitment is designed to create a more open and competitive market for
commodities between the EU and Vietnam, leading to increased trade and economic
growth for both parties.
1.2 Commitment on export tariff:

Vietnam and the EU commit to not apply any kinds of tariffs or fees for only exports
but not for domestic goods, and no tariffs and fees will be imposed on exports higher than
those for domestic goods, except for cases which are clearly reserved (according to the
commitment results, only Vietnam has reservations on this issue, the EU does not make
any reservations). This means that many Vietnamese products, such as textiles, footwear,
agricultural products, automobile industry... can be exported to the EU market at lower or
zero tariffs, making them more competitive in the European market.
1.3 Commitment on non-tariff barriers:

The EVFTA addresses non-tariff barriers including agreement to strengthen the

disciplines of the WTO technical barriers to trade (TBT), sanitary and phytosanitary
measures (SPS), and other non-tariff measures such as export/import licensing, customs
procedures,..to facilitate trade in goods, promote transparency, predictability, and fair
competition between the EU and Vietnam. This helps Vietnamese businesses to have
easier access to the EU market by reducing unnecessary trade barriers.

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1.4 Appendix on pharmaceuticals:

The EVFTA contains an Annex on pharmaceuticals which covers topics such as the
classification of pharmaceutical products, the determination of their origin, and the
elimination of tariffs on these products. This cooperation includes the exchange of
information on regulations and standards, promoting good regulatory practices, and
collaboration on innovations and intellectual property rights. The pharmaceutical industry
is a significant export sector for both the EU and Vietnam, and the Annex aims to
facilitate trade and cooperation in this important field.
2. Trade in service and investment:

The EVFTA promotes liberalization of services and investment, providing increased

market access and protection for EU and Vietnamese service providers and investors in
various sectors, such as telecommunications, financial services, and transportation. As the
Agreement includes provisions on market access, national treatment, and most-favored-
nation treatment for services and investment, it provides more favorable conditions for
Vietnamese companies to access and invest in the EU market.
3. Government procurement:

The principles of Government Procurement are equivalent to the provisions of WTO

Government Procurement Agreement. The provisions aim to ensure fair and transparent
access to government procurement opportunities for businesses from the EU and
Vietnam. They are designed to promote open and non-discriminatory procurement
practices as well as cover a broad range of areas, including procurement procedures,
publication of procurement notices, and dispute settlement mechanisms.
4. Intellectual property:

The EVFTA commitments on copyrights, inventions, patents, commitments related

to pharmaceuticals and geographical indications ,... with a higher level of protection than
WTO. Viet Nam committed to protect 169 geographical indications of the EU anh the EU
will protect 39 geographical indications of Viet Nam. Regarding pharmaceuticals, Viet
Nam commits to increase the exclusive data protection for EU pharmaceutical products,
and in case the competent authority delays the issuance. This provides incentives for

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Vietnamese businesses to invest in research and development and promotes technology
transfer from the EU to Vietnam.
5. State-owned enterprises and subsidies:

The two Parties agree on the principles for SOEs together with those on subsidies,
aim to ensure an environment of fair competition between SOEs and private enterprises
when SOEs engage in commercial activities. There will be transparency rules and
consultation procedures for domestic subsidies.
6. Trade and sustainable development:

The EU and Vietnam commit to promote and enforce international labor and
environmental standards, including those set out by the International Labour Organization
and the United Nations Framework Convention on Climate Change. It also includes
provisions on sustainable development that aim to promote economic growth while
protecting the environment, ensuring social and economic benefits for all, including
disadvantaged groups, which can improve the overall business environment in Vietnam
and attract more responsible investment from the EU.
7. Dispute settlement mechanism:

EVFTA establishes a mechanism to settle disputes that may arise between Vietnam
and the EU in the interpretation and implementation of the commitments in the
Agreement. It also envisages a more flexible mechanism: a mediation mechanism, to deal
with problems related to measures which have negative impact on bilateral trade and
investment. This provides a stable and predictable legal framework for businesses and
investors, reducing uncertainties and risks associated with international trade and
investment.

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IV. The impacts of EVFTA on trade flows between Vietnam and the EU:

V. The impacts of EVFTA on the capital and labor flow between Vietnam the EU:

VI. Opportunities and challenges for Vietnam at the time of signing the EVFTA:

B. CONCLUSION