KoCham raises foreign workers residence issue at VBF

The ongoing issue of residence rights of foreign workers in industrial zones (IZs) has been raised at the Vietnam Business Forum (VBF), highlighting the concerns of the Korean business community.

According to a report given at the VBF by the Korean Chamber of Business in Vietnam (KoCham), many factories currently have dorms on their campus for their expat workers. However, a new regulation in Decree 35 asks foreign workers to live in specially built accommodation areas within IZs. In other words, according to the new rules, developers have to set aside specific land in the complex to build accommodation for their expat workers, instead of them living in dorms within the factory campus.

Notably, the decree stipulates that accommodation facilities within the complex are to be built in the service area of the complex and at a safe distance in accordance with related laws. The company must ensure security and order and not affect the production and business activities of other enterprises in the industrial park.

Pursuant to Decree No. 35/2022/ND-CP, Dong Nai Industrial Zones Management Authority has issued an official letter of implementation of regulations on the residence of foreign workers. The Immigration Department of Dong Nai Public Security implemented the contents of the decree, which has caused some difficulties.

KoCham’s reports said there have already been measures taken to suspend the registration of foreign workers who wish to take up residence on company grounds within IZs since last year. For foreign workers currently residing at these complexes, there will be some consideration given to allow their continuing residence until no later than July 15, 2023, when the company must terminate their residence according to Decree 35.

The Immigration Department and the Industrial Park Police in Dong Nai are currently suspending the registration of new temporary residences for foreign workers.

Hong Sun, chairman of KoCham, speaking at the VBF, said, “In the case of an industrial complex located on the outskirts of the city, there are many things to consider when selecting facilities for foreigners to reside in, such as the distance to the company, security, and facilities that match the expected quality of environment of foreigners. So far, some companies that operate foreign dormitories have been experiencing difficulties”.

Adding to the matter is the conflict between the existing Dong Nai’s decree, which states accommodation facilities are to be installed in areas that must be separate from production workplaces, and a protocol published in May last year that states accommodation facilities need only be simply separated from the factory building.

With the current protocol in effect, the law is interpreted as allowing foreign workers to live only in spaces permitted as housing areas within the industrial complex. Despite the above problems, Dong Nai is applying the regulations before any other province or city and are implementation follow-up measures, thereby raising the issue of residence status for foreign workers in companies that operate existing dormitories.

“If the existing industrial complex currently has a housing area or if there is no licensed industrial complex, there is no clear information on whether the new land purchase plan and housing area permission procedure of the existing corporation are possible, and the majority of foreign-invested corporations engaged in production activities in the corporation are subject to it, adding to the confusion,” Sun said.

“We ask for the cooperation of the related organisations so that foreign workers are allowed to live in company dormitories and recreational facilities, and normal company operation can be ensured by guaranteeing legal residence and the right to stay for those working in foreign-invested companies,” he added.

This issue was previously raised by several other businesses at a meeting discussing Decree 35 between Dong Nai People’s Committee and the local business community in mid-February.

Vietnam Investment Review