ALLENS ARTHUR Robinson and the Ho Chi Minh City Stock Exchange (HOSE) are working together to promote foreign investment in Vietnam’s fledging securities market.
HOSE has been listed as a stock exchange only since July 2007 and the legal framework of the emerging Vietnamese market poses substantial difficulties for foreign investors. The venture will combine the legal translation expertise of Allens with the new online resources of the HOSE stock exchange to assist potential investors.
Allens international partner Nigel Russell has spent most of his legal career in Vietnam. Russell joined Phillips Fox’s office in Hanoi in 1995, and was made a partner of that firm the following year. He opened Phillips Fox’s Ho Chi Minh City office in 1997, where he is still based, albeit now as a partner of Allens Arthur Robinson.
The entire practice switched to Allens on the first of January 2007, a coup for Allens which resulted from the DLA Piper alliance with Phillips Fox.
The Vietnamese offices have translated and published English versions of the local regulatory laws since 1992, Russell says, progressing from a single volume set to a loose leaf service and, most recently, an online electronic database.
The growing interest of foreign investors in Vietnam prompted Allens and the HOSE to work together to improve investment conditions.
“Over the last couple of years we’re been doing a lot of work with foreign companies buying shares in Vietnamese companies including listed companies, of which there are still not that many,” Russell told Lawyers Weekly. “It’s a growing area of our practice and we’re spending a lot of time advising clients on these acquisitions and through that work which is necessitated with liaison with Ho Chi Minh stock exchange,” he said.
Russell says that most of the concerns expressed by overseas investors stem from the difficulty of finding and interpreting the local laws.
“Back in 1992 there wasn’t that much foreign investment here,” Russell said. :One of the questions and criticisms the Vietnamese authorities were receiving back then is: ‘Well, we can’t find your laws [and] if we do find them they’re only in Vietnamese and the English translations that are available aren’t of very good quality, so we’re not going to invest.’
“Likewise in the securities market I think both the quality and the quantity of investment will improve — just as it did back in the early ’90s — once good-quality English translations of the laws become available and investors know more about what they’re getting into,” Russell said.
There is clearly a business case for translations in promoting investment, but in terms of profits, Russell admits the translations aren’t a strong source of revenue for the firm. “To be perfectly honest, we don’t make any money out of this exercise on its own and its marketing value, [well] I’m not sure that compensates for the cost of us doing this sort of thing.”
Russell likens the translation work’s benefits to that of the pro bono legal services provided by his Australian counterparts. “In Australia, firms, including ours, provide pro bono services in various forms. Here in Vietnam the best way we can contribute to legal reform — facilitate and attract foreign investment — is by making English translation of laws readily available.
“It’s something that we take for granted in Australia, but in Vietnam it is a big deal. It requires a lot of investment and that’s investment we’re prepared to make.”