In 2020 to see the effects of Covid-19 pandemic Various legal and regulatory changes have been introduced with respect to companies. In 2020 foreigners were also admitted have Condominiums, and the Lao Civil Code 2020 and that changed Insurance law Installation.
Beyond Laos’ VAT The law has been repealed and replaced by the Tax Administration Act, the Income Tax Act and the Excise Tax Act to improve Laos’ tax administration.
Summaries of these key developments are given below.
COVID-19 – Support and Advanced Control Measures and Policies for the COVID-19 Outbreak
In March 2020, the Lao government put in place increased measures, restrictions and guidelines to reduce the impact of the COVID-19 pandemic on businesses. These include tax exemptions, extending the date for filing financial reports, credit guidelines to support businesses, postponing payment of social security obligations, restrictions on business / services and work, restrictions on movement and gatherings, and closing borders. Click here for more information.
The government has since updated its policy to contain the COVID-19 pandemic in the country.
Foreigners are now allowed to own condominiums
Foreigners are now allowed to purchase suites or units in condominiums with the same term as the life of the building or condominium. You can also have land use rights from leases and concession agreements with Lao citizens and the government. The land use rights on the land on which the condominium was built continue to belong to the legal entity that owns the land. Click here for more information.
The Lao Civil Code 2020 comes into force on May 26, 2020
On May 26, 2020, the Lao Civil Code came into force. It is a comprehensive law with 630 articles. It supersedes and repeals civil and commercial laws that contain similar provisions, including the Contracts and Tort Act, Property Law, Secured Transactions Act, and other civil law laws. Click here for more information.
The amended Insurance Act will come into force on April 15, 2020
The amended Insurance Act came into force on April 15, 2020 (“Changed lawThe amended law regulates the insurance activity in Laos, the day-to-day operations of insurers, and the termination and liquidation of insurance companies. Click here for more information.
The repeal of the tax law
On January 16, 2020, the Tax Act was repealed and replaced by the Tax Administration Act, the Income Tax Act and the Excise Tax Act.
Tax Administration Act: The law lays down the principles, rules and measures to ensure that individuals and organizations or organizations meet their tax obligations and that taxes are collected efficiently.
Income Tax Act: The law encourages individuals to pay their income taxes effectively. Taxes covered by the law include personal income tax, corporate income tax, micro-business income tax, individual income tax for residents, and individual income tax for non-residents.
Excise Tax Act: The law aims to regulate the collection of taxes on goods and services. The taxes collected are used to improve health care and the environment, as well as to improve the socio-economic situation of the country at national and international level.
Look into: 2021
The Laos economy will see startups as drivers of economic growth. This can be deduced from stories of aspiring entrepreneurs who are successful E-commerceB. Food Panda, the largest grocery ordering app in Laos, or Food Panda – Local Food & Grocery Delivery, the latest on-demand e-commerce service for grocery shopping. Meanwhile, banking services are increasingly relocating as the demand for local e-commerce grows, helping shape a regulatory environment and payment system that can support online merchants.
Laos also intends to make a change to strengthen the rule of law in the country Law on the Enforcement of Judgments.
In addition, the following important trends and / or developments must be observed:
- Promotion of the development of small and medium-sized enterprises (SMEs);
- Opportunity and Challenge of the digital system towards socio-economic development in Laos;;
- Official start of the connecting lines Laos to Cambodia;; and
- Laos Visits Laos (Lao Thiao Lao) – While the Laos tourism industry has been hit by the loss of international visitor arrivals, a domestic tourism campaign called “Lao Visits Laos” (“Lao Thiao Lao“) is slowly taking shape. The Lao Thiao Lao marketing campaign was recently launched to promote it Domestic tourism.
Below are summaries of some of the developments in 2020 leading to the above trends.
Draft decree on electronic commerce
The draft decree on electronic commerce (“Draft e-commerce decree“) was published in the electronic gazette on February 21, 2020 and has yet to be approved. The draft e-commerce decree is intended to regulate e-commerce in Laos in order to protect the rights and interests of users and e-traders, among other things.
Amendments to the Law on the Enforcement of Judgments
The amendments to the Enforcement of Judgments Act 2008 were published in the electronic gazette on March 18, 2020 and have yet to be approved. The amendments include principles, rules, procedures, methods and measures related to the enforcement of penalties for fines, confiscation of property or objects, and penalties for impunity without detention. The changes also aim to: (i) further strengthen state authority and the rule of law; (ii) protect the state and collectives, and the legitimate rights and interests of collectives, citizens and organizations; and (iii) improving social security, public order and justice. Click here to view the published draft amendment in Lao language. (The English translation is not available).