01.08.2026
Newsletter August 2026
We are happy to inform you about the latest legal developments in Asia. The authors of the articles are at your disposal for further questions and information.


THAILAND: Board of Investment (“BOI”) Introduces a New Subcommittee and New Approval Requirements for Data Center Projects
On 15 July 2026, the Thailand Board of Investment (“BOI”) established the Subcommittee on Energy Management to Support Investment and Review Data Center Projects (the “Subcommittee”). The Subcommittee consists of representatives of various government agencies and was established to support the new approval framework for data center projects described below.
Core Responsibilities of the Subcommittee
- Developing and recommending energy management strategies and practical measures to facilitate investment, while monitoring potential risks to the energy supply and helping to ensure that investment projects can be implemented efficiently.
- Identifying legal, regulatory, or operational obstacles affecting investment projects and referring such issues to the BOI for coordination with the relevant government agencies to enable timely resolution.
- Evaluating and reviewing data center projects, including reviewing the adequacy and reliability of energy and water resources, environmental impacts and proposed mitigation measures, and the expected economic and public benefits for Thailand.
- Inviting experts and representatives of relevant government agencies to provide information, opinions, or supporting materials for consideration by the Subcommittee.
- Coordinating with public- and private-sector stakeholders to gather information and promote cooperation in areas such as energy, water resources, environmental management, and other matters that support investment and benefit the country.
- Performing any other duties assigned by the BOI or its Chair.
New Subcommittee Approval Requirement
As part of the latest regulatory changes, the BOI has introduced a further revision to the investment promotion criteria for data center projects. Under the revised framework, the requirement introduced in March 2026 to obtain a confirmation letter from the Office of the Energy Regulatory Commission has been revoked. Instead, data center projects must now obtain approval from the Subcommittee responsible for reviewing such projects before an application for investment promotion is submitted to the BOI.
The new approval requirement applies to all applications for investment promotion submitted on or after 15 July 2026. It also extends to applications currently under review by the BOI, as well as applications to amend existing promoted projects where the proposed amendment would increase the project’s IT load by more than 30%.
In light of these changes, companies involved in data center projects should closely monitor further updates and regulatory developments from the relevant authorities to assess the potential impact of these new approval requirements on their investment plans.
This article is intended as a general overview and does not constitute legal advice. If you have any questions or require tailored legal assistance, please do not hesitate to contact the Respondek & Fan team.
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Your point of contact in Thailand: Dr. Andreas Respondek
Respondek & Fan Ltd
United Center, 39th Floor, Suite 3904 B
323 Silom Road
Bangkok 10500, Thailand
CELL: +66 89 896 4048
TEL: +66 2 635 5498
FAX: +66 2 635 5499

PHILIPPINES: Marcos’ SONA 2026 – Key Takeaways for German Businesses
On July 27, President Ferdinand Marcos Jr. delivered his fifth State of the Nation Address (SONA) – at 86 minutes the longest of his term, and the opening of the final stretch of his presidency. For companies considering the Philippines as a sourcing, sales, or investment location, the speech contained several relevant signals. An overview from a German business perspective.
Anti-Corruption Drive Takes Center Stage
Marcos addressed the scandal surrounding manipulated flood control projects head-on. Around 25 billion pesos in assets have been frozen, and charges have been filed against contractors, officials, and lawmakers – including former House Speaker Martin Romualdez, a cousin of the president. “Painful as this may be for me, we must do what is right,” Marcos said.
The economic fallout of the scandal is tangible: public construction investment dropped by roughly a quarter at times, and GDP growth in 2026 is expected to come in at just over 5 percent – below the government’s target of 5.5 to 6.5 percent. At the same time, a consistent clean-up could improve conditions in the medium term, particularly for companies that depend on transparent procurement processes. Whether the charges will lead to convictions remains an open question.
Energy: Emergency Measures and Structural Reform
The declared state of national energy emergency – triggered by the Middle East conflict and the country’s dependence on oil imports – featured prominently. Beyond short-term measures (fuel subsidies, suspended excise taxes), Marcos announced structural steps: a reform of the EPIRA electricity market law, the removal of system loss charges and VAT from electricity bills, openness to nuclear power, and the development of a newly discovered gas field.
Investments of around 26 billion US dollars are expected in the energy sector by 2030, roughly 40 percent of which will go into photovoltaics. As the government treats energy dependence as a security risk, further investment in renewables, grids, and storage is likely – areas where German technology and engineering firms are strongly positioned internationally.
Investment, Taxes, Pax Silica
According to the government, more than 6 trillion pesos in investments have been fast-tracked through the “Green Lanes” over three years. Marcos also announced tax relief measures: a higher income tax exemption threshold and lower corporate taxes for small businesses. With “Pax Silica,” a US-led semiconductor and AI ecosystem is being established in New Clark City, designed to embed the Philippines more firmly in Western supply chains.
In the context of diversification strategies (“China+1”), the country is thereby taking a clear geopolitical position – with a young, English-speaking workforce and an established electronics manufacturing base as location advantages.
EU Free Trade Agreement Nearing Conclusion
One topic that featured only marginally in the SONA but is particularly relevant for European companies: the free trade agreement between the EU and the Philippines is close to being finalized. The seventh – and likely final – round of negotiations took place in Brussels in early July. The agreement would replace the expiring GSP+ tariff preference scheme and put trade (around 18 billion US dollars between the EU and the Philippines in 2025) on a permanent contractual footing – including chapters on services, public procurement, and digital trade.
After Vietnam and Singapore, the Philippines would become the third ASEAN country with an EU free trade agreement. For companies that have so far postponed market entry due to tariffs and regulatory uncertainty, this changes the starting position.
How Business Groups Assessed the Speech
Local business associations – including the European Chamber of Commerce – rated the SONA as a mix of “hits and misses”: the right priorities on investment climate, energy security, and infrastructure, but open questions on implementation, timelines, and policy consistency. The remaining two years of the term will show whether the announcements translate into procurement certainty, reliable electricity prices, and ratified agreements.
What stands out: a growth market of 115 million people that is publicly confronting corruption, restructuring its energy supply, and approaching a free trade agreement with the EU is likely to play a larger role in the Asia strategies of German companies going forward.
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Your point of contact in the Philippines: Lutz Kaiser
Villanueva Gabionza & Dy Law Offices
20th/F Corporate Center
139 Valero St., Salcedo Village
Makati City 1227, Philippines
CELL: +63 995 985 4957
TEL: +63 2 8813 3351
FAX: +63 2 8816 6741

INDIA: Government Facilitates Corporate Social Responsibility Spending
Under Indian company law, any company surpassing certain thresholds—inter alia, net profit of INR 50 million (ca. EUR 450k)—needs to spend at least 2 % of the net profits on certain defined objectives serving the public good (“Corporate Social Responsibility” under Section 135 and Schedule VII Companies Act, 2013).
Recently, the rules thereon have been amended, permitting companies to spend up to 10 % of their CSR spending on so-called “zero coupon zero principal instruments”, which are financial instruments issued by registered non-commercial organizations to obtain funds through the Social Stock Exchange—essentially, a structured way of raising donations.
This will reduce compliance and should thus facilitate the administration of CSR spending.
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Your point of contact in India: Dr. Jörg Schendel
Suman Khaitan & Co.
W-13, West Wing, Greater Kailash Part-II
Delhi 110048, Indien
CELL: +91 97 11 08 04 03
TEL: +91 11 49 50 15 00
FAX: +91 11 49 50 15 99
www.sumankhaitanco.in
germandesk@sumankhaitanco.in
schendel@adwa-law.com

HONGKONG: Hong Kong IPO Resurgence and the Rise of Listings Under Chapter 18C of the Main Board Listing Rules
Hong Kong has seen a remarkable resurgence in IPO activity in Q1 2026, reasserting itself as the leading global fundraising hub once again. Total funds raised were approximately HK$110.40 billion (US$14.09 billion), a nearly sixfold increase compared to the same period in 2025 and Hong Kong’s strongest IPO quarter in five years.
For companies who are operating in or looking to expand into Asia, this renewed IPO momentum signals strong institutional confidence in a favourable regulatory environment.
What is an IPO?
An IPO is the process in which a private company can offer shares to the public and become listed on a stock exchange. It offers several strategic advantages for businesses:
- Grants access to a large pool of institutional and retail investors.
- Public listings enhance brand credibility.
- Gives liquidity for founders and initial investors.
- Accessible platform for future fundraising rounds.
Purpose of an IPO
Besides providing business with direct exposure to one of the most globally connected capital markets, an IPO in Hong Kong is especially attractive today because:
- Provides business with direct access to one of the most liquid markets.
- Global investors are seeking increased exposure to Asia, resulting in renewed capital inflows.
- There is strong demand from investors for fast growing companies within AI and other innovative technology sectors.
- The current regulatory environment is especially conducive to businesses listing under Chapter 18C given temporarily lowered financial thresholds.
Chapter 18C Explained: A New Pathway for Innovation
The increased adoption of Chapter 18C is a key driver behind the IPO resurgence in Hong Kong, which targets Specialist Technology Companies (STCs) in five eligible “forward looking” industries:
- Next generation information technology.
- Advanced hardware and software.
- Advanced materials.
- New energy and environmental protection.
- New food and agriculture technologies.
It enables high growth companies to list on the Hong Kong Stock Exchange even if they have not yet met traditional profit or revenue requirements, which is especially relevant for business engaging in upfront Research and Development (R&D).
In Q1 2026, Chapter 18C listings have rapidly gained traction:
- Approximately HK$19.5 billion raised (US$2.49 billion), representing nearly one-fifth of total IPO proceeds.
- Raised volume surpassed the combined volume from 2024 and 2025.
- Significant backing from institutional investors and sovereign wealth funds.
This trend largely aligns with the global surge in AI and related technology investments, as many newly listed companies have a stated focus on these areas.
Basic legal mechanics of Chapter 18C listings
1. Two Categories of Applicants
For companies considering a listing through this pathway, it is essential to understand the underlying legal frameworks. There are two categories of applicants:
Commercial applicants
- At least HK$6 billion in market capitalisation.
- Meet revenue threshold of at least HK$250 million from their core specialist technology business in the most recent financial year.
- R&D expenditure amounting to at least 15% of total operating expenditure both on a yearly basis for at least two of the three financial years prior to listing, and on an aggregate basis over those three years.
Pre-commercial applicants
- At least HK$10 billion in market capitalisation.
- Must demonstrate a credible path to commercialisation.
- R&D expenditure amounting to at least 30% where revenue in the most recent financial year is HK$150 million or more, and at least 50% where that revenue is below HK$150 million.
Both types of applicants must have also received meaningful investment from a core group of sophisticated independent investors.
2. Technology Enterprises Channel (TECH)
Beginning May 2025, the HKEX and SFC have jointly operated TECH. As traditional financial metrics can struggle to capture the value in high growth companies, TECH works to address this by introducing specialised evaluation processes.
There are numerous benefits for companies which utilise TECH, which help to reduce uncertainty for applicants while upholding the high standards for regulatory integrity:
- Provides confidential filing procedures to protect sensitive information.
- Specialist review teams to assess highly technical business models.
- Tailored guidance on eligibility and suitability for listing.
3. Flexibility for Weighted Voting Rights (WVR) structures for shareholders
Through a WVR structure, the company issues two types of shares:
- Ordinary shares carry one vote per share and are sold to regular investors.
- WVR shares are typically held by founding members, and each share carries multiple votes (up to a maximum of 10 in Hong Kong).
These structures enable founders to retain strategic control of their companies while raising public capital. But, under a traditional Hong Kong listing, companies face a subjective, heavily scrutinized regulatory test to demonstrate that they meet “Innovative Company Requirements” and have external investor validation.
Listing under Chapter 18C dramatically streamlines this process. Companies which successfully qualify for a Chapter 18C listing are presumed to satisfy both the innovativeness and external investor requirements.
Proposed lowering of market capitalisation requirements
A March 2026 consultation paper has also, among other changes, proposed a significant reduction in the financial thresholds a company must satisfy in addition to the prior tests.
- Test A: Lowered from HK$40 billion market capitalisation to HK$20 billion.
- Test B: Lowered from HK$10 billion market capitalisation and HK$1 billion in revenue to HK$6 billion market capitalisation and HK$600 million in revenue.
These newly proposed lowered thresholds would provide an unprecedented opportunity for early-stage technology companies to go public.
- Allows founders to preserve strategic control during critical growth phases.
- Reduced financial thresholds enables earlier stage companies to access capital markets when R&D funding is crucial.
- Improves predictability by reducing regulatory friction and streamlining listing procedures.
These changes are currently under review by the HKEX, and a conclusion paper is expected by the end of 2026.
How Ravenscroft & Schmierer Can Help?
Navigating the complex mechanics of a Hong Kong IPO can be challenging, especially if a Chapter 18C pathway is being considered.
At Ravenscroft & Schmierer, our Corporate & Commercial team combines legal expertise with commercial insight to offer clients sophisticated guidance at every stage of the IPO journey. Contact us to discuss how we can support your strategic business objectives.
FAQ: Hong Kong IPO and Chapter 18C Listings
What are the key benefits of a Hong Kong IPO for companies?
A Hong Kong IPO can provide access to one of the world’s most active capital markets, which offers strong institutional investor demand, high liquidity, and enhanced visibility for firms operating in Asia.
What is Chapter 18C in a Hong Kong IPO?
Chapter 18C is a listing regime that allows certain Specialist Technology Companies in designated industries to list on the Hong Kong Stock Exchange without needing to meet the traditional profit or revenue requirements, making it ideal for early-stage businesses.
What companies qualify as a Specialist Technology Company under Chapter 18C?
To qualify, companies must primarily operate within one of the five recognised frontier industries, if they can demonstrate strong growth potential, significant investment in R&D, and backing from sophisticated independent investors.
Can pre-revenue companies list in Hong Kong?
Under Chapter 18C, pre-commercial companies may qualify for listing if they can demonstrate a strong focus on R&D, meet certain market capitalisation thresholds and can demonstrate a credible path to commercialisation.
What is the Technology Enterprises Channel (TECH) and why is it important?
TECH is a jointly operated regulatory initiative by the HKEX and the SFC that streamlines the IPO process by offering confidential filings, specialised review teams, and clearer eligibility guidance.
How do Weighted Voting Rights (WVR) structures benefit founders?
WVR structures allow founders to retain strategic control of their companies even after listing. Under Chapter 18C, the approval process for WVR structures is streamlined, which significantly reduces the regulatory hurdles involved.
Is now a good time to pursue a Hong Kong IPO?
Considering the strong IPO momentum, favourable regulatory conditions, and growing investor demand for innovative technologies, the current market presents a very compelling opportunity for business who wish to pursue a Hong Kong IPO.
How can Ravenscroft & Schmierer support your Hong Kong IPO?
Ravenscroft & Schmierer provides tailored legal guidance to support your business every step of the journey, from initial eligibility assessments to regulatory engagement and execution. If you have any inquiries, contact us here to explore how we can assist you. Bitte auf deutsch übersetzen ohne den Inhalt zu verändern.
Disclaimer: This publication is general in nature and is not intended to constitute legal advice. You should seek professional advice before taking any action in relation to the matters dealt with in this publication.
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Your point of contact in Hong Kong: Stefan Schmierer
Ravenscroft & Schmierer
22nd Floor, Bupa Centre
141 Connaught Road West
Hong Kong, SAR
CELL: +852 9229 6603
TEL: +852 2388 3899
FAX: +852 2385 2696

TAIWAN: Taiwan’s Telecommunications Reform
At the end of July 2026, Taiwan’s Legislative Yuan passed amendments to the Telecommunications Management Act. If promulgated and implemented, these amendments would allow authorities to exempt foreign investors from specific regulatory hurdles on a case-by-case basis.
Currently, Article 36 of said Act generally requires an applicant establishing a public telecommunications network using regulated telecommunications resources (such as satellite communications technology) to be a company limited by shares with an ROC-national chairperson. Also, foreign ownership is capped at 49% of shares held directly and 60% of shares held in total, combining both directly and indirectly held shares.
The amendments to the Act would allow applicants using satellite communications technology to seek a case-by-case exemption from these restrictions. The competent authority (National Communications Commission, the NCC) would be required to review such requests in light of various aspects, such as national security and industry development. The application procedure, eligibility conditions, required documents, review standards, and other related matters still need to be defined by further regulations.
As reflected in the Legislative Yuan Agenda Related Documents, the rationale behind the amendment is communications resilience: Taiwan relies heavily on submarine cables and terrestrial networks, which may be disrupted by natural disasters, maritime incidents and other exceptional events. Satellite connectivity can provide a complementary backup layer. As such networks are cross-border and capital-intensive, lawmakers concluded that existing nationality and ownership limits could hinder deployment.
The amendments to the Act have not been promulgated nor entered into force yet and several aspects still remain to be further clarified. Foreign investors interested in this topic should monitor Executive Yuan announcements.
This article is intended to provide general insights and does not constitute legal advice. If you have any questions or require legal advice, please contact estelle.seiler@eiger.law and michael.werner@eiger.law.
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Your point of contact in Taiwan: Estelle Seiler
Eiger Law
Bldg. A, 2F, 25-2 Ren Ai Rd, Sec. 4
Taipei 10685
Taiwan
CELL: +886 9 6880 4910
TEL: +886 2 2771 0086
FAX: +886 2 2771 0186

KOREA: Workplace Harassment in Korea – Revised MOEL Manual Tightens Investigation Requirements
Since July 2, 2026, a fundamentally revised Manual on the Prevention of and Response to Workplace Harassment issued by the Ministry of Employment and Labor (MOEL) has been in effect in Korea. Together with case law on workplace harassment in Korea, the manual functions in practice as the authoritative administrative guideline – including for Korean subsidiaries of German, Austrian and Swiss companies. The revised version prohibits so-called “self-investigation” by accused employers, introduces rights to challenge biased members of the investigation committee, and for the first time qualifies abusive harassment reports as grounds for disciplinary action. At the same time, case numbers at the labor authorities continue to rise significantly. Harassment cases registered with the labor authorities rose from 7,774 (2021) via 11,038 (2023) to 16,373 in 2025. The following sets out the legal framework, the key changes, and the resulting compliance obligations for companies with a presence in Korea.
Why the MOEL Manual Has Binding Effect in Practice for Companies in Korea
The prohibition of workplace harassment has been enshrined in Korean law since July 2019. The Labor Standards Act prohibits employers and employees from inflicting physical or mental suffering on other employees, or from deteriorating their working environment, beyond the appropriate scope of work by taking advantage of superiority in rank or relationship within the workplace. Since 2021, employers have additionally been under a fine-backed duty to conduct a prompt and objective investigation of reported cases, and the sanctions are tiered pursuant to the details of violations.
Where the statute is silent – for instance on the design of the investigation procedure or the line between permissible work instructions and harassment – the MOEL manual provides the detail. Labor inspectors base their supervisory practice on it.
What Changes Does the July 2026 Revision Bring?
The new version replaces the previous edition of April 2023 as well as guidance materials for employers and employees. Already in April 2026, on the Minister’s instruction, MOEL had improved the processing guideline for harassment reports so that, with a view to small workplaces, labor inspectors may conduct a preemptive direct investigation in cases where the employer is reported as the perpetrator. The manual revision continues this line at the workplace level.
Four areas of change stand out as follows:
- Prohibition of “Self-Investigation”;
- Restrictions on excessive or baseless false reports, as well as reports amounting to false accusation;
- Refined assessment standards; and
- Revisions to standard Rules of Employment, expressly granting the victim the right to challenge.
Conclusion: Action Items for Companies with Korean Subsidiaries
The revision of the workplace harassment manual leaves the substantive principles unchanged but noticeably shifts the requirements placed on the internal procedure. For Korean subsidiaries of German-speaking companies, the following priorities emerge:
- Adapt the Rules of Employment to be aligned with the revised model version;
- Define an escalation path for management-level cases;
- Document investigations;
- Handle abuse cases firmly but carefully; and
- Integrate training.
It is recommended that companies with Korean subsidiaries schedule the review of the subsidiaries’ internal policies no later than the next regular update of their Rules of Employment – the revised guidance on workplace harassment provides the concrete occasion for doing so.
This article was written by ADWA lawyer Anton Schröder in Korea and Jeeseon Choi (Partner D&A LLC).
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Your point of contact in Korea: Joachim Nowak
DAERYOOK & AJU LLC
7 – 16F, Donghoon Tower
317, Teheran-ro, Gangnam-gu
Seoul 06151, Republik Korea
CELL: +82 10 9001 6430
TEL: +82 2 772 5948
FAX: +82 2 3016 5222

VIETNAM: Anti-Sexual Harassment at the Workplace under Vietnamese Labor Regulations
Conducting anti-sexual harassment at the workplace is currently a binding legal obligation, rather than merely a matter of internal workplace culture. Vietnamese labor law expressly prohibits sexual harassment at the workplace and requires employers to establish appropriate measures to prevent and address this conduct, not only to maintain a safe and respectful working environment but also to ensure compliance with their legal obligations as employers.
The following provides a brief overview of the Vietnamese labor regulations governing anti-sexual harassment at the workplace, including the relevant obligations of employers to prevent and handle this conduct.
I. Legal Framework
The matter in question shall be governed by the following legal instruments
- The Labor Code No. 45/2029/QH14 dated 20.11.2019 (the “Labor Code”);
- Decree 145/2020/ND-CP dated 14.12.2020 detailing and guiding the implementation of a number of articles of the Labor Code (“Decree 145/2020/ND-CP”);
- Law No. 91/2025/QH15 on Personal Data Protection dated 26.06.2025 (the “Law on Personal Data Protection”);
- Decree No. 356/2025/ND-CP dated 31.12.2025 guiding the implementation of the Law on Personal Data Protection (“Decree 356/2025/ND-CP”);
- Decree 12/2022/ND-CP dated 17.01.2022 prescribing administrative penalties in the fields of labor (“Decree 12/2022/ND-CP”) and shall be replaced by Decree 283/2026/ND-CP dated 15.07.2026 prescribing administrative penalties in the fields of labor (“Decree 283/2026/ND-CP”) as of 10.09.2026.
II. Legal Definitions
A. Sexual Harassment at the workplace
Article 3 Clause 9 of the Labor Code defines sexual harassment at the workplace generally “as any act of a sexual nature by any person to another person at the workplace without the latter’s wish or consent.”
Clause 1 Article 84 of Decree 145/2020/ND-CP specifies two forms the conduct may take:
- Exchange (quid pro quo): such as a request, demand, suggestion, threat, or use of force to have sex in exchange for any work-related benefits; or
- Hostile environment: any sexual acts that create an insecure and uncomfortable work environment and affect the mental, physical health, performance and life of the harassed person.
Clause 2 Article 84 of Decree 145/2020/ND-CP further identifies three modalities:
- Physical: Actions, gestures, physical contact with the body of a sexual or suggestive nature
- Verbal: sexual or suggestive comments or conversations in person, by phone or via electronic media
- Non-verbal: body language; display, description of sex or sexual activities whether directly or via electronic media
B. Workplace
Article 3 Clause 9 of the Labor Code defines workplace as “any place where an employee actually works pursuant to the agreement with or assignment by the employer.” Article 84 Clause 3 of Decree 145/2020/ND-CP further provides that workplace means “any location where the employee works in reality as agreed or assigned by the employer, including work-related locations or spaces such as social gatherings, conferences, training sessions, business trips, meals, phone conversations, communications through electronic media, on shuttles provided by the employer and other locations as specified by the employer.”
III. Mandatory obligations of the Employer
A. Internal Labour Regulations Setup
An employer with 10 or more employees must have written Internal Labour Regulations (“ILR”) and register such with the provincial labour authority. Regulations on the prevention of sexual harassment, as well as the procedural regulations for handling such issues, are mandatory regulations to be contained in the ILR.¹
Minimum content of the anti-harassment regulations shall include:² (a) prohibition of sexual harassment at the workplace; (b) a detailed, specific description of harassing conduct, tailored to the nature of the work and of the workplace; (c) responsibilities, time limits and internal handling procedures, including the responsibilities of the person authorised to receive complaints; (d) the forms of labour discipline applicable to the harasser as well as to a person who knowingly makes a false accusation; and (e) compensation for damage and remedial measures.
B. Handling upon receipt of complaint
Article 86 Clause 1 of Decree 145/2020/ND-CP requires the Employer to handle any sexual harassment complaint in an appropriate manner, while protecting the confidentiality, dignity, reputation, and safety of all persons involved.
Article 86 Clause 1 of Decree 145 specifies three obligations of an employer: (i) to implement and monitor compliance with the law on prevention of sexual harassment; (ii) to organize communication and training on the subject for employees; and, (iii) where a complaint or denunciation arises, to promptly prevent and handle the conduct and to take measures to protect the confidentiality, honor, reputation, dignity and safety of the person harassed, of the complainant or denouncer, and of the accused person.
Employees, according to Article 86 Clause 2 of Decree 145, are obliged to comply with anti-harassment rules and to participate in building a working environment free of harassment. The organization representing employees (internal labour union), according to Clause 3, is entitled to participate in drafting, implementing and monitoring the rules, and to advise and represent both the person harassed and the person complained of. Furthermore, prevention of sexual harassment may also be placed on the agenda of periodic workplace dialogue³, in accordance with Article 63.3 and Article 64.2.e of the Labor Code.
C. Relevant Obligations
An investigation of sexual harassment allegations by an Employer will generate a significant amount of sensitive personal data, for e.g. witness statements, messages, images, and health information. As of 01.01.2026, the processing of such data is governed by the Law on Personal Data Protection and its implementing Decree No. 356/2025/ND-CP. Accordingly, the Employer should ensure that such data is collected, processed, stored, and retained in accordance with applicable data protection requirements. A data protection failure, even where the investigation itself has been properly conducted, may expose employers to separate liabilities.
IV. Administrative fines for Violations
Under applicable labour regulations, sexual harassment at the workplace that does not reach the threshold for criminal prosecution shall be subject to sanction with a fine of VND 15,000,000 to VND 30,000,000.⁴ That range applies to individuals, while fines imposed on an organization amount to double, i.e. VND 30,000,000 to VND 60,000,000.⁵
As from 10.09.2026, Decree 283/2026/ND-CP introduces an additional remedial measure for this violation, under which the harasser may be required to make a public apology at his/her place of residence, the workplace, another location or through mass media, unless the victim files a written request that no public apology be made.⁶
V. Legal consequences on employment relationship
Under Clause 2, Article 125 of the Labor Code, dismissal is one of the disciplinary measures that the Employer may impose on an employee who commits sexual harassment at the workplace, but only subject to a specific condition: the ILR must expressly identify sexual harassment at the workplace as a ground for a dismissal, a reprimand, deferral of salary increases, or demotion. This is precisely why the labor law⁷ requires the ILR to specify, in advance, both the conduct that constitutes sexual harassment and the corresponding disciplinary measures.
On the employee’s side, the labor law⁸ entitles an employee who is sexually harassed at the workplace to unilaterally terminate the labor contract without prior notice to the Employer. Such termination is considered lawful, rather than being treated as an unauthorized absence from work or an illegal unilateral termination of the labor contract.
Disclaimer
This summary is provided for general informational purposes only and does not constitute legal advice. It reflects our general understanding of the legal framework as of the date of issuance and may not account for subsequent legal developments, amendments, or judicial interpretations. It is not intended to address the specific circumstances of any individual or entity, and should not be relied upon as a substitute for tailored legal counsel. No attorney-client relationship is created by the distribution or receipt of this summary. Should you require advice on a specific matter, please contact us directly.
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¹ Clause 2 (d) of Article 118 and Article 119 of the Labor Code; Clause 2 (d) of Article 69 of Decree 145/2020/ND-CP.
² Article 85 of Decree 145/2020/ND-CP.
³ According to Clauses 1 and 2, Article 63 of the 2019 Labor Code, workplace dialogue means the sharing of information, consultation, discussion, and exchange of opinions between the employer and employees or the organization representing employees (internal labour union) related to the rights, interests, and concerns of the parties at the workplace, with the aim of enhancing understanding and cooperation and jointly working towards mutually beneficial solutions. Workplace dialogue shall be conducted periodically at least once a year.
⁴ Clause 3 Article 11, Decree 12/2022/ND-CP. From 10.09.2026: Clause 3 Article 17 of Decree 283/2026/ND-CP
⁵ Article 6.1, Decree 12/2022/ND-CP. From 10.09.2026: Clause 1 Article 7 of Decree 283/2026/ND-CP.
⁶ Clause 5 (d) Article 17 of Decree 283/2026/ND-CP.
⁷ Clause 1 Article 85 of Decree 145/2020/ND-CP
⁸ Clause 2 (d), Article 35 of the Labor Code
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Your point of contact in Vietnam: Christian A. Brendel
Brendel & Associates Law Co., Ltd.
D&D Tower, 10th Floor, 458 Nguyen Thi Minh Khai
Ban Co Ward,
Ho-Chi-Minh-Stadt, Vietnam
CELL: +84 98 978 4791
TEL: +84 28 3911 2008
FAX: +84 28 3911 2010

CHINA: Innovation vs. Loss of Control? Approaches to AI Regulation in the EU and China
Artificial intelligence offers companies extensive opportunities, but at the same time brings new requirements regarding data protection and legal compliance. The increasing integration of AI-supported applications into existing business processes is not only changing the way companies use and analyse data, but also raising legal questions.
While the EU places the protection of individuals, transparency and the oversight of algorithmic systems at the centre of its approach, China combines the promotion of AI with economic objectives, societal governance and national security.
For companies that use—or intend to use—AI applications in the EU and at their Chinese subsidiaries, this gives rise to two fundamentally different regulatory regimes. The challenge lies not only in the new technology itself, but above all in the parallel observance—and practical implementation—of the sometimes divergent requirements of both legal systems.
In our article “Innovation vs. Loss of Control? Approaches to AI Regulation in the EU and China”, published in issue 7/2026 of the specialist journal International Business Law, we examine the different approaches taken by the EU and China and outline the developments that companies should take into account in the future when using new technologies.
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Your point of contact in China: Rainer Burkardt
Burkardt & Partner
Suite 1706, Five Corporate Avenue
No. 150 Hubin Road
Shanghai 200021, P.R. China
CELL: +86 186 1687 7153
TEL: +86 21 6321 0088
FAX: +86 21 6321 1100
