The Vietnamese government upheld in Decree 93 (issued July 2005) its previous limit on the number of expatriate employees a company may hire, which was 3% of the company´s total workforce.  The 3% cap originally appeared in Decree 105, issued in September 2003, which addressed the hiring of expatriates in Vietnam.  Decree 93 amended some provisions in Decree 105 but did not, as many businesses had hoped, increase or abolish the 3% cap.  This cap applies to both foreign-owned and domestic businesses, as well as state-owned enterprises.

Companies that rely on foreign workers are understandably disappointed.  However, there are a number of exceptions to the 3% rule.  Companies that have just begun operations are permitted to hire more than 3% expatriates, with permission from the Chairperson of the local People´s Committee of the company´s headquarters.  Other entities such as foreign contractors, branch offices of foreign companies or law firms, offices of foreign projects in Vietnam, and representative offices of organizations (e.g. economic, scientific, sporting, cultural) are exempt from this cap.  However, these employers still need approval from the Chairman of the local People´s Committee before hiring any expatriates.  Companies that have obtained written approval of the permissible number of expatriate employees in their license from the People´s Committee are also exempt from the 3% cap.

Companies must also obtain work permits for each foreign worker.  Members of management boards, heads of representative or branches offices of companies, and expatriate workers staffed on a project not exceeding 3 months are exempt from this rule. A work permit is valid for 3 years.