I. Definition
The Economic Needs Test (ENT) is a legal procedure used to assess the impact of a retail outlet on the market, society, and its potential contribution to the economic development of a project.
The purpose of the ENT is to determine the necessity of granting approval or licensing the establishment of a retail outlet, while ensuring that approved projects generate positive value for socio-economic development.
II. Cases Subject to the Economic Needs Test
Pursuant to Clause 1, Article 23 of Decree No. 09/2018/ND-CP, the cases are as follows:
| No. | Cases | Requirement |
|---|---|---|
| 1 | Establishment of a retail outlet beyond the first retail outlet | ENT is mandatory |
| 2 | A retail outlet beyond the first retail outlet with an area of less than 500 m², located in a shopping mall, and not classified as a convenience store or mini supermarket | ENT is not required |
Criteria for conducting the Economic Needs Test include:
- The scale of the geographic market area affected by the operation of the retail outlet;
- The number of existing retail outlets operating within the geographic market area;
- The impact of the retail outlet on market stability and on the business operations of existing retail outlets and traditional markets within the geographic area;
- The impact on traffic density, environmental sanitation, and fire prevention and fighting within the geographic area;
- The contribution of the retail outlet to the socio-economic development of the geographic area, including:
- Job creation for domestic workers;
- Contribution to the development and modernization of the retail sector;
- Improvement of the environment and living conditions of local residents;
- The capacity and level of contribution to the state budget.
III. Economic Needs Test Council (ENT Council)
The Economic Needs Test Council (ENT Council) is established to evaluate the criteria of the ENT process and to determine the suitability of the proposed location for the retail outlet.
The ENT Council shall be established by the Provincial People’s Committee where the retail outlet is proposed, based on the recommendation of the licensing authority.
Composition of the ENT Council:
| Position | Composition |
|---|---|
| Chairperson | Representative of the Provincial People’s Committee or an authorized representative |
| Members | Representatives of the Department of Industry and Trade, Department of Planning and Investment, and other relevant departments, agencies, and organizations |
In cases where the proposed retail location is situated in a commune/ward/town area adjacent to another province or centrally governed city, the ENT Council must include a representative from the adjacent provincial People’s Committee.
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