SPECIAL INVESTMENT PROCEDURES IN VIETNAM - A NEW PATHWAY FOR FOREIGN INVESTORS

1. What are Special Investment Procedures?

Special Investment Procedures is a new mechanism for investment licensing that enables investors to implement projects promptly and efficiently, eliminating numerous burdensome administrative procedures as previously required. Specifically, the State now focuses on monitoring during its implementation rather than conducting extensive evaluations before granting licenses.

2. What are the Key Advantages?

 🛃 Simplified documentation and appraisal process:

NOT be required to apply for the licensing procedures as follows:

• Investment policy approval;

• Technology assessment;

• Environmental impact assessment (EIA);

• Construction permits, fire prevention and fighting approvals, etc.

INSTEAD, the investor is required to:

• COMMIT to comply with laws on environment, construction, firefighting, and prevention  in the registration dossier;

• BE responsible for ensuring relevant compliance and addressing any violations, if occur.

⏱️ Shortened approval time:

• Conventional procedures: at least 80 days;

• Special procedures: 15 working days if the dossier is valid.

In practice, the approval time under the Special Procedures will be shortened to 260 days compared to conventional procedures.

3. Which Projects are Qualified for Special Investment Procedures?

According to clause 3, Article 36a of the Law on Investment, the Special Investment Procedures may apply to investment projects satisfying ALL of the following conditions:

(i) Falls within the sector category qualified for special investment procedures, when the project:

✅ Not require investment policy approval by the National Assembly;

✅ Fall within the list of special sectors as follows:

• Investment in Innovation centers or Research and Development (R&D) centers; Investment in the semiconductor industry: design and manufacturing integrated circuit (IC), flexible electronics (PE), and chip and semiconductor materials;

• Investment in high-tech sectors prioritized for development, manufacturing of products listed in the high-tech product eligible for development promotion list as per the Prime Minister’s decision;

✅ Located in Special Zones as follows:

• Industrial parks, export processing zones;

• High-tech parks (in compliance with the High Technology Law and relevant regulations);

• Information technology zones; or

• Functional zones within economic zones or free trade zones.

(ii) Conform with the applicable planning, including: zoning master plan of Special Zones, or general master planning for economic zones, cities, or towns, particularly for projects proposed within functional zones of economic zones, etc.

(iii) Land use demand: If a project requires land, it must satisfy legal conditions on land leasing or land repurposing, in line with Clause 5, Article 3 of Decree No. 19/2024/ND-CP.

(iv) Investor’s commitment: The foreign investor must COMMIT to comply with Vietnamese law in the investment registration dossier.

Remarks: Other legal matters such as project implementation duration, investor’s legal status and experience, investment incentives and eligibility conditions (if any) shallfollow the convetional investment procedures and are not different under the Special Investment Procedure.

4. 📝 Implementation Process under the Special Procedure

(i) Required dossier includes:

• A written request to implement the investment project, including a commitment to comply with conditions, standards, and technical regulations on (a) construction, (b) environmental protection, (c) fire prevention and fighting.

Notably, instead of a preliminary EIA report, only identification and forecast of environmental impact and mitigation measures are required in the Special Procedure. STANDARDIZED FORMS are provided in Appendices 1, 2, and 3 of CIRCULAR NO. 06/2025/TT-BKHĐT.

• Project Implementation Proposal;

• Legal and financial capacity documents;

• Land or site-related documentation.

(ii) Competent licensing authority: Management Boards of industrial parks, export processing zones, high-tech parks or economic zones.

(iii) Licensing timeframe: 15 working days from the date of submission of a complete and valid dossier.

(iv) Results: Investment Registration Certificate (IRC) - serving as a legal basis for land lease, land repurposing, construction permits, state supervision, handling of administrative violations, and state management of the project.

5. 🔍 Post-licensing Supervision: A balance of Opportunity & Responsibility

A key innovation of the Special Procedure is the shift to post-licensing supervision. This enables investors to begin implementation early, without waiting for all licenses, while still ensuring regulatory compliance.

✅ Advantages:

• Investors may implement the project and begin construction early, without waiting for environmental, construction, or fire prevention and fighting licenses;

·       Reducing administrative burden and facilitating rapid development.

⚠️ Associated responsibilities:

• Investors must take full legal responsibility for compliance with Vietnamese laws.

• If commitments are violated, consequences may include:

• Administrative penalties;

o   Remedial measures;

o   Suspension or termination of project operations.

📌 Specific Compliance Requirements:

• Project implementation guarantee:

If land use is involved after the issuance of the Investment Registration Certificate (IRC), the investor must either:

-       Place a security deposit, or

-       Obtain a guarantee from a credit institution, in accordance with Article 4 of Decree No. 19.

·       Before commencement:

• Submit techno-economic report (if construction components are involved);

• Obtain an environmental license if required;

• Complete environmental registration if applicable.

·       During project implementation:

• Must comply with conditions stated in the IRC; and

• Fulfill all legal commitments on the environment, construction, and fire prevention and fighting.

  
  

6. 🌍 Unique Advantages for Foreign Investors

Under Clause 5, Article 36a of the Law on Investment, foreign investors are entitled to establish a company before obtaining the IRC. However, a point of ambiguity arises under the current wording: It is unclear whether all foreign investors under the Special Procedure, are eligible to establish a company before registering their investment project, or whether this only applies when two or more investors jointly propose the project, including at least one foreign investor, jointly propose the project as stated in clause 5, Article 36a?

Recommendation: As this mechanism is still new in practice, differences in interpretation and implementation may occur across authorities. It is strongly recommended that foreign investors consult with competent authorities and legal experts before initiating any action under this provision.

7. When Should the Special Procedure Not Be Chosen?

The Special Investment Procedure is an option, not an obligation. Foreign investors have the right to choose between the Special Procedure and the conventional investment procedure, even if their project meets the eligibility criteria for the special mechanism.

So, when might the Special Investment Procedure not be the right fit?

Situations where the Special Procedure may NOT be suitable:

• The expansion of ongoing projects under the conventional process: If the investment project is already operating under the conventional procedure, it is more consistent to use the same (conventional procedure) for expansion.

• Risk-averse investors: If the investors prefer tight risk control from the outset, such as early legal assessments, clear feasibility confirmation, and thorough pre-implementation checks, the conventional route offers more structure and pre-screening.

• Limitation on self-regulation: The investors have not fully prepared to manage legal compliance internally or lack experience handling a “build-as-you-go” approach to documentation and approvals. In that case, the conventional procedure provides more step-by-step oversight.

• Newcomers to Vietnam: For first-time investors unfamiliar with Vietnam’s business environment or legal system, the conventional process, with its multiple approval checkpoints, may help identify challenges earlier and provide a safer pathway.

  
  

🎯 Conclusion

Criteria	Regular Procedure	Special Procedure
Licensing time frame	80 - 260 days	15 working days
EIA, fire prevention and fighting, construction permit required before implementation?	Yes	Only commitment required
Applicable sectors	All sectors	Special sectors only
Company establishment before the IRC?	Foreign investors are not allowed.	Foreign Investor: Possible.
Management mechanism	Pre-licensing inspection	Post-licensing supervision

 Article: Prepared by LLVN.

Image: Internet.

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