How much are fines imposed for engaging in construction work without valid license of operation in Vietnam?
What are capability conditions of organizations and individuals engaged in construction activities in Vietnam?
Based on Article 148 of the Law on Construction 2014 (amended and supplemented by point a, point b, point c, clause 53, Article 1 of Law on amendments to Law on Construction 2020), the regulations are as follows:
“Article 148. General regulations on the capacity conditions of organizations and individuals engaged in construction activities
1. Individuals participating in construction activities must have appropriate diplomas and certificates for the work they undertake, issued by legitimate training institutions.
2. Foreign contractors that are organizations or individuals engaging in construction activities in Vietnam must comply with legal provisions on bidding and be granted an operating license by the state construction management agency.
3. The positions and individuals practicing construction activities must have practicing certificates according to the provisions of this Law, including project management directors; heads and principal designers of construction planning; heads of construction surveys; heads and principal designers, design verifiers; construction supervision consultants; heads of preparation, verification, and cost management of construction investments. Practicing certificates are classified into grades I, II, and III.
4. Organizations participating in construction activities must have capacity certificates as provided by this Law, including project management consultants; construction survey; preparation of construction planning design; design, verification of construction designs; construction of works; construction supervision consultancy. Capacity certificates of organizations are classified into grades I, II, and III. Professional agencies under the Ministry of Construction issue grade I capacity certificates; the Department of Construction and professional social - occupational organizations that meet the Government's regulations issue the remaining capacity certificates.
4a. Organizations and individuals practicing architecture operate according to the provisions of architecture law.
5. The Government stipulates in detail the capacity conditions of organizations and individuals participating in construction activities; regulations on the programs, contents, and forms of organizing assessments to grant practicing certificates; regulations on issuance, re-issuance, conversion, and revocation of practicing certificates; regulations on conditions, authority, sequence, and procedures for granting and revoking construction operating licenses for foreign contractors.”
Thus, when participating in construction activities, organizations and individuals must meet the general requirements on construction capacity conditions as outlined above.
How much is the fine for engaging in construction activities without a practicing certificate or with an expired practicing certificate?
What are penalties imposed upon individuals for engaging in construction work without valid license of operation in Vietnam?
Based on Article 24 of Decree 16/2022/ND-CP, the regulations are as follows:
“Article 24. Violations of regulations on capacity conditions for construction activities
1. A fine ranging from VND 10,000,000 to VND 20,000,000 shall be imposed on individuals practicing construction activities with one of the following acts:
a) Conducting construction activities without meeting the practicing conditions as prescribed;
b) Conducting construction activities without a practicing certificate, with an expired practicing certificate, or with incorrect practicing certificate details;
c) Foreigners or overseas Vietnamese practicing construction activities in Vietnam without converting their practicing certificates as prescribed.
2. A fine ranging from VND 30,000,000 to VND 50,000,000 shall be imposed on organizations conducting construction activities with one of the following acts:
a) Assigning individuals without appropriate practicing certificates or who do not meet the practicing conditions corresponding to the type and class of the works they undertake for positions as prescribed;
b) Conducting construction without meeting the capacity conditions as prescribed;
c) Conducting construction activities without a capacity certificate or with an expired capacity certificate as prescribed.
…
4. Additional sanctions:
a) Suspension of construction activities from 03 months to 06 months for acts specified at point b, clause 2 of this Article;
b) Suspension of construction activities from 06 months to 12 months for cases without a capacity certificate, suspension of construction activities from 03 months to 06 months for cases with expired capacity certificates as specified at point c, clause 2 of this Article;
c) Revocation of practicing certificates from 06 months to 12 months for acts specified in point a, clause 3 of this Article;
d) Suspension of construction activities in Vietnam from 12 months to 24 months for acts specified at point b, clause 3 of this Article.
5. Remedial measures (for projects not yet commenced or under construction):
a) Requiring construction activities to ensure appropriate conditions as prescribed for acts specified at point a, clause 1 of this Article;
b) Requiring the replacement of individuals with appropriate capacity or practicing certificates for acts specified at point a, clause 2 of this Article;
c) Requiring procedures for obtaining a construction operating license for acts specified at point b, clause 3 of this Article;
d) Requiring foreign contractors to establish an executive office after obtaining a construction operating license or to add registration or notification information as prescribed for acts specified at point d, clause 3 of this Article;
dd) Requiring contractors to carry out exit procedures for foreign workers for acts specified at point đ, clause 3 of this Article;
e) Requiring contractors to comply with commitments according to the granted construction operation license for acts specified in point e, clause 3 of this Article;
g) Requiring foreign contractors to add content, volume, or specific value of work of Vietnamese contractors in the consortium or Vietnamese subcontractors for acts specified in point g, clause 3 of this Article;
h) Requiring verification as prescribed for acts specified at point h, clause 3 of this Article;
i) Requiring contractors to carry out reporting policies as prescribed for acts specified in point i, clause 3 of this Article.”
Individuals engaging in construction activities without a practicing certificate or with an expired practicing certificate or practicing incorrectly according to the certificate can be fined up to VND 20 million.
Additionally, based on the violations related to construction activity capacity conditions, additional sanctions and remedial measures as prescribed above can be determined.
What is the prescriptive period for imposing penalties for administrative violations in construction in Vietnam?
Based on Article 5 of Decree 16/2022/ND-CP, the regulations are as follows:
"Article 5. Prescriptive period for administrative violations
1. The prescriptive period for administrative violations is 01 year for real estate business activities, management of technical infrastructure works, and production of construction materials.
The prescriptive period for administrative violations is 02 years for construction activities, and management, and development of houses.
2. The point to calculate the prescriptive period for administrative violations provided in clause 1 of this Article is regulated as follows:
...
o) Violations of construction activities prescribed in this decree that do not fall under cases specified at points a, b, c, d, dd, e, g, h, i, k, l, m, n of this clause shall have the prescriptive period determined by the competent sanctioning person based on the Law on Handling Administrative Violations and relevant records and documents.
Violations of regulations on capacity conditions for construction activities have a prescriptive period for administrative violations of 02 years.
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