Is there a penalty of imprisonment for selecting unqualified contractors to execute construction in Vietnam?

Is there a penalty of imprisonment for selecting unqualified contractors to execute construction in Vietnam?

Pursuant to Article 224 of the 2015 Criminal Code, regulations on offences against regulations of law on investment in construction that lead to serious consequences are as follows:

1. A person who abuses his/her position or power to commits any of the following acts and causes damage assessed at from VND 100,000,000 to under VND 300,000,000 or under VND 100,000,000 while having incurred a disciplinary penalty for the same offence shall face a penalty of up to 03 years' community sentence or 01 - 05 years' imprisonment:

a) Deciding investment in construction against the Law on Construction;

b) Making, assessing, approving a design or budget estimate, adjusting a budget estimate, accepting a construction funded by the State against the Law on Construction;

c) Selecting unqualified contractors to execute the construction;

d) Colluding with another entities in falsifying the result of project planning, survey, design, construction supervision.

2. This offence committed in any of the following circumstances carries a penalty of 03 - 12 years' imprisonment:

a) The offence is committed for self-seeking purposes;

b) The offence is committed by an organized group;

c) The offence involves the use of deceitful methods;

d) The offence results in damage from VND 300,000,000 to under VND 1,000,000,000.

3. If the damage caused by the offence is assessed at VND 1,000,000,000 to over, the offender shall face a penalty of 10 - 20 years' imprisonment.

4. The offender might also be prohibited from holding certain positions or doing certain works for 01 - 05 years or have all or part of his/her property confiscated.

According to this Article, the investment director of a construction project who chooses a contractor who is unqualified for construction to build and causes damage in the above case will be prosecuted for criminal liability according to the law in Vietnam.

Is there a penalty of imprisonment for selecting unqualified contractors to execute construction in Vietnam? (Image from the Internet)

What are administrative penalties for selecting unqualified contractors to execute construction in Vietnam? 

According to the provisions of Clause 1, Article 7 of Decree 16/2022/ND-CP on violation of regulations on selecting organizations and individuals for construction activities as follows:

1. A fine ranging from VND 60.000.000 to VND 80.000.000 shall be imposed on selection of ineligible organizations or individuals for:

a) Construction surveying; or

b) Preparation of construction planning and design; or

c) Management of construction investment project; or

d) Design or assessment of construction design; or

dd) Architectural design and assessment of architectural design; or

e) Construction work; or

g) Supervision of construction work; or

h) Management of construction investment; or

i) Construction inspection; or

k) Construction experimentation.

In addition, Clause 3 and Clause 4 Article 7 of Decree 16/2022/ND-CP stipulates as follows:

3. Additional forms of penalty:

Suspending construction activities for 3 to 6 months for projects, structures, and work items where violations under Point c or Point e Clause 1 of this Article occur.

4. Remedial measures:

a) Mandated selection of eligible organizations and individuals for violations under Points a, c, g, h, i, and k Clause 1 of this Article if the construction has not been commenced or if the construction is in progress and Points b, d, dd, and e Clause 1 of this Article if the construction has not been commenced;

b) Mandated application of the foreign contractor for construction permit for violations under Point a Clause 2 of this Article;

c) Mandated rectification and compliance of the foreign contract with commitment under joint venture contract signed with the Vietnamese main contractor or use of Vietnamese subcontractors as per the law if the project has not been commenced or if the project is in progress for violations under Point b Clause 2 of this Article;

d) Mandated re-export of construction machinery and equipment for violations under Point c Clause 2 of this Article;

dd) Mandated written notice issued to relevant contractors and construction authorities for violations under Point dd Clause 2 of this Article.

Thus, the act of choosing a contractor who is not capable of constructing the project will be fined from 60,000,000 VND to 80,000,000 VND. Forced application of remedial measures and additional penalties according to the above regulations in Vietnam.

Best regards!