03-stage procedure for construction investment in Vietnam

03-stage procedure for construction investment in Vietnam

Pursuant to the provisions of Clause 1, Article 50 of the Law on Construction 2014 and Clause 1, Article 4 of Decree 15/2021/ND-CP, the order of construction investment involves three stages, including project preparation, project implementation and construction completion to put the project’s work into exploitation and use, except the construction of separate houses, specifically as follows:

- Pre-construction:

+ Construction survey;

+ Formulation, appraisal of pre-feasibility study report, decision or approval of investment policy (if any);

+ Formulation, appraisal, approval of detailed construction planning to formulate feasibility study report;

+ Formulation, appraisal of feasibility study report for construction approval/decision and other necessary tasks related to pre-construction;

- Construction:

+ Site preparation, demining (if any);

+ Construction survey;

+ Formulation, assessment and approval for design and construction estimate;

+ Issuance of construction permit (if required);

+ Selection of contractors and signing of construction contracts;

+ Execution of the works; supervision of work execution;

+ Advances or payments for completed works;

+ Commissioning;

+ Taking-over of the works;

+ Handover of completed works and putting into operation; and other necessary tasks;

- Post-construction: finalization of construction contract, final accounts of the completed works, certificate of completed works, performance guarantees, handover of relevant documents and necessary tasks.

03-stage procedure for construction investment in Vietnam (Internet image) 

 Classification of construction projects in Vietnam

Construction projects shall be classified, for management purpose, as prescribed in Article 49 of the Law on Construction 2014 (amended 2020) and the provisions of Decree 15/2021/ND-CP as follows:

- The projects shall be classified by functions, fields, management purposes as specified in Appendix IV attached to Decree 15/2021/ND-CP.

- The projects shall be classified by sources of funds, forms of investment, including: projects funded by public investment capital, projects financed by state fund other than public investment, PPP projects and projects funded by other funds.

A construction project funded by mixed sources of funds shall be classified, for management purpose, as follows:

+ If the above project is partially funded by public investment capital, regulations on management of projects funded by public investment capital shall prevail; if the above project is a PPP project partially funded by public investment capital, regulations on management of PPP projects shall prevail;

+ If the above project is funded by state capital other than public investment capital and other funds: in case the rate of state capital other than public investment capital is greater than 30% or more than VND 500 billion of total investment, regulations on management of projects funded by state capital other than public investment capital shall prevail;

In case of other circumstances, regulations on management of projects funded by other funds shall prevail.

- Unless the investment-decision maker requires a feasibility study report, the following construction projects only require an economic - technical report:

+ Projects for religious purposes;

+ Projects for new construction, repair, innovation or upgrade with total investment of less than VND 15 billion (excluding land levies);

+ Projects primarily for procurement of goods, services, installation of equipment or projects for repair, renovation without impact on bearing structure of the works with the cost of construction component less than 10% of total investment and less than VND 5 billion (except for projects of national importance, projects of group A, PPP projects).

Mai Thanh Loi

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