Cases in which a deposit is not required for guarantee for execution of investment projects in Vietnam

What are the cases in which a deposit is not required for guarantee for execution of investment projects in Vietnam? - Hoai Tam (Tien Giang, Vietnam)

Cases in which a deposit is not required for guarantee for execution of investment projects in Vietnam (Internet image)

1. Rules for execution of investment projects in Vietnam

Rules for execution of investment projects under Article 42 of the Law on Investment 2020 are as follows:

- For a project subject to approval for its investment guidelines, the approval for investment guidelines shall be granted before the investor executes the investment project.

- For a project subject to issuance of an investment registration certificate, the investor shall follow the procedures for issuance of the investment registration certificate before executing the investment project.

- Investors shall comply with regulations of this Law and the laws on planning, land, environment, construction, labor and fire prevention and fighting; other relevant regulations of law, written approval for investment guidelines (if any) and the investment registration certificate (if any) during execution of their investment projects.

2. Cases in which a deposit is not required for guarantee for execution of investment projects in Vietnam

According to Clause 1, Article 43 of the Law on Investment 2020, the investor shall pay a deposit or have a bank guarantee for investment project execution if the project uses land allocated or leased out by the State or is permitted by the State to repurpose land, except for the following cases:

- The investor is the successful bidder for the right to use a land area that is allocated by the State for land levy or leased out by the State for a lump-sum rent;

- The investor wins bidding for execution of an investment project using land;

- The State allocates or leases out land to the investor on the basis of receipt of an investment project for which a deposit has already been paid or for which the capital has been fully contributed or raised following the schedule specified in the written approval for investment guidelines or the investment registration certificate;

- The State allocates or leases out land to the investor for execution of an investment project on the basis of receipt of the land use right and assets on land from another land user.

3. Duration of investment projects in Vietnam

Duration of investment projects under Article 44 of the Law on Investment 2020 is as follows:

- The duration of an investment project inside an economic zone shall not exceed 70 years.

- The duration of an investment project outside an economic zone shall not exceed 50 years. The duration of an investment project in a disadvantaged area or extremely disadvantaged area or a project with large investment capital but with slow rate of capital recovery may be longer but shall not exceed 70 years.

- If an investment project uses land allocated or leased out by the State, but the transfer of land is delayed, the delay shall not be included in the project duration or execution schedule.

- Upon expiry of the duration of an investment project, if the investor wishes to keep executing the investment project and satisfies the conditions as prescribed by law:

The duration of the investment project may be extended but shall not exceed the maximum prescribed in Clauses 1 and 2 of Article 44 of the Law on Investment 2020, except for the following investment projects:

+ Investment projects using obsolete, environment threatening or resource-intensive technologies;

+ Investment projects in which the investor must transfer assets without reimbursement to the State of Vietnam or the Vietnamese side.

Quoc Dat

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