In Vietnam, certain investment projects require approval from the National Assembly before they can proceed. This approval process is a critical step for large-scale or strategically important projects that could impact the country’s economy, environment, or social welfare. Understanding which projects need to obtain this approval is essential for both domestic and foreign investors to ensure compliance with Vietnam’s legal framework. In this article, we will explore the types of investment projects that are subject to the National Assembly’s approval and the key considerations for obtaining such approval.
1. What is Approval of investment policy
According to Clause 1, Article 3 of the Law on Investment 2020
“Approval of investment policy means a competent state agency’s approval of the objectives, site, scope, and implementation schedule and duration of an investment project; investor or form of investor selection and special mechanisms and policies (if any) to implement the project.”
2. Projects subject to the approval of investment policy of the National Assembly
According to Article 30 of the Law on Investment 2020, except for projects subject to investment policy decision of the National Assembly under the Law on Public Investment, the National Assembly shall approve investment policies for the following investment projects:
“1. Projects with great environmental impacts or a latent possibility of causing serious environmental impacts, including:
a/ Nuclear power plants;
b/ Investment projects requiring change of the use purpose of 50 hectares or more of special-use forests, headwater protection forests or border protection forests; 500 hectares or more of windbreak or sandbreak protection forests or protection forests for tide shielding and sea encroachment prevention; or 1,000 hectares or more of production forests;
2. Investment projects requiring change of the use purpose of 500 hectares or more of paddy fields with 2 or more crops;
3. Investment projects requiring relocation and resettlement of 20,000 or more people in mountainous regions or 50,000 or more people in other regions;
4. Investment projects requiring application of special mechanisms or policies subject to decision by the National Assembly.”
3. Application for investment policy approval of the National Assembly
According to Clause 1, Article 33 of the Law on Investment 2020, The Investor must prepare documents for investment policy approval of the National Assembly which includes:
Here’s the content formatted into a table:
| No. | Document | Details |
|---|---|---|
| 1 | Written request for implementation of the investment project | Including the investor’s commitments to bear all expenses and risks if the project is not approved. |
| 2 | Document on the legal status of the investor | Provides proof of the investor’s legal status. |
| 3 | Documents explaining the investor’s financial capacity | Includes at least one of the following: the investor’s financial statements of the last 2 years; financial support commitment of the parent company; financial support commitment from a financial institution; guarantee for the investor’s financial capacity; or another document proving financial capacity. |
| 4 | Investment project proposal | Covers: investor or form of investor selection, investment objectives and scope, investment capital and capital raising plan, project implementation site, duration and schedule, land use status and proposals (if any), labor demand, socio-economic impacts, benefits, preliminary environmental impact assessment (if any). A prefeasibility study report can replace the proposal if required by construction law. |
| 5 | Land use rights (if applicable) | If the investor doesn’t request the State to allocate or lease land or change land use purposes, submit a copy of land use rights paper or another document certifying land use rights for the project implementation site. |
| 6 | Explanation of technology used (if applicable) | For projects requiring technology appraisal or soliciting opinions under the law on technology transfer. |
| 7 | BCC (if applicable) | For investment projects in the form of BCC. |
| 8 | Other documents | Any other documents related to the investment project, investor’s conditions and capacity requirements according to law (if applicable). |
In conclusion, obtaining approval for investment policies from the National Assembly is an essential step for certain large-scale or impactful projects in Vietnam. These projects, which may have significant environmental, social, or economic implications, require careful consideration and approval to ensure that they align with the country’s priorities and legal framework. Investors, both domestic and foreign, must be aware of the specific requirements for such approvals and prepare comprehensive documentation as outlined by the Law on Investment 2020. By following these guidelines, investors can ensure their projects comply with the necessary legal and regulatory standards, paving the way for successful project implementation.
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