Vietnam Tightens Investment Policy Approval Under 2026 Law

Vietnam's 2025 Law on Investment, effective March 1, 2026, introduces stricter requirements for investment policy approval for 20 categories of projects. This approval signifies the government's decision on whether a project can proceed and its core terms, irrespective of foreign ownership percentage. Projects requiring approval include those involving significant land use changes or resettlement. Specifically, this covers projects converting 500 hectares or more of two-crop wet rice land, or requiring resettlement of 10,000 people or more in mountainous areas, and 20,000 people or more elsewhere. Forest conversion above specified thresholds and projects related to national defense and security, sea area allocation, nuclear power, casinos, air transport, telecommunications with network infrastructure, and oil and gas processing are also subject to approval. Furthermore, projects in national monument and World Heritage areas, housing and urban developments, golf courses, industrial zone infrastructure development, major seaports, airports, and aviation infrastructure may fall under this regime. Operating within an industrial park does not automatically trigger this approval, but the development and operation of the park's infrastructure does. Approval authority is tiered: the National Assembly handles projects needing special mechanisms, the Prime Minister oversees eight project groups, and provincial authorities manage thirteen groups. However, projects within designated investment zones, such as industrial parks or high-tech parks, that align with approved master plans may have their investment guidelines approved by the respective zone management board. The investment policy approval process defines a project's objectives, scale, capital, location, duration, and implementation schedule. Specific capital requirements, such as minimum equity for real estate projects based on land area, are stipulated. This approval is distinct from the Investment Registration Certificate (IRC) and Enterprise Registration Certificate (ERC). The new law also allows foreign investors to establish a Vietnamese company before completing IRC procedures, reversing the prior sequence. Notably, qualifying projects within industrial parks and similar zones can benefit from a streamlined special investment procedure, potentially exempting them from investment policy approval and other requirements, provided they commit to applicable standards. Projects mandating investment policy approval are ineligible for this special route. Information Source: Vietnam Briefing