"One law amending four laws" on investment to decentralize and ease business challenges

	Ensuring reasonableness upon enforcement of regulations in "1 law amending 7 laws"
	Vietnam's economy is recovering well
	Removing difficulties in public investment disbursement

National Assembly deputies attend group discussion at the working session on October 30, 2024. Photo: National Assembly

Delays in funding due to planning obstacles

On October 30, 2024, the National Assembly held group discussions on the “One law amending four laws” project, covering investment, planning, and other areas.

Reflecting on actual business situations in industrial zones, delegate Huynh Thanh Chung (Binh Phuoc) emphasized the importance of simplifying the planning process and adding regulations for urgent adjustments through streamlined procedures.

The draft law includes provisions for special investment procedures, shifting from pre-checks to post-checks to streamline investment procedures, reduce project deployment times, and create favorable mechanisms to attract strategic investors.

However, the delegate argued for provisions on localized planning adjustments, as it is not uncommon for real estate projects to require 3-5 years for legal procedures, during which actual conditions may change, but detailed planning cannot be modified, which is impractical.

Furthermore, in some industrial zones, investors are ready to commit millions of USD but require access to electricity. However, industrial zones are restricted from adding substations and transmission lines due to land-use planning limitations.

Therefore, the representative from Binh Phuoc province suggested that simplifying investment and planning procedures would be "very welcome," as it would reduce the time needed to bring projects into operation.

“It’s only a few square meters for building a transformer station, but it’s been stalled for years without any agency resolving it. We requested to lease the land, but were told leasing was not permitted,” said representative Huynh Thanh Chung.

Also regarding investment, representative Thach Phuoc Binh (from Tra Vinh) noted that decentralizing the authority to grant special investment certificates to management boards of industrial zones, export processing zones, high-tech parks, and economic zones is a sensible approach.

This would shorten procedures, ease the burden on higher levels, and facilitate project implementation.

However, the representative noted that this regulation should be accompanied by specific criteria regarding the capabilities and resources of each management board to ensure their ability to fulfill their duties.

Additionally, representatives stressed the need to establish clear accountability mechanisms for management boards, especially for projects with large scale and complexity, to ensure transparency and prevent lax oversight.

Simplifying investment procedures and reducing project implementation time

Ahead of group discussions, Minister of Planning and Investment Nguyen Chi Dung, on behalf of the Prime Minister, presented the project.

Minister of Planning and Investment Nguyen Chi Dung presented the project. Photo: National Assembly

Regarding amendments to the Investment Law, the Minister of Planning and Investment noted that the draft law delegates authority from the Prime Minister to provincial People's Committees to approve investment policies for certain projects as stipulated.

Additionally, the draft includes provisions to establish an Investment Support Fund, sourced from additional corporate income tax revenues in compliance with global tax base erosion regulations and other lawful sources.

This aims to attract strategic investors, multinational corporations, and support businesses in specific incentivized industries and sectors.

Notably, the "one law amending four laws" draft allows for continued use of Build-Transfer (BT) contracts, with payments made either in cash or through land allocations. This approach modernizes the implementation and payment methods for investors, addressing challenges in previous BT contract practices.

However, the Economic Committee recommended that, to ensure feasibility, the government should be authorized to provide detailed guidance on BT contract mechanisms, processes, and procedures. These guidelines should be framed around principles of innovation, leveraging BT contracts’ advantages, and preventing losses, waste, or misuse.

According to the Government's report, for the Law on Investment in the PPP (Public-Private Partnership) model, the draft law removes restrictions on investment fields and does not set a minimum capital requirement for these projects. This aims to encourage PPP projects across all fields suitable to the specific investment needs and conditions of each ministry, sector, and locality.

However, the reviewing body noted that expanding PPP investment fields and reducing or eliminating minimum scale requirements could facilitate private sector participation in State-related projects.

Regarding the Law on Procurement, the draft law allows for the approval of contractor selection results before project approval or the signing of contracts with contractors before the conclusion of international agreements or foreign loan agreements. This change aims to save time and accelerate project and package implementation.

On this issue, the Economic Committee recommended that the Government considered the rights and responsibilities of investors and contractors to create appropriate regulations that protect the lawful rights and interests of both parties, preventing disputes and complaints.

Additionally, the draft law revises the regulations on direct procurement for purchasing retail drugs in pharmacies at hospitals to resolve challenges in hospital retail operations, accelerate drug procurement, and meet quality and service requirements for medical examinations and treatment.

However, according to National Assembly members, strict oversight mechanisms are necessary to ensure transparency and prevent the repeated misuse of direct procurement policies.