Decree No. 191-CP on the issuance of the Regulation on the Formation, Appraisal, and Implementation of Direct Foreign Investment Projects

DECREE

Of the Government Decision No. 191-CP dated December 28, 1994 on the issuance of regulations on the formation, examination, and implementation of foreign direct investment projects

THE GOVERNMENT

Pursuant to the Government Organization Law dated September 30, 1992;

Upon the proposal of the Minister, Chairman of the State Committee for Cooperation and Investment, the Minister of Justice;

 

DECREE:

Article 1.

These Regulations on Formation, Examination, and Implementation of Foreign Direct Investment Projects are hereby promulgated together with this Decree.

Article 2.

The provisions on the regime for examining projects with foreign direct investment capital issued together with Decision No. 366-HĐBT dated November 7, 1991 of the Council of Ministers (now the Government) and other provisions contrary to this Decree are abolished.

Article 3.

This Decree shall take effect from January 1, 1995.

Article 4.

Ministers of Ministries, Heads of ministerial-level agencies and agencies under the Government related to this matter are responsible for guiding in detail the implementation of these Regulations promulgated together with this Decree.

Article 5.

Ministers of Ministries, Heads of ministerial-level agencies and agencies under the Government, Chairmen of People's Committees of provinces and centrally governed cities, and Heads of central agencies of mass organizations are responsible for implementing this Decree.

REGULATIONS

REGULATIONS ON THE FORMATION, EXAMINATION AND IMPLEMENTATION OF FOREIGN DIRECT INVESTMENT PROJECTS

(Issued together with Government Decree No. 191-CP dated December 28, 1994)

These Regulations stipulate the procedures for forming, examining, and implementing investment projects according to the Law on Foreign Investment in Vietnam, including projects for constructing infrastructure in export processing zones, industrial parks, and build-operate-transfer (BOT) projects, except where otherwise provided by law.

PART 1:

GENERAL PROVISIONS

Article 1.

Based on the socio-economic development plan, the State Committee for Cooperation and Investment publishes the List of projects calling for foreign investment in each period.

The State Committee for Cooperation and Investment issues Model Project Proposals and main standards for certain types of projects to guide investors in preparing project proposals.

Article 2.

Ministries, ministerial-level agencies, and agencies under the Government (hereinafter referred to collectively as Ministries) perform state management functions in the field of foreign direct investment mainly through the following activities:

Issuing guidance documents for the implementation of laws, standards, procedures, norms, and economic and technical quotas within their jurisdiction;

Specifying clear administrative procedures, minimizing application and approval processes for specific tasks;

Inspecting and supervising compliance with state laws and regulations issued by Ministries; handling violations within their jurisdiction.

Article 3.

Provincial People's Committees (hereinafter referred to as Provincial People's Committees) perform state management functions in accordance with state regulations and Ministries, including determining lists of investment projects, land rental fees in different areas, points of contact for specific matters, and deadlines for completing procedures.

Article 4.

Vietnamese enterprises of all economic sectors when negotiating and signing investment contracts with foreign parties must meet the following conditions:

1- Legally established in accordance with the law;

2- Possess lawful ownership over assets intended for capital contribution; in cases where state assets are used for capital contribution, permission from the competent state authority is required;

3- Possess lawful land use rights or have been permitted by the Provincial People's Committee to use land for cooperation with foreign countries;

4- Have staff knowledgeable about investment laws.

PART 2:

EXAMINATION OF INVESTMENT PROJECTS

Article 5.

The content of the examination of Investment Projects includes:

1- Legal status and financial capacity of foreign and Vietnamese investors;

2- The degree of conformity of the project objectives with planning and socio-economic development directions;

3- Benefits for the Vietnamese State and Vietnamese party:

Ability to create new production capacities, new industries, and new products, expand markets;

Ability to create employment for workers;

Financial revenue sources;

4- Level of technology and application, rational use, and protection of natural resources and ecological environment;

5- Rationality of land use, compensation and resettlement plans, valuation of capital contributions from the Vietnamese side (if any);

6- Tax rates, land rental fees, water surface fees, sea surface fees, and incentives.

Article 6.

The review of Investment Projects is regulated as follows:

1- The Prime Minister decides on Group A projects which include:

Construction of infrastructure in industrial parks, export processing zones, and BOT projects;

Projects with investment capital of 40 million US dollars or more in the electricity, mining, oil and gas, metallurgy, cement, chemical, machinery, electronics, seaports, airports, telecommunications, commercial centers, cultural zones, tourism, real estate business sectors;

Cultural, press, and publishing projects;

Projects in the national defense and security sector;

Projects using urban land of 5 hectares or more and other types of land of 50 hectares or more.

2- The Chairman of the State Committee for Cooperation and Investment decides on Group B projects which are those not included in Group A as specified in Clause 1 of this Article.

3- The process of leasing land for project implementation is carried out concurrently with the examination of the project.

Article 7.

The examination of Investment Projects is regulated as follows:

For Group A projects, the Chairman of the State Committee for Cooperation and Investment seeks opinions from the State Planning Committee and relevant Ministries to submit to the Prime Minister for consideration and decision. In cases where Ministries have differing opinions on important issues of the project, the Chairman of the State Committee for Cooperation and Investment may establish an advisory council consisting of authorized representatives of the State Planning Committee, relevant Ministries, and experts to examine the project before submitting it to the Prime Minister. Depending on the specific case, the Prime Minister may request the National Examination Council to study and advise so that the Prime Minister can consider and decide.

For Group B projects, the Chairman of the State Committee for Cooperation and Investment seeks opinions from the State Planning Committee and relevant Ministries before considering and deciding.

Relevant Ministries are responsible for assigning staff to work at the State Committee for Cooperation and Investment to examine projects.

Article 8.

Time limit for examining Investment Projects:

1- Within twenty days from the date of receiving the project dossier, relevant Ministries shall provide their comments in writing to the State Committee for Cooperation and Investment on the contents of the project within their respective areas of management. Failure to provide written comments within this period shall be deemed as approval of the project's content.

2- Regarding Group A projects: Within fifty days from the date of receiving a valid project dossier, the Chairman of the State Committee for Cooperation and Investment shall submit the appraisal opinion to the Prime Minister. Within seven days from the date of receiving the Prime Minister's decision, the Chairman of the State Committee for Cooperation and Investment shall notify the decision to the project investor.

3- Regarding Group B projects: Within forty-five days from the date of receiving a valid project dossier, the Chairman of the State Committee for Cooperation and Investment shall notify the decision to the project investor.

Article 9.

Within twenty days from the date of receiving the project dossier, the People's Committee of the province shall provide their comments in writing to the State Committee for Cooperation and Investment on the following issues:

1- The legal status of the foreign party and the Vietnamese party;

2- The suitability of the project objectives and location with the local socio-economic development plan and planning;

3- The land use rights of the Vietnamese party, the area of land used for the project, the land rental fee, and the compensation and clearance plan;

4- The value of the capital contribution of the Vietnamese party (if any);

Failure to provide written comments within this period shall be deemed as approval of the project.

 

CHAPTER 3.

IMPLEMENTATION OF INVESTMENT PROJECTS

Article 10.

The Prime Minister decides on the leasing of land for Group A projects. The Prime Minister delegates the Provincial People's Committee Chairperson to decide on the leasing of land for Group B projects.

The decision on leasing land, signing the lease contract, and issuing the Land Use Certificate must be completed within thirty days from the date of obtaining the Investment License.

Article 11.

The design of the construction works shall be reviewed with regard to the following contents:

1- The legal status of the designing organization;

2- The compliance of the design with the planning and architectural requirements;

3- Compliance with agreed technical design standards.

The investor shall be responsible under Vietnamese law for the safety of the construction works, fire prevention, explosion protection, and environmental protection during the construction period as well as throughout the operational period.

Article 12.

The procedures for reviewing the design and issuing the Construction Permit are as follows:

The Minister of Construction shall review the design of Group A projects. The Provincial People's Committee Chairperson shall review the design of Group B projects;

The investor shall submit the design dossier to the Provincial People's Committee;

Within seven days from the date of receiving the design dossier of a Group A project, the Provincial People's Committee shall provide their comments in writing along with the design dossier to the Ministry of Construction. Within twenty days from the date of receiving a valid design dossier, the Ministry of Construction shall complete the design review;

Within twenty days from the date of receiving a valid design dossier of a Group B project, the Provincial People's Committee shall complete the design review;

The Construction Permit shall be issued within ten days from the date when the issuing authority receives a complete and valid dossier.

Article 13.

Upon completion of the construction work, the investor shall report to the Construction Permit issuing authority about the completion of the construction work and obtain permission to put the work into use. In necessary cases, the Construction Permit issuing authority may conduct inspections of the work; if violations of the Construction Permit or agreed technical design standards are found, appropriate measures shall be taken according to the law.

Within six months from the date of completing the construction work, the investor shall submit a final investment cost report to the State Committee for Cooperation and Investment.

Article 14.

Within thirty days from the date of receiving the application for an Import Permit, the Ministry of Trade shall issue the Import Permit, clearly stating the quantity of goods eligible for tax exemption according to the law.

For equipment with strict requirements for labor safety, the Ministry of Trade shall cooperate with the Ministry of Labor, Invalids, and Social Affairs in reviewing and approving imports. For used equipment, the Ministry of Trade shall cooperate with relevant economic and technical ministries in reviewing and approving imports.

Article 15.

The investor shall strictly comply with all laws regarding environmental protection. The Ministry of Science, Technology, and Environment shall promulgate environmental protection standards, organize inspections of their implementation, and promptly and strictly handle any violations according to the law, including suspending operations if the enterprise causes adverse environmental impacts beyond permissible limits.

Article 16.

In addition to the Permits and Decisions specified in Articles 10, 11, 12, 13, and 14 of this Regulation, for industries that require business registration according to the law, enterprises must register based on the business objectives stipulated in the Investment License and submit the registration to the competent authorities of the Provincial People's Committee.

Article 17.

1- Enterprises have the right to independently manage production and business activities.

2- State agencies (Ministries, Provincial People's Committees) shall perform their management functions through:

Monitoring the operation of enterprises and promptly addressing reasonable requests of enterprises;

Resolving disputes arising during the operation of enterprises;

Strictly and promptly handling any legal violations by enterprises;

3- The Provincial People's Committee shall perform state management over all enterprises within its territory. For matters exceeding their authority, the Provincial People's Committee shall coordinate with relevant Ministries and the State Committee for Cooperation and Investment to resolve them.

Article 18.

Ministries and the Provincial People's Committees shall cooperate with the State Committee for Cooperation and Investment in inspecting and supervising the operation of enterprises to ensure strict compliance with the law.

All illegal, arbitrary inspections causing inconvenience to the operation of enterprises are strictly prohibited.

Article 19.

The State Committee for Cooperation and Investment and the General Statistics Office shall issue statistical reporting forms on the operation of enterprises.

The State Board for Cooperation and Investment is responsible for periodically compiling the situation, analyzing and evaluating the activities of foreign direct investment throughout the country.

CHAPTER 4:

FINAL PROVISIONS

Article 20.

Organizations and individuals violating the provisions of this Regulation shall be handled in accordance with the law.

Article 21.

This Regulation takes effect from January 1, 1995./.