The Special Investment Procedures under Decree No. 19/2025/ND-CP takes effect on January 15, 2025. This is a completely new mechanism, unprecedented in Vietnam’s legal system, aimed at attracting strategic investments, particularly in high-tech industries, AI, and green energy.

Vietnam has referred to and learned from the experience of Egypt’s Golden License – a mechanism that has proven effective in attracting large-scale investments in key economic sectors. Egypt’s Golden License allows for the fast-track approval of major investment projects, particularly in strategic industries, by simplifying licensing procedures, reducing administrative barriers, and providing tax incentives.

However, since this is a new mechanism, it is still too early to fully assess its real impact on business activities and the investment environment. This article provides an initial legal and economic analysis of the special investment procedures, focusing on the potential benefits and risks. It will take time to gather concrete data and feedback from the business community, especially foreign direct investors (FDI) in Vietnam, before the full effects of this regulation can be understood.

1. Benefits of Special Investment Procedures – A Catalyst for FDI Attraction

Shortened Approval Time – 15 Days Instead of 3-6 Months

Under the normal investment procedures, the issuance of an Investment Registration Certificate (IRC) typically takes 3 to 6 months.

According to Clause 4, Article 36a of the Investment Law and Article 3 of Decree 19/2025/ND-CP, the approval time will be shortened to 15 days from the date of receipt of a complete and valid application. Applications are submitted to the Management Board of industrial zones, export processing zones, high-tech parks, economic zones or to the Department of Planning and Investment (if the project is outside these zones).

For example, a semiconductor manufacturing project worth USD 500 million that would normally take 3–6 months to be approved could now be approved within 15 days under the special investment procedures.

The shortened approval time represents a significant competitive advantage for high-tech projects amid fierce FDI competition between Vietnam and neighboring countries such as Singapore, Thailand, Malaysia, and Indonesia.

Simplified Documentation and Appraisal Process

According to Clauses 5 and 7 of Article 36a of the Investment Law and Decree 19/2025/ND-CP, special investment procedures will reduce or eliminate several complex requirements:

• No technology appraisal required (except for high-tech parks or sectors with special technical requirements).
• No environmental impact assessment (EIA) required unless the project is listed as requiring an EIA under the Environmental Protection Law.
• No construction permit required if the project is located in an industrial zone, export processing zone, or high-tech park.
• No fire prevention and fighting approval required before project implementation (unless specifically required).

This reduction in procedures helps to lower administrative costs and appraisal time, allowing investors to focus on project implementation.

Transparent and Fast Investor Selection Process

According to Clause 2, Article 3 of Decree 19/2025/ND-CP, if two or more investors apply for the same project, the competent authority will prioritize:

• The investor who applies first.
• The investor with experience in implementing similar projects.
• The investor with strong financial capacity and a firm commitment to meeting project timelines.

A fast and transparent investor selection process will help screen out financially weak investors and ensure that projects are implemented by credible and capable investors.

2. Legal Consequences for Breach of Commitment – Stricter Legal Risks

Revocation of Investment Registration Certificate (IRC)

According to Article 7 of Decree 19, the investment license will be revoked immediately without prior notice if the investor:

• Fails to meet the committed project timeline.
• Fails to comply with environmental, safety, or construction standards.
• Illegally transfers the project or misuses investment capital.
• Fails to maintain the financial capacity required in the registered documents.

Administrative Penalties and Compensation for Damages

Under Article 7, the investor may face fines of up to VND 1 billion (approximately USD 40,000) or higher depending on the nature of the violation.

Suspension of Operations and Requirement for Remediation

The Management Board of the industrial zone or the competent authority may suspend the project’s operations if the investor fails to meet commitments or causes negative environmental or social impacts.

The investor will be given 30–60 days to rectify the violation before being allowed to resume operations.

If the investor fails to remedy the issue, the investment license may be revoked.

3. Balancing Benefits and Risks

Since this is a new and untested mechanism, more time will be needed to evaluate its practical effectiveness. For both investors and regulatory authorities, particularly the Ministry of Planning and Investment, a balanced approach is necessary to weigh the benefits and risks during the initial implementation phase, with appropriate legal and policy adjustments based on real-world results.

4. Solutions for Balancing Benefits and Risks

To balance the benefits and risks, the Ministry of Planning and Investment should:

• Establish a transparent monitoring mechanism to ensure investor compliance with commitments.
• Allow investors reasonable time to rectify breaches before revoking licenses.
• Develop a flexible post-licensing monitoring and enforcement framework.
• Evaluate and rank investors based on compliance and project implementation progress.
• Strengthen coordination among regulatory authorities to promptly address issues arising during implementation.

Conclusion

The special investment procedures represent a significant breakthrough in Vietnam’s legal system to attract FDI. However, as a new regulation, more time will be needed to assess its feasibility and effectiveness.

Flexible implementation, strict monitoring, and firm enforcement will be the key to the success of this mechanism. If effectively implemented, special investment procedures could become a strategic lever to enhance Vietnam’s competitiveness in the regional investment market.