On 5 November 2020, the Vietnam Government issued Resolution No. 164/NQ-CP (“Resolution 164”) relating to investment in, and construction of, urban area projects (“Urban Projects”) as regulated under Decree 11/2013/ND-CP dated 14 January 2013 (“Decree 11”) regarding the management of investment and development of urban areas. Resolution 164 provides that investors in Urban Projects conducted under the Law on Investment 2014 and Law on Housing 2014 (collectively, “Laws”) are no longer required to obtain an investment acceptance decision under Decree 11 (“IAD”).
Prior to the issuance of Resolution 164, an investor in an Urban Project was required to obtain an IAD in addition to either an investment policy decision under the Law on Investment 2014 or an in-principle investment approval under the Law on Housing 2014. The requirement to obtain an IAD has caused some difficulty and confusion for both investors and the competent authorities in granting investment approvals for Urban Projects as the procedure to grant an IAD overlaps with procedures set out in the Laws. Obtaining an IAD as well as the approvals required under the Laws has proven to be time-consuming for investors and has caused delays in the development of Urban Projects. Indeed, in practice, there are investors that have not obtained an IAD despite carrying out the development of Urban Projects in contravention of Vietnam regulations thus necessitating Resolution 164.
For the avoidance of doubt, investors will still be required to obtain an investment policy decision under the Law on Investment 2014 or an in-principle investment approval under the Law on Housing 2014. Investors who currently have an IAD as well as the necessary approval under one of the Laws must still comply with the terms and conditions under each issued approval.
It should also be noted that when the Law on Investment 2020 comes into force on 1 January 2021, such law would generally resolve the overlap in the procedures relating to the issuance of investment approvals for real estate projects (including Urban Projects) under existing regulations. Accordingly, investors in Urban Projects will only be required to obtain investment approvals as prescribed under the Law on Investment 2020.