Starting from March 1, 2026, the 2025 Investment Law came into effect, marking a significant adjustment in the legal framework for investment activities in Vietnam. Notably, some regulations related to business conditions will take effect later – from July 1, 2026.
According to experts, the new law clearly demonstrates a direction for reforming administrative procedures in the investment sector, shifting strongly from a pre-approval to a post-approval mechanism, while clarifying the responsibilities and authority of agencies in the process of reviewing and deciding on investment projects.
According to Dr. Bui Quy Thuan, Head of the General Research Department at Vietnam's Association of Foreign Invested Enterprises (VIPFA), the 2025 Investment Law represents a new approach to managing investment activities, reducing formal business conditions, thereby contributing to improving the quality of the investment environment and increasing Vietnam's attractiveness in attracting investment capital.
Reducing the Number of Conditional Business Sectors
One of the notable points of the 2025 Investment Law is the continued narrowing of the list of conditional investment and business sectors compared to previous regulations.
According to Appendix IV of the law, many areas have been removed from the list or had their scope of management adjusted, such as: Tax procedure services, customs procedure services, insurance auxiliary services, labor leasing, commercial inspection, temporary import and re-export of frozen food or used goods.
After the adjustments, the list of conditional business sectors now comprises 198 sectors, a reduction of 38 sectors compared to the previous regulations.
In addition, the law also assigns the Government to publish the list of conditional investment and business sectors that require licensing or certification before operation, as well as the list of sectors that will shift from pre-inspection to post-inspection management methods. This regulation is expected to take effect from July 1, 2026.
Foreign investors can establish businesses before having a project
The new law allows foreign investors to establish economic organizations even before proceeding with the procedures for granting or amending the Investment Registration Certificate, provided they meet the regulations on market access.
Compared to the previous regulations of the 2020 Investment Law, which required investors to have an investment project before establishing a business, this change is considered to significantly shorten the time to enter the market and is more in line with international practices.
Clarifying Projects Requiring Investment Policy Approval
The 2025 Investment Law specifically stipulates 20 groups of projects that must undergo the investment policy approval procedure, instead of only being determined by the decision-making authority as before.
These project groups include: Projects using large areas of forest land or rice paddy land; projects involving large-scale resettlement; projects related to national defense and security; Projects proposing the allocation of sea areas; projects in specialized fields such as nuclear power, casinos, air transport, telecommunications with network infrastructure, oil and gas processing…
In addition, projects in national monument areas, world heritage sites, historical inner-city areas of special cities; housing development projects, urban areas, golf courses, industrial zones, large seaports, airports or important aviation infrastructure are also subject to this procedure.
Regarding decision-making authority, the law stipulates that the National Assembly only considers projects requiring the application of special mechanisms; the Prime Minister decides on 8 groups of projects; and the Chairman of the Provincial People's Committee will decide on 13 groups of projects within the local scope.
Simplifying Investment Policy Adjustment Procedures
The new law reduces the number of cases requiring investment policy adjustments to just five. These cases include changes to project objectives within the approved content; changes to the land area or location; extending the project implementation schedule beyond 24 months; adjusting the project's operating period; or changing the investor for an approved project.
Compared to previous regulations, the new law has eliminated two cases requiring investment policy adjustments: Changes in total investment capital of 20% or more; and Changes in technology that have already been assessed.
This reduction in technical procedures is expected to help businesses reduce unnecessary administrative procedures, especially for projects with capital adjustments during implementation.
Expanding the “Green Channel” Mechanism for Investment Projects
The 2025 Investment Law also expands the scope of application of special investment procedures, allowing investors to choose this mechanism when implementing projects in industrial parks, export processing zones, high-tech zones, concentrated digital technology zones, free trade zones, international financial centers, or functional zones within economic zones (except in cases where the project requires investment policy approval).
Under this mechanism, projects will not have to go through many procedures such as investment policy approval, technology assessment, environmental impact assessment reports, detailed planning, construction permits, or fire safety procedures.
Instead, investors will follow a mechanism of commitment to comply with relevant legal standards and regulations.
More Flexibility Regarding Project Operating Periods
The new law maintains the maximum operating period for investment projects at 50 years (for projects outside economic zones) and 70 years (for projects within economic zones). However, investors are allowed to proactively adjust the project's operating period upwards or downwards during implementation.
This regulation is considered to create more room for businesses to handle issues related to financial restructuring, project transfer, or changes in business strategy.
For projects already implemented before the new law came into effect, it also allows for adjustments to the operating period if the remaining time does not meet the financial or business plan of the transferee.
Abolishing the Procedure for Approving Overseas Investment Policies
The 2025 Investment Law has abolished the previous procedure for approving overseas investment policies, which was under the authority of the National Assembly and the Prime Minister.
According to the new regulations, only overseas investment projects with capital exceeding the amount stipulated by the Government or belonging to sectors with conditional overseas investment requirements are required to obtain a Certificate of Registration for Overseas Investment.
Other projects only need to register foreign exchange transactions with the State Bank of Vietnam to transfer investment capital.
Expanding the Scope of Investment Project Transfers
The new law also expands the scope of projects permitted to transfer investment projects. Accordingly, all projects that have received investment policy approval or have been granted or amended Investment Registration Certificates can be transferred according to regulations.
Compared to before, when only certain types of projects were allowed to be transferred, the new regulations are expected to create more flexibility for project restructuring and attract more investment capital into the economy.