If projects have to be suspended, will enterprises be exempted from paying land rents in Vietnam? What are procedures for suspension of investment projects in Vietnam?

1. If projects have to be suspended, will enterprises be exempted from paying land rents in Vietnam?

Pursuant to Article 47 of the Investment Law 2020, there are provisions on suspension of investment projects as follows:

1. When suspending an investment project, the investor must notify the investment registration authority in writing. If the project has to be suspended in a force majeure event, the State shall allow the investor to be exempt from paying land rents or reduce land levies for the suspension period with a view to remedy consequences caused by the force majeure event.

2. The investment authority shall decide to suspend an investment project in part or in full in the following cases:

a) To protect sites/monuments, relics, antiques or national treasures in accordance with the Law on Cultural Heritage;

b) To rectify a violation of the law on environmental protection at the request of the environment authority;

c) To take measures to ensure occupational safety at the request of the labor authority;

d) Pursuant to a judgment or decision of a court or an arbitral award;

dd) The investor fails to adhere to the written approval for investment guidelines or the investment registration certificate and recommits administrative violations after incurring penalties.

3. The Prime Minister shall decide to suspend a project in part or in full if the project execution is detrimental or potentially detrimental to national defense and security at the request of the Ministry of Planning and Investment.

4. The Government shall elaborate conditions, procedures and time limit for suspending investment projects in accordance with this Article.

Thus, according to the above regulations, only in case your company has to suspend the operation of an investment project due to force majeure event, it will be exempted from land rent in Vietnam.

2. What are procedures for suspension of investment projects in Vietnam?

Pursuant to Clause 3, Article 56 of Decree 31/2021/ND-CP, suspension procedures are as follows:

a) If the investor decides to suspend the investment project himself/herself/itself as prescribed in Clause 1 Article 47 of the Law on Investment, such investor shall send a notification to the investment registration authority within 05 working days from the date of making the decision. The investment registration authority shall receive the notification and notify the project suspension to relevant authorities;

b) If the investment authority decides to suspend the investment project, such authority shall, according to the competent authorities’ opinions about the cases specified in Clause 2 Article 47 of the Law on Investment to decide to suspend part or whole of the investment project and notify relevant authorities and investor. The investment authority or competent authorities in the fields specified in Points a, b, c and dd Clause 2 Article 47 of the Law on Investment shall make a record prior to deciding to suspend or suspend part of the investment project. Where the investment project is suspended according to the court’s judgment or decision or arbitral award, the investment authority shall, according to the court’s effective judgment or decision or effective arbitral award, decide to suspend part or whole of the investment project;

c) Regarding an investment project that is detrimental or potentially detrimental to the national defense and security, the provincial People’s Committee shall send a written notification to the Ministry of Planning and Investment. The notification shall contain the following contents: the investor executing the project; objectives, locations and contents of the project, process of executing the project; assessment of impacts or potential impacts of the project on national defense and security; proposal that part or whole of the project is suspended. At the request of the provincial People's Committee, the Ministry of Planning and Investment shall seek opinions of the Ministry of National Defense and Ministry of Public Security for submission thereof to the Prime Minister for decision to suspend part or whole of the project.

According to this Article, procedures for suspension of investment projects in Vietnam will be carried out according to the above procedures.

Best Regards!