Vietnam law has regulations on construction investment activitie. Let’s find out this issue with Lawyer X through the following situation: “Dear Lawyer! I want to ask what are basic principles of construction investment activities in Vietnam? What are types and grades of construction works? Thanks for answering my questions!”
Legal grounds
- 2014 Vietnam Construction law
Basic principles of construction investment activities
– Ensuring the compliance of work construction investment with master plans and designs, the protection of scenery and environment; the suitability to natural and social conditions and cultural characteristics of each locality; ensuring the stable life of people; combining socio-economic development with national defense and security and response to climate change.
– Rationally using resources and natural resources in project areas, ensuring proper purposes, proper subjects and process of construction investment.
– Complying with standards and technical regulations, regulations on the use of building materials; ensuring convenient and safe access for people with disabilities, the elderly and children to public facilities and high-rises; ensuring scientific and technological application and information system application to construction investment activities.
– Ensuring the quality, schedule and safety of works, human lives and health and property; fire and explosion prevention and fighting; and environmental protection.
– Ensuring synchronous construction within each work and synchronism with technical and social infrastructure facilities.
– Organizations and individuals involved in construction activities must have full capacity conditions suitable to types of projects, types and grades of construction works and jobs as prescribed by 2014 Vietnam Construction Law.
– Ensuring the publicity, transparency, thrift and efficiency; preventing and combating corruption, waste, loss and other negative practices in construction investment activities.
– Clearly defining the function of state management in construction investment activities from the function of management of project owners suitable to each type of to used funding sources.
Types and grades of construction works
– Construction works shall be classified by type and grade.
– Types of construction works determined by utility include civil works, industrial works, traffic works, agricultural and rural development works, technical infrastructure and national defense or security works.
– Grades of construction works shall be determined according to types of works and based on their sizes, purposes, importance, lifetime, used materials and technical requirements on construction.
The grades of works include special grade, grade I, grade II, grade III, grade IV and other grades stipulated by the Government.
Application of standards and technical regulations in construction investment activities
– Construction investment activities must comply with national technical regulations.
– Standards shall be applied in construction investment activities on the principle of voluntariness, excluding standards referred in technical regulations or other relevant legal documents.
– Standards applicable to works shall be considered and approved by investment deciders when deciding the investment.
– The application of standards must satisfy the following requirements:
+ Meeting the requirements of national technical regulations and relevant laws;
+ Ensuring synchronism and feasibility of the applied standard system.
– The application of technical solutions, technologies and new materials in construction investment activities must satisfy national technical regulations and relevant laws.
– The Ministry of Construction and specialized construction work-managing ministries shall formulate standards and national technical regulations applicable to specialized construction works in accordance with the law on standards and technical regulations.
Regulations on Project owners
– The project owner shall be decided by the investment decider before the formulation or approval of a project.
– Depending on funding sources used for projects, project owners shall be specifically determined as follows:
+ For a project using state budget funds or non-budget state funds, the project owner is the agency or organization assigned by the investment decider to manage and use the funds for construction investment;
+ For a project financed by a loan, the project owner is the agency, organization or individual that borrows the loan for construction investment;
+ For a project to be implemented under project contract or public-private partnership contract, the project owner is the project enterprise established with the investors’ agreement in accordance with law;
+ For projects other than those prescribed at Points a, b and c of this Clause, the owners of funds shall act as project owners.
– Based on the specific conditions of projects using state budget funds, the investment deciders shall assign the specialized construction investment project management units or regional construction investment project management units to be project owners; if the project management units are not available, investment deciders shall select fully qualified agencies or organizations to be project owners.
– Project owners shall take responsibility before law and investment deciders within the limits of their rights and obligations prescribed in 2014 Vietnam Construction Law and relevant laws.
Regulations on Monitoring and evaluation of construction investment projects
– Construction investment projects shall be monitored and evaluated as suitable to each type of funding source as follows:
+ For projects using state funds, competent state agencies shall conduct the monitoring and evaluation in accordance with the law on public investment and law on construction according to the approved evaluation contents and criteria;
+ For projects using other funding sources, competent state agencies shall conduct the monitoring and evaluation of objectives, conformity with relevant master plans, land use, construction investment schedule and environmental protection.
– Infrastructure construction investment projects using state funds or community- contributed funds and financial assistance of domestic organizations and individuals are subject to community supervision.
Within the ambit of their tasks and powers, the Vietnam Fatherland Front Committees in construction areas shall organize the community supervision.
– The Government shall detail this Article.
Insurance in construction investment activities
– Insurance in construction investment activities covers:
+ Work insurance during the construction;
+ Construction investment consultancy professional liability insurance;
+ Insurance for construction supplies, materials, means, equipment and laborers;
+ Civil liability insurance for third party;
+ Construction work warranty insurance.
– Responsibility to buy compulsory insurance in construction investment activities is prescribed as follows:
+ Project owners shall buy work insurance during the construction for works affecting the community safety, environment, works with particular technical requirements and complicated construction conditions;
+ Consultancy contractors shall buy construction investment consultancy professional liability insurance for construction survey and construction design of construction works of grade II or higher grade;
+ Construction contractors shall buy insurance for construction workers working on the construction sites.
– Project owners, consultancy contractors and construction contractors are encouraged to buy types of insurance in construction investment activities, except for the case specified in Clause 2 of this Article.
– The Government shall detail the responsibility to buy compulsory insurance, the conditions, premium levels and minimum insurance money which the insured and insurers are obliged to comply with.
Encouragement policies in construction investment activities
– Domestic and foreign organizations and individuals shall be encouraged and given conditions to research and apply advanced construction science and technology, use new materials, conserve energy and resources, protect the environment and respond to climate change; to conserve, embellish and promote the value of historical relics, cultural heritages, beliefs and religion; organizations and individuals shall be given conditions to build social houses, participate in construction investment under planning in mountainous areas, areas facing exceptionally difficult socio-economic conditions and areas prone to climate change.
– Stakeholders of all economic sectors in construction investment activities shall be treated equal before law, encouraged and given favorable conditions in construction investment activities; contractors with works conferred by the State with the construction work quality awards shall be given priority when they participate in bidding in construction activities.
– A number of public services provided by state management agencies in construction investment activities shall be gradually transferred to fully capable and qualified socio- professional organizations for provision.
International cooperation in construction investment activities
– Domestic organizations and individuals shall be encouraged to expand international cooperation in construction investment activities, transfer of technologies, techniques, managerial experiences and use of new materials.
– The State shall protect Vietnamese construction brands overseas; create conditions to support and work out measures to promote the conclusion and implementation of treaties and international agreements in construction investment activities between domestic organizations and individuals and foreign organizations and individuals on the basis of ensuring the fundamental principles in construction investment activities prescribed in Article 4 of 2014 Vietnam Construction Law.
Regulations on Prohibited acts
– Deciding on construction investment in contravention of 2014 Vietnam Construction Law.
– Starting construction when the conditions therefor prescribed in 2014 Vietnam Construction Law are not fully met.
– Constructing works in non-construction zones ; constructing works in encroachment upon the protection corridors of national defense, security, traffic or irrigation works, dykes, energy facilities, historical-cultural relic areas and protection zones of other works prescribed by law; constructing works in areas prone to landslide, sweeping flood or flash flood, except works built to overcome these phenomena.
– Constructing works at variance with construction master plan, except cases with construction permits with a definite term; in encroachment of construction boundaries or construction levels; constructing works at variance with granted construction permits.
– Formulating, appraising and approving designs and cost estimates of construction works using state funds in contravention of 2014 Vietnam Construction Law.
– Contractors participating in construction activities when failing to fully satisfy the capacity conditions for carrying out construction activities.
– Project owners selecting contractors that fail to fully meet the capacity conditions for conducting construction activities.
– Constructing works not in compliance with the selected standards and technical regulations to be applied to works.
– Manufacturing and using building materials which cause harms to community health and environment.
– Violating regulations on labor safety and assets, fire and explosion prevention and fighting, security, order and environmental protection in construction.
– Using works against their purposes and utility; building annexes or lean-tos encroaching upon areas and spaces lawfully managed or used by other organizations or individuals or upon public areas and common-use areas.
– Giving and taking bribe in construction investment activities; abusing other legal persons to participate in construction activities; committing manipulation and collusion to falsify the results of project formulation, surveys, designs or supervision of construction.
– Abusing positions and powers to violate the law on construction; covering up and handling late acts in violation the law on construction.
– Obstructing lawful construction investment activities.
Please see more:
- Instructions for exclusive registration of company logos in Vietnam
- Service of changing the legal representative of Vietnamese enterprises
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Frequently asked questions
Construction works shall be classified by type and grade.
Construction investment activities must comply with national technical regulations.
The application of technical solutions, technologies and new materials in construction investment activities must satisfy national technical regulations and relevant laws.
Conclusion: So the above is General regulations on construction investment activities in Vietnam. Hopefully with this article can help you in life, please always follow and read our good articles on the website: lsxlawfirm.com
