Can businesses be exempted from land rent when an decommissioning investment projects in Vietnam

Hello Lawyer. My name is Huong, I am currently researching and researching investment projects for enterprises. The lawyer can provide me with information: If the investment project stops working, will the business be exempt from land tax? What is the procedure for decommissioning an investment project? Looking forward to the lawyer’s reply. Thank you, Lawyer.

Thank you for trusting and sending questions to Lawyer X. To answer the question “Can an investment project that ceases to operate a business be exempted from land rent?” and also understand some issues surrounding this question. Please refer to our articles below:

Legal grounds

Investment Law 2020

Decree 31/2021/ND-CP

Can an investment project that ceases to operate an enterprise be exempt from land rent?

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

1. The investor who stops the operation of an investment project must notify in writing the investment registration agency. In case of cessation of operation of an investment project due to force majeure, the investor shall be exempted from land rent or reduced by the State during the shutdown period to overcome the consequences caused by force majeure.
2. The state management agency in charge of investment shall decide to suspend or partially stop the operation of an investment project in the following cases:

a) To protect relics, relics, antiquities and national treasures in accordance with the Law on Cultural Heritage;

b) To remedy violations of the law on environmental protection at the request of the state management agency in charge of the environment;

c) To take measures to ensure occupational safety at the request of the state agency in charge of labor;

d) According to court judgments or decisions or arbitral awards;

e) The investor fails to comply with the contents of the investment policy approval, and the investment registration certificate and has been administratively sanctioned but continues to violate.

3. The Prime Minister shall decide to suspend or stop part of the operation of an investment project in case the implementation of the investment project causes harm or is likely to cause harm to national defense and security according to the proposal. recommendation of the Ministry of Planning and Investment.
4. The Government shall detail the conditions, order, procedures, and time limit for the shutdown of investment projects specified in this Article.

Therefore, if the enterprise stops operating the investment project due to force majeure, the land rental shall be exempted.

What is the procedure for decommissioning of investment project?

Dossier to prepare

• Notice of suspension of operation of the investment project;

The notice of suspension should contain the following main contents: Investor information; information on economic organizations implementing investment projects; operational status of the project (implementation of administrative procedures, the progress of implementation); performance of financial obligations; contents of temporary suspension of investment projects; investor commitment.

• Power of attorney for the applicant who is not the legal representative; Authorization contract or service contract for the organization providing the filing service and the organization’s recommendation letter for the individual submitting the application;
• The decision, meeting minutes (if any) on the suspension;
• Copy of Decision on Investment Policy/Certificate of Investment Registration/Investment Certificate/Investment License/Business License or Decision on Investment Policy.

Procedures for decommissioning an investment projects

Pursuant to Clause 3, Article 56 of Decree 31/2021/ND-CP, the shutdown of an investment project shall comply with the following procedures:

a) In case of self-decision to stop the operation of the investment project as prescribed in Clause 1, Article 47 of the Law on Investment, the investor shall send a notice to the Investment Registration Authority within 05 working days from the date of issuance. decision date. The investment registration authority shall receive and notify the cessation of operation of the investment project to the relevant agencies;

b) In case the state management agency in charge of investment decides to stop the operation of an investment project, that agency shall base itself on the opinions of competent state agencies for the cases mentioned in Clause 2 of this Article. 47 of the Investment Law to decide to stop all or part of the operation of an investment project and notify relevant agencies and investors. The state management agency in charge of investment or the agency competent in the fields specified at Points a, b, c, and d, Clause 2, Article 47 of the Law on Investment shall make a record before deciding to stop or stop a project. the operational part of the investment project. For the cessation of operation of an investment project according to a court judgment or decision or an arbitral award, the state management agency in charge of investment shall base itself on the legally effective judgment or decision of the court. legally effective judgment or award of arbitration to decide to stop the whole or part of the investment project;

c) With regard to investment projects that are detrimental or are likely to cause harm to national defense and security, the People’s Committees of provinces shall notify in writing the Ministry of Planning and Investment. The notice includes the following contents: the investor implementing the project; objectives, location, project contents, project implementation process; assess the impact or risk of the project’s impact on national defense and security; Propose to stop the whole or part of the operation of the investment project. At the request of the People’s Committee of the province, the Ministry of Planning and Investment consults with the Ministry of National Defense and the Ministry of Public Security to submit to the Prime Minister for decision to stop all or part of the operation of the investment project.

Related articles

• Guidance on procedures for shutting down an investment project in Vietnam
• Conditions for transferring real estate investment and business projects in Vietnam

Procedure for decommissioning investment projects

Step 1: Investors prepare documents including:

– Notice of suspension of project implementation (Form A.I.13 of Circular 03/2021/TT-BKHDT)

– Minutes of meeting, the decision on suspension of project implementation

– Authorization to suspend the operation of investment projects

Step 2: Submit the application file to the investment registration agency (DPI or industrial park management board)

Step 3: The investment registration agency records information about the investor’s project suspension and gives written approval to the investor.

Penalties for failure to notify investment project shutdown

Penalties for failure to notify the suspension of investment projects are specified in Decree 122/2021/ND-CP as follows:

Article 15. Violations against regulations on information and reporting on investment activities in Vietnam

2. A fine ranging from VND 30,000,000 to VND 50,000,000 shall be imposed for one of the following acts:
   d) Failing to send a notice to the investment registration agency within 05 working days from the date of decision to cease operation of the investment project;

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