Vietnam is in the process of international integration and opening up the economy. Therefore, foreign traders can participate in bidding to implement projects in Vietnam. However, unlike domestic contractors, after winning the bid, the foreign contractor must be granted a construction permit. So, what are the procedures for granting a construction permit to a foreign contractor? Let’s find out in this article with LSX Law firm.
Law on Construction 2014 (amended in 2020);
Conditions for granting construction permits to foreign contractors
A contractor can apply for a construction operation license/construction permit when fully meeting the following conditions:
Firstly, there is a decision on winning the bid or the contractor is selected by the investor and the contractor must have full capacity conditions suitable for the job as a contractor according to the provisions of the law on construction.
Secondly, the foreign contractor must form a joint venture with a Vietnamese contractor or use a Vietnamese sub-contractor. Although there are exceptions where domestic contractors are not qualified to participate in any work in the bidding package. When entering into a joint venture or using a Vietnamese contractor, the contents, volume, and the value of the work done by the Vietnamese contractor/sub-contractor in the joint venture must be clearly defined.
Thirdly, foreign contractors must fully comply with the provisions of Vietnamese law related to the contracting activities in Vietnam.
Procedures for granting construction permits to foreign contractors
Preparation of the dossier:
The Documents must include:
- An application form for a construction permit in Vietnamese (Must use the form required by relevant laws).
- A certified, translated, notarized copy or an electronic copy of the bidding results; or decision to choose a legal contractor.
- A certified copy or an electronic copy of the establishment license; or Business Registration Certificate for organizations. And the practice certificate (if any) of the country where the foreign contractor holds the nationality. If it is in a foreign language, it must be translated into Vietnamese, notarized, and authenticated. The establishment license or business registration certificate must be consularly legalized. Except for cases where international treaties to which Vietnam and relevant countries are members, have provisions on exemption from consular legalization.
- A report on operational experience related to the contract; A certified copy. Or an electronic copy of the financial audit summary report for the last 3 years (in case of failure to comply with the law on bidding);
- A certified, translated, notarized copy or an electronic copy of the joint venture contract with the Vietnamese contractor; or formal contract; or a contract with a Vietnamese sub-contractor to perform the bidding.
- certified, translated, notarized Legal authorization documents for a person who is not the contractor’s legal representative.
- A certified copy or an electronic copy of the project approval decision. Or investment decision or investment certificate of the project/work.
What agencies can grant construction permits?
- Firstly, Specialized agencies under the Ministry of Construction can grant construction permits to foreign contractors for important national projects, group A projects, construction investment projects in two or more provinces.
- Secondly, The Department of Construction issues construction permits to foreign contractors for group B, group C projects.
Procedures for granting construction permits
Firstly, Foreign contractors shall submit 1 set of dossiers to the construction permits issuing agency according to their competence.
Contractors can choose to submit their dossiers through one of the following:
- Directly at a state agency.
- Via postal service.
- E-Portal of the licensing agency (if any).
Then, within 05 working days, the agency will consider and request additional information or correction if the dossier is missing or inappropriate and provide written instructions.
And Within 20 working days from when the agency receives the valid documents, the licensing agency will consider and grant construction permits to foreign contractors or refuse to grant them; clearly stating the reasons.
Finally, hope this article helps you learn more about the procedures for Issuing construction permits for foreign contractors
Also, If you have any questions, please contact Lawyer X for quick and best legal services: 0833102102.
Frequently asked questions
So, What is a foreign contractor?
According to regulations, foreign contractors are organizations established under foreign laws and foreign individuals participating in bidding for projects in Vietnam.
Are foreign contractors subject to tax in Vietnam?
Foreign business organizations with permanent establishments or without permanent establishments in Vietnam, and Foreign individuals who are residents or non-residents in Vietnam (foreign contractors and sub-contractors) doing business in Vietnam; earning income in Vietnam on the basis of contracts or agreements; or commitments between foreign contractors and Vietnamese organizations and individuals; or between a foreign contractor and a foreign sub-contractor to perform part of the work in the contractor contract, the foreign contractor must pay the contractor tax.
What kind of taxes do the foreign contractors have to pay?
On one hand, Foreign contractors and subcontractors that are organizations must pay VAT and CIT.
On the other hand, Foreign contractors and subcontractors that are individuals must pay VAT and PIT.