Many foreign investors into Vietnam no longer want to stay with the original investment project. So, LSX Lawfirm will introduce an article related this issue: “Suspension of investment projects in Vietnam”, as follows:
Law on investment 2020
What does investment project means?
Accordingly, from a management perspective, an investment project is a tool to manage the use of capital, materials and labor to create financial, economic and social results in a long time. A project is a series of linked activities designed to achieve certain results within a defined budget and time.
Related article: What is an investment certificate?
Suspension of investment projects in Vietnam
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.
The investment authority shall decide to suspend an investment project in part or in full in the following cases:
- Firstly, protect sites/monuments, relics, antiques or national treasures in accordance with the Law on Cultural Heritage.
- Secondly, rectify a violation of the law on environmental protection at the request of the environment authority.
- Thirdly, take measures to ensure occupational safety at the request of the labor authority.
- Then, pursuant to a judgment or decision of a court or an arbitral award.
- Finally, the investor fails to adhere to the written approval for investment guidelines; or the investment registration certificate and recommits administrative violations after incurring penalties.
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. The Government shall elaborate conditions; procedures and time limit for suspending investment projects in accordance with the law as section 4 as below.
Accordingly, the total period of suspension of an investment project shall not exceed 12 months. So, if the investment project is suspended according to a court’s effective judgment or decision; then effective arbitral award or investment authority’s decision, the suspension period shall be determined according to the court’s judgment or decision; effective arbitral award or investment authority’s decision. If these documents do not specify the suspension period; the total suspension period shall not exceed the period prescribed in the law.
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.
If the investment authority decides to suspend the investment project, such authority shall, according to the competent authorities’ opinions 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
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