CONDITIONS, PROCEDURES FOR SUSPENSION OF INVESTMENT PROJECTS IN VIETNAM

Legal grounds

Law on Investment 2020;

Decree 31/2021/ND-CP.

1. In which case the operation of an investment project will be suspended?

Article 47 of the Law on Investment 2020, guided in clause 1 Article 56 of Decree 31/2021/ND-CP, lists cases of stopping investment projects including:

- Case 1: The investor suspends the operation of the investment project

In this case, the investor must notify in writing the investment registration agency. In case the operation of an investment project is suspended 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.

- Case 2: The state management agency in charge of investment decides to suspend or partially suspend the operation of the investment project for one of the following reasons:

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

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

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

• According to court judgments or decisions, arbitral decisions;

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

- Case 3: The Prime Minister decides to suspend part or whole of the operation of an investment project in case the implementation of the investment project causes harm or is likely to cause damage to national defense and security at the request of the Ministry of Planning and Investment.

2. What conditions must be met to suspend an investment project?

According to clause 2 Article 56 of Decree 31/2021/ND-CP, the suspension of an investment project must satisfy the condition that the total shutdown time of the investment project does not exceed 12 months.

- In case the operation of an investment project is stopped under a court judgment, decision, an effective arbitral decision, or a decision of a state management agency in charge of investment, the shutdown period of Investment projects are determined according to court judgments, decisions, arbitration decisions or decisions of state management agencies in charge of the investment.

- In case these documents do not specify the time of shutdown of the investment project, the total time of shutdown shall not exceed the total time of 12 months.

3. Procedures for suspension of investment projects

Procedures for suspension of investment projects are carried out according to clause 3 Article 56 of Decree 31/2021/ND-CP as follows:

- In case the investor decides to suspend the operation of the investment project on his own as prescribed in clause 1 Article 47 of the Law on Investment 2020, within 05 working days from the date of the decision, the investor shall send a notice to the Investment Registration agency. The investment registration agency shall receive and notify the suspension of the investment project to the relevant agencies;

- In case the state management agency in charge of investment decides to suspend the operation of an investment project, that agency shall base itself on opinions of competent state agencies for the cases mentioned in clause 2 Article 47 of the Law on Investment 2020 to decide to suspend 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 to make a record before deciding to suspend or suspend a part of the operation of the investment project.

For the suspension of operation of an investment project according to a court judgment or decision or an arbitral decision, the state management agency in charge of investment shall base itself on the legally effective judgments or decisions of the court and legally effective arbitration decisions to decide to suspend the whole or part of the investment project;

- For an investment project that is harmful or has the potential to cause harm to national defense and security, the People's Committee of the province 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; Proposing to suspend 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 the decision to suspend whole or part of the operation of the investment project.

ADK & Co Vietnam Lawyers Law Firm