03 MUST-KNOWS FOR FOREIGN INVESTORS WHO WANT TO ENJOY INVESTMENT INCENTIVES ACCORDING TO THE LATEST REGULATIONS

03 MUST-KNOWS FOR FOREIGN INVESTORS WHO WANT TO ENJOY INVESTMENT INCENTIVES ACCORDING TO THE LATEST REGULATIONS

The Law on Investment 2020 has supplement various new regulations on investment incentives and support for foreign investors in order to take advantage of resources to promote the attraction of FDI into Vietnam. These regulations not only are considered as a bright spot for foreign investors who wish to invest in the Vietnamese market but also have a great impact on the country's socio-economic development. Thus, to enjoy these investment incentives, what should the foreign investors pay attention to? The following article will point out some important notes for foreign investors who want to enjoy investment incentives under the Law on Investment 2020.

Firstly, the entities eligible for investment incentives and assistance.

According to clause 2 and clause 6 Article 20 of the Law on Investment 2020, the group entitled to Special investment incentives and assistance must firstly be projects that meet the criteria for certain industries and fields of investment: (i) on the total registered state capital; (ii) on the disbursed period of state capital; and (iii) on distinguishing projects being entitled to special incentives and support from those enjoying other investment incentives. In addition, the group that special investment incentives and assistance set out in this Article do not apply to is also mentioned in clause 5, Article 20 of the Law on Investment 2020.

The list of business lines with special investment incentives is also listed in Appendix II of Decree 31/2021/ND-CP. According to Article 13 of the Law on Investment 2020, higher investment incentives are always applied to investors to ensure a stable regulatory environment and incentives for investors to invest in industries of the new, beneficial to society or implemented in disadvantaged areas or extremely disadvantaged areas. However, the Law on Investment also sets out the exceptions to this principle, in particular, the projects that have been granted the investment certificate, the investment registration certificate or the decision on investment guidelines before the effective date of the Law on Investment 2020 are not entitled to special investment incentives and assistance.

Secondly, the level of special investment incentives and assistance.

Regarding incentives, projects will enjoy special investment incentives in accordance with the Law on Corporate Income Tax and the Law on Land. Including: (i) Incentives on corporate income tax and (ii) Incentives for land rents and water surface rents.

Regarding investment assistance, projects shall enjoy special investment assistance similar to enterprises entitled to other investment assistance, including the forms mentioned in clause 1, Article 18 of the Law on Investment 2020 and clause 6 Article 20 Decree 31/2021/ND-CP.

Thirdly, the authority to determine the application of special investment incentives and assistance.

The Government decides on the application of special investment incentives and assistance for the cases specified in clause 6 Article 20 of the Law on Investment 2020. Moreover, the Prime Minister also decides the level and duration of application of special investment incentives according to the criteria of high technology, technology transfer, Vietnamese enterprises supplying in the chain, domestic production value for investment projects mentioned in clause 2 Article 20 of the Law on Investment 2020. For other forms of incentives and support that may be applied or projects other than those specified in the Investment Law 2020 to be considered for application, The Government shall request the National Assembly to decide to apply special investment incentives and assistance.

Legal consultation on legal issues related to investment incentives for foreign investors:

HTC Vietnam Law Firm provides advice on the matter concerning investment incentives for foreign investors as follows:

- Consulting on legal matters related to investment incentives for foreign investors;

- Advising on relevant procedures for foreign investors to enjoy investment incentives in accordance with the regulations;

- Performing as an authorized representative to participate in settling investment-related disputes with foreign investors.

Service Quality Commitment

The following are HTC Vietnam Law Firm’s Principles of Operation: Conscientious - Effective - Reliable. HTC Vietnam Law Firm assures quality, specifically as follows:

- Ensure that the work is carried out according to the agreed schedule, in accordance with the law, and in accordance with the code of ethics and Codes of Conduct of Vietnamese lawyers.

- Give priority to customers' interests, and make every effort to provide customers with the best quality of service.

- Respect the confidentiality of information that clients provided and information pertaining to the clients.

We are looking forward to a long-term cooperation.

Best Regards!

(Writer: Vu Thi Thanh Nhan; 184; Date: 30/03/2022)

Translator: Pham Nguyen Nhat Linh