Amending the Law on Investment: a golden opportunity to reshape Vietnam’s investment environment

The amended Law on Investment is seen as a strategic step that brings fresh air to Vietnam’s business environment. It is not just an adjustment of legal rules. It is also a golden opportunity for Vietnam to reshape its policies, attract high-quality capital and become more competitive internationally.

The Ministry of Finance is consulting widely on the draft amended Law on Investment. To help improve the draft, Lawyer Nguyễn Hồng Chung, an investment policy expert, Vice Chairman and Secretary General of the Vietnam Industrial Park Financial Association (VIPFA) and Managing Director of DVL Ventures, has made important, strategic contributions aimed at reshaping the investment environment in Vietnam.

A clear distinction between domestic and foreign investors

According to Lawyer Nguyễn Hồng Chung, this amendment of the Law on Investment is a golden opportunity to create a breakthrough legal framework that fits international economic integration, helps raise national competitiveness and promotes sustainable economic development.

One point he stresses in particular is the need for a clear distinction between domestic and foreign investors. This distinction is not meant to create barriers or discrimination. It is a solid legal basis for applying separate investment incentives and support policies, in line with Vietnam’s international commitments and economic development goals. Clearly defining who the rules apply to will help the authorities design better policies and bring transparency and stability to implementation.

According to Lawyer Chung, a vital factor in improving the investment environment is administrative procedure reform. He strongly proposes reviewing and cutting overlapping and unnecessary procedures, and building a lean, transparent investment process, in particular a digital one-stop-shop system. This would not only shorten licensing times but also reduce compliance costs for businesses.

A breakthrough in institutional thinking proposed by Lawyer Chung is a shift from ex-ante control (checks before approval) to ex-post control (checks after the event). Investors would be allowed to carry out projects as registered, while the authorities focus on supervision after the project starts operating. This approach reduces the initial procedural burden and gives businesses more autonomy and flexibility. It is a modern management model in line with the practice of developed countries, and it helps businesses seize market opportunities quickly.

Keeping existing investors and attracting new ones

Another important point in Lawyer Chung’s comments is a proposal to add exceptional incentives for strategic investment projects, high-tech projects and key industries. These incentives could include corporate income tax exemptions and reductions, land rent support and workforce training. However, he stresses that these policies must be specific, clear, stable and long-term, to avoid arbitrary application that causes difficulties for investors.

Improving the current incentive policies is also urgent. The criteria for incentives should be clear, easy to understand, fair and workable. This would make it easier for investors to access the policies and would create healthy competition between localities in attracting investment.

Alongside incentives, the dispute resolution mechanism also needs to improve to protect investors’ lawful rights and interests. Lawyer Chung proposes a fast and effective dispute resolution mechanism, especially for disputes involving state authorities. Encouraging alternative dispute resolution such as mediation and arbitration, together with building the capacity of specialised courts, would help handle complex cases more flexibly and effectively.

All these reforms aim to create a stable, transparent and attractive investment environment. Lawyer Chung hopes that the amended Law on Investment will both keep existing FDI and open the way for a new wave of investment as global supply chains are restructured. This is an opportunity for Vietnam to be not only a destination for investment capital but also a place where high value added in global value chains comes together.

Another notable point in Lawyer Nguyễn Hồng Chung’s comments is a proposal to abolish the outward investment licence and replace it with a registration and ex-post control mechanism. This is a strong institutional reform with many positive effects for Vietnamese businesses, especially the private sector and SMEs. In his view, businesses could carry out projects abroad quickly without long waits for approval. Giving businesses more flexibility and autonomy would help them seize opportunities in international markets, especially in fields that need fast decisions such as trade, services and technology.

This policy is in line with the spirit of Resolution No. 59-NQ/TW on promoting international economic integration. It not only attracts capital and technology into Vietnam but also encourages Vietnamese businesses to export capital, brands and business models abroad. It also links to Resolution No. 68-NQ/TW on developing the private economy into an important driving force of the economy. Helping Vietnamese private businesses become “multinational enterprises” will allow them to take a deeper part in global value chains and bring benefits back to the domestic economy.

From a policy perspective, this amendment of the Law on Investment is not just a technical legal adjustment. It is also a chance to reshape Vietnam’s role in the global economy. If the proposals are adopted and put into law effectively, Vietnam could move from being a country that receives investment to an active player in international capital flows, with domestic businesses at the centre.