The Law on Investment No. 143/2025/QH15 (“LOI 2025”), which was adopted by the National Assembly on 11 December 2025, replacing the Law on Investment No. 61/2020/QH14 (“LOI 2020”) will officially take effect from 01 March 2026.
The LOI 2025 introduces many important amendments and supplements, reflecting Vietnam’s continued efforts to improve the investment environment, simplify administrative procedures, and adjust the investment management framework toward more clarity and flexibility. In particular, several new regulations relating to investment conditions, investment policy approval, investment incentive mechanisms, and decentralization of authority, etc., may have direct or indirect impacts on the investment activities of foreign investors in Vietnam. On that basis, this article highlights certain key amendments of the LOI 2025 that may be of interest to foreign investors in Vietnam.
1. Foreign investors are no longer required to have an investment project prior to establishing an enterprise
Under the current regulations, before setting up an economic organization (including an enterpiese) in Vietnam, a foreign investor is required to have an investment project and conduct procedures to obtain the Investment Registration Certificate (“IRC”).
However, the LOI 2025 allows foreign investors to establish an economic organization for the purpose of implemeting an investment project before carrying out procedures to obtain an IRC, provided that the market access conditions applicable to foreign investors at the time of establishment of tge economic organization are satisfied. Pursuant to the draft Decree guiding the implementation of the LOI 2025, currently being prepared by the Government, the statutory time limit for the completion of the IRC application procedure is 06 months from the date of establishment of the economic organization.
This may be considered as one of the notable new points of the LOI 2025 compared to the LOI 2020, contributing to the assurance of the principle of equal treatment between domestic investors and foreign investors in carrying out these procedures.
2. Change to prohibited business lines and conditional business lines
Compared to the LOI 2020, the LOI 2025 has removed nearly 40 conditional business lines across various sectors, meaning that enterprises are no longer required to obtain licenses to conduct business activities in these sectors. Notable examples of business lines removed from the conditional list include: (i) in logistics, import–export and transportation such as: temporary import and re-export of goods subject to special consumption tax, frozen food products, and used goods; multimodal transport services; maritime safety assurance services; and sea tugboat services; (ii) in construction area such as: construction activities of foreign contractors and architectural services; (iii) in the trade and industrial services such as automobile warranty and maintenance services; and (iv) technology and data infrastructure such as data center and data storage services, etc.
The LOI 2025 also adjusts the scope of about 20 other conditional business lines, for example: (i) regarding Printing services, printing of packaging not containing product labels is no longer subject to licensing requirements; , or (ii) the business line of Construction execution services has been revised to “Practicing as a construction site commander”, whereby enterprises operating in this field are no longer subject to investment conditions at the enterprise level, instead conditions are applied to individuals holding the position of construction site commander in accordance with construction laws. The list of conditional business lines under the LOI 2025 will take effect as of 1 July 2026.
Additionally, the LOI 2025 formally includes “Trading in electronic cigarettes and heated tobacco products” in the list of prohibited business lines in Vietnam, following the policy approved by the National Assembly in Resolution No. 173/2024/QH15, effective from 01 January 2025.
3. Investment project subject to invesment policy approval and approving authority
While the LOI 2020 does not directly specify the types of projects subject to investment policy approval, but instead regulates such projects based on the approving authority of each competent body, the LOI 2025 adopts a different approach by expressly identifying 20 categories of projects that are required to obtain investment policy approval. This approach enhance clarity, consistency, and ease of application in practice.
At the same time, the LOI 2025 also revises the allocation of authority for investment policy approval toward greater decentralization. Accordingly, the National Assembly only approves investment policies for projects requiring special mechanisms or policies that differ from the provisions of laws or resolutions of the National Assembly; the Prime Minister approves investment policies for certain important projects that have significant impacts on socio-economic development or national defense and security; while provincial-level People’s Committees are authorized to decide on a larger number of project types. For example, for housing and urban area development projects, the LOI 2025 assigns investment policy approval authority to provincial-level People’s Committees without distinguishing based on land area or population size (except for special cases), whereas under the LOI 2020, projects with a land area of 50 hectares or more or a population size of 15,000 people or more fell under the approval authority of the Prime Minister.
4. Special investment procedure
Regarding the special investment procedure, the LOI 2025 adds “International financial centers” to the list of areas eligible for the special investment procedures when investment projects are located therein, except for projects subject to approval of investment policy in accordance with Government regulations.
Under the new regulations, the Government will specify in detail the sectors eligible for special investment procedures, whereas previously, such sectors were specified under the LOI 2020.
5. Business lines eligible for investment incentives
Instead of specifically listing the business lines eligible for investment incentives as under the LOI 2020, the LOI 2025 (Article 15) adopts a goal-oriented approach. Specifically, the LOI 2025 introduces the concept of ‘investment incentive business lines’ as those prioritized for investment in order to achieve defined objectives, and sets out such objectives. Notable objectives under the LOI 2025 include “Development of science and technology, innovation, digital transformation, digital technology industry and the semiconductor industry; Development of the green economy, circular economy, sharing economy, and digital economy; etc.” as well as other socio-economic development objectives as prescribed.
6. Beneficiaries of special investment incentives and supports
The LOI 2025 no longer prescribes detailed requirements regarding investment capital scale and disbursement schedules for projects to be eligible for special incentives and support. Instead, such matters are to be prescribed by the Government, enabling a greater flexibility for certain specializedsectors such as pharmaceuticals, digital technology industries, and chemicals.