Amendments in Vietnam’s Investment Licensing: Highlights of Decree 239

Effective September 3, 2025, Decree 239 amends and supplements several provisions of Decree No. 31/2021/ND-CP (“Decree 31”), which provides detailed regulations and implementation guidelines for certain aspects of Vietnam’s 2020 Investment Law.

In this article, we highlight the main benefits of this new decree and outline its provisions that require proactive action from businesses and investors to ensure compliance with the new rules.

Clarifying investment incentives for local administrative units

Decree 239 introduces changes to how investment incentive areas are defined, particularly in the context of Vietnam’s two-tier local government model. Previously, rules under Decree 31 only applied at the district level, which created inconsistencies when administrative boundaries were adjusted.

The new decree extends the framework to commune-level units, ensuring that newly formed communes, whether through mergers, splits, or upgrades, retain investment incentive status based on their pre-existing socio-economic conditions. Where communes are combined from different classifications, the new unit will be assigned incentive status according to majority rule, with clear guidance for tie-break situations.

Provincial People’s Committees are tasked with announcing incentive areas and reporting to the Ministry of Finance.

Removal of the 10-year equipment age restriction

Another update addresses investment projects using machinery and equipment. Previously, projects were not eligible for extensions if they used equipment over 10 years old under Chapter 84 and Chapter 85 of the Harmonized System, regardless of condition. This rule proved impractical, as many machines remain efficient beyond the 10-year threshold.

Decree 239 removes the blanket age restriction. Instead, eligibility will be evaluated based on national technical regulations for safety, energy efficiency, and environmental protection, or on international standards when domestic benchmarks are not available. Equipment will also be assessed for performance. Machines will be ineligible if they operate at below 85 percent of their design efficiency or exceed resource consumption by more than 15 percent compared to the design.

Infrastructure investment in industrial zones

Decree 239 revises regulations on infrastructure development and business activities in industrial parks, export processing zones, high-tech zones, digital technology zones, and economic zones.

Major updates include:

• Infrastructure development must align with approved master plans;
• In difficult socio-economic areas, provincial authorities may propose public service units as investors;
• Investors may build and lease factories, offices, and warehouses, and are authorized to set and register rental frameworks and service fees with zone management authorities, with updates every six months or when adjustments occur; and
• Investors may collect infrastructure usage fees, transfer land-use rights, and engage in other activities permitted under investment and land laws.

Highlights for foreign investors: Streamlined investment licensing procedures

Reduction in the number of application dossiers

All procedures related to IRC applications, approval of investment policies, project adjustments, and investor approvals now require only one original set of documents accompanied by a digitally signed electronic copy as prescribed under Article 6 of Decree 31. Accordingly, investors shall submit an electronic application dossier that meets the following conditions:

• Legal validity: The electronic dossier must bear a digital signature in accordance with the law on electronic transactions, and shall have the same legal validity as the paper dossier submitted to the Ministry of Finance (MoF) or the investment registration authority;
• Responsibility of investors: Investors are responsible for the accuracy, consistency, and completeness of the contents of both the paper dossier and the electronic dossier submitted to the MoF or the investment registration authority. In case of any discrepancy between the paper dossier and the electronic dossier, the contents of the paper dossier shall prevail as the final legally binding version; and
• Responsibility of authorities: The MoF and the investment registration authority are responsible for publicly disclosing the address and method of receiving investors’ electronic dossiers on the National Investment Information Portal, the MoF’s e-portal, and the e-portal of the local investment management authority.

The investor must also submit the prescribed dossier either in person, online, or through public postal services, based on the designated method of receipt for that type of procedure.

Foreign investors should note that digital signatures used in Vietnam must fully comply with the standards and technical regulations on electronic signatures and electronic signature certificates, as stipulated under Article 26 of the Law on Electronic Transactions 2023 and relevant international treaties to which Vietnam is a party.

In addition, for such signatures to be legally recognized in Vietnam, they must undergo the recognition process administered by the Ministry of Information and Communications, as set out in Articles 6 and 7 of Circular No. 06/2024/TT-BTTTT,” – Nguyen Thi Hai Tam, Senior Manager of Business Advisory Service, Dezan Shira & Associates.

Shortened IRC issuance timeline

According to Clause 12, Article 1 of Decree 239, the investment registration authority will issue the IRC to the investor within 10 days after receiving a valid application, provided the conditions are satisfied. Previously, the processing time for issuing the IRC was 15 days.

New addition to the List of areas eligible for investment incentives

Decree 239 adds a new category to Appendix III of Decree 31, which initially only detailed areas eligible for investment incentives by province. The update introduces broader incentives based on special economic zones aligned with current state priorities, including:

• Economic zones, hi-tech zones (including concentrated information technology zones established in accordance with Government regulations) are entitled to the same investment incentives as those applied to areas with extremely difficult socio-economic conditions; and
• Industrial parks, export-processing zones, and industrial clusters established according to government regulations are entitled to the same investment incentives as those applied to areas with difficult socio-economic conditions.

According to Decree 31, investment projects under Appendix III are subject to respective reductions of the guarantee amount, including:

• For areas with difficult socio-economic conditions: a 25 percent reduction of the guarantee amount; and
• For areas with extremely difficult socio-economic conditions: a 50 percent reduction of the guarantee amount.

Takeaway

Decree 239 marks a significant advancement in Vietnam’s investment regulatory framework by streamlining licensing procedures and enhancing clarity around investment incentives at the local government level. Overall, these changes are designed to foster investment growth and adapt to the evolving economic landscape.

Businesses and investors should proactively engage with these new provisions to ensure compliance and capitalize on the opportunities presented.