Regulations on new investment projects according to Vietnamese law

1. Concept of investment project

According to Clause 4, Article 3 of the Law on Investment 2020, specific investment projects are specified as follows:

“Article 3. Interpretation of terms

In this Law, the following terms are understood as follows:

…

4. Initial project investment is a set of proposals to invest medium-term or long-term capital to conduct business investment activities in a specific area, within a specified period of time.”

2. Concept of new investment project

Pursuant to Clause 6, Article 3 of the Law on Investment 2020, on the concept of new investment project specifically as follows:

“Article 3. Interpretation of terms

In this Law, the following terms are understood as follows:

…

6. Project A new investment project is an investment project implemented for the first time or an investment project independent of an active investment project.”

3. Is an enterprise carrying out two projects at the same time considered a new investment project to enjoy tax incentives?

Pursuant to Clause 5, Article 18 of Circular 78/2014/TT-BTC and Clause 3, Article 10 of Circular 96/2015/TT-BTC, it is stipulated:

“Article 18. Conditions Apply corporate income tax incentives

…

5. Regarding new investment projects:

a) New investment projects that enjoy corporate income tax incentives specified in Article 15 and Article 16 of Decree No. 218/2013/ND-CP are:

– Projects that are granted investment certificates for the first time from the date of January 1, 2014 and generate revenue from that project after being granted an Investment Certificate.

– Domestic investment projects associated with the establishment of new enterprises with investment capital of less than 15 billion VND in Vietnam and not on the List of conditional investment fields that are granted Business Registration Certificates from January 1, 2014.

– Project Investment projects independent of active enterprise projects (including projects with investment capital of less than 15 billion VND in Vietnam and not in the List of conditional investment fields) have an Investment Certificate from January 1, 2014 to implement this independent investment project.

– Notary offices established in areas with difficult and especially difficult socio-economic conditions.

New investment projects that enjoy corporate income tax incentives according to regulations must be granted an Investment License or Investment Certificate by a competent state authority or be allowed to invest in accordance with the law on investment.

b) New investment projects that enjoy corporate income tax incentives under the new investment category do not include the following cases following:

– Investment projects formed from: division, separation, merger, consolidation, transformation of business form according to the provisions of law;

– Investment projects formed from the conversion of owners (including cases of implementing new investment projects but still inheriting the assets, business location, and business lines of the old enterprise to continue production and business activities; acquisition active investment project).

Established enterprises or enterprises with investment projects resulting from business type conversion, ownership conversion, division, separation, merger, consolidation will inherit the corporate income tax incentives of the enterprise or investment project before conversion, division, separation, merger, consolidation for the remaining time if they continue to meet the conditions for corporate income tax incentives.