When are investment project activities terminated?

According to Article 48 of the Investment Law 2020, an investment project will terminate in the following cases:

1. An investor shall terminate their investment activities and/or investment project in the following cases:

a) The investor decides to terminate the project;

b) The project has to be terminated according to the conditions set out in the contract or charter of the enterprise;

c) The project duration is over.

2. The investment registration authority shall terminate an investment project in part or in full in the following cases:

a) The investor fails to overcome the difficulties that lead to project suspension in the cases mentioned in Clause 2 and Clause 3 Article 47 of this Law;

b) The investor is no longer permitted to keep using the investment location and fails to complete the procedures for change of investment location within 06 months from the date on which the investor is no longer permitted to use the investment location, except for the case specified in Point d of this Clause;

c) The investment registration authority cannot contact the investor or the investor’s legal representative after 12 months from the date of suspension of the project;

d) Land reserved for the investment project is expropriated by the State for the reason that the land is not used or the land use is delayed in accordance with regulations of law on land;

dd) The investor fails to pay the deposit or obtain a bank guarantee as prescribed by law if project execution security is required;

e) The investor conducted the investment activities on the basis of a sham civil transaction in accordance with the civil law;

g) The investment project is terminated according to a judgment or decision of a court or an arbitral award;

Investors need to note the following contents:

• For investment projects subject to approval for investment guidelines, the investment registration agency shall terminate the investment project after receiving the opinion of the investment policy approval agency.
• Investors shall liquidate their investment projects according to the provisions of law on liquidation of assets when the investment project terminates its operation, except for cases of land use rights and assets attached to land when the investment project terminates its operation, the handling shall be carried out according to the provisions of law on land and other relevant provisions of law.
• The investment registration authority shall decide to revoke the Investment Registration Certificate in case the investment project terminates its operation as prescribed in Clause 2, Article 48 of the Investment Law 2020, except for the case of partial termination of the investment project's operation.

Procedures for terminating investment projects: according to the Government's instructions in Articles 57 to 60 of Decree 31/2021/ND-CP effective from March 26, 2021.

The above is the consulting content of Gia Luat related to the termination of investment projects. If you have any questions or need to use legal services related to the establishment, adjustment, change of activities, termination of investment projects of foreign-invested enterprises in Vietnam, please contact Gia Luat for detailed advice and best support.