Vietnam’s real estate market has developed strongly in recent years. In addition to domestic enterprises, there has been a sudden growth thanks to grasping opportunities to develop products for housing projects, urban areas…. Foreigners also have high hopes for a potential market like Vietnam, formed from foreign investment flows into Vietnam, including infrastructure development projects from ODA, investment projects public sector, or project products of resorts, hotels, houses, urban areas also promote activities in the Vietnamese market … before carrying out business construction activities need to be licensed by the competent authority. jurisdiction in Vietnam. In this article, Apra Law will help readers better understand the conditions, order, and application documents for construction permits for foreign investors operating in Vietnam.
Principles of operation management of foreign contractors
According to the provisions of Article 102 of Decree No. 15/2021/ND-CP, foreign contractors are only allowed to carry out construction activities in Vietnam after obtaining construction permits from state management agencies in charge of construction. Activities of foreign contractors in Vietnam must comply with Vietnamese law and relevant international treaties that Vietnam has signed or adhered to.
Conditions for granting operation license to foreign contractors
- A foreign contractor is granted a construction license when there is a winning decision or is selected as a contractor by another investor/contractor.
- Foreign contractors must form a partnership with Vietnamese contractors or use Vietnamese sub-contractors, unless the domestic contractors are not qualified to participate in any work of the bidding package. When entering into a partnership or using a Vietnamese contractor, the content, volume and value of the work performed by the Vietnamese contractor in the joint venture, or the Vietnamese sub-contractor must be clearly identified.
- Foreign contractors must commit to fully comply with the provisions of Vietnamese law related to contracting activities in Vietnam.
Dossier and authority to issue construction licenses to foreign investors
1. The foreign contractor submits a set of documents including the following documents to the construction licenses – issuing agency:
- An application form for a construction license, made according to Form No. 01 and Form No. 04, Appendix IV of Decree 15/2021/ND-CP;
- Certified copy/Email copy of the bidding results or lawful contractor selection decision;
- Copy of Establishment License/Certificate of Business Registration for organizations where the foreign contractor’s nationality is granted consular legalization (except for cases exempted from consular legalization under international treaties);
- The report of operational experience related to the jobs under the contract and a copy of the audited financial statements of the last 3 years (in case of failure to comply with the law on bidding) (must be translated into Vietnamese notarized or authenticated);
- A certified true copy of the joint venture contract with a Vietnamese contractor or a contract with a Vietnamese sub-contractor for the performance of the contract work (already included in the bid or bidding documents);
- Legal power of attorney for a person who is not the contractor’s legal representative;
- Copy of project approval decision or investment decision or investment certificate of the project/construction.
2. Authority to issue construction licenses:
- Construction specialized agencies under the Ministry of Construction grant construction operation licenses to foreign contractors performing contracts of national important projects, group A projects, and construction investment projects in their respective localities province or more;
- The Department of Construction issues construction licenses to foreign contractors to perform contracts of group B and group C projects invested in construction in the administrative division of the province.
3. License Duration
The construction agency shall consider and grant the construction license to the foreign contractor within 20 days from the date of receipt of a complete dossier as prescribed.
Rights and obligations of foreign contractors
1. Rights of foreign contractors
- To request competent agencies to guide the preparation of dossiers of application for construction permits and other issues related to the contractor’s activities;
- Complaints and denunciations of violations committed by organizations and individuals performing the work specified in Decree 15/2021/ND-CP;
- To have their legitimate interests protected in doing business in Vietnam under the granted construction license.
2. Obligations of foreign contractors
- Set up an executive office at the project site after being granted a construction operation license; Register the address, phone number, fax number, e-mail, stamp, bank account, tax code of the executive office. For contracts for construction planning, construction investment project formulation, construction survey, and work construction design, foreign contractors may set up an Executive Office at the place where their head office is registered. invest or not set up an Executive Office in Vietnam. For contracts for construction and construction supervision of works passing through many provinces, foreign contractors may set up an office in a locality where the work passes to perform work. The executive office only exists during the performance of the contract and dissolves upon the expiration of the contract.
- Register, cancel the seal sample, return the seal at the end of the contract according to the provisions of law. Foreign contractors only use this seal for contract performance in Vietnam according to regulations;
- Register and pay taxes in accordance with Vietnamese law, implement accounting regimes, open accounts and make payments under the guidance of the Ministry of Finance and the State Bank of Vietnam;
- To recruit and employ Vietnamese and foreign workers in accordance with Vietnamese laws on labor, only experts in economic management and management are allowed to register in Vietnam technical managers, and highly skilled people that Vietnam cannot afford;
- Carry out procedures for export and import of supplies, machinery and equipment related to the contract of contract in Vietnam in accordance with the provisions of Vietnamese law;
- To perform a partnership contract signed with a Vietnamese contractor or use a Vietnamese sub-contractor identified in the application for a construction license;
- Buy insurance according to the provisions of Vietnamese law for the contractor’s work, including: Professional liability insurance for construction investment consulting contractors; property and goods insurance for procurement contractors; types of insurance for construction contractors and other insurance regimes according to the provisions of Vietnamese law;
- To register the quality of imported materials and equipment provided under the contract of contract;
- Register the safety of construction equipment and means of transport related to business activities of foreign contractors in accordance with Vietnamese law;
- Comply with regulations on regulations, standards, quality management of construction works, labor safety and environmental protection as well as other relevant Vietnamese laws;
- Implement reporting regimes as prescribed in the construction operation permit;
- Upon completion of the work, the foreign contractor must compile a work completion dossier; responsible for the warranty; finalization of imported materials and equipment; handle materials and equipment left over in the work construction contract according to regulations on import and export; re-export of registered construction materials and equipment under the regime of temporary import for re-export; liquidation; and at the same time notify the relevant state management agencies of the contract termination and operation termination of the project management office
Above is the article about “Legal regulations on construction permits for foreign contractors” of Apra Law Firm. If you have questions or comments about the issues mentioned in the article and need to be answered, please contact the hotline for advice and support.
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