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With the development of the economy and policies to attract investment, investment has become a popular trend today. However, the process of issuing or adjusting an Investment Registration Certificate (IRC) is a challenging task, requiring the knowledge and proficiency of a team of experts in this field. To better understand the process and procedures for granting and adjusting IRC in practice, in this article, Siglaw will dig deeper with you on this topic.
LEGAL BASIS FOR INVESTMENT LICENSE
- Investment Law No. 61/2020/QH14 of the National Assembly dated June 17, 2020;
- Decree No. 31/2021/ND-CP of the Government dated March 26, 2021, detailing and guiding the implementation of a number of articles of the Investment Law;
- Circular 03/2021/TT-BKHDT of the Ministry of Planning and Investment dated April 9, 2021, regulating the form of documents and reports related to FDI investment activities in Vietnam, investment from Vietnam to abroad, and investment promotion.
WHAT IS AN IRC? IS IT NECESSARY?
The Law defines an Investment Certificate (or Investment Registration Certificate) on Investment 2020 as “a paper or electronic document recording the investor’s registration information about the project”.
It can be said that the investment certificate is one of the most important documents necessary for businesses, organizations, or individuals investing in a specific economic field in Vietnam as well as abroad because this is proof that the investor is registered and licensed by the government to invest in a particular locality. Therefore, having an investment registration license is very necessary.
Investment has many positive effects, including the promotion of economic development, the creation of income, and the development of the country. However, investing involves risks, especially in the implementation process. The Investment Certificate serves as a tool to assist investors in receiving legal protection and support from the state and organizations. Besides, having an investment license makes business registration, tax registration, and operation license application more convenient.
Currently, the Investment Law 2020 stipulates that the contents of an investment registration certificate include:
“Article 40. Contents of Investment Registration Certificate
- Investment project name.
- Investors.
- Investment project code.
- Location of the investment project, land use area.
- Objectives and scale of investment projects.
- Investment capital of the investment project (including contributed capital of the investor and mobilized capital).
- Term of operation of the investment project.
- Investment project implementation progress, including:
- a) Progress of capital contribution and mobilization of capital sources;
- b) The progress of the implementation of the main operational objectives of the investment project, in case the investment project is divided into phases, the progress of each stage must be specified.
- Forms of incentives, investment support, and grounds and conditions for application (if any).
- Conditions for investors implementing investment projects (if any).”
Previously, the investment registration certificate was also known by other names as the investment certificate. In essence, these two names refer to the same type of paper.
IN WHICH CASE IS AN IRC REQUIRED?
Currently, the Investment Law 2020 clearly stipulates the cases in which an IRC is required and not required in Article 37, specifically:
Cases in which the procedures for the issuance of an IRC must be carried out include:
- Investment projects of foreign investors;
- Investment projects of economic organizations that:
- Having a foreign investor holding more than 50% of the charter capital or having the majority of general partners being foreign individuals, for economic organizations being a partnership;
- Foreign investors and economic organizations specified at Point a of this Clause hold more than 50% of charter capital;
- There are economic organizations specified at Point a of this Clause that hold more than 50% of charter capital.
For investment projects of domestic investors (1) Investment projects of economic organizations specified in Clause 2, Article 23 of the Law on Investment 2020; (2) Investment in the form of capital contribution, share purchase, or purchase of capital contribution of economic organizations are NOT required to carry out procedures for the issuance of IRC. However, for projects (1) and (2), if the investor still wishes to carry out the procedures for issuance of an IRC for an investment project, he or she can still prepare a complete set of documents and fully perform the steps to apply for an IRC as compulsory subjects.
DOSSIER AND PROCEDURES FOR NEW ISSUANCE OF IRC
For projects subject to the investment policy decision of the provincial People’s Committee
Investors need to prepare four sets of documents. Each complete dossier includes:
| Types of documents | Quantity | Category |
| A written request for implementation of an investment project, made according to form I-1_TT16 | 1 | Original |
| Identity card or passport for individual investors; a copy of the Certificate of Establishment or other equivalent document certifying the legal status of the investor being an organization | 1 | Copied |
| The investment project proposal includes the following contents: investor implementing the project, investment objectives, investment scale, investment capital and capital mobilization plan, location, duration, and investment schedule. , labor demand, a proposal for investment incentives, impact assessment, socio-economic efficiency of the project according to Form I-2_TT16 | 1 | Original |
| One of the following documents: financial statements of the last 2 years of the investor; commitment to the financial support of the parent company; financial institution’s commitment to financial support; guarantee on the financial capacity of the investor; document explaining the financial capacity of the investor | 1 | Copied |
| Proposing land use demand for projects requesting land allocation, land lease, or permission to change land use purpose by the State; If the project does not request the State to allocate or lease land or permit the change of land use purpose, the investor shall submit a copy of the location lease agreement or other document certifying that the investor has the right to use the site for implementing investment projects | 1 | Original |
| An explanation on the use of technology for projects specified at Point b, Clause 1, Article 32 of the Law on Investment, including the following contents: technology name, technology origin, technological process diagram; main technical parameters, use status of main machinery, equipment and technological lines; | 1 | Original |
| BCC contract for investment projects in the form of a BCC contract | 1 | Original |
Procedure
| Procedure | Detail |
| Step 1 | The investor submits the prepared dossier to the Department of Planning and Investment where the investment project is intended |
| Step 2 | The Department of Planning and Investment shall send a dossier to receive due diligence opinions from state agencies related to the contents specified in Clause 3, Article 30 of Decree 118/2015/ND-CP. |
| Step 3 | The consulted agency shall do due diligence on the contents under its state management and send it to the investment registration agency. |
| Step 4 | The Department of Planning and Investment shall make a due diligence report and submit it to the People’s Committee of the province. |
| Step 5 | Provincial People’s Committees decide on investment policies (approve or refuse). In case of refusal, the investor will be informed in writing of the reason. |
| Step 6 | The Department of Planning and Investment shall issue the Investment Registration Certificate to the investor upon receipt of the decision on the investment policy. |
For projects subject to the Prime Minister’s decision on investment policies
Investors need to prepare eight complete dossiers. Each set includes:
- Documents similar to the application for an IRC for projects subject to the investment policy decision of the provincial People’s Committee
- Plan on ground clearance, migration and resettlement (original)
- Preliminary assessment of environmental impact, environmental protection solutions (original)
Procedure
| Procedure | Detail |
| Step 1 | The investor submits the prepared dossier to the Department of Planning and Investment where the investment project is intended |
| Step 2 | The Department of Planning and Investment shall send the dossier to the Ministry of Planning and Investment and concurrently send the dossier to the competent state agency related to the investment project for comments. |
| Step 3 | The consulted agency shall do due diligence on the contents under its state management and send it to the investment registration agency. |
| Step 4 | The Department of Planning and Investment shall make a due diligence report and submit it to the People’s Committee of the province. |
| Step 5 | Upon receiving opinions from the province’s People’s Committee, the Ministry of Planning and Investment shall make a due diligence report. |
| Step 6 | Upon receiving the due diligence report from the Ministry of Planning and Investment, the Prime Minister shall decide on the investment policy and send a written decision to three agencies:
|
| Step 7 | The Department of Planning and Investment shall issue the Investment Registration Certificate to the investor upon receipt of the decision on the investment policy. |
For projects subject to the National Assembly’s decision on investment policies
The investor prepares 21 sets of documents, each complete with the following documents:
- Documents similar to the Application for IRC for projects subject to the Prime Minister’s decision on investment policies;
- Assessment of the project’s socio-economic impacts and efficiency (1 original);
- Proposing specific mechanisms and policies (1 original).
Procedure
| Procedure | Detail |
| Step 1 | The investor submits the prepared dossier to the Management Board of the industrial park, export processing zone, high-tech park, economic zone, or the Department of Planning and Investment where the investment project is intended. (Depending on the investment project to be submitted to the investment registration agency) |
| Step 2 | The investment registration agency shall send investment project dossiers to the Ministry of Planning and Investment for reporting to the Prime Minister to establish the State Appraisal Council. |
| Step 3 | The State Appraisal Council shall organize the appraisal of investment project dossiers and make an appraisal report including the contents specified in Clause 6, Article 33 of the Law on Investment and make an appraisal report to submit to the Government. |
| Step 4 | The Government shall send the Investment Policy Decision Dossier to the agency in charge of verification of the National Assembly. |
| Step 5 | The agency assigned by the National Assembly to preside over the verification shall conduct the verification |
| Step 6 | The National Assembly considers and passes a resolution on investment policies |
| Step 7 | The Department of Planning and Investment shall issue the Investment Registration Certificate to the investor upon receipt of the decision on investment policy. |
For projects that are not subject to investment policy decisions
For investment projects in this case, implementing investment registration licensing procedures is much simpler. Accordingly, the investor only needs to prepare one (01) set of documents with the same documents as the case of issuance of an IRC for a project subject to the investment policy decision of the provincial People’s Committees like the Siglaw team mentioned above.
Procedure
| Procedure | Detail |
| Step 1 | Prepare and submit a dossier to the investment registration agency |
| Step 2 | The investment registration agency receives and examines the application.
Note: Investors should pay attention to preparing detailed and complete dossiers to avoid wasting time on supplementing and completing dossiers. |
| Step 3 | Appraisal and approval of documents |
| Step 4 | Get results
Investors come to the Investment Registration Authority according to the appointment on the Application Receipt Certificate to receive the results. |
ADJUSTMENT OF INVESTMENT REGISTRATION CERTIFICATE
In which case is it necessary to amend the investment registration certificate?
According to Clause 1, Article 41 of the Law on Investment 2020, investors can adjust their goals, transfer part or all of an investment project, merge projects, divide or split a project into many projects, use land use rights and assets on land belonging to investment projects to contribute capital to establish enterprises, business cooperation, or other contents and must comply with the provisions of the law
According to the provisions of Clauses 2 and 3, Article 41 of the Investment Law 2020, the cases in which the IRC must be adjusted are as follows:
“2. The investor shall carry out procedures for adjusting the IRC in case the adjustment of the investment project changes the contents of the IRC.
- An investor whose investment policy has been approved must carry out the procedures for approval for adjustment of investment policy if it falls into one of the following cases:
- a) Change the target specified in the written approval of investment policy; adding targets subject to approval of investment policies;
- b) Change in the size of the land used for more than 10% or more than 30 hectares, change the investment location;
- c) The total investment capital is changed by 20% or more, resulting in a change in the scale of the investment project;
- d) Prolong the implementation schedule of an investment project while the total project investment time exceeds 12 months compared with the progress of the investment project specified in the written approval of the initial investment policy;
đ) Adjustment of the operation duration of the investment project;
- e) Change the technology that has been appraised and consulted in the process of approving the investment policy;
- g) Change of investor of an investment project with approved investment policy concurrently with investor approval before the project is exploited, operated, or changed conditions for investors (if any).
In addition, Article 63 of the Investment Law 2020 also clearly stipulates that offshore investment projects need to amend the IRC in the following cases:
“a) Change of Vietnamese investor;
- b) Change the form of investment;
- c) Change in outward investment capital; investment capital sources, forms of investment capital;
- d) Changing the location of investment activities for investment projects requiring an investment location;
đ) Changing the main objective of overseas investment activities;
- e) Using profits from overseas investments as prescribed at Points a and b, Clause 1, Article 67.”
Which agency has the authority to amend the Investment Registration Certificate?
The law stipulates that the following agencies have the authority to amend the IRC, specifically:
The Department of Planning and Investment, where the investor intends to implement the investment project has the authority to amend the IRC for:
- Investment projects implemented in 02 or more provincial-level administrative units;
- Investment projects implemented inside and outside industrial parks, export processing zones, high-tech zones and economic zones;
- Investment projects in industrial parks, export processing zones, hi-tech zones, and economic zones where the management board of industrial parks, export processing zones, hi-tech zones, and economic zones has not been established or is not under the management of Management board of industrial parks, export processing zones, high-tech zones and economic zones.
The Management Board of industrial parks, export processing zones, hi-tech zones, and economic zones shall have the authority to amend the IRC for:
- Investment projects on the construction and business infrastructure of industrial parks, export processing zones, high-tech zones, and functional zones in economic zones;
- Investment projects implemented in industrial parks, export processing zones, high-tech zones, and economic zones.
Therefore, investors need to accurately determine the information about their projects to send the dossiers to the right authorities to carry out the procedures for adjusting the IRC to avoid wasting time.
Dossier and Procedure for adjusting investment registration certificates in some basic cases
Dossier
For projects that are not subject to investment approval, investors can choose to submit an application for adjustment of the IRC in one of two forms: online or in person.
The dossier set includes the following documents:
- A written request for adjustment of the investment project;
- Report on the implementation of investment projects up to the time of adjustment;
- Investor’s decision on the adjustment of investment projects for institutional investors;
- Explain or provide documentation related to the adjustment
Besides, depending on the content to be adjusted, the investor must also provide some other documents:
| Stt | Adjusted content | Type of document |
| 1 | Adjusting the content of investor information |
|
| 2 | Adjustment of the charter capital and investment capital of the project |
|
| 3 | Adjusting the content of the location of the investment project, the area of land to be used |
|
Procedure
Step 1: The investor submits a written request for adjustment of the investment project to the Investment Registration Authority, enclosed with documents related to the change of the name of the investment project’s name and the investor’s name.
Step 2: The investment registration agency receives and considers the application.
Step 3: If valid, the Investment Registration Authority shall amend the IRC for the investor within 03 working days from the date of receipt of the written request for adjustment of the IRC.
Are the documents and procedures for adjusting the Certificate of outward investment registration different?
For projects that are not subject to the approval of outward investment policies
Dossier
In case the investor wishes to amend the certificate of outward investment registration, it is necessary to prepare the documents specified in Clause 3, Article 63 of the Law on Investment 2020 with the following documents:
- A written request for adjustment of the Certificate of outward investment registration, made according to Form B.I.3;
- Documentation of the investor’s legal status;
- A copy of the certificate of registration of outward investment;
- Decision to adjust outward investment activities;
- The written approval of the competent state agency on the satisfaction of the conditions for outward investment (For offshore investment projects in the industries and trades specified in Clause 1, Article 54 of the Investment Law);
- Report on the operation of the investment project up to the time of submission of the application for adjustment of the Certificate of outward investment registration according to Form B.I.5;
- A document from the tax authority certifying the investor’s fulfillment of the tax payment obligation in the case of an increase in outward investment capital, according to Form B.I.8;
- A written commitment to self-balance foreign currency sources or a written commitment to arrange foreign currency for investors of an authorized credit institution. In case the investor chooses to submit a written commitment to self-balance foreign currency sources, it must be enclosed with a document from a credit institution certifying the investor’s foreign currency account balance according to Forms B.I.6 and Form B.I.7.
Implementation process
Step 1: Submit a dossier to the Ministry of Planning and Investment and register investment information on the National Investment Information System.
Step 2: The Ministry of Planning and Investment receives the application
Step 3: The Ministry of Planning and Investment checks the validity of the application.
Step 4: In case the project, after adjustment, has registered capital remitted abroad in foreign currency equivalent to 20 billion VND or more and is not part of the project specified in Article 56 of the Investment Law, the Ministry of Planning and Investment obtain written opinions from the State Bank of Vietnam.
Step 5: The State Bank of Vietnam has written comments to the Ministry of Planning and Investment.
Step 6: The Ministry of Planning and Investment adjusts the Certificate of outward investment registration, and sends copies to some other agencies
Step 7: In case the application does not satisfy the prescribed conditions, the Ministry of Planning and Investment shall issue a written notice of refusal to amend the Certificate of outward investment registration and clearly state the reasons for sending it to the investor.
For projects falling under the Prime Minister’s authority to approve outward investment policies
Dossier
In addition to the above documents, investors must also consider whether their project is eligible for investment approval or not to provide more specialized documents as prescribed in Article 75 of Decree No. 31/ 2021/ND-CP, specifically:
- Investment project proposal;
- Documents proving the financial capacity of the investor.
Implementation process
Step 1: Submit a dossier to the Ministry of Planning and Investment and register investment information on the National Investment Information System.
Step 2: The Ministry of Planning and Investment receives the application
Step 3: The Ministry of Planning and Investment checks the validity of the application.
Step 4: The Ministry of Planning and Investment shall send the dossier to the Ministry of Finance, the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Industry Management, the State Bank of Vietnam and the Provincial People’s Committee directly under the Central Government where the investor’s head office is located.
Step 5: The consulted agency shall give written opinions on the contents under its assigned state management competence and send it to the Ministry of Planning and Investment.
Step 6: The Ministry of Planning and Investment organizes the appraisal and makes an appraisal report on the project’s adjusted contents of the project and submits it to the Prime Minister.
Step 7: Upon receiving the appraisal report from the Ministry of Planning and Investment, the Prime Minister shall decide on the policy of adjusting the outward investment project.
Step 8: For outward investment projects of enterprises in which 100% charter capital is held by the State, after a decision on the adjustment of outward investment policies is issued, the owner’s representative agency shall decide to invest in accordance with Article 29 of the Law on Management and Use of State capital invested in production and business in enterprises.
Step 9: The Ministry of Planning and Investment amends the Certificate of outward investment registration and sends a copy to the State Bank of Vietnam, the Ministry of Finance, the Ministry of Foreign Affairs, the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Industry Management, the People’s Committee of the province or city directly under the Central Government where the investor is headquartered or registered for permanent residence, the tax authority where the investor confirms the fulfillment of the tax payment obligation, the investor’s owner’s representative agency (if any);
Step 10: In case the Prime Minister does not approve the policy of adjusting the outward investment project, the Ministry of Planning and Investment shall issue a written notice of refusal to adjust the outward investment registration certificate and clearly state the reason for sending to the investor.
For projects subject to the National Assembly’s competence to approve outward investment policies
Dossier
In addition to the same documents as the projects that are not subject to the approval of investment policies as mentioned above, projects subject to the approval of the National Assembly’s outward investment policy will have to supplement a number of additional documents following Article 77 of Decree No. 31/2021/ND-CP:
- Investment project proposal;
- Documents proving the financial capacity of the investor.
Implementation process
Step 1: The investor submits an amendment to the Certificate of outward investment registration to the Ministry of Planning and Investment; and registers investment information on the National Investment Information System.
Step 2: When receiving sufficient investment project dossiers, the Ministry of Planning and Investment shall report to the Prime Minister to establish the State Appraisal Council.
Step 3: The State Appraisal Council organizes the appraisal and makes an appraisal report including the contents specified in Clause 3, Article 57 of the Investment Law.
Step 4: The Government sends the application for adjustment of outward investment policies to the agency in charge of verification of the National Assembly.
Step 5: The National Assembly considers and approves the adjustment of the outward investment policy, including the contents specified in Clause 8, Article 57 of the Law on Investment.
Step 6: The Ministry of Planning and Investment shall issue an Outward Investment Registration Certificate to the investor upon receipt of the National Assembly’s written approval of the adjustment of the outward investment policy.
NOTES FROM SIGLAW WHEN INVESTORS ADJUST THE INVESTMENT REGISTRATION CERTIFICATE
Firstly, enterprises that have not yet carried out the procedure to separate the Investment Registration Certificate into the Business Registration Certificate will need to perform the separation of the Investment Certificate.
Secondly, after the enterprise has adjusted the IRC, it is necessary to carry out a number of procedures to avoid unintended legal problems, including the fact that new investors contribute capital to the investment account of the enterprise and pay attention to ensure that the time limit for capital contribution commitment has been stated in the IRC.
Third, if an enterprise adjusts to new and conditional business lines, it will need to ensure conditions during its operation.
Fourth, enterprises also need to pay attention to the reporting procedures and reporting forms of enterprises according to the content of recognition and investment reporting obligations of enterprises.
Fifth, in case the investor fails to contribute capital on schedule as committed on the IRC, the enterprise will have to carry out the extension procedure and be fined according to the provisions of the law.
CONSULTING SERVICE FOR ISSUANCE AND ADJUSTMENT OF INVESTMENT CERTIFICATE OF SIGLAW
| Siglaw Firm provides professional and reliable consulting services for granting and adjusting investment registration certificates to clients in Vietnam. | We understand the complexities of the investment registration process, so we are committed to providing our clients with the most optimal solutions to ensure their interests are best protected. |
| Experience | For more than 10 years, Siglaw is confident to be a reputable consulting and support unit to help clients solve all related problems when carrying out the procedures for granting investment registration certificates. |
| Legal team | Experienced lawyer with a deep understanding of the investment field |
| Typical clients | Korean Lotte Group in Vietnam, HS F&B Group, Alliex Vietnam, HAIDILAO,… |
INVESTMENT REGISTRATION LICENSE CONSULTING SERVICE FEE
Adjusting Investment Registration Certificates ranges from 15 to more than 20 million VND. The cost of this service varies according to criteria such as the firm offering the service, the scope of the service, the time, and so on. The cost of Siglaw’s services depends on the scope and scale of the client’s project. We are committed to offering the most reasonable and competitive cost in the market so that clients can choose the right one for their needs.
The above is the basic information about the documents and procedures for granting and adjusting the IRC that investors need to understand in order to properly and fully comply with the legal procedures. Fully complying with regulations and processes related to IRC will help businesses ensure their legal rights and create favorable conditions for business development and investment.
However, the issuance and adjustment of the IRC is always a difficult procedure, requiring carefulness and practical experience to save the most time for investors. Siglaw team is always ready to accompany and support investors to carry out related procedures. If you have any problems that need to be solved, please contact Siglaw for free support in the fastest way.
For a free comprehensive M&A consultation, please contact:
Head office in Hanoi City: 12A Floor Sao Mai Building, No. 19 Le Van Luong Street, Nhan Chinh Ward, Thanh Xuan District, Hanoi City.
Email: [email protected]
Branch in the South: 21 N4 Street, Commercial, Service and Residential Complex at 16/9 Bui Van Ba Street, Tan Thuan Dong Ward, District 7, Ho Chi Minh City.
Central Branch: 177 Trung Nu Vuong Street, Hai Chau District, Danang City
Email: [email protected]
Hotline: 0961 366 238
