Vietnam's Investment Law 2025: The Substantive Changes FDI Investors Need to Know

With the new Investment Law (Law No. 143/2025/QH15) officially taking effect on March 1, 2026, this marks an important reform milestone — creating momentum for Ho Chi Minh City and the Ho Chi Minh City Export Processing and Industrial Zones Authority (Hepza) to accelerate the transformation of their growth model, strengthen competitiveness, and attract higher-quality investment capital flows.

Quick Answer

Vietnam's Investment Law 2025 (Law No. 143/2025/QH15), effective March 1, 2026, shifts investment regulation from ex-ante licensing to ex-post self-compliance across four areas: business-line classification, investment project operating terms, the "green lane" special investment procedure for priority sectors, and the mandatory DICA capital account. Investors gain faster market entry and more flexibility, but take on greater responsibility to self-assess, self-declare, and document their own compliance.

Significant Reduction in Conditional Business Lines

The Law applies a three-tier classification system for investment activities: prohibited business lines, conditional business lines, and unrestricted business lines. This system applies to both domestic and foreign investors; for foreign investors, however, the relevant reference is the "List of Sectors with Restricted Market Access." As in many other countries, the State provides greater protection and more favorable conditions for domestic investors relative to foreign investors — which is why checking the applicable business line classification is a critically important step for foreign investors.

The most notable point: the number of conditional business lines has been sharply reduced from 198 to 142 sectors following the elimination and consolidation of overlapping categories. The new list of conditional business lines officially takes effect on July 1, 2026, creating substantially more favorable conditions than before for foreign investors operating in Vietnam. This is one of the clearest pieces of evidence that Vietnam is continuing to open up and integrate internationally.

Notably, the Investment Law 2025 also adjusts the regulatory approach to conditional business lines by clearly separating the management method into two lists:

•        (i) A list of business lines that require a license or certificate before investment and business activities may commence; and

•        (ii) A list of conditional business lines that shifts the management method for business conditions away from licensing/certification and toward a self-declaration model, under which enterprises publicly declare that they meet the required conditions and self-manage compliance on a post-audit basis.

For group (ii), enterprises may commence business operations based on their own determination and public declaration that they meet the relevant conditions, without needing to obtain a prior license or certificate.

Under this management mechanism, enterprises must proactively assess their own compliance with the conditions and retain supporting documentation to produce in the event of an inspection or audit. If a business's self-assessment proves inaccurate, or it cannot demonstrate actual compliance with the conditions, it may face legal consequences such as administrative penalties, suspension, or termination of its business operations.

The separation of these two lists reflects a clear shift from "licensing-based management" toward "compliance- and post-audit-based management." However, the real-world effectiveness of this mechanism will depend heavily on the detailed implementing guidance and enforcement practices of the state authorities.

Decree 96/2026/NĐ-CP, issued on March 31, 2026, sets out in detail the list of sectors with restricted market access and sectors not yet open to market access for foreign investors, along with market-access procedures and investment incentive policies. This is an important implementing document that every foreign investor should review carefully before beginning to invest in Vietnam.

Adjustments to Investment Project Operating Terms

Article 31 of the Investment Law 2025 retains the existing rule that an investment project's operating term may not exceed 50 years for projects located outside an economic zone, or 70 years for projects located within an economic zone.

What is new is that investors are now permitted to adjust — increase or decrease — a project's operating term during the course of implementation. Specifically, under Clause 4, Article 31:

"4. During the course of implementing an investment project, the investor may adjust the operating term of the investment project by increasing or decreasing it. The operating term of the investment project after adjustment must not exceed the term prescribed in Clauses 1 and 2 of this Article."

The previous rule under Article 44 of the Investment Law 2020 did not permit this; it only allowed for an extension request when the term was nearing expiry.

In addition, Clause 6, Article 52 allows projects already underway before the effective date of the new Law to have their term adjusted if the remaining term is insufficient to support the financial plan or business plan of the transferee.

Establishing the "Green Lane" — Special Investment Procedure Mechanism

To attract higher-quality investment capital flows and minimize compliance costs for enterprises, the Investment Law 2025 has formally codified provisions on special investment procedures, applicable to certain fields such as high technology, innovation, semiconductors, and AI (Artificial Intelligence) — reducing both the processing time and the number of approval steps compared to standard procedures. This is an important breakthrough, allowing projects located in key economic functional zones to benefit from an administrative "green lane" mechanism that significantly shortens implementation timelines. So which investors qualify for this special mechanism, and how does the process for obtaining an Investment Registration Certificate differ from the standard procedure?

Investors with a project located in one of the following locations:

•        Industrial parks;

•        Export processing zones;

•        High-tech zones;

•        Concentrated digital technology zones;

•        Free trade zones;

•        International financial centers; or

•        Functional zones within an economic zone

may apply the special investment procedure under the Investment Law 2025 and Decree 96/2025/NĐ-CP, which provides detailed guidance on the implementation of certain provisions of the Investment Law 2025.

Under Article 28 of the Investment Law, where the special investment procedure applies, investors are not required to carry out the procedures for investment policy approval, technology appraisal, environmental impact assessment reporting, detailed planning, construction permitting, or other approval/consent procedures in the fields of construction and fire prevention and fighting. Instead, the investor must submit a written commitment to meet the applicable conditions, standards, and technical regulations under construction, environmental protection, and fire prevention and fighting law; and submit an investment project proposal that identifies and forecasts environmental impacts and proposes mitigation measures for adverse environmental effects, in place of a preliminary environmental impact assessment — as well as disclosure of the use of any technology subject to transfer restrictions, if applicable.

Applying the special investment procedure under the Investment Law 2025 is not merely a time-saving benefit — it is also an optimized legal pathway, as enterprises are exempted from numerous cumbersome environmental, construction, and fire-safety procedures at the initial stage. However, rights always come with responsibilities. Investors must pay particular attention to the accuracy of their written commitments and technical-economic reports to ensure the project operates in compliance with the applicable legal standards.

The DICA Account: A Mandatory Requirement for All FDI (Foreign Direct Investment) Capital Flows

The current Law clearly affirms the capital contribution rights of foreign investors, while also requiring that all FDI capital flows must pass through a Direct Investment Capital Account (DICA) opened at a licensed bank in Vietnam.

Opening and operating a DICA account in practice involves a number of points investors should note. Chief among them is the requirement to declare transaction details honestly and in full. Exactly what "honest and complete" declaration means is a question CHILLI can help clarify. Separately, if an investor needs to change the bank holding the DICA account, they must open a new DICA account at the new bank, transfer the entire balance from the old account to the new one, and then close the old account. Transactions through the new DICA account are only legally valid once the old account has been terminated.

What This Means for You

The Investment Law 2025 marks a clear shift in the State's regulatory philosophy toward investment activities — moving from "ex-ante control" (prior licensing) toward "ex-post control" (enterprises bear responsibility themselves, with the State supervising afterward) — while also substantially expanding incentive mechanisms and streamlined procedures for priority sectors (high technology, innovation, semiconductors, AI) and specialized economic functional zones (free trade zones, international financial centers).

However, this relaxation of administrative procedures comes together with increased legal responsibility for investors: enterprises must now assess, declare, and prove their own compliance with business conditions, rather than relying on "confirmation" from state authorities as before. This means investors — foreign investors in particular — need rigorous legal support from the very earliest stage of preparing their documentation, in order to both take advantage of the new, more open mechanisms and avoid the risk of penalties or suspension of operations resulting from errors in self-compliance.

This is precisely where advisory firms such as Chilli can serve as a bridge — helping investors correctly understand and apply the new regulations, from determining which business-line category applies, to making use of the special investment procedure, to correctly operating the DICA account process.

Key Takeaways

•        The new Investment Law takes effect on March 1, 2026; Article 7 and Appendix IV take effect on July 1, 2026.

Frequently Asked Questions (FAQ)

When does the Investment Law 2025 take effect?

The new Investment Law (Law No. 143/2025/QH15) officially took effect on March 1, 2026.

How has the number of conditional business lines changed?

The number of conditional business lines has been sharply reduced from 198 to 142 sectors following elimination and consolidation. The new list officially takes effect on July 1, 2026.

Which list should foreign investors check before investing?

Foreign investors should refer to the "List of Sectors with Restricted Market Access," which is set out in detail in Decree 96/2026/NĐ-CP, issued on March 31, 2026.

What is the operating term for an investment project in Vietnam?

Under Article 31 of the Investment Law 2025, an investment project's operating term may not exceed 50 years for projects outside an economic zone, or 70 years for projects within an economic zone.

What is new regarding adjustment of project terms compared to the Investment Law 2020?

Under Clause 4, Article 31 of the Investment Law 2025, investors may adjust — increase or decrease — a project's operating term during implementation (provided the adjusted term does not exceed the applicable maximum). The previous rule under Article 44 of the Investment Law 2020 did not permit this and only allowed for an extension request as the term was nearing expiry.

Which locations qualify for the "green lane" special investment procedure?

It applies to investment projects located in: industrial parks, export processing zones, high-tech zones, concentrated digital technology zones, free trade zones, international financial centers, or functional zones within an economic zone.

Which procedures are investors exempted from under the special investment procedure?

Under Article 28 of the Investment Law, investors are not required to carry out investment policy approval, technology appraisal, environmental impact assessment reporting, detailed planning, construction permitting, or related construction and fire-safety approval procedures — instead submitting a written commitment to meet the applicable conditions and standards prescribed by law.

What is a DICA account, and is it mandatory?

DICA (Direct Investment Capital Account) is the mandatory account through which all FDI (Foreign Direct Investment) capital flows must pass, opened at a licensed bank in Vietnam.

What is the process for changing the bank holding a DICA account?

The investor opens a new DICA account at the new bank, transfers the entire balance from the old account to the new account, and then closes the old account. Transactions through the new DICA account are only legally valid once the old account has been terminated.

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Disclaimer: This article is for reference purposes only and does not replace formal legal advice. Regulations may change — please confirm with a licensed lawyer before taking action.