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December 15, 2025

Vietnam Issues Amended Law on Construction

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On December 10, 2025, the National Assembly of Vietnam officially passed the amended Law on Construction, marking the culmination of a multiyear reform process aimed at modernizing Vietnam’s construction legal framework, streamlining administrative procedures, and aligning with digital transformation and sustainability goals.

The amended law, which replaces the current Law on Construction No. 50/2014/QH13, will take effect on July 1, 2026. The Ministry of Construction (MOC) is also preparing several guiding decrees covering project classification, digital submissions and database management, and technical standards for design documentation.

Key Changes in the Amended Law

While the executed version of the amended Law on Construction has yet to be released to the public, reports have confirmed that it includes the following key changes introduced under the latest draft submitted by the MOC in September:

  • Project classification: The amended Law on Construction classifies construction projects by investment form (public, PPP, business investment, and others), which aligns with the Law on Public Investment, the Law on Investment, and the Law on PPP Investment. This reduces regulatory overlap and clarifies responsibilities.
  • Project preparation and appraisal: The requirement for prefeasibility reports for business investment projects is abolished, as this requirement is now governed by the Law on Investment and the Law on Public Investment. This change shortens the preparation timeline and reduces duplication of procedures. In addition, the authority’s appraisal is streamlined to a single feasibility stage. Also eliminated is the appraisal process conducted following basic design approval, shifting more responsibility to investors and consultants, with targeted post-audit mechanisms for high-risk projects.
  • Construction permits: One of the most significant new changes of the amended Law on Construction is the expansion of exemptions from construction permit requirements to the following eight distinct groups of construction works:
    1. State-secret works, emergency or urgent constructions, works under special public investment projects or projects following special procedures, temporary works, and works located on national defense or security land.
    2. Works under public investment projects approved by competent authorities such as the prime minister, heads of central agencies, leaders of supreme judicial bodies, the State Audit Office, the Office of the President, the Office of the National Assembly, ministries, political-social organizations, and chairpersons of People’s Committees at all levels.
    3. Works constructed along routes spanning two or more provinces, or those outside designated urban development areas as per approved plans or accepted route proposals.
    4. Offshore works under investment projects with authorized sea area allocation, airports, airport-related works, and works ensuring flight operations outside airports.
    5. Advertising structures exempt under the Law on Advertising—such as small, compact signs and billboards (under 20 m² per side), signs and billboards with simple structures (not metal frames), and freestanding billboards under 40 m² in area—and passive telecommunications infrastructure.
    6. Works under investment projects whose feasibility study reports or adjustments have been appraised and approved by competent authorities according to regulations.
    7. Grade 4 constructions and individual residential buildings under seven stories with a total floor area under 500 m2, provided they are not located in areas with specific architectural management regulations—such as functional zones, urban areas, rural residential zones, provincial/city urban development areas, national economic or tourism zones, or areas with established architectural management rules.
    8. Works involving internal repairs or external renovations that do not adjoin urban roads subject to architectural management, as long as such repairs do not alter the building’s purpose or function, affect structural safety, or compromise fire safety, environmental protection, or technical infrastructure.

According to the MOC, forthcoming government decrees will further simplify construction permit procedures. The entire permitting process is expected to be conducted online, with a maximum processing time of 7 to 10 days—reducing both time and costs by at least 30% as mandated by the government. The new regulations will also increase the responsibility of design consultants to ensure construction safety.

Other Notable Reforms

The amended law also reforms requirements and procedures in several other areas, as detailed below.

Cost Management and Contractual Principles

The amended law introduces clearer and more practical provisions on construction cost management and contractual arrangements, with a particular focus on risk allocation and contract adjustment. Accordingly, it distinguishes between force majeure events and fundamental changes of circumstances, following the Civil Code 2015, aiming to provide a fair and transparent legal basis for contract adjustment in exceptional situations.

Force majeure in this context refers to events that are entirely beyond the parties’ control and directly disrupt construction activities, such as natural disasters, environmental catastrophes, fires, epidemics, wars, national emergencies, strikes, blockades, or other situations determined by the prime minister for public investment and PPP projects. By contrast, a fundamental change of circumstances arises when external conditions make contract performance excessively difficult or economically imbalanced—for instance, changes in state policies or laws, unforeseeable geological conditions, or abnormal fluctuations in construction material prices.

Digital Transformation, Innovation, and Smart Construction Governance

For the first time, the amended Law on Construction establishes a legal basis for a National Construction Information and Database System, creating a digital foundation for state management of construction activities. This system will collect, store, and update data throughout the project lifecycle, serving as an official source to support functions such as project appraisal, permit issuance, and quality supervision. It will also connect with other national databases on land, planning, investment, and infrastructure, enabling data sharing and consistency across sectors.

In parallel, the law promotes the use of science, technology, and innovation in construction, including the adoption of green technologies and building information modeling (BIM).

Green and Sustainable Construction Policy

The amended law incorporates sustainability principles, requiring construction activities to comply with environmental protection standards and encouraging the use of local, recyclable, and energy-efficient materials. It promotes research and application of advanced technologies and green building solutions to reduce resource consumption and environmental impact. These provisions aim to align construction practices with Vietnam’s broader green growth strategy and support the transition toward sustainable development.

Outlook for Investors and Developers

While the amended Law on Construction takes a progressive step forward, it also brings several practical challenges that investors and other stakeholders should be mindful of. Pending the issuance of implementing decrees, the decentralization of appraisal and permitting authority could lead to different interpretations and enforcement practices among provinces, which may affect project timelines and create uncertainty in compliance.

The move from state preapproval to postconstruction accountability, though intended to streamline oversight, also places greater responsibility on investors to manage safety, design, and technical risks. This shift will likely require stronger internal controls and more reliable professional assurance systems.

Another issue lies in the transition period. Projects that start under the currently effective Law on Construction but continue after the new law takes effect may face uncertainty over which procedures, documents, or appraisal standards apply until detailed guidance is issued.

Finally, the success of the National Construction Information and Database System will depend heavily on how well government agencies coordinate, how reliable the shared data proves to be, and how secure the digital infrastructure is. Building strong digital capacity across stakeholders will be essential to ensure the system works as intended in practice.

Investors and developers should keep a close watch on forthcoming regulations that clarify the division of appraisal authority between central and local levels, the technical framework for database integration, and transitional procedures for projects that bridge the old and new legal regimes.

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