At the 2025 Investment Legal Support Forum (ILS Forum) themed “Investing in Industrial Zone Infrastructure Development: Updates on Regulations and Implementation Recommendations,” lawyer Bùi Văn Thành – Vice Chairman of the Vietnam Industrial Park Finance Association, VIAC Arbitrator, stated that pre-approval procedures for industrial zone (IZ) investment projects typically span 2-5 years. A positive development is the shortened approval process for IZ investment projects, as authority has been decentralized from the Government to provincial People’s Committees, streamlining the process.
However, Mr. Thành identified land access as the most significant bottleneck. The 2024 Land Law mandates the State to handle land recovery and clearance for IZ projects, yet negotiations with residents remain highly challenging.
Additional hurdles include the requirement to amend investment registration certificates for minor changes in business objectives. “With shorter product lifecycles and continuous innovation demands, adjusting investment goals for every small change costs businesses both time and money,” noted lawyer Thành.
Furthermore, procedures for construction permits and financial capacity verification, especially for foreign investors using offshore companies without financial reports, complicate capacity proof.
According to lawyer Thành, to attract more IZ infrastructure businesses, investment approval procedures must be simplified, land recovery and allocation must be seamless, and clean land funds must be ready before investment calls. Industry planning within IZs should also be clear from the outset to avoid frequent adjustments.
 Lawyer Bùi Văn Thành
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Risks in Land Lease Transfers
Regarding IZ land lease transfers, lawyer Ngô Thị Vân Quỳnh – Director and Managing Lawyer at AN Legal LLC, highlighted growing legal risks for secondary investors due to limited direct land access from infrastructure developers. Many businesses must accept subleases, complicating legal due diligence.
Ms. Quỳnh advised investors to thoroughly review planning, especially environmental regulations, land type, and industry restrictions before subleasing. For instance, if an IZ’s environmental permit lacks the investor’s industry code, the Management Board may reject applications even for non-polluting projects.
In land lease transfers, for one-time payments, infrastructure developers must terminate contracts with previous lessees before signing new ones. For annual payments, developers hold more control and may charge 2-5% transfer fees.
Ms. Quỳnh warned of land recovery risks even after one-time lease payments. Under the Land Law, failure to use land for 12 consecutive months or develop projects within 24 months may lead to provincial authorities reclaiming the land. Current laws lack mechanisms to compel land holders to utilize vacant areas, increasing risks for transferees.
Prolonged Procedures Drive Up Costs
From a management perspective, Trần Việt Hà – Deputy Head of HCMC’s Export Processing and Industrial Zones Authority, noted that legal processes from IZ establishment intent to project implementation can take up to 10 years, sharply increasing financial costs. “All delays ultimately burden land-leasing investors,” he said, explaining rising industrial land rents.
HCMC faces limited land availability and recovery challenges. Compensation for residents often falls below expectations, with some demanding double the developer’s offer. For public land, asset handling complications further delay clearance by years.
Another issue is the short remaining terms of older IZs, deterring new investors. The city’s 2025-2030 restructuring plan, with a vision to 2040, aims to maintain existing IZ locations, transition to high-tech industries, and extend terms for investor confidence.
On environmental regulations, Mr. Hà noted inconsistencies, as some non-polluting industries are excluded due to missing codes in IZ environmental permits. Following HCMC’s proposal, the Ministry of Natural Resources and Environment amended permits to include clean industries within three weeks.
Mr. Hà clarified that IZ infrastructure developers separating land rent and infrastructure fees is legally permissible as a civil matter. Investors should note this to avoid cost confusion.
– 10:29 22/11/2025
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