Decree No. 96/2026/ND-CP: Reform of Investment Procedures, Expansion of Incentives, and New Market Entry Models for Investors

On 31 March 2026, the Government promulgated Decree No. 96/2026/ND-CP detailing and guiding the implementation of several provisions of the Law on Investment 2025 (“Decree 96”). Decree 96 takes effect from 31 March 2026, except for Articles 11 and 12, which will take effect from 1 July 2026, and replaces Decree No. 31/2021/ND-CP, Decree No. 19/2025/ND-CP, and Decree No. 239/2025/ND-CP. Key highlights focus on streamlining investment procedures, selectively expanding investment incentives, decentralizing approval authority, and introducing more flexible market entry mechanisms for foreign investors in Vietnam.

Special Investment Procedures – a “Green Lane” Mechanism for Eligible Projects

For the first time, Decree 96 introduces a “special investment procedure” applicable to certain projects implemented in industrial parks, export processing zones, high-tech parks, concentrated digital technology zones, free trade zones, international financial centers, and functional zones within economic zones. Under this mechanism, eligible projects may be exempted from procedures such as investment policy approval, detailed environmental impact assessment (EIA), construction permits, and the preparation of detailed 1/500 planning. The timeline for issuance of the Investment Registration Certificate (IRC) is shortened to a maximum of 15 working days and is centrally handled by the management authority of the relevant industrial park/economic zone or other competent authority.

This mechanism may significantly reduce the legal preparation timeline for projects, particularly in sectors with short product life cycles such as semiconductors, electronics, data centers, and high technology. However, simplified procedures do not equate to reduced compliance obligations. Investors must commit to full compliance with national technical regulations on construction, environmental protection, and fire prevention and fighting; prepare their own techno-economic reports; and notify the competent authority at least 30 days prior to the intended commencement date. Accordingly, the new mechanism shifts regulatory focus from ex-ante approval to ex-post supervision, thereby increasing the importance of robust internal compliance controls from the early stages of project development.

Expanded and More Targeted Investment Incentives

Decree 96 refines investment incentive policies to focus on high value-added sectors, innovation, and strategic technologies, including semiconductors (R&D, design, manufacturing, packaging, and testing), AI/cloud data centers, 5G infrastructure, green hydrogen, green ammonia, and other key technology industries. Notably, Decree 96 introduces specific capital thresholds and disbursement requirements for each category of project, ensuring that only projects with substantial capital commitment and genuine implementation qualify for incentives.

In addition to corporate income tax incentives of up to 1.5 times the standard level, eligible projects may also receive financial support from the Investment Support Fund and, in certain cases, assistance with foreign currency balancing. However, enterprises must ensure ongoing compliance with all eligibility conditions, particularly those relating to business sectors, capital scale, disbursement progress, technology transfer, localization ratios, and the participation of Vietnamese enterprises in the supply chain.

Updates on Market Access Conditions and Decentralization of Investment Authority

Decree 96 maintains the list of sectors subject to market access restrictions for foreign investors, including sectors not yet open to market access and those subject to conditional access. Importantly, it supplements regulations concerning the management and operation of intermediary e-commerce platforms, social networks engaged in e-commerce activities, and integrated e-commerce platforms, reflecting a trend toward tighter regulatory oversight of digital business models.

At the same time, Decree 96 revises the decentralization framework for investment policy approval by narrowing the authority of the Prime Minister and expanding that of provincial-level People’s Committee Chairpersons. This decentralization may shorten project approval timelines and enhance local autonomy. However, variations in appraisal capacity and administrative practices across provinces may lead to inconsistencies, delays, or divergent documentation requirements.

More Flexible Market Entry Models for Foreign Investors

A notable new development is that foreign investors may establish an economic organization prior to obtaining an Investment Registration Certificate (IRC), and subsequently apply for the IRC for their project. This approach allows investors to obtain legal entity status at an early stage to open bank accounts, enter into lease agreements, recruit personnel, and undertake initial preparatory activities. However, the IRC must be obtained within 12 months from the date of establishment.

Given the absence of clear legal consequences in cases where the IRC is not granted within this timeframe, contracts entered into during the interim period should be carefully structured, particularly with respect to conditions precedent, termination rights, refund mechanisms, and risk allocation.

Overall, Decree 96 reflects a significant reform in Vietnam’s investment regime, facilitating investor entry while shifting part of the regulatory burden toward post-licensing supervision. In light of this, ALIAT recommends that enterprises focus on the following:

• Proactively monitor, update, and review expense items to ensure proper classification of deductible expenses for CIT purposes;
• Review and supplement supporting documentation for deductible expenses to ensure compliance with the new requirements;
• In cases of investment project expansion, ensure timely notification to tax authorities regarding changes in investment capital;
• For foreign enterprises engaging in capital transfers, securities transactions, or derivative securities transactions, carefully determine and record the appropriate timing for recognizing taxable revenue for CIT purposes.