New points of Decree 35/2023/ND-CP on granting licenses to foreign contractors

Decree 35/2023/ND-CP was issued and amended many contents in the construction field, including important contents related to Construction Licenses for foreign contractors. The Decree takes effect from the date of issuance (June 20, 2023). In the article below, Viet An Law will inform you of the following new updates.

Legal basis

• Law on Construction 2014, as amended and supplemented in 2020.
• Decree No. 35/2023/ND-CP on amendments to some Articles of Decrees in the field of state management of the Ministry of Construction.
• Decree No. 15/2021/ND-CP on elaborating certain regulations on the management of construction projects.

Additional authority to issue Construction Permits

Supplemented by Article 41a besides Article 41 of Decree 15/2021/ND-CP on construction licensing, general authority is prescribed for the following subjects:

• Provincial People’s Committees issue construction permits for works that require a construction permit in the province, except for works of the authority of District-level People’s Committees. The Provincial People’s Committee decentralizes and authorizes the Department of Construction, the Management Board of industrial parks, export processing zones, high-tech zones, economic zones, and district-level People’s Committees to issue construction permits within their functions. and the scope of management of this agency.
• District-level People’s Committees issue construction permits for level III and level IV works and individual houses in the area under their management.
• The agency competent to issue construction permits is the agency that has the authority to adjust, extend, reissue, and revoke the construction permit it issues.
• In case the agency competent to issue construction permits does not revoke the construction permit issued improperly, the Provincial People’s Committee will directly decide to revoke the construction permit.

Thus, updated according to the newly amended Construction Law, the current licensing authority no longer belongs to the Ministry of Construction for special-level projects. Accordingly, the decree supplements regulations on authority in some special licensing cases as follows:

• For projects with many works of different types and levels, the authority to issue construction permits is determined according to the project with the highest level of construction;
• When adjusting the construction design or repairing or renovating a project to change the class of the project, the authority to issue a construction permit is determined according to the class of the project after adjusting the design or the repair or renovation project.

Modify the authority to issue a Construction Operating License

Decree 35/2023/ND-CP has amended the regulations on the authority to issue a Construction Operating License in Article 104 of the old Decree. Previously, the regulations on decentralization of authority to two entities: the Construction Specialized Agency under the Ministry of Construction and the Department of Construction simultaneously had the authority to license construction activities for foreign contractors, based on the division of project classification, project scale, project location, and project importance. This classification has caused certain difficulties for subjects in identifying and submitting documents to the correct competent authority.

According to Decree 35/2023/ND-CP, the regulation has been amended to:

“Departments of Construction shall issue construction operating permits (including the adjusted permits) to foreign contractors in charge of construction investment of provinces. Regarding construction projects located in at least two provinces, Departments of Construction of provinces where the administration offices of foreign contractors are located shall issue construction permits”.

Thus, the current decentralization of authority no longer takes place but only focuses on one management focal point, the Department of Construction. At the same time, the need to classify projects by project classification to determine authority no longer exists. Instead, determining which province Department of Construction is based solely on the administrative boundary where the project is located. This regulation makes it easier for foreign contractors to apply for construction operating licenses in Vietnam.

Regulations on Project Classification in Decree 15/2021/ND-CP have been amended in a number of sections and clearly state “Project classification in this Appendix serves the management of construction activities according to the law on construction, does not apply to determine new urban area construction projects subject to land recovery according to the provisions of Article 62 of the Land Law No. 45/2013/QH13”.

Revocation of construction permits

Regulations on the revocation of Construction Permits issued in contravention of the law in Article 53 of Decree 15/2021/ND-CP are amended to add the case of “the issued construction permit does not meet the conditions issue a construction permit according to the provisions of law”.

Supplementing regulations on adjusting the Construction Operating License after issuance

This is a completely new regulation supplemented by Decree 35/2023/ND-CP in Article 104a. Decree 15/2021/ND-CP previously left a loophole for 2 years of implementation when there was no mechanism to guide license adjustments if the contractor changed the information recorded on the license after issuance.

Condition

• After being granted a construction activity license;
• There is a change in the name, address of the contractor, member of the contractor consortium or subcontractor, or other contents recorded in the issued construction operating license;

Adjustment procedures

• Foreign contractors must submit 01 set of the dossier to the Department of Construction where the construction operation license has been issued;
• Submit directly or send by mail.
• The time to adjust the construction activity permit is carried out within 20 days from the date of receipt of complete and valid documents.

Dossier requesting adjustment

• Application for adjustment of a Construction Operating License is prescribed according to Form No. 8, Appendix III of this Decree;
• Documents supporting the proposed adjustments. Documents must be translated into Vietnamese and certified according to Vietnamese law.

Transitional regulations for amendments and supplements to Decree No. 15/2021/ND-CP

Foreign contractors who have submitted dossiers requesting the issuance of a Construction Operating License or adjustment of a Construction Operating License but have not yet completed the issuance of a Construction Operating License shall continue to comply with the provisions of Decree No. 15/2021/ND-CP.

The issuance and adjustment of a Construction Operating License from the effective date of this Decree shall be carried out in accordance with the provisions of this Decree.

Above are the new points of Decree 35/2023/ND-CP on granting licenses to foreign contractors that Viet An Law summarizes and informs you. Please contact Viet An Law for support with the best licensing procedures for foreign contractors.