Resolution No. 98/2023/QH15 dated June 24, 2023 of the National Assembly on piloting a number of specific mechanisms and policies for the development of Ho Chi Minh City is a breakthrough document, a "jump" step for the City to develop rapidly.
On April 12, 2024, under the direction of the Ho Chi Minh City People's Committee, the Vietnam International Arbitration Center (VIAC) in collaboration with the Ho Chi Minh City Investment and Trade Promotion Center (ITPC) held the Preparatory Session of the 2024 Investment Legal Support Forum (Part I). The program was attended by delegates from foreign business associations, state agencies and experts in many fields. The event was organized on the basis of the Report synthesizing opinions of the 2023 Investment Legal Support Forum,
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| Investment Legal Support Forum 2024 focuses on PPP discussion |
In Session I of the Investment Legal Support Forum, the discussion focused on the topic "Investment in the form of public-private partnership (PPP) in the new context of Ho Chi Minh City" including 02 sessions: Preparatory Session and Plenary Session. In which, the Preparatory Session was deployed to collect opinions from business associations and investors related to two main topics: Choosing the type of PPP contract and requirements for ensuring the balance of interests between the parties in the contract; Enhancing the role of the private sector to improve and effectively operate PPP projects in Ho Chi Minh City.
Representative of Vietnam International Arbitration Center (VIAC), Dr. Vu Tien Loc - Chairman of Vietnam International Arbitration Center (VIAC) assessed the current implementation of Resolution 98 in Ho Chi Minh City. Mr. Loc acknowledged that Resolution 98 is a breakthrough document, a "jump" step for Ho Chi Minh City to develop rapidly. However, the regulations in Resolution 98 set many precedents beyond the current regulations of the whole country, which largely causes confusion for investors and competent state agencies in implementing and applying the provisions of this Resolution.
Thus, the Investment Legal Support Forum is an effective tool for investors to share difficulties and challenges in the process of implementing investment and business activities in Vietnam. It can be said that this Forum is a step to realize the core motto of "supporting businesses with legal matters for investors".
Ms. Cao Thi Phi Van - Deputy Director of the Ho Chi Minh City Investment and Trade Promotion Center (ITPC) said that investors highly welcome the efforts of Ho Chi Minh City and Vietnam in promulgating and putting Resolution 98 into practice. For investment projects in the form of public-private partnership (PPP), the Resolution has opened up a very positive mechanism, so the City has the motivation to launch many projects under Resolution 98 in 2024.
Currently, Ho Chi Minh City is urgently reviewing the shortcomings to restart "frozen" projects and prepare to start new projects such as projects following the urban development model with the orientation of public transport development TOD; projects following the public-private partnership (PPP) method applying BOT and BT contracts.
However, the implementation of Resolution 98 still has difficulties and obstacles. Therefore, the need to listen to the opinions of the business community is absolutely necessary. Events such as ILS Forum are the place for investors - state agencies - experts to dialogue and discuss existing problems, especially related to legal issues.
Experts have assessed the potential of new projects under Resolution 98. Accordingly, the Resolution allows the implementation of projects in the fields of health,education - training, sports and culture (a new point compared to the current PPP Law). This provision creates new momentum for the development of the Culture, Sports and Tourism sector, but leaves open the management and exploitation rights of projects as well as the mechanism for capital recovery of investors.
For example, there are currently no specific regulations or detailed instructions regarding the period of time for investors to manage and exploit projects, and the rights and obligations of investors, which are different from projects in areas previously regulated in the PPP Law. As a result, investors feel confused and are not really ready to invest.
The current PPP Law has provisions on the mechanism for sharing profits and risks, however, investors are not really satisfied with this ratio. Furthermore, in case the revenue is lower than the financial plan, investors must go through a very strict auditing process. Therefore, investors expect a more reasonable mechanism in the future.
Commenting on the types of PPP contracts applied, investors suggested that the city should study and apply many other forms besides BOT and BT contracts to select investors. Because what investors really aim for is a long-term cooperation and sharing model, not just a short-term focus like BT and BOT. Besides, the current BOT contract models are also very basic, often not meeting the requirements of investors.
Therefore, the requirement to supplement and detail many regulations in the BOT model contract, such as: regulations on obligations and responsibilities of the contracting agency, regulations related to investment capital and disbursement of investment capital, revenue increase and decrease mechanisms, etc., is absolutely necessary to ensure legal safety and minimize risks when implementing the project.
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