Concerns about risks before the proposal of Government guarantee, dispute resolution for BOT power project

On the evening of November 24, the 51st session of the National Assembly Standing Committee gave opinions on the draft Resolution of the National Assembly on mechanisms and policies to remove difficulties in national energy development in the 2026-2030 period.

Minister of Industry and Trade Nguyen Hong Dien - Photo: National Assembly

Presenting the report, Minister of Industry and Trade Nguyen Hong Dien said that the laws related to energy are still inconsistent, while the procedures for selecting investors are many and complicated, causing projects to be delayed.

Therefore, the submission presents contents related to power projects and works already in the planning that will not have to go through investment policy approval procedures, except for investment projects under the authority of the National Assembly ; medium and low voltage grid investment projects; emergency power projects; and offshore wind power projects.

Many notes for policies to remove power projects

The draft stipulates the replacement of the decision on approval of investment policy for power business investment projects that are not subject to land use rights auctions, investor selection bidding, and projects subject to investor selection bidding.

For transmission grid projects and works in the planning, the Prime Minister decides to assign a state-owned enterprise holding 100% of the charter capital or an enterprise in which a state-owned enterprise holds 100% of the charter capital as the investor.

The draft supplements regulations on a long-term minimum electricity output mechanism of no less than 75% of average output and an application period of no more than 15 years for gas-fired thermal power projects using imported LNG to remove difficulties for investors and promote projects.

For BOT power projects, additional mechanisms are added to meet the requirements of foreign investors and lenders and increase the attractiveness to attract capital. Including mechanisms applied according to foreign laws, mortgage of land use rights and assets on land at international financial institutions and foreign organizations licensed to operate in Vietnam; electricity contracts calculated in USD and paid in VND; implementation of government guarantees...

For offshore wind power, there will be mechanisms such as project surveys to establish investment policies; authority to approve investment policies, bidding to select investors; assigning tasks to a number of state-owned enterprises, reputable, branded and capable Vietnamese enterprises to implement; incentives for projects...

Emphasizing the need to issue a resolution, the review report presented by Chairman of the Economic and Financial Committee Phan Van Mai emphasized the need to pay attention to policies on decentralization, delegation of power and management of state capital. The government guarantee mechanism can create great legal constraints, potentially posing a risk of the State being sued in international arbitration.

At the same time, the policy mechanism on land mortgages and assets attached to land at foreign credit institutions is not appropriate. The mechanism for choosing to apply foreign laws and foreign currency payments is potentially risky and related to national monetary security factors...

In particular, some contents related to land law, government guarantees, foreign exchange guarantees, BOT terms, investor selection and USD commitments... are policies with great impact, beyond the current legal framework, affecting energy security, national financial and monetary safety, posing many unpredictable risks, and have not been thoroughly assessed.

Chairman of the Committee on Law and Justice Hoang Thanh Tung speaks - Photo: National Assembly

Carefully evaluate mechanisms to avoid risks

Chairman of the Law and Justice Committee Hoang Thanh Tung also expressed concern about the mechanism for applying BOT projects, important national construction projects, if disputes arise and foreign laws can be applied.

"I do not understand whether the parties agree to apply foreign law at the time of the dispute, or whether foreign law has been agreed upon by the parties and recorded in the contract from the beginning" - Mr. Tung said that this is a very important issue that can give rise to disputes.

National Assembly Chairman Tran Thanh Man also noted the need to continue reviewing and re-evaluating projects, adding fundamental, appropriate, and fair solutions to avoid consequences and legalize violations.

It is especially important to note that allowing the application of foreign laws to BOT projects and allowing mortgages of land use rights with foreign credit institutions requires reassessment of specific impacts to seek opinions from competent authorities.

At the same time, it is necessary to evaluate the impact of the Government guarantee mechanism on public debt safety and financial stability, and fully evaluate it to clarify solutions to avoid financial risks; the long-term minimum contract electricity output mechanism and the application period for LNG projects...

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Source: https://tuoitre.vn/lo-ngai-rui-ro-truoc-de-xuat-bao-lanh-chinh-phu-giai-quyet-tranh-chap-cho-du-an-bot-dien-20251124224932013.htm