Extending the grace period for delayed projects

Investors with projects that are behind schedule may have an additional 12 months to complete them before the competent state authority issues a decision to terminate the project.

After 12 months from the completion date specified in the investment policy approval document, investment registration certificate, or investment policy adjustment approval document, or adjusted investment registration certificate, if the investor still fails to implement the project, the investment registration authority shall terminate the project or a part of the project.

The conditions for project suspension and termination are being clarified to ensure feasibility and practicality.

This is new content, proposed by the drafting agency of the Law amending and supplementing several articles of the Planning Law, the Investment Law, the Law on Investment under the Public-Private Partnership method, and the Bidding Law. It suggests adding a provision on project termination to Article 48 of the Investment Law.

This means that if a project only violates the progress schedule as committed in previous documents, the investor will not be required to stop the project immediately but will have an additional 12 months to implement solutions to accelerate progress and ensure compliance with requirements.

Mr. Dang Xuan Quang, Deputy Director of the Legal Department ( Ministry of Planning and Investment ), representing the drafting committee, stated that this revision will clarify that projects with delayed progress will be handled through one process, while projects that cannot be implemented will be terminated through another process.

"The goal is to expedite slow-progress projects, not to create difficulties. If a business fails to implement a project after a grace period, it will have to be terminated," Mr. Quang clarified. Clarifying the conditions for halting or terminating projects will help address the issue of many projects remaining unimplemented for years, freeing up land resources for socio-economic development…

In fact, during the review of the legal document system according to Resolution No. 101/2023/QH15 and within the framework of the Special Task Force on reviewing and resolving difficulties and obstacles for investment projects according to Decision No. 1242/QD-TTg dated July 16, 2021 of the Prime Minister, many localities, including Cao Bang , Bac Giang, Hung Yen, Ninh Binh, Nghe An, Ha Tinh, Binh Thuan, Tra Vinh… have discovered that the requirements and conditions for terminating investment projects related to implementation progress are unclear, incomplete, and in some cases not truly appropriate.

Specifically, according to Clause a, Point 2, Article 48 and Clause 2, Article 47 of the Investment Law, the investment registration authority terminates operations in cases where the investor fails to comply with the approved investment policy and the Investment Registration Certificate, has been penalized for administrative violations but continues to violate the regulations without the ability to remedy the conditions for cessation of operations.

The problem is, if the reason for the suspension is project progress, then suspending operations in this case will further delay project progress, failing to address the objectives/conditions that need to be rectified in a situation where the project is already behind schedule.

Consequently, investors have no opportunity to rectify the conditions that led to the cessation of operations, and state management agencies have no basis to consider the investor's attitude before deciding to terminate the investment project, because rectifying the consequences is only possible if the project is allowed to continue.

Furthermore, Article 48 of the Investment Law, while stipulating the termination of investment projects, includes termination related to implementation progress. The investment registration authority terminates the project in cases where the land is revoked due to failure to put the land into use or delayed putting the land into use as prescribed by land law.

However, this regulation relates to projects that have already been allocated or leased land, but it does not apply to terminating the operation of projects that have been delayed for many years because the investor has not implemented the land allocation or lease procedures or has not cooperated in carrying out compensation and land clearance work to complete land procedures, leading to the situation of "stalled projects" or projects that are many years behind schedule compared to the progress stated in the investment policy approval document, Investment Registration Certificate, etc.

However, some issues remain unclear. According to representatives from the Lao Cai Industrial Park Management Board, is this 12-month grace period calculated according to the overall project progress or according to the progress of each phase?

Representatives from the Thai Nguyen Department of Planning and Investment suggested that the termination of unfinished projects should also follow a procedural process to ensure that projects that are behind schedule or unfeasible are definitively resolved, thus creating favorable conditions for attracting alternative projects.

Source: https://baodautu.vn/them-thoi-gian-an-han-cho-du-an-cham-tien-do-d224858.html