Foreign Investment in Vietnam in Engineering Services (CPC 8672)

February 12, 2025 | Guidelines, Setting up a company in Vietnam

Foreign Investment in Vietnam to provide Engineering Services (CPC 8672) in accordance with Vietnam's WTO Schedule of Specific Commitments on Trade in Services (GATS)

I. Legal Basis:

Vietnam's WTO Schedule of Specific Commitments on Trade in Services (GATS)
Law on Investment No. 61/2020/QH14 dated June 17, 2020
Law on Enterprises No. 59/2020/QH14 dated June 17, 2020

II. Scope of Business Activities of Technical Consulting Services (CPC 8672) for Foreign Investors in Vietnam:

86721 Advisory and consultative engineering services

Assistance, advisory and recommendation services concerning engineering matters. Included here are the undertaking of preparatory technical feasibility studies and project impact studies. Examples are: study of the impact of topography and geology on the design, construction and cost of a road, pipeline or other transportation infrastructure; study of the quality or suitability of materials intended for use in a construction project and the impact on design, construction and cost of using different materials; study of the environmental impact of a project; study of the efficiency gains in production as a result of alternative process, technology or plant layout.
The provision of these services is not necessarily related to a construction project. It may consist, for example, of the appraisal of the structural, mechanical and electrical installations of buildings, of expert testimony in litigation cases, of assistance to government bodies in drafting laws, etc.

86722 Engineering design services for the construction of foundations and building structures

Structural engineering design services for the load-bearing framework of residential and commercial, industrial and institutional buildings. Design services consist of one or a combination of the following: preliminary plans, specifications and cost estimates to define the engineering design concept; final plans, specifications and cost estimates, including working drawings, specifications regarding materials to be used, method of installation, time limitations and other specifications necessary for tender submission and construction and expert advice to the client at the time of calling for and accepting tenders; services during the construction
phase.
Exclusion: Engineering services for buildings if they are an integral part of the engineering design service for a civil work or production plant or facility.

86723 Engineering design services for mechanical and electrical installations for buildings.

Mechanical and electrical engineering design services for the power system, lighting system, fire alarm system, communication system and other electrical installations for all types of buildings and/or the heating, ventilating, air conditioning, refrigeration and other mechanical installations for all types of buildings. Design services consist of one or a combination of the following: preliminary plans, specifications and cost estimates to define the engineering design concept; final plans, specifications and cost estimates, including working drawings, specifications regarding materials to be used, method of installation, time limitations and other specifications necessary for tender submission and construction and expert advice to the client at the time of calling for and accepting tenders; services during the construction phase.

86724 Engineering design services for the construction of civil engineering works

Engineering design services for the construction of civil engineering works, such as bridges and viaducts, dams, catchment basins, retaining walls, irrigation systems, flood control works, tunnels, highways and streets
including interchanges and related works, locks, canals, wharves and harbours works, water supply and sanitation works such as water distribution systems, water, sewage, industrial and solid waste treatment plants
and other civil engineering projects. Design services consist of one or a combination of the following: preliminary plans, specifications and cost estimates to define the engineering design concept; final plans, specifications and cost estimates, including working drawings, specifications regarding materials to be used, method of installation, time limitations and other specifications necessary for tender submission and
construction and expert advice to the client at the time of calling for and accepting tenders; services during the construction phase. Included are engineering design services for buildings if they are an integral part of the
engineering design for a civil engineering work.

86725 Engineering design services for industrial processes and production.

Engineering design services for production processes, procedures and facilities. Included here are design services as they relate to methods of cutting, handling and transporting logs and logging site layout; mine development layout and underground construction, the complete civil, mechanical and electrical mine surface plant installations including hoists, compressors, pumping stations, crushers, conveyors and ore and waste-handling systems; oil and gas recovery procedures, the construction, installation and/or maintenance of drilling equipment, pumping stations, treating and storage facilities and other oil field facilities; materials flows,
equipment layout, material handling systems, processes and process control (which may integrate computer technology) for manufacturing plants; special machinery, equipment and instrumentation systems; any other
design services for production procedures and facilities. Design services consist of one or a combination of the following: preliminary plans, specifications and cost estimates to define the engineering design concept; final plans, specifications and cost estimates, including working drawings, specifications regarding materials to be used, method of construction and/or installation, time limitations and other specifications necessary for tender submission and construction and expert advice to the client at the time of calling for and accepting tenders; services during the installation phase. Included are engineering design services for buildings if they are an integral part of the engineering design service for a production plant or facility.

86726 Engineering design services n.e.c.

Other specialty engineering design services. Included here are acoustical and vibration engineering designs, traffic control systems designs, prototype development and detailed designs for new products and any other
specialty engineering design services.
Exclusion: The aesthetic design of products and the complete design of products which do not require complex engineering (e.g. furniture) are classified in subclass 87907 (Specialty design services).

86727 Other engineering services during the construction and installation phase

Advisory and technical assistance services to the client during construction to ensure that construction work is in conformity with the final design. This involves services provided both in offices and in the field, such as the review of shop drawings, periodic visits to the site to assess progress and quality of the work, guiding the client and the contractor in the interpretation of contract documents and any other advice on technical questions that may develop during construction.

86729 Other engineering services

Engineering services not elsewhere classified. Included here are geotechnical engineering services providing engineers and architects with necessary subsurface information to design various projects; groundwater engineering services including groundwater resources assessment, contamination studies and quality management; corrosion engineering services including inspection, detection and corrosion control programmes; failure investigations and other services requiring the expertise of engineers.

III. Market Access Restrictions for Architectural Services (CPC 8671) under Vietnam's WTO Schedule of Specific Commitments on Trade in Services (GATS):

The method of supply (3) commercial presence is unrestricted, except for:

(i) Within 2 years from the date of WTO accession, 100% foreign-invested enterprises are only allowed to provide services to foreign-invested enterprises in Vietnam.

(ii) Foreign enterprises must be legal entities of a WTO Member.

Accordingly, foreign investors are allowed to invest in establishing 100% foreign-invested enterprises in Vietnam for architectural services (CPC 8671), except that they must meet the 2 conditions mentioned above. Vietnam joined the WTO in 2007, so the requirement that foreign-invested enterprises only provide services to foreign-invested enterprises in Vietnam has been removed.

See more related content on the principles of GATS here

IV. Investment Procedures for Foreign Investors in Vietnam:

According to the provisions of Articles 21 to 28 of the Law on Investment 2020 on forms of investment in Vietnam, the following applies:

Foreign investors can choose the following forms of investment to conduct business in Vietnam:

1. Investment in Establishing an Economic Organization:

a) Foreign investors establishing an economic organization must meet the market access conditions for foreign investors specified in Article 9 of this Law.

b) Before establishing an economic organization, foreign investors must have an investment project, carry out procedures for issuance and adjustment of the Investment Registration Certificate, except for the establishment of innovative start-up small and medium enterprises and innovative start-up investment funds as prescribed by law on support for small and medium enterprises.

From the date of issuance of the Business Registration Certificate or other equivalent legal document, the economic organization established by the foreign investor is the investor implementing the investment project as prescribed in the Investment Registration Certificate.

2. Investment in Contributing Capital, Purchasing Shares, or Purchasing Capital Contributions:

Foreign investors contributing capital, purchasing shares, or purchasing capital contributions of an economic organization must meet the following regulations and conditions:

a) Market access conditions for foreign investors specified in Article 9 of the Law on Investment.

b) Ensuring national defense and security as prescribed by this Law.

c) Regulations of land law on conditions for receiving land use rights, conditions for land use on islands, border communes, wards, and towns, and coastal communes, wards, and towns.

3. Implementation of Investment Projects:

Foreign investors conduct business through the implementation of investment projects in Vietnam.

4. Investment in the Form of BCC Contracts:

BCC contracts signed between domestic investors are implemented in accordance with the provisions of civil law.
BCC contracts signed between domestic investors and foreign investors or between foreign investors carry out procedures for issuance of the Investment Registration Certificate as prescribed in Article 38 of the Law on Investment.
The parties participating in the BCC contract establish a coordinating committee to implement the BCC contract. The functions, tasks, and powers of the coordinating committee are agreed upon by the parties.

5. New Investment Forms and Types of Economic Organizations as Prescribed by the Government:

Foreign investors make investments in the form of new economic organizations as prescribed by the government.

The information contained in this article is general and intended only to provide information on legal regulations. DB Legal will not be responsible for any use or application of this information for any business purpose. For in-depth advice on specific cases, please contact us.

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