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[HO CHI MINH CITY] As Vietnam sets its sights on a double-digit economic growth target in 2025, the National Assembly has pushed forward an ambitious set of legislative and bureaucratic reforms to reduce overlapping regulations and enhance governance.

Observers argued that these legal reforms are not just a response to the challenges of an increasingly complex economy moving towards upper-middle-income status, but also a strategic effort to enhance Vietnam’s appeal as a top investment destination.

Here are six key laws poised to take effect this year that are set to reshape the business and investment landscape in Vietnam over the long run:

1. Capital Law: Fast-tracking Hanoi investments

Effective from Jan 1, 2025, the revised Capital Law grants Hanoi’s authorities greater autonomy, empowering them to fast-track investments and implement policies tailored to the capital’s unique challenges.

This includes tax and fee incentives for high-value investments in areas such as creative and culture industries, high technology, healthcare and education, as well as for strategic investors in certain prioritised sectors including semiconductors, green energy, smart city and traffic infrastructure.

The law also emphasises sustainability, with stricter regulations on businesses concerning emissions, waste management and environmental reporting. 

Hanoi will enhance the oversight of its land assets to deter speculative practices and inefficient use. Foreign businesses in real estate development must now comply with more stringent rules, ensuring that projects meet timelines and adhere to green standards.

The push for urban expansion into Hanoi’s satellite cities is another vital aspect of this legal framework, aiming at relieving congestion in the city centre while promoting economic growth in the surrounding areas.

2. Securities Law: Boosting market transparency

Vietnam’s revised Securities Law, which also came into force on Jan 1, introduces substantial reforms to enhance market discipline and protect investors. 

Only professional investors, akin to accredited investors in other jurisdictions, can purchase and trade private placement bonds, with individuals allowed to invest only in those backed by credit ratings and assets or bank guarantees. 

Meanwhile, foreign investors are automatically qualified as professional investors and are not required to undergo a verification process.

The amendments impose stricter disclosure requirements and more rigorous eligibility criteria for issuers of shares and bonds. 

Additionally, regulatory oversight is strengthened by giving authorities more power to suspend and cancel wrongful securities offerings and address misconduct such as market manipulation.

The responsibilities of other parties involved in securities dossiers, including advisory firms, auditors and credit rating agencies are also clearly stipulated. 

The new law permits the establishment of independent clearing and settlement organisations, enabling the central clearing counterparty mechanism to enhance market efficiency. This aligns with international practices and is necessary for a stock market upgrade to the emerging status. 

3. VAT Law: Targeting e-commerce players

Scheduled to take effect on Jul 1, this new law makes adjustments to the list of goods and services subject to 0, 5 and 10 per cent value-added tax (VAT) rates, including tax exemption that benefits industries such as export, agriculture, healthcare and education.

For example, goods and services exported to markets outside of Vietnam or in duty-free zones are eligible for 0 per cent VAT. 

Another key provision is the increase in the tax-exempt revenue threshold, which has been raised from 100 million dong (S$5,373) to 200 million dong a year. This provision will enter into force on Jan 1, 2026, easing the financial burden of small businesses and promoting entrepreneurship.

In particular, the law stipulates additional taxpayers, including local operators of foreign e-commerce platforms and foreign suppliers that conduct business with Vietnamese organisations and individuals through e-commerce or digital platforms.

In addition to the new law, Vietnam’s government decided to scrap the VAT exemption for low-value imported goods, effective Feb 18, 2025. This is expected to curb the rising tide of e-commerce imports that have bypassed local taxation and ensure a level-playing field for local businesses.

The National Assembly extended the VAT reduction of 2 per cent for the first half of the year to boost consumption, making goods and services that were previously taxed at 10 per cent subject to an 8 per cent rate. 

4. Data Law: Strengthening Vietnam’s digital future

Set to take effect on Jul 1, the new Data Law is a landmark piece of legislation that will shape the future of digital governance in Vietnam and form a more secure and dynamic environment for sectors such as fintech, e-commerce and cloud computing.

One of the law’s key provisions is the creation of the National Database and National Data Centre, which will centralise data management and improve the country’s ability to leverage big data for economic and social development.

The law also establishes stringent regulations regarding the cross-border transfer of important and core data, as well as enables authorised requests for organisations and individuals to provide data to state agencies in specific circumstances.

Providers of data-related products and services including data analysis and synthesis in Vietnam are eligible for incentives applicable to those in high-tech, digital and innovative sectors, as well as subject to registration requirements per investment laws and further guidance.

The Data Law introduces a legal framework that allows qualified public units or state-owned companies to create data platforms, providing data-related resources to serve the research and development activities as well as facilitating the exchange of data services and products.

5. Public Investment Law: Greater local autonomy to expedite projects

Effective from Jan 1 this year, these amended laws aim to streamline the management of public infrastructure projects and improve the efficiency of public investment. 

These new rules focus on decentralising authority and empowering local governments to expedite small-scale, localised projects.

There is also a shift from a pre-check to post-check approach, with simplified procedures to shorten project implementation timelines and accelerate the disbursement of official development assistance capital and preferential loans from foreign donors.

The related amendments to the Public-Private Partnership (PPP) Law introduce provisions to enhance the attractiveness of the mechanism by removing minimum investment requirements, enabling flexibility in initiating smaller-scale PPP projects.

It also increases the cap on state capital contributions to address barriers in capital-intensive projects, thus encouraging more private-sector participation. 

6. Electricity Law: Certainty for large power projects

The revised law, effective Feb 1, expands the definition of renewable energy, including offshore wind power and new energy sources such as green hydrogen and green ammonia. 

Nuclear power is reintroduced, with the government maintaining a monopoly on its development, while high-tech, efficient coal-fired plants are acknowledged.

The new regulations promote development in these sectors through incentives such as reduced land rentals and sea use fees. 

Notably, the provision of long-term minimum contracted electricity output for projects connecting to the national grid promises enhanced certainty in cash flow and dispatch level for large-scale projects such as liquefied natural gas-to-power, domestic gas-fired and offshore wind plants.

Energy storage systems are also encouraged to be integrated into renewable projects through preferential mechanisms.

Another key improvement of the law is new directions on structuring tariff mechanisms for both conventional and renewable energy projects under power purchase agreements.

This is expected to address longstanding investors’ concerns over returns and bankability, though competent authorities still need to determine detailed tariff calculation principles in upcoming guiding documents.