The setup: a Korean investor’s factory project runs out of capital mid-construction and wants to pause for a year. The investor asks: do I need permission to suspend, and does suspension affect the IRC? The good news: a self-initiated suspension only requires written notice, not approval. The bad news: a mishandled suspension quietly turns into termination — and then the IRC is revoked.
Article 35: three suspension tracks
- Track 1 — investor-initiated (Clause 1): the investor notifies the investment registration agency in writing. For force-majeure suspensions, the State exempts or reduces land rents and land-use fees during the suspension to remedy the force-majeure consequences.
- Track 2 — agency-ordered (Clause 2): the state investment authority suspends a project to protect heritage, remedy environmental violations or ensure labor safety at the line authorities’ request, enforce court judgments or arbitral awards, or punish repeated non-compliance with the approval or IRC.
- Track 3 — Prime Minister-ordered (Clause 3): where project implementation harms or risks harming national defense, security or the environment.
Impact on the IRC: what changes and what does not
Suspension does not revoke the IRC — revocation follows only project termination (Article 36). But two silent clocks keep running during suspension: 12 months of being unreachable after suspension, and 24 months past the objective deadline without completion, both lead to termination. The professional move: alongside the suspension notice, file an IRC amendment adjusting the implementation schedule (Article 33(4) of the Law on Investment 143/2025/QH15; Article 56 of Decree 96/2026/ND-CP), so the pause does not count as falling behind schedule.
Four practical notes
1. Put a time limit in the notice. The law sets no hard cap, but an open-ended suspension invites scrutiny — state the expected duration and the conditions for resumption.
2. Land rent still accrues during suspension, except for force-majeure cases qualifying for exemption or reduction.
3. Keep reporting. Periodic investment reports continue; silence is what triggers the 12-month termination ground.
4. Watch tax incentives. Incentives attach to project implementation — a long suspension can affect eligibility conditions; check with the tax authority.
Frequently asked questions
1. Does suspending a project need permission?
No — a self-initiated suspension requires only written notice to the investment registration agency. Only agency-ordered suspensions are decisions imposed on the investor.
2. How long may a suspension last?
The law sets no fixed maximum, but 12 months of suspension plus being unreachable leads to termination; set a concrete duration and stay in contact.
3. Is land rent payable during suspension?
Yes, except in force-majeure suspensions where the State exempts or reduces land rents and land-use fees for the remedy period.
4. Does suspension affect tax incentives?
Potentially — incentives are tied to implementing the project. A prolonged suspension may breach eligibility conditions; verify with the tax authority before suspending.
5. How to resume operations?
Notify the investment registration agency in writing of the resumption; if the schedule was amended during suspension, implement per the amended IRC.
This article has been quality-reviewed by the FLAW AI Legal Council