Schedule delay is the most common condition of FDI projects in Vietnam — and the most misunderstood. On one side, investors assume “a few months late is nothing”; on the other, a fear that the IRC will be revoked overnight. The truth sits in between: the law handles delayed projects on a ladder with several rungs — supervision and reminders, explanation requests, administrative fines, suspension, and only at the top, termination of the project’s operation. Understanding each rung tells you where you stand and how much room remains to save the project. This article climbs that ladder under Investment Law 143/2025/QH15, Decree 96/2026/ND-CP and Decree 122/2021/ND-CP.
Rungs 1–2: Supervision, reminders and explanation requests
The registration authority follows the project through reporting on the National Investment Information System and through investment supervision activity. When reported data shows actual progress diverging from the registered schedule — capital contributed late, construction not started, a completion milestone already passed — the authority’s first response is usually a written reminder urging the investor to report, explain the causes and present a remediation plan. No money sanction applies at this stage; it is the most valuable window of opportunity, because a serious response together with a properly filed schedule adjustment normally closes the matter at the lowest rung. Conversely, failing to report or staying silent before a reminder letter is the fastest way to push the project upward, because the authority records non-cooperation in the supervision file.
Rung 3: Administrative fines
When delay attaches to a specific procedural violation, money sanctions under Decree 122/2021/ND-CP (as amended by Decree 288/2026/ND-CP) come into play. Typical conduct includes failing to observe project reporting duties; implementing the project inconsistently with the registered contents and schedule; and, most seriously, letting the project term expire without filing the extension adjustment — conduct in the decree’s heavier band, with a reference fine of VND 70–100 million for expiry without adjustment under Article 17. Be precise about what a fine does: it sanctions the procedural violation; it does not by itself revoke the project. But the penalty record is an important link in the file if the case escalates. Investors are also often surprised that organizational offenders can face higher exposure than the nominal individual band under the decree’s general principles — one more reason to act at the reminder rung rather than wait for the fine rung.
Rungs 4–5: Suspension and termination of project operation
At the upper rungs, the instrument is no longer money but the project itself. The competent authority may order the project’s operation stopped or suspended in statutory cases — for example to protect the environment or national defense and security, or for serious violations. The final rung is termination of the project’s operation, typically tied to situations such as: the investor failing to implement the project for a prolonged period without an accepted reason; the project’s land being recovered under land law for delayed use; or the project having become incapable of implementation after reminders and extensions. Once termination is decided, the IRC loses effect accordingly and the project enters liquidation. The essential point to remember: termination for delay is almost never a surprise decision — it is the end point of a chain of letters the investor received over many preceding months.
Rescuing the project: what to do mid-ladder
- Adjust the schedule proactively before it expires, with evidenced reasons and a catch-up plan — instead of waiting to be discovered.
- Restore reporting discipline immediately: file all outstanding reports on the national investment system and keep them regular, because reporting is the first compliance face the authority sees.
- Create real implementation traces: contribute capital to the new commitment, start or finish the most feasible work item, sign documented construction and procurement contracts.
- Shrink the project to a doable scale through an objective and scale amendment if the original plan exceeded capacity — a smaller project that runs beats a large one standing still.
- Consider transferring the project to an investor able to implement it; a properly conducted transfer preserves project value instead of a passive termination and liquidation.
In short, the ladder gives investors several chances to correct course, but each rung upward narrows the options. The cheapest moment to rescue a delayed project is when the first reminder letter arrives — answer it as you would answer a major decision, because on the record, that is exactly what it is.
Early-warning discipline inside the company
Projects rarely slide from healthy to terminated without internal warning signs; the slide happens when nobody owns them. Assign the IRC schedule the same governance as the budget: a named owner, a quarterly review against registered milestones, and an escalation rule — for example, any milestone forecast to slip by more than one quarter goes to the investor’s decision level that month, with options priced: accelerate, adjust, rescope or transfer. Keep the reporting calendar independent of individuals, so a staff departure cannot silently stop the filings that authorities read as the project’s pulse. And record slippage decisions in writing: when supervision later asks why a milestone moved, a contemporaneous internal record showing active management is worth more than any retrospective explanation. The enforcement ladder described in this article is climbed, in practice, by projects whose internal ladder — notice, decide, act — was never climbed at all.
Frequently Asked Questions
How late must a project be before fines apply, and how much are they?
The law sets no single “X months late” threshold for all projects; sanctions attach to specific conduct such as failing to report, implementing inconsistently with the registered schedule, or letting the term expire without adjustment. The heaviest reference point is operating past the project term without filing the extension adjustment, fined at VND 70–100 million under Article 17 of Decree 122/2021/ND-CP, plus a remedial order to complete the procedure.
When is an IRC revoked over schedule delays?
When prolonged non-implementation falls within the statutory cases and after reminder and remediation steps: typically a project that has barely been implemented for a long period without an accepted reason, or whose land is recovered under land law for delayed use. A decision terminating the project’s operation makes the IRC lose effect and sends the project into liquidation.
Can a project at risk of revocation still be saved?
Yes, if you act early: proactively seek a schedule adjustment with evidence and a catch-up plan; clear the reporting backlog; create real implementation such as capital contributions and starting feasible work items; rescope the project to a doable size; or transfer it to an investor with implementation capacity. Projects that get saved share one trait — they return to the table with the registration authority before the file climbs to the suspension and termination rungs.
This article has been quality-reviewed by the FLAW AI Legal Council
