Foreign Investment

Environmental Permits for Factories: Vietnam vs Thailand vs Malaysia

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Scenario: an investor building factories in all three countries asks: “Where is EIA slowest, where are environmental permits most troublesome?” The answer lies not in statute books but in who reviews, how long it takes, and how post-monitoring works — three countries, three entirely different philosophies.

Vietnam: integrated environmental licence — one permit replacing many

Under the Law on Environmental Protection 72/2020/QH14 (in force) and Decree 08/2022/ND-CP, Vietnam uses an integrated environmental licence: one licence covering wastewater discharge, air emissions and waste management — replacing many previous component permits. Projects requiring an EIA complete it first, then apply for the environmental licence; projects not requiring EIA but generating waste apply directly. In practice: 3–6 months with a clean dossier; bottlenecks are usually community consultation and baseline monitoring. Note: a draft amendment to EIA thresholds (amending Decree 08/2022) is out for comment — low-risk projects may get simpler procedures while large projects face tighter carbon and waste content.

Thailand: EIA via ONEP plus factory licence Ror Ngor 4

Thailand splits two tiers: EIA reviewed by ONEP (Office of Natural Resources and Environmental Policy and Planning) for listed projects — and the factory licence (Ror Ngor 4) under the Factory Act issued by the Department of Industrial Works. Investors face two independent gates: environmental and industrial. Thai EIA is famously time-consuming (6–12 months for large projects, including mandatory public consultation) — the longest “gate” of the three.

Malaysia: EIA via DOE by scheduled activity

Malaysia regulates under the Environmental Quality Act 1974: projects in the scheduled EIA activities submit to the DOE (Department of Environment). Malaysia’s philosophy is “by schedule”: check the schedule to know whether EIA applies — fewer grey zones than Vietnam or Thailand. EIA typically takes 3–9 months by scale. Post-monitoring: Malaysia tightens periodic monitoring and reporting; violations draw heavy fines and possible suspension.

Quick comparison

CriterionVietnamThailandMalaysia
Main legal frameworkLEP 72/2020 + Decree 08/2022; integrated environmental licenceEIA (ONEP) + factory licence Ror Ngor 4 (Factory Act)Environmental Quality Act 1974; EIA via DOE
Typical EIA timeline3–6 months6–12 months (longest)3–9 months
Most scrutinised sectorsChemicals, metallurgy, thermal power, dyeingLarge factories, energy, chemicalsOil & gas, chemicals, mining
Post-monitoringPeriodic monitoring + data transmission to DONREEIA conditions + factory licenceDOE periodic reporting; heavy fines, possible suspension

Recommended actions

1. Start EIA the moment the site is locked — it drives the master schedule. 2. In Thailand, add 6 months’ contingency for EIA. 3. Design monitoring systems from the engineering phase; do not wait for the licence. 4. Confirm each country’s detail with local environmental counsel.


Frequently Asked Questions

How long does environmental impact assessment take in each country?

Vietnam: EIA usually 3–6 months. Thailand: EIA can run 6–12 months for large projects (including mandatory public consultation) — the longest in the group. Malaysia: EIA usually 3–9 months by scale. Real timelines depend on dossier quality and site sensitivity.

Which sectors face the heaviest scrutiny in each country?

Vietnam: chemicals, metallurgy, thermal power, dyeing. Thailand: large factories, energy, chemicals. Malaysia: oil & gas, chemicals, mining. These sectors face full EIA requirements and the tightest post-monitoring.

How do annual environmental compliance costs compare?

Common components: periodic monitoring, reporting, waste treatment, environmental fees/insurance. Malaysia and Thailand lean toward heavy fines and suspension for violations, raising “prevention” costs; Vietnam is tightening with duties to transmit monitoring data to regulators.

How do penalties for environmental violations differ?

All three impose heavy administrative sanctions and possible criminal prosecution for serious violations. Thailand and Malaysia have a tradition of decisive suspension; Vietnam is proposing sharply higher administrative fines for environmental violations (draft).

What does Vietnam’s integrated environmental licence replace?

Under the Law on Environmental Protection 72/2020/QH14 and Decree 08/2022/ND-CP, the integrated environmental licence (wastewater, air emissions, waste management and the like) replaces many previous component permits — one licence instead of many.

What is notable in Vietnam’s draft EIA-threshold amendments?

The draft amending Decree 08/2022, out for comment, moves toward: simpler procedures for low-risk projects, but tighter content (carbon, waste) for large projects. Investors should track which group their project falls into when the new rules take effect.