Scenario: an electronics components project will use a production line imported from China that has already been in service for three years. The licensing authority asks for a technology explanation. The investor’s team wonders: is every project required to file one, and what exactly should it say to survive appraisal?
When is a technology explanation required?
Point e, clause 1, Article 32 of Decree No. 96/2026/ND-CP (31 March 2026) requires a technology explanation for projects subject to technology appraisal or consultation under technology transfer law. The current framework: the Law on Technology Transfer No. 07/2017/QH14, as amended by Law No. 115/2025/QH15 (effective 1 April 2026; consolidated text VBHN 138/2026/VBHN-LQ-VPQH), implemented by Decree No. 101/2026/ND-CP (dated 31 March 2026, effective 1 April 2026), which replaced Decree No. 76/2018/ND-CP (expired 1 April 2026).
The typical cases: projects using technology on the list of technologies subject to restricted transfer; projects using technology at risk of adverse environmental impact; and projects with used machinery, equipment or technological lines. Pure trading or service projects with no production element are normally outside the scope — though projects with distinctive technology components (data centers, digital platforms) may be asked for clarification case by case.
What to write in the explanation
Clause 2, Article 4 of Decree 101/2026/ND-CP defines the explanation’s core: an analysis, comparison and justification of the chosen technology — the basis on which the authority assesses the reasonableness of the technology plan. In practice the document should cover: the technology’s name; its origin (the transferring country); the technological process diagram; the main technical specifications; and the usage status of the principal machinery, equipment and technological lines — new or used, year and country of manufacture, remaining capacity. Then compare with alternative technology options and state the reasons for the choice: efficiency, environmental performance, safety.
For used equipment, do not hide its history — appraisal focuses precisely on remaining service life, conformity with environmental and safety standards, and consistency with the project’s stated capacity. An honest, well-documented used line passes; a disguised one fails and damages credibility for the whole dossier.
What does the authority appraise?
Article 7 of Decree 101/2026/ND-CP sets the appraisal (or consultation) contents at the investment-policy-approval or IRC-consideration stage: (1) assessing the reasonableness of the chosen technology plan based on the investor’s analysis, comparison and justification; (2) determining whether the technology falls on the restricted-transfer list or is used in a project at risk of adverse environmental impact under environmental law; (3) evaluating latent technological hazards and risk levels — environmental, safety and human-health risks, technical-incident risk, waste and emission impacts; and (4) assessing the reasonableness and feasibility of the planned measures to prevent, control and mitigate technological risks.
At the investment-decision stage, a more detailed explanation of the technology, machinery, equipment and lines is required (clause 3, Article 4). Practical note: obsolete machinery and polluting technology rarely survive this appraisal — and appraisal failure at this stage blocks the IRC itself, so the technology explanation deserves the same care as the financial documents.
Frequently asked questions
Does a pure trading project with no manufacturing need a technology explanation?
No — it is not subject to technology appraisal, so no explanation is required. But where a project has distinctive technology elements (a data center, a digital platform), the authority may request clarification depending on the facts; prepare a short technical description just in case.
Is used production equipment banned from transfer or use?
Not absolutely banned. The investor must evidence the equipment’s condition, capacity and compliance with environmental and safety requirements. Technologies on the prohibited-transfer list are banned; those on the restricted list may be used only if the applicable conditions are met.
At which stage is the technology explanation filed?
Together with the investment-policy-approval dossier (for projects subject to it) or the IRC application dossier. At the investment-decision stage, the investor must have a detailed explanation of the technology, machinery, equipment and technological lines (clause 3, Article 4 of Decree 101/2026/ND-CP).
Is Decree 76/2018/ND-CP still usable?
No. It expired on 1 April 2026 and was replaced by Decree 101/2026/ND-CP (Article 69 of Decree 101/2026). All dossiers prepared after 1 April 2026 follow Decree 101/2026 — citing the old decree in a new dossier is itself a red flag.
