Issue of April 2024 – Policies on investment incentives and support in hi-tech parks according to Decree no. 10/2024/ND-CP of the Government dated February 1, 2024

Dear Valued Clients,

In order to solve some obstacles, create more favorable conditions, aimed at promoting development of high-tech parks, on February 1, 2024, the Government issued Decree 10/2024/ND-CP (“Decree 10”), replacing Decree 99/2003/ND-CP on high-tech park regulations and Article 112, Decree 31/2021/ND-CP (amending and supplementing some articles of Decree 99/2003/ND-CP). Decree 10 officially takes effect from March 25, 2024.

In this Legal Update, we would like to summarize and clarify the policies on investment incentives and support in hi-tech parks specified in Decree 10 that investors in this business area should take into consideration.

1. Policies on investment incentives and support for projects on investment in hi-tech parks

Pursuant to the provisions in Article 12 of Decree 10, a hi-tech park is an area eligible for investment incentives and may receive investment incentives applicable to extremely disadvantaged socio-economic areas according to investment laws. Accordingly, specific incentive and support rates for investment projects and operations in the hi-tech park shall be applied according to laws on investment, corporate income tax, import tariff, export tariff, land, credit, and relevant laws.

Besides the incentives mentioned above, investment projects and operations at the hi-tech park shall also be prioritized for participation in programs on support for employee training and recruitment; programs on support for hi-tech application and research and transfer of technologies; programs on support for the development of hi-tech industries and high technologies in agriculture; support for innovative enterprises and innovative entrepreneurship medium and small-sized enterprises; support for capital loans and other support programs of the Government of Vietnam, ministries, and central and local authorities.

2. Regulations on encouragement to invest in technical infrastructure construction and business

According to Article 13 of Decree 10, organizations and individuals with sufficient experience and capacity to invest in hi-tech park infrastructure construction and business, including:

• Investment in the construction and business of the whole system of technical infrastructures of hi-tech parks;
• Investment in the construction and business of the parts of the system of technical infrastructures of hi-tech parks.

Projects on investment in infrastructure construction and business are eligible for exemption from land use levies and refund of compensation or site clearance according to regulations on land use levy collection in hi-tech parks. On the other hand, projects on investment in hi-tech infrastructure construction and business also are eligible for other incentives according to laws on investment, taxation, land, and relevant laws and prioritized for participation in pilot schemes, programs, and projects on the development of smart urban areas and other support policies as prescribed by laws.

Projects on investment in hi-tech park infrastructure construction and business are prioritized for taking out investment credit capital loans of the State and implementing legal capital mobilization forms according to laws on enterprises, credit, and relevant laws.

3. Policies on development of social infrastructures serving employees in hi-tech parks

In addition to policies on investment incentives and support for projects on investment in hi-tech parks and regulations on encouragement to invest in technical infrastructure construction and business, Decree 10 stipulates additional policies on development of social infrastructures serving employees in hi-tech parks. Accordingly, for investment projects, which are buildings of houses, service works, and public utilities directly serving employees in high-tech parks, are entitled to enjoy preferential and supporting policies in accordance with the regulations on social housing construction and other relevant laws.

In addition, the Decree also stipulates the subjects who are allowed to rent, buy, or lease purchase houses and accommodation facilities for employees working in high-tech parks (purchasing and renting houses only apply for housing areas built outside high-tech parks), in particular: (a) organizations being investors, individuals being experts, and employees working in the high-tech parks are allowed to rent houses during the working period in the high-tech parks; and (b) employees working in the High-Tech Park Management Board, experts and employees signing indefinite-term employment contracts with investors in HighTech parks are given priority in consideration for purchasing houses.

4. Policies on hi-tech development research, hi-tech incubation, hi-tech enterprise incubation, and hi-tech personnel training 

According to the provisions of Article 15.4 of Decree 10, projects on investment in the construction of hi-tech development and research facilities and facilities of hi-tech incubation and hi-tech enterprise incubation are eligible for exemption from land use levies and refund of compensation or site clearance according to regulations on land use levy collection in hi-tech parks.

Besides, for facilities of hi-tech incubation and hi-tech enterprise incubation and projects on hi-tech incubation and hi-tech enterprise incubation approved for incubation at the mentioned facilities in the hi-tech park, and projects on technological innovation shall receive sponsorships, support, capital loans, and loan guarantees from the National Technological Innovation Fund, Fund for the Development of Small and Medium-Sized Enterprises, and other legal funds and sponsorship sources for operations as prescribed by laws.

5. Policies on export processing enterprises in hi-tech parks

Aside from the investment incentives and support prescribed in Decree 10, export processing enterprises in hi-tech parks, when satisfying the conditions for inspection, customs supervision, and regulations applicable to non-tariff zones according to import and export tariff laws, may apply particular regulations on export processing enterprises operating in industrial and economic zones according to industrial and economic zone laws.

If enterprises in hi-tech parks satisfy the conditions for inspection, customs supervision, regulations applicable to non-traffic zones, and import and export tariff laws before the effective date of Decree 10, they may apply regulations on export processing enterprises operating in industrial and economic zones according to industrial and economic zone laws from the date they satisfy such conditions.

ENT Law LLC

The full version of this Legal Update can be found here.