In which cases will a foreign contractor have its Construction Operation License revoked? What are the authority and procedures for revoking a Construction Operation License for foreign contractors?

Cases Where a Foreign Contractor’s Construction Operation License Is Revoked

Pursuant to Clause 17, Article 3 of the Law on Construction 2014, a construction permit is a legal document issued by a competent state authority to an investor for the purpose of constructing, repairing, renovating, or relocating a construction project.

According to Clause 1, Article 118 of Decree No. 175/2024/ND-CP, the revocation of a Construction Operation License is regulated as follows:

Article 118. Revocation of Construction Operation Licenses

A foreign contractor shall have its Construction Operation License revoked in any of the following cases:

a) Forging documents in the application dossier for the issuance of a Construction Operation License;

b) Amending, erasing, or altering the contents of the Construction Operation License in an inaccurate manner;

c) The Construction Operation License contains incorrect information due to errors made by the authority issuing the Construction Operation License.

Accordingly, there are three cases where a foreign contractor’s Construction Operation License may be revoked, including:

• Forging documents in the application dossier for the issuance of a Construction Operation License.
• Modifying, erasing, or altering the contents of the Construction Operation License, resulting in inaccurate information.
• The Construction Operation License containing incorrect information due to errors made by the licensing authority.

Authority and Procedures for Revoking a Construction Operation License for Foreign Contractors

Pursuant to Clauses 2 and 3, Article 118 of Decree No. 175/2024/ND-CP, the authority and procedures for revoking a Construction Operation License for foreign contractors are regulated as follows:

1. Authority to Revoke a Construction Operation License for Foreign Contractors

- The authority that issued the Construction Operation License shall have the authority to revoke the Construction Operation License issued by such authority.

- In cases where a Construction Operation License was issued contrary to regulations but the licensing authority fails to carry out the revocation, the Ministry of Construction shall directly issue a decision to revoke such Construction Operation License.

2. Procedures for Revoking a Construction Operation License for Foreign Contractors

- Within 10 days from the date of receiving an inspection conclusion or an inspection document issued by a state management authority in the construction sector recommending the revocation of a Construction Operation License, or upon discovering or having grounds to determine that one of the revocation cases specified in Clause 1, Article 118 of Decree No. 175/2024/ND-CP applies, the competent authority shall issue a decision to revoke the Construction Operation License. In cases where the license is not revoked, the authority must provide a written response to the requesting authority stating the reasons.

- The competent authority responsible for revoking the Construction Operation License shall send the revocation decision to the organization or individual whose license is revoked. At the same time, the decision shall be sent to the project owner and relevant authorities for information and coordination.

- The organization or individual whose Construction Operation License has been revoked must return the original license to the authority issuing the revocation decision within 05 days from the date of receipt of the revocation decision.

- In cases where the Construction Operation License is revoked because incorrect information was recorded due to errors made by the licensing authority, the competent authority shall be responsible for re-issuing the Construction Operation License within 05 days from the date of receiving the revoked license. For violations specified in Points (a) and (b), Clause 1, Article 118 of Decree No. 175/2024/ND-CP, the competent authority shall only consider granting a new Construction Operation License to the foreign contractor after 12 months from the date of issuance of the revocation decision.

- If the organization or individual whose Construction Operation License has been revoked fails to return the license as required, the competent authority shall issue a decision declaring the Construction Operation License invalid. This decision shall be sent to the organization or individual whose license has been invalidated and the information shall also be provided to the project owner and relevant authorities for their awareness.

What Are the Rights and Obligations of Foreign Contractors?

Pursuant to Article 119 of Decree No. 175/2024/ND-CP, the rights and obligations of foreign contractors are regulated as follows:

1. Rights of Foreign Contractors

Foreign contractors shall have the following rights:

• To request competent authorities to provide guidance on preparing dossiers for the issuance of Construction Operation Licenses and other matters related to the contractor’s operations in accordance with this Decree;
• To file complaints or denunciations regarding violations committed by organizations or individuals performing activities regulated under this Decree;
• To have their lawful business interests in Vietnam protected in accordance with the issued Construction Operation License.

2. Obligations of Foreign Contractors

Foreign contractors shall have the following obligations:

• To establish an executive office at the project location after being granted a Construction Operation License; and register the address, telephone number, fax number, email address, seal, bank account, and tax identification number of the executive office.

For contracts involving construction planning, preparation of construction investment projects, construction surveys, or construction design, foreign contractors may establish an executive office at the registered head office address of the project owner or may choose not to establish an executive office in Vietnam.

For contracts involving construction execution or construction supervision of projects extending across multiple provinces, foreign contractors shall establish an executive office in the locality where the construction permit was issued. The executive office shall only exist during the contract performance period and shall be dissolved upon expiration of the contract.

• To register, cancel the seal specimen, and return the seal upon completion of the contract in accordance with legal regulations. The foreign contractor may only use such seal for activities serving the performance of the contract in Vietnam as specified in the Construction Operation License.
• To register and pay taxes in accordance with Vietnamese law; comply with accounting regulations; open accounts and conduct payments in accordance with the guidance of the Ministry of Finance and the State Bank of Vietnam for business activities performed under the contract.
• To recruit employees and employ Vietnamese workers and foreign workers in accordance with Vietnamese labor regulations; only register the entry into Vietnam of economic management experts, technical management experts, and highly skilled workers whose expertise cannot be adequately provided by Vietnam.
• To complete procedures for the export and import of materials, machinery, and equipment related to the contracted works in Vietnam in accordance with Vietnamese laws.
• To perform the joint venture agreement signed with a Vietnamese contractor or use Vietnamese subcontractors identified in the application dossier for the Construction Operation License.
• To purchase insurance in accordance with Vietnamese laws for the contractor’s activities, including: professional liability insurance for construction investment consulting contractors; property and goods insurance for procurement contractors; insurance types applicable to construction contractors; and other insurance regimes prescribed by Vietnamese law.
• To carry out quality inspection and registration procedures for imported materials and equipment supplied under the construction contract.
• To carry out safety inspection and registration procedures for construction equipment and vehicles related to the business activities of foreign contractors in accordance with Vietnamese law.
• To comply with regulations on technical regulations, standards, construction quality management, occupational safety, environmental protection, and other relevant provisions of Vietnamese law.
• Upon completion of the construction project, the foreign contractor must prepare completion documents; assume responsibility for warranty obligations; finalize imported materials and equipment; handle remaining materials and equipment under the construction contract in accordance with import-export regulations; re-export construction materials and equipment registered under the temporary import-re-export regime; liquidate the contract; and notify relevant state management authorities of the contract completion and termination of the operation of the project executive office.

During the implementation of construction projects in Vietnam, foreign contractors are required to fully satisfy legal conditions and obtain a Construction Operation License before carrying out construction activities in accordance with applicable regulations. However, the licensing procedure often requires various documents and materials relating to the contractor’s capacity, project implementation, construction contracts, and compliance with Vietnamese laws. A lack of experience in preparing application dossiers may result in prolonged processing times or unexpected legal risks.

With a team of experienced lawyers and legal professionals specializing in investment, construction, and corporate law, Khanh An Business Law Limited Company provides professional, comprehensive, and effective services for obtaining Construction Operation Licenses for foreign contractors in Vietnam. We support clients throughout the entire process, including consulting on licensing conditions, reviewing the legality of application dossiers, preparing and completing necessary documents, representing clients in working with competent state authorities, and assisting until the Construction Operation License is successfully obtained.

With in-depth knowledge of Vietnamese legal regulations and extensive experience supporting both domestic and foreign enterprises, Khanh An Business Law is committed to providing appropriate legal solutions that help contractors save time, minimize risks, and quickly implement construction projects in Vietnam in a smooth and legally compliant manner.

Khanh An’s Core Values

We always pursue three core values: REPUTATION – QUALITY – HIGH EFFICIENCY. These values are not only the guiding principles in our operations but also the motivation for our continuous growth and development. We are proud to receive positive feedback from our clients, which confirms the quality and effectiveness of the legal services we provide.

Khanh An will continue making every effort to deliver the best legal services and accompany our clients in their sustainable development journey.

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