I) Summary of the Law on Construction 2025
Chapter I – General Provisions
This chapter defines the scope of regulation, applicable entities, terminology, and fundamental principles in construction activities.
- Regulates all construction activities: project formulation, surveying, design, construction, supervision, acceptance, handover, operation, warranty, and maintenance. (Example: “Construction activities include project formulation, appraisal, evaluation… warranty and maintenance of construction works.”)
- Provides definitions for more than 30 terms: construction works, technical infrastructure, investment projects, types of design (preliminary, basic, FEED, technical, construction drawings), appraisal, evaluation, contractors, construction incidents, etc.
- Principles of construction: compliance with planning, environmental protection, safety, transparency, anti‑corruption.
- Regulates types and grades of construction works; standards and technical regulations; construction materials; investors; compulsory insurance; incentive policies; international cooperation.
- Prohibited acts: building against planning, building without permits, using substandard materials, violating safety regulations, bribery, obstructing lawful construction activities.
Article 3. Interpretation of Terms
In this Law, the terms below are defined as follows:
- Construction activities include preparing, verifying, appraising, and approving construction investment projects; construction design; construction surveying; management of construction permitting; construction and supervision of construction works; management of construction investment projects; management of construction capacity; management of construction investment costs; management of construction contracts; acceptance, handover, commissioning and operation of works; finalization of investment capital; warranty and maintenance of construction works, and other activities related to construction works.
- Construction work is a product built according to a design, created by human labor, construction materials, and equipment installed in the work, fixed to land, and may include underground, above-ground, underwater, and above-water parts.
- Technical infrastructure works system includes transportation works, telecommunications works, energy supply, public lighting, water supply, drainage, solid waste collection and treatment, cemeteries, and other technical infrastructure works.
- Social infrastructure works system includes healthcare, cultural, educational, sports, commercial, service, parks, and other works used for public purposes.
- Investment decision-maker is an individual or a representative of an agency, organization, or enterprise authorized to approve projects and decide on construction investment according to law.
- Construction investment project is a set of proposals related to the use of capital to carry out construction activities for new construction, upgrading, expansion, repair, renovation, or relocation of works to maintain, develop, and improve the quality of works or products and services within a defined timeframe and cost.
- Urban construction investment project is a project for new construction, renovation, or urban upgrading that ensures synchronized technical and social infrastructure systems together with housing, in accordance with urban and rural planning approved by competent authorities.
- Construction consultancy activities include preparing construction investment projects, surveying, designing, verifying, inspection, testing, cost management, project management, construction supervision, and other consultancy work related to construction activities.
- Preparation of construction investment projects includes preparing the Pre‑feasibility Study Report or Proposal for investment policy or Project Proposal for deciding or approving investment policy; preparing the Feasibility Study Report or the Economic–Technical Report for investment decision and performing necessary tasks for construction investment preparation.
- Preliminary design is a design expressing the conceptual idea of the construction work, technological process, and equipment.
- Basic design is a design expressing the principal technical specifications in conformity with applicable technical regulations and standards.
- Overall technical design is a design prepared for projects with technological design to detail requirements of technological solutions and technical specifications of technological equipment; expressing solutions, technical specifications, and principal materials in conformity with applicable technical regulations and standards (Front-End Engineering Design, referred to as FEED).
- Technical design is a design expressing full technical solutions, specifications, and materials in conformity with applicable technical regulations and standards.
- Construction drawing design is a design expressing full technical specifications, materials, and structural details in conformity with applicable technical regulations and standards, ensuring sufficient conditions for construction implementation.
- Verification is the activity in which organizations or individuals inspect, evaluate, and conclude on necessary professional contents during project preparation and implementation at the request of the investment decision-maker, investor, or specialized construction agency.
- Appraisal is the activity in which the investment decision-maker, investor, specialized construction agency, or appraisal council inspects and evaluates necessary contents during project preparation and implementation for competent authorities or persons to consider and decide on construction investment and approve construction designs.
- State management agencies for construction include the Ministry of Construction, provincial People’s Committees (referred to as provincial-level People’s Committees), and commune-level People’s Committees (referred to as commune-level People’s Committees).
- Ministries managing specialized construction works are ministries assigned to manage construction investment for works under their specialized sectors, including the Ministry of Public Security, Ministry of Industry and Trade, Ministry of Agriculture and Environment, Ministry of National Defense, and Ministry of Construction.
- Specialized construction agencies are specialized agencies assigned to manage construction under ministries managing specialized construction works, provincial-level People’s Committees, commune-level People’s Committees; management boards of industrial parks, export processing zones, high‑tech zones, economic zones, and other agencies as prescribed by the Government.
- Specialized agency under the investment decision-maker is an agency or organization with expertise appropriate to the nature and contents of the project and assigned by the investment decision-maker to conduct appraisal.
- Construction permit is a document issued by a competent authority to the investor for new construction, repair, renovation, or relocation of works.
- Construction of works is the activity of building, installing construction equipment and technological equipment into construction works; and demolishing construction works.
- Construction equipment is equipment installed into construction works according to construction design.
- Technological equipment is equipment in the technological process installed into construction works according to technological design.
- Contractor in construction activities (referred to as contractor) is an organization, individual, or consortium of organizations and individuals participating in construction activities under a construction contract.
- Main contractor is a contractor entering into a construction contract directly with the investor.
- Subcontractor is a contractor entering into a construction contract with the main contractor.
- Foreign contractor is an organization established under foreign law or an individual of foreign nationality participating in entering into and managing the performance of construction contracts in Vietnam. Foreign contractors may be main contractors or subcontractors.
- Construction incident is damage exceeding allowable safety limits, causing construction works or auxiliary structures used during construction to be at risk of collapse, partially or completely collapsed during construction or operation.
- Dangerous zone in construction is the boundary of areas within and around the construction site where hazardous factors may arise, causing harm to people, works, assets, equipment, or vehicles due to construction activities, determined according to applicable technical regulations, standards, and construction organization measures.
Chapter II – Management of Construction Investment Projects
This Chapter regulates the entire process of construction investment and project management.
- Investment process includes: project preparation – project implementation – project completion.
- Classification of projects by investment form (public investment, PPP, private investment) and by scale (nationally important, group A/B/C).
- Requirements for projects: compliance with planning, design feasibility, safety, financial solutions.
- Regulates the system of construction designs (preliminary, basic, FEED, technical design, construction drawing design).
- Construction surveys: topography, geology, hydrology, current conditions.
- Preparation of the Feasibility Study Report and the Economic–Technical Report.
- Appraisal of projects, design verification, approval, and project adjustment.
- Defines responsibilities of investors, consulting contractors, surveying contractors, appraisal agencies, and investment decision-makers.
Chapter III – Construction Permits and Construction Order Management
This chapter regulates construction permitting, exemptions, and management of construction order.
- Types of permits: new construction, repair – renovation – relocation, temporary permits.
- Many cases exempt from permits: state‑secret works, urgent works, linear works, grade‑IV works, detached houses under 7 stories… (Example: “Grade‑IV construction works, detached houses with fewer than 07 stories…”)
- Conditions for permit issuance: compliance with land use, planning, safety, fire prevention, environmental protection.
- Responsibilities of permitting authorities and applicants.
- Management of construction order from commencement to acceptance.
Chapter IV – Construction of Works
This Chapter regulates conditions for commencement, construction, safety, environment, relocation, demolition, and incident handling.
- Conditions for commencement: site availability, construction permit, approved design, construction contract, commencement notice.
- Requirements at construction sites: signage, supervision, labor safety, waste treatment.
- Construction must comply with design, technical regulations, safety, and fire prevention.
- Detailed regulations on construction safety, dangerous zones, equipment inspection.
- Environmental protection during construction.
- Relocation and demolition of works: conditions and responsibilities.
- Handling construction incidents: suspension, site protection, cause assessment.
Chapter V – Construction Investment Costs and Construction Contracts
This Chapter regulates cost management and construction contracts
Cost Management
- Principles: consistency with project objectives, total investment, market prices.
- Cost management contents: total investment, cost estimates, bid package prices, contract prices, final settlement.
- Construction norms, construction prices, construction price indexes.
- Regulations on preliminary total investment, total investment, cost estimates for works/packages.
Construction Contracts
- Types of contracts: consultancy, construction, equipment supply, EPC, turnkey…
- Pricing methods: lump‑sum, fixed unit price, adjustable unit price, time‑based, cost‑plus‑fee…
- Contract contents: quality, schedule, price, payment, guarantees, amendments, dispute resolution.
- Regulations on contract modification, suspension, termination, bonuses – penalties, compensation, dispute settlement.
Chapter VI – Capacity Conditions for Construction Activities
This chapter regulates the competency requirements for organizations and individuals participating in construction.
- Individuals must hold professional practice certificates (Class I, II, III) for roles such as design lead, supervision, appraisal, surveying.
- Requirements for chief engineers and project directors.
- Foreign contractors must obtain operation permits.
- Organizations must disclose their capacity on the national construction database.
Chapter VII – State Management of Construction
Defines the functions and responsibilities of the Government, Ministry of Construction, ministries, and local authorities.
- Issuing strategies, plans, and legal documents.
- Issuing standards, technical regulations, norms, and construction prices.
- Managing the national information system and database on construction.
- Inspection, examination, and handling of violations.
- Training human resources and promoting international cooperation.
- Decentralizing construction order management.
Chapter VIII – Implementation Provisions
This chapter regulates the effective date, amendments to related laws, and transitional provisions.
- The Law takes effect from July 1, 2026 (some provisions from January 1, 2026).
- Repeals the 2014 Law on Construction and related amendments.
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Transitional provisions for projects, permits, designs, and contracts approved before the effective date. (Example: “Construction investment projects… approved before July 1, 2026 are not required to be re‑approved.”)
II) Key New Features of the 2025 Construction Law Compared to the 2014 Law
1. Broader scope – covering the entire lifecycle of a construction project
The 2025 Law expands the definition of construction activities, fully covering project formulation, surveying, design, construction, supervision, acceptance, warranty, maintenance, cost management, contract management, capacity management, and more. This is far more detailed than the 2014 Law, which only listed major activity groups.
2. Addition of numerous new terms (more than 30 definitions)
The 2025 Law introduces many modern concepts that the 2014 Law lacked or defined vaguely:
- FEED design (Front-End Engineering Design)
- Overall technical design
- Dangerous zones in construction
- Construction incidents (more detailed definition)
- National database on construction activities
- Construction information systems
- Clearer definition of foreign contractors
→ The 2025 Law modernizes the terminology system to align with technological and management trends.
3. Strong emphasis on digital transformation in construction
The 2025 Law dedicates an entire article (Article 14) to:
- Establishing the National Database on Construction Activities
- Connecting with land, planning, and construction price databases
- Ensuring transparency and public access to information
- Applying BIM, digital technologies, and innovation
The 2014 Law had no dedicated chapter or article on digital transformation.
4. New regulations on standards, technical regulations, and technology
Under the 2025 Law:
- Voluntary standards may be applied unless referenced in technical regulations
- Standards must be compatible and feasible
- New provisions on science, technology, innovation, and BIM
The 2014 Law only provided general rules on standards and technical regulations and did not mention digital transformation.
5. Expanded incentive policies
The 2025 Law broadens incentives:
- Encouraging green materials, smart materials, recycled materials
- Promoting smart cities and green growth
- Transferring certain public services to professional associations
- Supporting construction in mountainous, island, and disadvantaged areas
The 2014 Law had incentives but not detailed and did not mention green materials or smart cities.
6. New mandatory insurance requirements
The 2025 Law clearly defines three compulsory insurance types:
- Construction works insurance during construction
- Professional liability insurance for consultants
- Insurance for workers on site and third‑party liability
The 2014 Law mentioned insurance but not in such detail and not as mandatory for all three types.
7. New regulations on force majeure and fundamentally changed circumstances
The 2025 Law explicitly lists:
- Natural disasters, epidemics, national defense and security emergencies
- Unforeseen geological conditions
- Discovery of relics or archaeological findings
The 2014 Law did not have a dedicated provision on force majeure in construction.
8. Strengthened state management – clearer decentralization
The 2025 Law:
- Clearly identifies management bodies: Ministry of Construction, provincial People’s Committees, commune-level People’s Committees
- Adds roles for management boards of industrial parks, export processing zones, high‑tech zones
- Distinguishes state management functions from investor management functions
The 2014 Law had decentralization but less detailed and did not cover special functional zones.
9. More prohibited acts added
The 2025 Law adds prohibitions such as:
- Illegal extensions or encroachments on public spaces
- Collusion or manipulation in surveying, design, and supervision
- Misusing legal entities to participate in construction
- Covering up or delaying handling of violations
- Obstructing lawful construction activities
The 2014 Law had fewer prohibited acts and lacked specificity.
10. Higher requirements for construction materials
The 2025 Law:
- Prioritizes local materials and materials with high domestic content
- Encourages green, lightweight, smart, and recycled materials
- Clearly defines material quality requirements based on standards and technical regulations
The 2014 Law did not mention green, smart, or recycled materials.