After two decades working with foreign investors, I’ve seen both success stories and costly failures. But one lesson stands out: investor confidence depends not only on business potential or profitability, but also on the clarity, transparency, and reliability of legal implementation.

I recall a striking case in 2020, when a foreign corporation acquired 100% equity in a major southern real estate company. The deal was smooth, transparent, and quickly updated in the Enterprise Registration Certificate (ERC). But the celebration didn’t last.

To be recognized as the new investor in the Investment Registration Certificate (IRC), the group had to resubmit documents multiple times over two years, enduring at least four rounds of correspondence between the industrial zone authority and the Ministry of Planning and Investment. Meanwhile, the company was told to fulfill tax obligations as if it were a real estate transaction, even though the deal was merely a transfer of shares. There was no official rejection, no guidance, just prolonged silence and the endless passing of paperwork.

Only after the embassy and trade associations intervened was the tax procedure resolved - three years later - and some land use rights certificates finally updated. Even now, five years on, multiple plots remain suspended due to planning issues and administrative restructuring. A project worth hundreds of millions of dollars has been frozen in red tape, forcing investors to reconsider and weakening their trust.

Paradox: idle capital, missed opportunities

The essence of investment is profit, and to generate profit, capital must turn over quickly. Vietnam expects foreign direct investment (FDI) to spur growth, create jobs, transfer technology, and boost competitiveness. But in this case, both sides suffered: capital was immobilized, land lay idle, workers had no jobs, and the state lost out on growth and revenue.

Imagine being an investor, ready to fund factories, generate employment, and pay taxes - only to face endless rounds of redundant paperwork. By the time procedures are completed, the market has changed, and the opportunity is gone. Many grow tired and give up.

To launch a project, investors must navigate a maze of procedures - from the IRC and ERC to construction, environmental, and fire safety permits. Over half of the IRC and ERC contain identical information: investor names, capital, industry, location. Many resort to unofficial payments to speed up the process. But others - especially smaller FDI firms - simply pull out.

Vietnam aims for double-digit growth and needs $239–271 billion in FDI from 2025–2030. Yet this bureaucratic entanglement poses a serious threat. FDI is not just supplemental capital - it is one of the three main financial pillars of national development.

Our surveys show 100% of FDI firms face hurdles when applying for or modifying their IRC. The process can take two to three months - some even six to seven. Much of the information overlaps with the ERC or the investment approval letter. Every time a project changes timeline, the IRC must be updated, adding another layer of red tape.

What should be a management tool has become a bottleneck, choking the flow of capital.

Meanwhile, Vietnam’s neighbors perform far better. In the Philippines, IRCs take just two to three weeks. In Malaysia, the process is faster: three to five days, fully online. Indonesia is even more efficient, with its OSS online licensing system issuing permits in just 30 minutes to a few hours.

Imagine a savvy investor landing in Jakarta and completing all filings before even leaving the airport.

According to the national business registration system, Ho Chi Minh City alone has over 17,000 enterprise registration or modification applications currently pending. Many firms can’t reach their assigned officers or are told to “wait for reassignment after the merger.” Some offices still lack staff to accept applications.

Decree 19/2025/ND-CP piloted a reduction in IRC processing time to 15 days for strategic projects - a 75% improvement. But so far, this only applies to “VIP” high-tech or R&D ventures, which have been rare in 2025. Thousands of regular businesses are still stuck in the same procedural labyrinth.

It’s time for radical reform

Vietnam absolutely has the potential to thrive - but only if we dismantle the barriers to policy implementation. We should eliminate the IRC requirement for standard industries; remove duplicate content between the IRC and ERC; scrap outdated conditions like project timeline approvals or debt-to-equity ratios; retain strict oversight only for sensitive sectors like defense or strategic minerals; and most importantly, allow businesses to file everything online using digital signatures.

Time and opportunity are money, growth, tax revenue, and jobs. A competitive economy is not just about market size or labor costs - it’s about enabling capital to move freely, transparently, and profitably. This is the message Vietnam must send to the world: that we are truly reforming, and truly open for business - not just in words, but in action.

Investment, land, and tax reform is no longer the task of individual ministries - it must become an inter-agency, interconnected mission. Only then can Vietnam attract and retain high-quality capital, the crucial fuel for our next leap forward.

Tran Thi Thanh Hao