DRAFT AMENDMENT TO THE 2026 INVESTMENT LAW: A SECTOR-BY-SECTOR MARKET-OPENING MECHANISM FOR FOREIGN INVESTORS

On September 12, 2026, the Ministry of Finance released the second draft of the Law amending and supplementing a number of articles of Investment Law No. 143/2025/QH15 for public comment, ahead of submission to the Ministry of Justice for appraisal. Foreign investors are watching this amendment closely, as the draft resets how Vietnam approaches FDI attraction: shifting the evaluation focus "from quantity to quality," using technology content, land-use efficiency, and linkages with domestic enterprises as yardsticks rather than simply the size of registered capital. The draft is expected to be submitted to the National Assembly at its October 2026 session and to take effect on January 1, 2027.

1. A mechanism to ease market access conditions by sector and by period

1.1. 91 conditional sectors, with the joint-venture group the first candidate 

Rather than amending each specific market access condition directly in the law in the traditional manner, the draft grants the Government the authority to "consider and decide on easing market access conditions" for certain restricted business lines applicable to foreign investors, based on socio-economic conditions and state management requirements in each period. Vietnam currently maintains 91 conditional market access sectors for foreign investors, of which around 10 sectors currently require a mandatory joint venture with a domestic partner without a specific cap on the foreign ownership ratio — this group is expected to be the first candidate for eased conditions.

1.2. A more cautious approach than the first draft

Compared to the first draft, the second draft has removed the rigid stipulation of a "maximum 100% ownership ratio" for certain fields, moving away from fixing a specific ownership threshold directly in the law and toward a flexible mechanism under which the Government decides by sector and by stage. For sensitive fields such as finance, banking, accounting, auditing, and travel services, the State Bank of Vietnam has noted that any proposal to relax conditions must be separately assessed for its impact on capital flows and systemic safety risks before being applied.

2. Safeguards to ensure transparency 

To prevent the relaxation mechanism from being applied arbitrarily on a project-by-project or investor-by-investor basis, the draft sets out a series of mandatory principles for any Government decision to ease market access conditions:

• It must be issued in the form of a normative legal document, applied uniformly by business line rather than to individual projects or investors;
• It must ensure transparency and non-discriminatory treatment among investors;
• It must be published in the Official Gazette;
• It may only move in the direction of being more favorable to investors and may not be used to impose new restrictive conditions.

Before issuance, any proposal to ease conditions must also undergo a policy impact assessment and consultation with relevant ministries on defense, security, and specialized sector matters. In other words, this is not a case-by-case "ask-and-grant" mechanism, but a controlled policy-making channel that allows investors to anticipate the pace of market opening in each sector over time.

3. A shift in how investment incentives are structured

3.1. Four new groups of investment support

Alongside easing market access, the draft also proposes four new groups of investment support mechanisms: support for supply chain development, support for product and technology upgrading, support for initial investment costs and fixed assets, and support for training-research linkages.

3.2. From upfront incentives to post-investment support

The fundamental difference from the traditional incentive policy is that the focus of support shifts from upfront incentives (tax exemptions and reductions granted at the licensing stage) to post-investment cost support, conditional on substantive commitments such as technology transfer and research and development (R&D). Incentives will no longer be available to every project with a large registered capital amount, but will instead be concentrated on projects that create genuine added value for the domestic economy.

4. What should foreign investors prepare?

The draft is still under public comment and appraisal, so its content may still be adjusted before submission to the National Assembly. Nevertheless, with an expected effective date of January 1, 2027, foreign-invested enterprises and investors planning to expand in Vietnam should proactively:

• Review whether their business line falls within the 91 conditional market access sectors, particularly the group currently subject to a mandatory joint-venture requirement, to assess the potential benefit if conditions are eased going forward;
• Closely monitor the appraisal and National Assembly submission process, since the easing mechanism will be issued sector by sector and period by period, and will not automatically apply the moment the law takes effect;
• Reassess their current investment incentive strategy, especially for projects that rely heavily on upfront tax incentives, and prepare to shift toward the new support criteria tied to technology transfer, R&D, and integration into domestic supply chains;
• Proactively consult legal advisors to stay updated as the draft is finalized, avoiding being caught off guard once the policy is officially issued.

The above summarizes the most notable content of the draft Law amending and supplementing the Investment Law, currently under public consultation. This is set to be one of the most significant policy changes affecting foreign investment inflows into Vietnam in the period ahead, and investors should begin preparing from the draft stage rather than waiting until the law officially takes effect. For advice on market access conditions, investment procedures, or other legal matters related to foreign investors' operations in Vietnam, Lexsol is always ready to accompany you and provide suitable legal solutions.