The investment deposit Vietnam requires for land-based projects is easy to treat as an administrative footnote. It should not be. Article 36.2(e) of the Law on Investment No. 143/2025/QH15 makes failure to post the deposit a ground for terminating the project, and Decree 96/2026/ND-CP fixes a tiered quantum that, on a large manufacturing or real estate project, runs to tens or hundreds of billions of dong.
The deposit is also a recurring friction point in transactions. Sellers describe projects as “fully licensed” without mentioning an unposted deposit; lenders ask whether a guarantee given to the State ranks ahead of their security; joint venture partners disagree over who funds it. This article analyses the statutory basis, scope, quantum, form, refund and forfeiture of the deposit, with drafting points and risk ratings.
Regulatory update as of 10 October 2026: the deposit rules sit in Decree 96/2026/ND-CP (issued 31 March 2026), but its release and forfeiture provisions beyond Article 27 were not reviewed in full. Separately, Circular 38/2026/TT-NHNN has governed the foreign investment capital account (DICA) since 18 August 2026 and replaced Circular 06/2019/TT-NHNN, which affects how an offshore-funded cash deposit is routed.
Legal basis of the investment deposit Vietnam
The deposit is a statutory obligation, not a contractual term negotiated with the authority, so the room for negotiation is narrow. Counsel can influence the computation base, eligibility for a reduction, the form of security, the guarantee wording and the evidence supporting release. Together these determine how much capital the investment deposit Vietnam locks up and for how long.
Article 30 and the investment deposit Vietnam decree
Article 30 of the Law on Investment 2025 requires a deposit or bank guarantee for projects that receive land allocation, land lease or permission to change land-use purpose. The exceptions include winners of a land-use-right auction or bidding process. Articles 26–27 of Decree 96/2026/ND-CP set the rates, reductions, form and timing.
Characterisation: project performance security Vietnam
Functionally, the deposit is project performance security Vietnam requires from the investor in favour of the State: it secures the commitment to implement the project on the registered timetable. It is not a tax, land charge or fee, and it is excluded from the land use fee and land rent calculation. Characterisation matters in three places:
- Accounting: a cash deposit is a recoverable asset, not an expense, subject to refund conditions.
- Financing: a guarantee is a contingent liability of the project company and, where counter-guaranteed, of the parent.
- Disputes: forfeiture follows the statutory regime rather than ordinary contract damages [State Authority Practice / Verification Required].
Which land-based project Vietnam is caught
The trigger for the investment deposit Vietnam is the investor’s direct land relationship with the State, not the size of the project or the investor’s nationality. A land-based project Vietnam can therefore be a modest factory on State-leased land or a very large resort; the analysis follows the land document.
Triggers and exemptions
A land-based project Vietnam is caught where the State allocates or leases land to the investor, or permits a change of land-use purpose. A manufacturer sub-leasing a factory or serviced land from an industrial park developer does not ordinarily enter into an allocation or lease with the State and is therefore not ordinarily within Article 30 [State Authority Practice / Verification Required]. Auction and bidding winners are exempt by statute.
Practical point: where a client compares a State-leased site with an industrial park sub-lease, the deposit is a legitimate line item in the site comparison.
When the investment deposit Vietnam falls due
Under Decree 96/2026, the investment deposit Vietnam is paid after issuance of the IRC or the investor approval decision, and before approval of the compensation, support and resettlement plan or the land allocation or lease decision. For a project that also needed investment policy approval, the deposit therefore falls where land costs are about to be incurred and before the investor holds any land right.
Quantum: Decree 96/2026 deposit rates
The Decree 96/2026 deposit is calculated on a marginal, tiered basis:
- 3% on the first VND 300 billion of investment capital;
- 2% on the portion from VND 300 billion to VND 1,000 billion;
- 1% on the portion above VND 1,000 billion.
Computation base for the investment deposit Vietnam
The base excludes land use fees, land rent and the cost of infrastructure to be handed over to the State. Make sure the project proposal and IRC capital breakdown separate these items clearly, because the authority will compute the investment deposit Vietnam from the registered figures. Mis-labelling a land cost as construction capital is the commonest way to overpay. Illustrative arithmetic (VND billion, base after exclusions): a base of 800 gives 19 (9 + 10); 1,500 gives 28 (9 + 14 + 5); 12,000 gives 133 (9 + 14 + 110). How the authority fixes the base in a specific file should be confirmed [State Authority Practice / Verification Required].
| Base (VND bn) | Full deposit | 25% reduction | 50% reduction | Effective rate (full) |
|---|---|---|---|---|
| 800 | 19 | 14.25 | 9.5 | 2.4% |
| 1,500 | 28 | 21 | 14 | 1.9% |
| 12,000 | 133 | 99.75 | 66.5 | 1.1% |
The table shows why the investment deposit Vietnam weighs proportionately more on mid-sized projects: the effective rate falls as the base grows, because most of a large project’s capital sits in the 1% tier.
Reductions
The amount is reduced by 25% for priority sectors or difficult areas, and by 50% for special-priority sectors or especially difficult areas. Tie eligibility to the incentive basis recorded in the IRC, since Decree 96/2026 Article 24 provides that incentives apply on the basis of the investment approval or registration document.
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Bank guarantee investment deposit: drafting checklist
Decree 96/2026 allows the investment deposit Vietnam in cash or by bank guarantee. For most foreign investors a bank guarantee investment deposit is more capital-efficient, but a newly incorporated project company has no credit history, and the issuing bank will usually require a parent counter-guarantee or cash collateral. Our banking & finance team typically reviews the following terms.
| Term | Issue | Investor position | Risk if mishandled |
|---|---|---|---|
| Issuer | Whether the authority accepts the issuing bank (credit institution licensed in Vietnam) | Confirm acceptability before mandating the bank [Verification Required] | High |
| Beneficiary | Correct identification of the investment registration authority | Use the name in the IRC or approval; reflect the post-July 2025 Department of Finance structure | Medium |
| Amount | Must match computed quantum after reductions | Attach computation; provide for step-down on partial release | Medium |
| Expiry and extension | Authority may require validity to cover the implementation timetable | Build an extension mechanism; diarise renewal well before expiry | High |
| Demand conditions | Scope of the beneficiary’s right to call | Link demand to statutory forfeiture events only [Verification Required] | High |
| Counter-guarantee | Parent exposure and cross-default | Limit to guarantee amount; avoid broad cross-default to group facilities | Medium |
The choice between cash and guarantee is a treasury decision. A cash investment deposit Vietnam locks equity that could fund compensation or design costs; a guarantee consumes credit capacity and carries periodic fees. Where the parent holds facilities with a bank licensed in Vietnam, a guarantee issued against the parent’s counter-indemnity is often the efficient route, but build credit-approval lead time into the IRC timetable.
Deposit refund and forfeiture
Plan deposit refund when the implementation timetable is drafted, not when the project is complete. Investors often model the investment deposit Vietnam as a one-off cost, when in practice it is a long-dated, partly contingent asset. The value of an investment deposit Vietnam to the investor is, in the end, a function of how quickly it comes back.
Release mechanics
The release stages and percentages under Decree 96/2026 were not among the provisions reviewed in full for this article, and any reliance on staged release tied to milestones such as land procedures, construction commencement and operation must be verified against the text [State Authority Practice / Verification Required]. Whatever the milestones, each deposit refund request depends on evidence, and a late deposit refund ties up capital that the project may need for compensation or construction: land handover minutes, the construction commencement notice, completion and acceptance records. Allocate responsibility for assembling that evidence in the project management plan.
Termination and forfeiture risk
Article 36.2(e) of the Law permits termination of a project where the investor fails to provide the deposit. Where a project is delayed, adjusted or terminated for investor-attributable reasons, refund rights may be curtailed [Verification Required under Decree 96/2026]. Where the State causes the delay, for example late land handover, notify the authority in writing at the time and request a timetable adjustment, preserving any argument against forfeiture. Quarterly and annual implementation reports on Circular 55/2026 Forms I.3.1 and I.3.2 form part of the compliance record.
The investment deposit Vietnam in M&A, JVs and financing
In M&A, a buyer of a project company should verify whether the deposit has been posted, whether any guarantee remains valid, whether any refund has been made, and whether refund entitlement stays with the project on a change of investor [State Authority Practice / Verification Required]. A seller warranty and a specific indemnity for pre-closing forfeiture events are appropriate. Where the acquisition exceeds 50% foreign ownership, Article 21.3 prior registration also applies; coordinate its timetable with any replacement guarantee.
Change of law is a further point. Law 24/2026/QH16, effective 1 March 2027, amends the Law on Investment; if rules on the deposit change during a project’s life, Article 12 (investment guarantee upon change of law, three-year window under Article 12.5) may be relevant [Verification Required].
In joint ventures, the shareholders’ agreement should state which party funds the investment deposit Vietnam or counter-guarantee, the consequences of default, and whether the deposit counts as a shareholder contribution. In project finance, lenders will ask whether the issuer’s reimbursement claim ranks against the project company’s assets and whether forfeiture is an event of default.
Funding must also respect the foreign exchange route. Under Circular 38/2026/TT-NHNN, charter capital reaches the project company through its foreign investment capital account, and outflows include transfers to the company’s operating payment account (Articles 8–9). A cash deposit paid from that payment account should be consistent with the 90-day charter capital contribution deadline under the Law on Enterprises. Whether banks accept payment of the deposit directly from the capital account is a matter of bank practice [Verification Required].
Hypothetical scenario: A Singapore-based fund agrees to acquire 60% of a Vietnamese company holding a State land lease for a logistics project with a registered base of VND 1,500 billion. The data room shows a bank guarantee for VND 28 billion expiring in four months, while the construction timetable runs two more years. The issuing bank’s facility is secured by the seller’s group. Counsel makes a replacement guarantee, issued on the buyer group’s credit lines and accepted by the authority, a condition precedent, and adds an indemnity for any call on the existing guarantee for pre-closing events.
Risk matrix for the investment deposit Vietnam
| Issue | Legal position | Commercial impact | Risk | Mitigation |
|---|---|---|---|---|
| Deposit not posted on time | Termination ground, Art. 36.2(e) | Loss of project and sunk land costs | Fatal | Board-approve funding before IRC; parallel bank mandate |
| Guarantee expires before milestones | Authority may treat security as lapsed [Verify] | Call or termination risk | High | Renewal diary; auto-extension clause |
| Base overstated | Exclusions in Decree 96/2026 | Excess capital locked | Medium | Separate land costs and handover infrastructure in proposal |
| Reduction not claimed | 25% / 50% reductions | Overpayment | Low | Align with incentive basis in IRC |
| State-caused delay | Timetable adjustment possible [Verify] | Refund dispute | Medium | Contemporaneous written notices |
| Deposit status undisclosed in M&A | Contractual allocation only | Unexpected exposure post-closing | High | Diligence, warranty, specific indemnity, CP |
For land-based projects IVLF typically prepares a Deposit & Security Structuring Note covering quantum, form, guarantee terms and release plan, integrated with the IRC, capital account, work permit and sub-licence workstream through our projects & infrastructure practice.
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Frequently Asked Questions
Which projects must post an investment deposit in Vietnam?
Projects receiving State land allocation, land lease or permission to change land-use purpose under Article 30 of the Law on Investment 2025, subject to exceptions including land auction and bidding winners.
How is the investment deposit Vietnam calculated under Decree 96/2026?
3% on the first VND 300 billion, 2% from VND 300 to 1,000 billion, and 1% above VND 1,000 billion, excluding land use fees, land rent and infrastructure handed over to the State.
Can a bank guarantee replace a cash deposit?
Yes. Decree 96/2026 permits cash or a bank guarantee. New project companies usually need a parent counter-guarantee or collateral to obtain one.
When is the deposit refund available?
Refund is linked to implementation milestones. The exact stages under Decree 96/2026 must be verified; refund may be curtailed if the project is terminated for investor-attributable reasons.
Does a factory sub-lease in an industrial park trigger the deposit?
Ordinarily not, because the investor does not receive land allocation or lease directly from the State. Confirm the position with the authority for each project.
Conclusion
Treat the investment deposit Vietnam as part of the approval critical path. Fix the base and any reduction in the project proposal, mandate the guarantee bank in parallel with the IRC, and allocate deposit risk expressly in every SPA, JV agreement and facility agreement.
This article provides general information as of 10 October 2026 and is not legal advice on any specific matter. Contact IVLF Advisors for advice on your facts.
This article is provided for general information only and does not constitute legal advice for any specific case. Regulations may change – please consult a qualified professional before acting. Should further analysis be required, please contact one of our lawyers below.
