[LEGAL UPDATE] DECREE NO. 175/2024/NĐ-CP

On December 30, 2024, the Government issued Decree No. 175/2024/NĐ-CP detailing the implementation of certain provisions and measures for the enforcement of the Law on Construction regarding the management of construction activities. This Decree replaces Decree No. 15/2021/NĐ-CP dated March 3, 2021, which detailed several contents on the management of investment projects in construction. 

Strong decentralization of authority in appraising, inspecting acceptance works, issuing construction activity certificates, and practicing certificates 

• Regarding the management of construction activity capacity: Full decentralization of the authority to issue construction activity certificates and Class I practicing certificates to local levels, while removing the requirement for practicing certificates in certain fields where they are no longer deemed necessary. 

• Regarding the authority to appraise feasibility study reports for construction investment, construction designs implemented after basic design, and inspect acceptance works by specialized construction agencies: Complete decentralization to local levels for implementation. Sector-specific construction management ministries only appraise and inspect acceptance works for projects with special-grade constructions, complex constructions, or those lacking applicable regulations and standards. 

• Reduction of unnecessary administrative procedures, including: Expanding the range of projects only required to prepare technical-economic reports (increasing the total investment level from 15 billion VND to 20 billion VND, and including maintenance, upkeep, and repair projects of Group C); Minimizing cases requiring design adjustments without necessitating project adjustments. 

Simplification of administrative procedures in construction investment activities 

Decree No. 175/2024/NĐ-CP standardizes the submission dossiers associated with administrative procedures, eliminating unnecessary documents to shorten processing times as follows: 

• Removing the requirement to provide legal documents and information already available in the national database on construction activities and the national land database (once these systems are operational and interconnected). 

• Eliminating overlapping management content between steps in the investment sequence and clearly defining the list and criteria for compliance in administrative procedures for appraisals, construction permits, certificates, etc., to enhance transparency. 

• Reviewing and eliminating certain cases requiring construction activity capacity certificates; consolidating some areas of practicing certificates that do not require specialized expertise (e.g., project management, construction supervision); and extending the validity of personal practicing certificates from 5 years to 10 years. 

Promotion of digital transformation and information technology application 

The Decree accelerates the adoption of Building Information Modeling (BIM) systems. The combination of BIM and database systems in managing construction activities for appraisals and issuing construction permits will provide an opportunity to expedite digital transformation in the construction industry. 

Addressing practical difficulties and harmonizing the legal system 

• Clarifying the types of planning or equivalent legal documents used as the basis for project formulation, as well as for issuing construction permits, to resolve issues in projects originating from multiple types of planning under specialized laws and address the lack of consistent planning in some localities. 

• Supplementing regulations on underground works and basements of construction projects to align with the Law on Urban and Rural Planning, addressing issues stemming from the lack of information on basements at various planning levels. 

• Defining clear, comprehensive criteria and documentation requirements for the appraisal of feasibility study reports for construction investment, designs implemented after basic design, and ensuring consistency with the Law on Investment, the Law on Housing, forestry laws, and fire prevention and fighting laws. Procedures must be transparent and efficient to reduce project preparation and design timelines while improving the effectiveness and efficiency of appraisal management. 

• Fully systematizing and clarifying legal land documents used as the basis for granting construction permits, ensuring consistency with the Law on Land and newly issued Decrees on land management.