Pháp luật về đầu tư theo hình thức đối tác công tư ở việt nam tt tieng anh

THE MINISTRY OF EDUCATION & TRAINING THE
MINISTRY OF JUSTICE
HANOI LAW UNIVERSITY

ĐOÀN THỊ HẢI YẾN

LAWS ON INVESTMENT IN THE FORM OF
PUBLIC-PRIVATE PARTNERSHIP IN VIETNAM

SUMMARY OF DOCTORAL THESIS ON LAW

Specialty: Economic Law
Code: 9380107
Academic Supervisors:
1. Dr.Nguyễn Văn Tuyến
2. Dr.Võ Đình Toàn

HÀ NỘI - 2020


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PREAMBLE
1. The urgency of the research topic
In the context of the current economy, countries in the world in
general and Vietnam in particular have myriad difficulties in ensuring
the revenue of the state budget with a view to meeting the demand for
funding, channeled into public affairs, as well as allocating money
for the construction and establishment of infrastructure systems. In
order to reduce the burden on the state budget and increase
investment resources for infrastructure construction, one of the
measures applied is to establish a partnership between the state and

the private sector. This is also called public - private partnership
(hereinafter referred to as PPP).
In Vietnam, public-private partnerships in infrastructure
construction investment have been in place since 1994 through
energy and telecommunications projects based on investment models
such as BOT, BT, BTO. However, the application of these approaches
seems to be only experimental and theoretically, the BOT, BT or
BTO investment methods in previous years have not reflected the
true nature of this investment model under public-private partnership
contract. Therefore, starting from 2011, with the promulgation of the
Prime Minister's Decision No. 71 / QD-TTg on November 9, 2010,
promulgating the Regulation on pilot investment in the form of
public - private partnership, investment mechanisms under the
public-private partnership model have just begun to be implemented
in Vietnam. In essence, BOT is one of the PPP forms, but the
coexistence of many divergent legal documents simultaneously
adjusting of public-private partnerships has caused many difficulties
for the application and legislative enactment process in practice. In
this context, Decree No. 15/2015 / ND-CP of the Government was
issued, followed by Decree No. 63/2018 / ND-CP of the Government


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to ensure the consistency of the legal system in regulating publicprivate partnership. Nevertheless, because this is a relatively new
field in Vietnam and the number of practical application cases has
been modest, the laws providing for this relationship remain
inadequate. Therefore, the search for a genuinely effective
partnership and dialogue mechanism between the State and private
investors in Vietnam has faced certain problems and requires further
study, investigation and viable solutions.

From the aforementioned practice, I settle on the topic: "Laws
on investment in the form of public-private partnership in
Vietnam" for my doctoral thesis.
2. Purpose and mission of the research
The research objective of the thesis is to clarify legal issues of
investment in the form of public-private partnership in Vietnam; on
that basis, make recommendations on building a legal model of
investment in the form of public-private partnership in Vietnam in
the current period.
To achieve the aforementioned goal, the thesis has the
following tasks:
First, study the theory of investment in the form of publicprivate partnership and the laws on investment under public-private
partnership.
Second, analyze and assess the current status of the laws on
investment under public-private partnership in Vietnam.
Third, research and make a comparison of laws on investment
in the form of public-private partnership in Vietnam with some other
countries around the world.
Fourth, propose directions to develop and improve the laws on
investment under public-private partnership in Vietnam.
3. Subject and scope of the research
The research subjects of the thesis are theoretical points of


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view, doctrines on investment in the form of public-private
partnerships and the theories of legal adjustment to investment
relationships under public-private partnerships; legal provisions on
investment in the form of public-private partnership of Vietnam and
some other countries; practical implementation of the laws on

investment in the form of public-private partnership in Vietnam.
The research scope of the thesis focuses on the following
issues:
- Scope of research content: Theoretically, the author focuses
on clarifying the nature of investment relationships in the form of
public-private partnerships (with the specific characteristic being an
asymmetric relationship between the participating parties - public and
private partners); specify ways of utilizing the laws to regulate
investment relations in the form of public-private partnerships (in
which clarifies the mechanisms for investor selection, payment and
contra entry practice for investors). In terms of practicality, the
author focuses on assessing the status of the laws on investment in
the form of public-private partnership in Vietnam, pointing out the
limitations and shortcomings of this legal field and thereby proposing
recommendations to strengthen the laws on investment in the form of
public-private partnership in Vietnam.
- Regarding the scope of time and space of the research:
In terms of time: The thesis focuses on studying the current
legal provisions on public-private partnership investment.
In terms of space: The thesis examines the legal provisions on
investment in the form of public-private partnership in Vietnam.
4. Methodology and research methods
The author studies the topic based on dialectical materialism
and historical materialism. On that basis, the author employs some
certain research methods of social sciences, including: Methods of
analysis, methods of synthesis, comparison methods and methods of


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normative logical analysis.

5. New contributions of the thesis
As an intensive, systematic and comprehensive scientific study
of laws on public-private partnership investment in Vietnam, the
thesis has the following major new contributions:
Firstly, the thesis systematically studies theoretical issues of
investment in the form of public-private partnership and the laws on
investment in the form of public-private partnership. The thesis
analyzes the concept, characteristics and content of this mode of
investment.
Secondly, the thesis has pointed out the nature of the
investment relationship in the form of public-private partnership,
which is inherently an asymmetric relationship between the
participating parties (Government and Private Sector), in which the
parties establish the partnership based on the signing of project
contracts to achieve the goals that each party pursues.
Thirdly, the thesis has detailed the roles, functions, tasks as
well as the advantages of the parties participating in this investment
relationship. The participation of the State through competent state
agencies and private investors through contracts will promote the
strengths of each party, contributing to the successful implementation
of PPP projects.
Fourthly, the thesis has clarified that investors in PPP projects
are organizations and pointed out criteria to select investors capable
of implementing projects. The thesis also proves that the regulation
that state enterprises are entitled to participate in PPP projects as
investors is inconsistent with the nature of investment relations in the
form of PPP.
Fifth, the dissertation has demonstrated the limitations in the
laws on bidding to select investors, which are still inadequate and
necessitate the change to online bidding to ensure the publicity,

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transparency in the process of selecting investors.
Sixthly, the thesis has proved that the settlement of project
work under the current law provisions for PPP projects is not suited
to this form of investment and needs to be changed.
Seventhly, the thesis has demonstrated the need for additional
regulations to ensure state support for PPP projects in order to attract
investors' participation, thereby contributing to risk sharing between
the State and the investors.
Eighthly, based on the limitations and shortcomings of current
stipulations, the thesis has proposed solutions to help complete the
laws on investment in the form of public-private partnership in
Vietnam in the current period.
6. Theoretical and practical meanings of the thesis
- The thesis is an intensive, systematic and comprehensive
scientific study to solve practical and core theoretical issues of
investment in the form of public-private partnership.
- The thesis is a useful resource for the authorized state
agencies in evaluating the effectiveness of the legal provisions on
investment in the form of public-private partnership, forming a basis
for perfecting the laws in the near future.
- The thesis is also a valuable source of materials for institutions
specialized in scientific research, teaching and learning about laws on
investment in the form of public-private partnership.
- With the theoretical and practical bases drawn from the research
process, the solutions and recommendations given by the thesis are of
reference value to the competent state agencies in the process of
completing laws on investment in the form of public-private partnership.

7. The structure of the thesis
Alongside the preamble, conclusion and list of references, the
thesis is designed to include:


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Part 1: Overview of research situation related to the thesis
topic.
Part 2: The content of the thesis comprises 3 chapters:
- Chapter 1: Theoretical issues of investment in the form of
public-private partnership and the laws on investment in the form of
public-private partnership.
- Chapter 2: Legislative practice regarding the laws on publicprivate partnership investment in Vietnam.
- Chapter 3: Requirements and solutions to perfecting the laws
on investment in the form of public - private partnership in Vietnam.
Part One
OVERVIEW OF
RESEARCH SITUATION RELATED TO THE THESIS TOPIC
1. Assessing the research situation related to the thesis topic and
the direction of deploying the thesis’s research topic
Through surveying the research situation related to the thesis
topic, the author draws some notions and assessments as follows:
1.1. The theoretical and practical results related to the thesis topic
1.1.1. The theoretical and practical results of other research work
related to investment in the form of public-private partnership.
In theoretical aspect: Other researchers have mentioned,
analyzed and clarified several theoretical issues about investment in
the form of public-private partnership such as the concept,
characteristics and the role of this investment form in attracting
investment capital into infrastructure and public services.

In practical aspect: Other researchers have mentioned the
practice of investing in the form of public-private partnerships of
typical countries in the world, these research results are of great
importance to the author and the thesis, having fully generalized the


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practice of drafting and implementing laws on investment under this
form in the world, thereby giving the author a basis for compraring,
collating and reviewing the status of Vietnamese laws and proposing
some research questions and solutions to drafting a Law on
Investment in the form of public-private partnership in Vietnam.
1.1.2. The theoretical and practical results of other research work
related to the topic of laws on investment in the form of publicprivate partnership
- In theoretical aspect: The research work of foreign scholars
about laws on investment in the form of public-private partnership
mentioned and analyzed on the legal status and practical application
of the law in some typical countries. In addition, scholars also
pointed out the lessons learned about legal adjustment to this mode of
investment in those countries. This is a precious resource for the
thesis author to inherit and develop in the process of solving the
requirements of the thesis. On the other hand, domestic research
work about laws on investment in the form of public-private
partnership have also initially approached and analyzed the
investment practice in the form of public - private partnership in
theoretical and practical perspectives. In which, most of the work
focus on studying theoretical issues of the laws governing BOT
contracts such as the nature, characteristics and roles of the laws on
BOT contracts. These analyzes will continue to be studied, evaluated,
commented by the thesis author. I will also make my own views on

the theoretical basis and the current status of Vietnam's laws on
investment under public - private partnership.
- In practical aspect: Experimental research work abroad on
PPP in the world is plentiful, with many important results having
been published. Specifically, studies claim that there exists no
standard PPP model and each country has its own strategy depending
on its context, legislative institutions, funding and the nature of the


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project.
Meanwhile, domestic research on the practice of implementing
the laws on investment in the form of public - private partnership in
Vietnam have focused on practical research on the implementation of
the laws on BOT contracts. Thereby, the studies have systematically
analyzed and evaluated the legal provisions on the BOT contracts,
pointing out both suitable and limited and inadequate points, from
which making recommendations to perfect the legislation on BOT
contracts in Vietnam.
1.2. Issues related to the thesis topic which have not been solved by
published research work, or have been examined but not yet
satisfactorily, or still sparked different opinions that need to be
further studied in the thesis.
Firstly, theoretically, there have been many studies on the
nature of investment relations in the form of public-private
partnership but mainly from an economic perspective; under the legal
perspective, there have been research but not studied
comprehensively about investment relations in the form of publicprivate partnerships, especially in terms of building a rule of law state
and international integration.
Secondly, in practical terms, there have been studies on the

current state of the law on investment in the form of public-private
partnerships but have not studied and assessed comprehensively,
especially not yet indicated fully and analyzed profoundly the
limitations and inadequacies of the current laws on investment in the
form of public - private partnership, not yet proposing solutions to
complete the legal framework on investment in the form of publicprivate partnership in Vietnam today, on that basis.
2. Research theory, research questions, research hypotheses
2.1. Research theory
The thesis content is developed based on the general theory of


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investment, in which the focus is on the theory of investment form in
the form of public-private partnership.
Public-private partnership investment form is carried out with
the participation of public and private partners; without one of the
two parties, it is impossible to implement this invesment method.
Now, the invesment only takes the form of public investment or
private investment.
Simultaneouly, the thesis is also based on the general theory of
contracts.
2.2. Research question
Based on the results of evaluating the research situation on the
topic, as well as the proposed research orientation of the thesis, the
author identifies the main research questions and hypotheses that
need to be justified in the thesis as follows:
The study was conducted to find the answer to a question:
“What are the limitations of the laws on investment in the form of
public-private partnership in Vietnam, which need to be handled with
to ensure legal provisions on PPP genuinely promote public-private

partnership investment in Vietnam?”. To find the answer to this
question, the thesis will research to find answers to the following
small questions:
- What is the legal nature of investment relations in the form of
public-private partnerships?
- How should the law regulating investment relations in the
form of public-private partnership?
- Should the establishment of investment contracts be decided
by the parties at their discretion or under the direction of the State?
Do the parties involved in the investment contracts have equal legal
status? Does Vietnamese laws regulating entities participating in this
relationship guarantee legitimate rights and interests for the parties?


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- Are the order and procedures for investment in accordance
with the current laws of Vietnam consistent with the nature of this
relationship as well as in line with international practice? Has the
investor selection in accordance with current regulations ensured
publicity and transparency? Are the criteria for selecting investors
really suitable to ensure that to-be-chosen investors have the best
capabilities to implement the project?
- Have the regulations on project settlement for PPP
investment projects fitted and reflected the true nature of this
relationship?
- Investment activities in the form of PPP usually take place in
a long time, so disputes are likely to happen between participating
parties or between service users and investors. So when a dispute
arises, which dispute resolution mechanism will be applied to resolve
conflicts and disagreements?

2.3. Research hypotheses
Based on the research of Decree No. 63/2018 / ND-CP, the
Investment Law, the Law on Public Investment, the Bidding Law, the
State Budget Law and the by-laws guiding the implementation of
these laws, the thesis suggests two research hypotheses as follows:
- The first research hypothesis:
In order to improve the efficiency of investment activities in
the form of PPP, it is necessary to have appropriate legal regulations,
according to which: The promulgated legal provisions need to reflect
the true nature of investment relations in the form of public-private
partnerships; Provisions on the legal status of entities participating in
this relationship, the rights, responsibilities and capabilities of the
parties involved in the relationship; Investors in this relationship
must meet certain requirements, so not all individuals and
organizations can participate as investors; In order to find competent
investors, open and transparent bidding must be conducted to


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minimize the application of contractor designations; State
participation with financial support is necessary for certain projects;
It is necessary to stipulate governmental guarantee measures to offset
risks that investors may incur; Regulations are needed to ensure the
benefits of the service users; The punishments imposed must be strict
enough to prevent the violation from happening and, at the same
time, severely punish the violating parties.
- The second research hypothesis:
In order to improve the efficiency of investment activities in
the form of PPP, the promulgated legal regulations aim to ensure the
rights and benefits of public partners more to fulfill the State’s

management objectives of investment activities; In this relationship,
the state has the right to intervene by administrative orders to require
investors to perform or not to perform a certain job that has not been
aggreed upon in the contract; Investors only need to satisfy financial
conditions to participate in PPP projects; The State does not need to
offer financial support as well as investment guarantee measures to
share risks with investors because if so, it is likely that the state will
bear all risks; There is no need for legal provisions to ensure the
interests of service users as this is a relationship established through a
legal form that is a contract between the state and the investor.
Part two
CONTENTS OF THE THESIS
Chapter 1
THEORETICAL ISSUES OF INVESTMENT IN THE
FORM OF PUBLIC PARTNERSHIP AND THE LAWS ON
INVESTMENT IN THE FORM OF PUBLIC PARTNERSHIP
1.1. Theoretical issues about investment in the form of publicprivate partnership
1.1.1. The concept of investment in the form of public-private


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partnership
In the author's view: “Investment in the form of public-private
partnership is a special cooperation relationship between the state
(through competent state agencies) and investors, formed based on
the asymmetry in conditions, status and interests between the parties
involved and implemented through a contractual mechanism
intended to build, renovate, operate, trade, manage infrastructure
work, and provide public services, in which the parties reach an
agreement on the appropriate allocation of financial resources,

sharing risks, liabilities and benefits arising in the process of
implementing investment activities.”
The above concept demonstrates the nature of a public-private
partnership - inherently not an entirely equal partnership between the
parties involved, although the parties still enter into contracts to
create legal rights and obligations for themselves.
1.1.2. Characteristics of investment in the form of public-private
partnership
First, in terms of legal nature,
The legal nature of investment in the form of public-private
partnership is a contractual relationship, which reflects the
"asymmetric" status of the parties involved and the differences in
advantages that each party has.
Second, in terms of the entities participating in investment
relations,
The important difference between public-private partnership
investment and public or private investment is that this type of
investment always involves two parties, one of which is the State
(through competent state agencies) and the other is a private investor.
Thirdly, in terms of investment capital,
In principle, the capital used to invest in a public-private
partnership investment contract usually includes two sources: (i) the


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public partner's investment; (ii) the private partner’s investment.
Fourthly, in terms of investment purposes,
For private investors, the purpose of participating in this
investment relationship is earning profit, and for the State, the
purpose of participating in this investment relationship is to exploit

private sector’s investment capital, expertise, and management and
governance capabilities to build infrastructure and provide public
services.
Fifthly, the subject of investment is building infrastructure and
providing public services to society.
1.1.3. The role of investment in the form of public-private
partnership
Firstly, public-private partnership investment will create more
investments in infrastructure.
Secondly, the investment in the public-private partnership
model will improve the efficiency of the construction and operation
of public work.
Thirdly, investing under public-private partnership will help
allocate funds and manage risks better and more effectively.
Fourthly, public-private partnership investment will contribute
to improving the quality of infrastructure and public services
provided.
1.2. Theoretical issues on the adjustment of laws on investment
relations in the form of public-private partnerships
1.2.1. The concept of laws on investment in the form of publicprivate partnership
At a general level, it is possible to introduce the concept of
laws on investment in the form of public-private partnership as
follows:


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The laws on investment in the form of public-private
partnership is a total of legal regulations stipulated or recognized by
the State to adjust the investment cooperation relationship between
the State and private investors in order to build, renovate, trade,

manage infrastructure work and provide public services.
1.2.2. Regulatory principles of laws on investment in the form of
public-private partnership
Theoretically, the legal adjustment on investment relations in
the form of public-private partnerships should adhere to some of the
following basic principles:
Firstly, the laws on investment in the form of public-private
partnership must be designed and enacted in an orientation that
satisfies the legitimate interests of all relating parties.
Secondly, the laws on investment in the form of public-private
partnership must ensure the principle of respecting the selfdetermination right of private investors in investment relations.
Third, the laws on investment in the form of public-private
partnership must ensure the fulfillment of the basic and core
objective of building, renovating, operating, trading and managing
infrastructure and public services. Simultaneously, the laws also have
to avoid the risk of "profiteering" from private investors through the
design of unfair and disadvantageous terms and provisions for the
State in investment contracts under the form of public-private
partnership (project contracts).
1.2.3. The structure of the laws on investment under public-private
partnership
From the thesis author standpoint, the structural model of the
laws on investment under public-private partnership will include but
is not limited to the following major legal groups of regulations:
(i) Legal provisions on the legal entities and their rights and
obligations when participating in investment relations in the form of


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public-private partnerships.

(ii) Legal provisions on investment contracts in the form of
public-private partnerships.
(iii) Legal provision on the order and procedures for
investment in PPP projects
(iv) Legal provisios on capital to implement the PPP projects
(v) Legal provisions on investment incentives and guarantees
(vi) Legal provisions on settlement PPP projects work
(vii) Legal provisions on organizing project, inspecting and
supervising investment activities in the form of public – private
partnership
(vii) Legal provisions on handling violations and the
resolution of disputes arising from the process of implementing
investment projects in the form of public-private partnerships.


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Chapter 2
LEGISLATIVE PRACTICE REGARDING THE LAWS ON
PUBLIC – PRIVATE PARTNERSHIP INVESTMENT IN
VIETNAM
2.1. Legislative status regarding entities participating in
investment relations in the form of public – private partnership
At a general level, there are some major shortcomings:
Firstly, the current law provides irrational provisions of
competent state agencies authorizing to sign the project contracts for
non- business units to self – finance recurrent expenditures and
investment expenditures.
Secondly, the current law still opens the regulation on
responsibilities of competent state agencies in case these agencies do
not comply with commitments in PPP contracts.

Thirdly, the current law provides quite general and lack
specific details about investors participating on investment projects in
the form of public – private partnership, resulting in shortcomings in
the implementation process in practice.
Fourthly, the current law does not specify the legal status of
the project enterprise and the legal relationship between the project
enterprises, the investors and the competent state agencies (public
partner) in PPP project implementation process.
2.2. Legislative status regarding the laws on public-private
partnership investment in Vietnam
Firstly, in term of the name of investment contract in the form
of private-public partnership in Vietnam
The PPP investment contract is recognized in Clause 2, Article
3 of Decree No.63/2018/ND-CP under the name “project contract”.
Secondly, in term of types of investment contracts in the form
of private – public partnership


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According to current law, investment contracts in the form of
private-public partnership are signed in one of the following major
categories:
- Build – Operate – Transfer (BOT)
- Build – Transfer - Operate (BTO)
- Build – Transfer (BT)
- Build – Own – Operate (BOO)
- Build – Transfer – Lease (BTL)
- Build – Lease - Transfer (BLT)
- Operations and Management (O&M)
Thirdly, in term of content of project contracts

The content of contract is clauses which are agreed by the
parties on the basis of cooperation and common benefit, which
directly sets the rights and obligations of the parties when
participating in the contractual relationship.
Fourthly, in term of signing and implementation of project
contracts
According to Article 39 of Decree No. 63/2018 /ND-CP, based
on the decision on approval of investors selection results and results
of negotiation and completion of contracts, competent state agencies
organize to sign project contracts.
Fifthly, in term of disclosure of project contracts
According to Article 41 of Decree No.63/2018/ND-CP,
disclosure of project contracts is a mandatory procedure to ensure
openness, transparency and access to information of society and
community.
Sixthly, in term of transfer rights and obligations of investors
in project contracts to other organizations and individuals
During the time of implementing the project contracts, if
investors and project enterprises cannot or do not want to continue to


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implement the project contracts, these rights or obligations may be
transferred to another entities.
Through the study of the regulations on investment contracts in
the form of public-private partnership, some limitations and
shortcomings can be identified:
Firstly, the current law fails to show an agreement on the name
of the contracts signed between investors, project enterprises and
competent state agencies to implement investment projects in the

form of public-private partnership.
Secondly, the current regulations on project contracts do not
clearly show whether the transaction and performance of the
contracts must comply with the basic principles prescribed in the
Civil Code or not?
Third, the current regulations on project contracts are not
sufficient to prevent the risk of taking advantage of the
implementation of investment projects in the form of public-private
partnership to profiteer, appropriate public properties or cause losses
and waste of national financial resources, forming group interests
during the implementation of PPP projects.
Fourth, the current law does not have uniform regulations on
the form of project contracts to ensure the conformity with the
specific characteristics of each type of project contracts.
2.3. Legislative status regarding the order and procedures for
public-private partnership investment in Vietnam
Through researching and surveying the legislative situation of
the order and procedures related to investment activities in the form
of public-private partnership, including procedures for selecting
investors, the author of the thesis ponders that these provisions have
revealed a number of major limitations and shortcomings as
followed:
Firstly, the current regulations on investor selection procedures


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for PPP projects by the method of appointing contractors are relatively
general, unclear, easily exploited and hinder the application process in
the real situations.
Secondly, the law permiting the application of contractor

designation to select investors for PPP projects not only limits
competition, reduces investment efficiency of the projects, but also
creates loopholes for corruption and group interests through PPP
projects.
2.4. Legislative status regarding capital sources for
implementation of investment projects in the form of publicprivate partnership.
Through a survey of practical implementation of the law on
investment in the form of public-private partnership, the author of the
thesis believes that the group of regulations stipulating the capital
sources to implement investment projects in the form of publicprivate partnership has revealed following limitations and
shortcomings:
Firstly, in terms of the regulations on investors' contributed
capital,
Under the provisions of Decree No. 63/2018 / ND-CP, the
equity capital of the investor must be at least 20% of the total
investment capital of the project (for investment projects with total
investment capital up to VND 1,500 billion) and at least 10% of total
investment capital (for investment capital exceeding VND 1,500
billion).
The regulation on the ratio of equity over total investment
capital as currently prescribed is low and not appropriate.
Secondly, in terms of the State's capital participation,
Practical evidences show that the funding structure plays
important role in PPP’s success, in which the funding structure is
construed to include the ratio between public and private equity in


20
PPP projects. The Government needs to expand the capital support
margin to increase the financial viability of PPP projects.

2.5. Legislative status regarding investment incentives and
guarantees for public-private partnership investment projects
It is obvious that the limitations and inadequacies in the
regulations on investment incentives and guarantees for investment
projects in the form of public-private partnership are expressed in
some of the following major aspects:
Firstly, the regulations on investment incentives are often
unclear, so it is difficult to be put into practice.
Secondly, the regulations on risk sharing are not yet mentioned
both in principles and mechanisms for identifying and allocating
risks to each party in the process of deploying, implementing and
operating PPP projects.
2.6. Legislative status regarding the settlement of investment
project works in the form of public-private partnership
Firstly, according to the current provisions of Decree No.
63/2018 / ND-CP, lawmakers only provide the point of time when
investors must complete the settlement of completed works, but they
haven’t guided the details of the settlement of payment for project
contracts in the stage of business operation and exploitation. Besides,
according to the provisions of Decree No. 63/2018 / ND-CP on
investment in the form of public-private partnership and Circular No.
88/2018 / TT-BTC, the settlement of investment capital for PPP
projects shall be performed as the final settlement for the projects
which are financed by the state capital, that is, the settlement
procedure is done as in the public investment project. Obviously,
such a regulation is not guaranteed to be scientific because the nature
of the investor's construction of a project with a life cycle of 20 - 30
years will be different from the project funded by the State.
Moreover, the current regulations on the final settlement of PPP

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projects are not consistent with international practices which focus on
controlling projects’ output instead of input.
Secondly, the approval of the settlement of project works
under the current provisions of the Construction Law also fails to suit
PPP projects.
2.7. Legislative status regarding the inspection and supervision
activities for investment activities in the form of public-private
partnership.
At a general level, it can be said that these regulations have
revealed some major shortcomings:
Firstly, there are no specific regulations on state audit of
investment projects in the form of public – private partnership.
Secondly, the absence of regulations on consultation and
supervision of the community on PPP projects is one of the causes
leading to the lack of agreement from citizens on the PPP projects
when PPP projects are come into operation.
2.8. Legislative status regarding handling violations of law and
the resolution of disputes in investment activities in the form of
PPPs
At a general level, these regulations reveal some of the
following limitations and shortcomings:
Firstly, the current law has no specific provisions on breaking
law in the field of investment in the form of public - private
partnership, except for some provisions on prohibited acts in
investment activities.
Secondly, the current law does not have specific provisions on
the right of participating in the proceedings of organizations and
individuals using infrastructures and public services which are

created from investment projects in the form of public - private
partnership.


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Chapter 3
REQUIREMENTS AND SOLUTIONS TO PERFECT THE
LAW ON INVESTMENT IN THE FORM OF PUBLIC –
PRIVATE PARTNERSHIPS
IN VIETNAM
3.1. Objective and basic requirements for the completion of the
law in the form of public – private partnership in Vietnam
3.1.1. Objective of completing the law on investment in the form of
public - private in Vietnam
From the demand of development in Vietnam, making and
completing the legal provisions on investment in the form of public –
private partnership are extremely necesssry and urgent, aiming to the
following basic objectives:
Firstly, institutionalize the Partty’s guidelines and views on
attracting resources of the private sector to develop national
infrustructure; upgrade the provisions of the current Decree to
improve the legal basis of the regulations, handle the overlapping
contents between laws and supplement the missing regulations.
Secondly, create investment environment in the form of public
– private partnership with a high legal basis, unity, synchronization,
limiting risks in term of policy changes.
Thirdly, perfect the legal regulations on PPP to improve the
effectiveness of investment in the form of PPPs in association with
the responsibilities of ralated parties, including Ministries, Branches
and localities (which are competent state agencies); investors, project

enterprises, banks, credit institutions and inspection agencies.
3.1.2. Basic requirements which are imposed to perfect law on
investment in the form of PPPs
From cognitive viewpoints, the author of the thesis believes
that the completion of the law on investment in the form of public –


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private partnership should meet some of the following basic
requirements:
Firstly, perfect laws on investment in the form of public –
private partnership must ensure that the requirement of both
addressing the basic objective of this particular investment mode is to
promote the construction of infrustructure and public services on the
basis of receiving investment capital and professional experience in
design, construction, operation and exploting projects of private
sector, while ensuring to deal with requirements about the right of
investors when investing in PPP projects.
Secondly, ensure the comprehensiveness, uniformity and
feasibility of the legal system on investment in the form of public –
private partnership.
Thirdly, perfect laws on investment in the form of public –
private partnership must ensure conformity with the current social
and economic situation of Vietnam in the context of transition to a
market economy and international integration.
Fourthly, perfect laws on investment in the form of public –
private partnership must ensure compatibility and comformity with
international practices and standards.
3.2. Solutions to perfect laws on investment in the form of publicprivate partnership in Vietnam
3.2.1. General solutions

Firstly, overcome the overlap and conflict between legal
documents which are rekated to investment in the form of public –
private partnership.
Secondly, laws on investment in the form of public – private
partnership must be perfected on the basis of the harmonizing
combination the beneficial relationship between public partners,
private partners and the third parties in the process of formation,
negotiation, signing and implementing investment projects.


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3.2.2. Specific solutions to perfect laws on investment in the form of
public – private partnership
Firstly, Perfect the legal regulations about entities
participating in investment relations in the form of public – private
partnership
Secondly, need to amend and supplement regulations on
contracts signed between public and private partners in the form of
public- private partnership
Thirdly, perfect the regulations on investment selection
procedures for PPP projects
Fourthly, perfect the regulations on capital to implement
investment projects in the form of public – private partnership
Fifthly, perfect regulations on sharing and allocation of risks
among parties in investment activities in the form of public – private
partnership
Sixthly, perfect regulations about drawing the balansheet
project works to suit the essence of PPP projects
Seventhly, perfect regulations on inspection and supervision
activities of competent state agencies and community to PPP projects

Eightthly, perfect regulations on handling violations of law
and resolving disputes during the process of implementing investment
projects in the form of public – private partnership.