Vietnam’s business community is currently at the center of a heated debate over a proposed amendment to the country’s Investment Law that could fundamentally reshape how conditional business sectors are regulated. At issue is whether the all-important list of sectors requiring special government approval—known as conditional business sectors—should remain enshrined in the law itself or be delegated to government decrees, a move that would grant the executive branch greater flexibility but also, critics warn, could open the door to regulatory confusion and unchecked bureaucratic expansion.
On September 20, 2025, Báo Đại Đoàn Kết reported that the Vietnam Chamber of Commerce and Industry (VCCI) had raised strong concerns about the Ministry of Finance’s proposal to shift the regulation of conditional business sectors from the Investment Law to government-issued decrees. The Ministry of Finance, as reported by The Saigon Times on September 21, 2025, is currently drafting amendments to the Investment Law, expected to be submitted to the National Assembly for consideration during its October 2025 session. This proposed change, the Ministry argues, is necessary to make the legal framework more responsive to rapidly evolving business realities and emerging risks.
Under the current legal system, the Investment Law—first enacted in 2014 and revised in 2020—specifies which business sectors are subject to special conditions, such as licensing requirements or additional compliance hurdles. The 2014 law included 267 such sectors; the 2020 revision reduced this number to 230, with the stated aim of creating a more favorable environment for entrepreneurs. However, as the Ministry of Finance notes, many of these reductions were achieved by merging or broadening sector categories rather than through substantive deregulation. In practice, a large proportion of these sectors still operate under a so-called “pre-permit” regime, where businesses must secure government approval before commencing operations.
Some sectors, such as the repair and refurbishment of inland waterway vessels or the manufacturing of safety helmets, are cited by the Ministry as examples where technical standards, rather than business conditions, could suffice for oversight. Conversely, the Ministry points out that new and potentially risky sectors—like platforms for sharing personal data or businesses utilizing deepfake technology—are not yet classified as conditional, making it difficult for authorities to manage associated risks and leaving loopholes that bad actors could exploit.
To address these challenges, the Ministry of Finance proposes that the authority to determine and update the list of conditional business sectors be delegated to the Government via decrees, rather than requiring an act of the National Assembly each time a change is needed. The Ministry insists that this would allow for more flexible and timely responses to new risks, as well as more effective state management. The draft law also introduces new principles for defining business conditions, emphasizing requirements around professional capacity, personnel, physical infrastructure, and management systems, while explicitly excluding product and service quality standards from the definition of business conditions.
This approach, the Ministry argues, would facilitate a review and reclassification of which sectors truly require pre-permit oversight and which could be shifted to a “post-audit” regime, where compliance is checked after the fact rather than before operations commence.
Yet VCCI and other business representatives are sounding the alarm. According to Báo Đại Đoàn Kết, VCCI has urged the Ministry of Justice to reconsider the proposal, arguing that moving the list of conditional business sectors to decrees could lead to the unchecked proliferation of new regulatory hurdles. As VCCI points out, decrees are sub-law documents that can be issued more quickly and with less parliamentary scrutiny than laws. This could result in arbitrary or poorly controlled additions to the list, especially since decrees issued after one another hold equal legal weight, with the latest taking precedence in case of conflict.
VCCI’s position is that the current system—where the list of conditional business sectors is anchored in the Investment Law—ensures comprehensive oversight and transparency. By requiring that any changes to the list be approved by the National Assembly, the law acts as a safeguard against the casual or opportunistic expansion of government control over the economy. This, VCCI argues, is in line with the spirit of Vietnam’s ongoing administrative reforms, which seek to streamline procedures, cut compliance costs, and foster a more open and predictable investment environment.
“If the list of conditional business sectors is regulated at the decree level, it will be difficult to control the addition of new sectors, especially when these additions originate from sub-law documents,” VCCI stated, as reported by Báo Đại Đoàn Kết. The organization further warned that this could create confusion for businesses, who would struggle to keep track of which sectors are subject to special conditions at any given time.
Adding another layer to the debate, The Saigon Times highlights the perspective of government officials who argue that delegating this authority to the executive branch is not just a technical matter, but a necessary step for regulatory modernization. They contend that the government needs to be able to respond rapidly to new economic and technological developments—especially as Vietnam seeks to maintain high economic growth and improve its business climate. However, as Phan Duc Hieu, a standing member of the National Assembly’s Economic and Financial Committee, observed in a recent seminar, “The biggest challenge in institutional reform is that most past initiatives have come from the government’s determination, while ministries and agencies rarely take the initiative to abolish business conditions under their management.”
Statistics from the Ministry of Justice underscore the persistence of bureaucratic hurdles: between October 2023 and July 2024, the Ministry reviewed 1,065 administrative procedures across 105 legislative proposals and drafts—a vivid illustration of how deeply entrenched red tape remains in the policymaking process.
At the heart of the controversy is a fundamental question: should Vietnam prioritize flexibility and speed in updating its regulatory framework, or should it maintain the checks and balances that come with legislative oversight? The answer, as both sides acknowledge, will have significant implications not just for the ease of doing business, but for the long-term stability and transparency of the country’s legal system.
In a nod to the complexity of the issue, The Saigon Times points out that Resolution 66-NQ/TW on legal reform emphasizes a hybrid approach: while certain core laws—especially those related to human rights, civil rights, and judicial procedures—should remain detailed and under parliamentary control, other laws, particularly those serving economic development, should focus on broad principles and delegate more detailed, frequently changing regulations to the government and relevant ministries.
For now, the business community and policymakers alike are waiting to see how the National Assembly will weigh these competing priorities when the amended Investment Law comes up for debate in October. The outcome will not only determine the future of conditional business sector regulation but also serve as a litmus test for Vietnam’s broader commitment to institutional transparency and reform.
As Vietnam stands at this legislative crossroads, the decision over where to anchor the list of conditional business sectors will shape the country’s investment environment for years to come, with implications for businesses large and small across the nation.
