Specific policies of the Vietnam International Financial Center according to Resolution 222 of the National Assembly

On June 27, 2025, the National Assembly of the Socialist Republic of Vietnam passed Resolution No. 222/2025/QH15 on the establishment of the International Financial Center (Vietnam IFC) in Ho Chi Minh City and Da Nang (Resolution 222).[1] Resolution 222 takes effect from September 1, 2025. This is a strategic move to create a conducive environment for international financial activities, attract foreign investment, and promote innovation. Vietnam IFC is expected to become a competitive financial center in the region, making an important contribution to Vietnam's economic development and international integration in the new period.

 

Delegates attending the Conference on Thorough Understanding and Implementation of the National Assembly’s Resolution on the Vietnam International Financial Center. Source: Government News

 

The resolution offers a series of specific policies, from tax incentives, foreign exchange policies, to labor support and infrastructure. These policies are not only aimed at attracting global financial institutions but also creating conditions for domestic businesses to develop. However, the implementation of these policies requires strict management to balance economic benefits and potential risks. This article will analyze each policy in detail, assess the impacts, benefits, and challenges they bring to Vietnam as well as for investors.

1. Foreign exchange policy (Article 16)

Vietnamese IFC members are allowed to use foreign currencies in transactions, payments, and valuations between members or with foreign parties. However, when dealing with non-member organizations or individuals in the territory of Vietnam, they must comply with the applicable foreign exchange regulations. In addition, foreign investors can transfer capital, profits, and legal income into and out of Vietnam IFC through foreign currency accounts at authorized financial institutions.

This policy brings significant flexibility to international financial activities, helps reduce exchange rate risk and creates favorable conditions for global investors. In our opinion, financial centers such as Singapore and Hong Kong also apply flexible foreign exchange policies to attract international capital flows. However, this freedom also comes with the risk of unstable capital flows, such as sudden withdrawals, that could affect the national financial system. Therefore, Vietnam needs to develop a strict monitoring mechanism to effectively manage capital flows in and out of Vietnam IFC in particular and Vietnam in general. A mechanism that is both flexible but sufficiently tight is necessary for an IFC institution. However, this is a tricky problem when the Government has to develop these regulations in detail in the coming time. It is necessary to study and learn from the world's leading financial centers, but it is necessary to concretize them in the context of Vietnam, a country that does not have too much experience in the international financial arena.

2. Tax policies (Article 19)

Resolution 222 also sets out provisions on a hostile policy when building the Vietnam IFC. But in relation to Vietnam's tax regulations for domestic businesses and international commitments. The tax policy for Vietnam IFC still has many things worth discussing in the coming time. In general, Resolution 222 stipulates tax-specific policies as follows:

Corporate income tax: Priority projects at IFC are entitled to a tax rate of 10% for 30 years, tax exemption for up to 4 years and a 50% reduction for the next 9 years. Other projects are subject to a tax rate of 15% for 15 years, with tax exemption for up to 2 years and a 50% reduction for the next 4 years.

Personal income tax: (1) Professionals, managers, and investors (both domestic and foreign) are exempt from tax until 2030. (2) Individuals with income from capital transfer (shares, capital contributions, capital contribution rights) are exempt from personal income tax until the end of 2030.

Import and export taxes: Goods at IFC are subject to preferential tax rates and simplified procedures.

Tax incentives are a powerful tool for attracting businesses and talent. Compared to the usual corporate income tax rate in Vietnam (20%), the 10%-15% rate at IFC is very competitive, even lower than Singapore (17%) or Hong Kong (16.5%).[2] However, the reduction in budget revenues from these incentives could put pressure on the national finances if there is no corresponding economic growth. A clear strategy is needed to ensure that tax breaks actually deliver long-term added value. In addition, it is necessary to carefully consider commitments in international agreements to which Vietnam is a member to review and make appropriate reservations to avoid unnecessary violations when developing a specific policy that is somewhat detrimental to non-members of the Vietnam IFC.

3. Visa, Residency and Worker Policy (Articles 18 and 20)

Foreign experts, strategic investors, and skilled workers are granted visas and residence permits for a minimum of 1 year with simple procedures. IFC members have the right to decide their own salaries and bonuses, and are supported in training human resources from the state budget for 4 years from 2026.

This policy helps attract international talent, a key factor in building IFC into a leading financial center. However, prioritizing foreign workers can put pressure on the domestic labor market if it is not accompanied by upskilling Vietnamese workers. Sponsored training programs are a positive solution, but they need to ensure quality and be in line with actual needs. Attracting talent requires a methodical roadmap and strategy that is suitable for the context of Vietnam. If it is only about the number and there is no proper appraisal in attracting talents to develop the Vietnam IFC in the long term, Vietnam may suffer losses of prestige for real talents in the process of building an international standard Vietnam IFC.

For domestic and foreign workers in Vietnam, IFC is entitled to participate in social, health, and unemployment insurance programs. Foreign workers who have taken out the same insurance abroad may be exempt from part of the contribution. Local governments also provide housing and welfare support for workers.

This policy not only protects the rights of employees but also creates an attractive working environment. However, differences in insurance policies between workers inside and outside Vietnam IFC can cause inequality, requiring adjustments to ensure social justice.

4. Infrastructure development policies (Article 27)

IFC is prioritized to develop modern infrastructure with capital from the state budget and other legal sources for 10 years. Investors can advance capital and be deducted or refunded, with imported equipment exempt from duty.

Modern infrastructure is the foundation for Vietnam IFC to compete with international financial centers. However, large investment costs require effective management to avoid waste. Models such as public-private partnership (PPP) can be the optimal solution to reduce the budget burden, especially in the period when Vietnam needs more financial resources for development, it is necessary to call for the cooperation of non-state sectors to develop infrastructure.

 

Prime Minister Pham Minh Chinh, Head of the National Steering Committee for the Vietnam International Financial Center. Source: Government News

 

5. Financial and Fintech Innovation Policy (Article 24)

The "sandbox" mechanism is applied to test new financial models and technologies under the supervision of the competent authority. Organizations participating in this mechanism are exempt from some legal provisions during the trial period. In addition, sectors such as green finance, digital assets, and Fintech are entitled to special incentives at the discretion of the Vietnamese regulator IFC.

International experience shows that the "sandbox" mechanism promotes innovation, especially in the field of Fintech. The early application of this mechanism will help Vietnam catch up with global trends. However, close supervision is needed to prevent systemic risks, such as the failure of experimental models that can cause financial losses, the risk of system failure for particularly sensitive industries such as finance and banking. Vietnam's focus on these areas shows a strategic vision, in line with the trend of sustainable development and technology that the Party and the State have set out in recent years. However, it is necessary to invest heavily in research and development (R&D) to ensure competitiveness in the international market.

Current practice shows that Vietnam has issued new regulations on financial testing mechanisms in the banking sector[3]. So what is the difference between the testing mechanism inside and outside Vietnam IFC? What is new and attractive from the sandbox mechanism that Vietnam will apply in the financial center to be built? Investors are looking forward to the detailed guidelines in the Government's Decree that will be issued in the near future.

6. Dispute settlement policy

Disputes in Vietnam IFC can be resolved through domestic or international courts, arbitration, depending on the agreement. In particular, Resolution 222 allows investors to resolve disputes through a key center established under Vietnam IFC. This shows that Vietnam is seeking and building a separate mechanism to resolve disputes arising within and related to the Vietnam IFC, in addition to existing settlement methods. It can be said that with this regulation, in the coming time, Vietnam still has a lot of work to do to bring Vietnam IFC and its activities into practical and effective operation, especially looking for a solution mechanism to ensure the peace of mind of investment and development of international investors.

As always, flexibility in dispute resolution strengthens investor confidence, but effectiveness depends on the quality of the legal system and enforcement agencies. For investors, it is expected that a quick dispute resolution mechanism is not only within the scope of the Vietnam IFC but also the wider Vietnamese market.

7. Other specific policies

7.1 Policies for strategic investors (Article 26)

Strategic investors are prioritized in large projects, allocate land without auction, and participate in the IFC Vietnam planning, with a long-term investment commitment.

This policy attracts large investors, but a monitoring mechanism is needed to ensure they are fulfilling their commitments and not abusing incentives.

7.2. Trade and customs policies (Article 28)

Goods in Vietnam IFC enjoy simplified customs procedures and duty exemption for items that are not prohibited or restricted.

This policy reduces costs and time for businesses, but strict control is needed to prevent illegal goods.

7.3. Policies on fees and charges (Article 29)

Local governments have the right to adjust fees and charges, with revenue reinvested in infrastructure over 10 years.

This flexibility helps reduce the burden on businesses, but it is necessary to ensure transparency in the use of revenue.

The specific policies in the Resolution on IFC in Vietnam are a bold step for Vietnam to build and operate a successful international financial center. For Vietnam, IFCs may offer many opportunities, but they also pose challenges in terms of management, supervision, and balancing interests. Successful implementation will depend on the ability to flexibly adjust and close coordination between stakeholders from the State, to management agencies, investors, IFC members in Vietnam to employees. We hope that with great determination, Vietnam will soon put Vietnam IFC into operation and development in the shortest time.

Lawyer Nguyen Van Phuc

HM&P Law Firm

Read more: Nghị quyết 222 của Quốc hội: “ Đòn bẩy” thể chế cho Trung tâm tài chính quốc tế tại Việt Nam