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Introduction: The VIFC and Vietnam’s Legal Modernisation

In 2025, Vietnam passed Resolution No. 222/2025/QH15 of the National Assembly (Resolution 222) which constitutes Vietnam’s first legal foundation for the establishment, operation, and long-term development of international financial centres (IFCs) in Ho Chi Minh City and Da Nang.

These IFCs are designed to draw diverse economic activities, with financial services as the core focus, while also encompassing other sectors, including infrastructure development, underpinned by an integrated legal architecture aimed at attracting credible international capital and expertise.

Apart from Resolution 222, the foundational framework is implemented through a package of eight Government decrees and complemented by Law No. 150/2025/QH15 of the National Assembly on Specialized Courts (Law on Specialized Courts). Among these instruments, Decree No. 323/2025/ND-CP of the Government (Decree 323) plays a central role by establishing the IFCs as unified legal entities operating within clearly defined physical boundaries in Ho Chi Minh City and Da Nang, while other decrees regulate specific aspects such as finance, arbitration, labour, land, and dispute resolution. Together, these instruments introduce a set of specialised rules applicable within the IFCs alongside Vietnam’s general legal framework.

Investment and business activities within the IFCs are primarily governed by Resolution 222 and its implementing instruments, with Vietnamese law applying on a residual basis where IFC‑specific rules are silent. This layered approach reflects Vietnam’s effort to develop a specialised, internationally oriented regulatory environment, while utilizing its domestic legal system in a complementary role. 

Priority sectors of the IFC 

Although finance lies at the core of the IFC concept, construction and infrastructure development are expressly recognised as priority sectors under Decree 323. Given that the IFCs are geographically defined zones established within existing urban areas, construction activity may highly be an essential precondition for all other financial and commercial operations. The development of financial districts, trading venues, supporting commercial facilities, and associated urban infrastructure will necessarily trigger extensive construction activity, spanning design, engineering, procurement, and project delivery.  

As a result, the IFC regime is expected to generate a significant volume of construction projects governed by IFC-specific legal mechanisms. The application of specialised rules within the IFCs promises greater flexibility and alignment with international practice in construction contracting, dispute resolution, and risk allocation compared to conventional projects governed solely by general Vietnamese law. 

For foreign contractors, developers, and consultants, understanding how Vietnam’s IFC legal structure interacts with construction contracting principles is essential. This article will consider these intersections and highlight two key points of comparative relevance with Singapore’s construction law and practice. 

1. Contract Administration and Risk Allocation: Practical Parallels and Divergences

The reality of the construction industry is that law and risk are often negotiated as much as they are legislated. Vietnam’s VIFC legal reforms create an enabling framework, but actual contract management within IFC projects will depend on the familiar interplay between owners / employers, contractors, financiers, and consultants. 

1.1. Governing Law and Language 

Resolution 222 permits parties to invest and conduct business transactions within the IFC, where at least one party is a foreign individual or organisation, to agree on the application of foreign law, provided that such application does not contravene the fundamental principles of Vietnamese law.  

The official language used for transactions and operations within the IFC is English. For international construction, participants who frequently use English law governed EPC contracts or Singapore standard forms, this flexibility is extremely encouraging. It opens the door for FIDIC, NEC, or other international templates to be used with limited localisation and reduces the need for translation. 

At the same time, Resolution 222 preserves mandatory application of Vietnamese law to matters concerning land use rights, real estate ownership, and security interests over land and assets located within Vietnam. Accordingly, complex IFC transactions may involve a hybrid contractual structure, with construction and services contracts governed by foreign law, while real estate-related agreements remain subject to Vietnamese law. Careful coordination is therefore required to ensure consistency across interrelated contracts and to preserve enforceability. 

1.2. Project Financing and Step In Rights 

Within the VIFC, the legislative ecosystem facilitates foreign investor participation and the integration of offshore and onshore capital flows. This, in turn, requires clarity around step‑in rights, performance security, and assignment provisions—areas that are familiar terrain for Singaporean practitioners dealing with the interface between project finance and construction. 

Singapore’s experience with standard security and direct agreement structures, under which lenders’ step‑in rights and contractors’ consents are typically tightly choreographed, may offer valuable operational advantages in the IFC context. Where Singaporean investors or contractors participate in IFC projects, this practical experience may be transferred and adapted, contributing to the adoption of more sophisticated project finance and construction interfaces within Vietnam’s IFC framework. 

However, at this stage these frameworks remain nascent. Project participants (not limited to lenders) will therefore need to closely monitor guidance issued by the IFC Executive Authority, as well as the evolving body of decisions rendered by the Specialized Court and the International Arbitration Centre (IAC), in order to assess how these arrangements develop in practice. 

1.3. Construction Claims Culture: Developing Consistency 

In Singapore, the introduction of statutory adjudication under the Building and Construction Industry Security of Payment Act (SOPA) has fostered a proactive “claim as you go” culture through progress claims, with strict timelines forcing early crystallisation of delay and variation claims.  

Vietnam, by contrast, has in practice exhibited a more reactive claims culture, with disputes commonly emerging at the final account or post‑completion stage. The IFC legislative regime does not currently introduce a statutory payment adjudication mechanism. However, given that IFC participants are primarily engaged in international services, together with the express recognition of party autonomy to choose foreign governing law, parties may adopt contractual mechanisms inspired by foreign systems. Where Singapore law is selected as the governing law of construction contracts within the IFC, SOPA may apply as a consequence of that choice, where the requirements of SOPA’s applicability have been fulfilled. 

For cross border contractors familiar with Singapore SOPA procedures, considering including contractual provisions in IFC projects allowing for optional adjudication or expert determination steps before arbitration or Specialized Court proceedings could possibly bridge the current procedural gap until statutory reforms mature. 

2. Dispute Resolution Within the IFC: A Parallel Judicial Universe

2.1. Vietnam context 

A defining innovation of the VIFC legal architecture lies in its dedicated judicial and arbitral mechanisms. 

(a) Specialized Court: Final and Binding 

Under the Law on Specialized Courts, effective 1 January 2026, Vietnam has established a separate court structure called Specialized Courts with first-instance and appellate divisions specifically for IFC-related transactions. The jurisdiction of the Specialized Court encompasses a broad range of investment and business‑related matters connected with the IFC. This includes disputes arising between IFC members, as well as disputes between IFC members and non‑member organisations or individuals; applications for the recognition and enforcement in Vietnam of judgments and decisions of foreign courts and awards of foreign arbitral tribunals relating to such disputes; and court‑related requests arising from arbitration proceedings involving IFC members and non‑members alike. In addition, the Specialized Court may hear other investment and business cases conducted within the IFC where at least one party is an IFC member, as further determined by the Supreme People’s Court. 

Appellate decisions are final, meaning no cassation or retrial procedures (a notable departure from Vietnam’s usual multi-tiered review structure). This streamlined approach bears similarities to international courts such as the Courts of the Dubai International Financial Centre or Singapore’s Singapore International Commercial Court (SICC). 

The Specialized Court also introduces a significant institutional development by allowing current or former foreign judges, foreign lawyers or experts, as well as local lawyers, arbitrators, university lecturers, scientists, or experts with suitable knowledge in investment and business law to be formally appointed as judges of the IFC Specialized Court, provided that they satisfy statutory requirements relating, among other things, to professional qualifications, experience, and language proficiency.  

This framework broadens the pool of eligible judicial personnel beyond Vietnam’s traditional regime and enables the Specialized Court to incorporate international and practical judicial experience through formal adjudicative roles. It introduces fresh institutional dynamics into the legal system supporting the IFC. At the same time, this approach presents practical challenges, particularly for foreign appointees who may be less familiar with Vietnamese substantive law and procedural practice. Ensuring effective integration will therefore require careful coordination between international experience and domestic legal principles to maintain consistency, legitimacy, and legal certainty. 

(b) International Arbitration Centre 

Complementing the Specialized Courts, Decree No. 328/2025/ND CP of the Government (Decree 328) establishes the IAC. The IAC has inherent jurisdiction over disputes arising from investment and business activities conducted within the IFC, except for disputes relating to administrative decisions or administrative acts of regulatory authorities or competent persons, labour disputes, personal rights disputes, or other disputes associated with state management that have already been resolved by judgments or decisions of competent Vietnamese authorities or courts.  

With respect to applicable law, the IAC may apply: (i) foreign law to investment and business transactions within the IFC where at least one party is a foreign individual or organisation, provided that the parties agree on the application of such foreign law and that its application does not contravene the fundamental principles of Vietnamese law; (ii) the law of the country having the closest connection to the transaction where the parties fail to agree on the applicable law; or (iii) the law of the country where the real estate is located where the transaction relates to ownership rights, other rights in rem over real estate, the lease of real estate, or the use of real estate as collateral. 

In addition, Resolution 222 and Decree 328 permit disputing parties to agree to waive their right to request the court to set aside a decision recognising the parties’ settlement or an arbitral award rendered by the IAC that has taken legal effect. In such cases, the court will not entertain an application to set aside the arbitral award or decision, unless the waiver agreement is invalid or the waiver is entered into after one party has already filed an application with the court to set aside the arbitral award or decision. In practice, waiver provisions of this nature have been commonly included in contracts, particularly construction contracts.  

With the express confirmation of their validity under the IFC legal framework, such provisions substantially reduce uncertainty in how courts assess, apply, or consider applications to set aside arbitral awards. This, in turn, accelerates the finality and enforceability of arbitral awards, minimises judicial intervention, and enhances investor confidence. 

2.2. Comparison with Singapore 

The new IFC dispute resolution regime resonates with Singapore’s multi track dispute landscape, where construction disputes can be addressed via, among others: 

• Arbitration under SIAC and other administrative bodies which often can appoint construction-focused panels; or
  
  
• Court litigation within Singapore’s existing Court structure or SICC.  

Like the SICC, the IFC Specialized Court enables the participation of foreign judges as well as foreign legal practitioners and experts. The concept of a self‑contained dispute resolution ecosystem, combining both arbitration and court proceedings within a specialised commercial regime, reveals clear similarities with Singapore’s institutional model, although Vietnam’s approach anchors this framework within defined physical IFC zones. 

For construction professionals, this means predictable neutrality (especially with the participation of foreign judges and legal practitioners and experts) and improved speed and efficiency in dispute resolution, factors that are often critical to foreign participation in large cross-border infrastructure ventures. 

Emerging Opportunities for Singapore Construction Stakeholders 

The VIFC development presents several direct opportunities for Singapore-based construction companies, consultants, and lawyers: 

1. Infrastructure Delivery and Management Contracts

• Vietnam will likely require experienced Engineering, Procurement, and Construction Management (EPCM) and design build contractors familiar with international risk management and FIDIC administration. Singapore firms which are already operational across Southeast Asia, can partner with local entities under VIFC’s dedicated investment and labour regimes. 

2. Dispute Resolution Services  

• The IAC and Specialized Court will need arbitrators, judges, and legal experts with strong English law grounding and construction expertise. Singaporean practitioners, particularly those experienced with SIAC and SICC proceedings, are natural candidates for collaboration or appointment.

3. Legal Engineering and Capacity Building  

• Just as Singapore exported its infrastructure law models to the Middle East and South Asia, it can also contribute to Vietnam’s IFC as it drafts detailed procedural rules and standard forms. Shared legal training, bilingual model contracts, and protocol development would all enhance IFC credibility. 

Comparative Snapshot: Alignment on Key Themes between Vietnam IFCs and Singapore

Strategic Takeaways 

1. Vietnam’s IFC legal regime institutionalises international dispute resolution at the heart of its financial and infrastructural growth model. Its Specialized Court and IAC system directly address investor concerns about neutrality and enforceability, both crucial for stakeholders in the construction industry.
2. For Singaporean construction stakeholders, the IFC presents a familiar and navigable legal environment. The parallels with Singapore’s SICC, SIAC, and project delivery models, meaning that project teams can translate their existing operational playbooks with minimal friction.
3. Future convergence is expected. Just as Singapore progressively reformed its payment security regime, Vietnam may evolve its IFC framework into a broader construction law modernisation initiative, potentially introducing statutory adjudication, standardised design–build contracts, or public project governance codes.

Conclusion: Building Legal Infrastructure for Physical Infrastructure

VIFC represents more than a physical congregation of towers and trading floors. They embody a strategic legal experiment, one that blends Vietnamese public policy with global best practices to nurture confidence in investment and project execution.  

For construction professionals, lawyers, and investors familiar with Singapore’s legal DNA, the IFC offers not just new business opportunities but also a new jurisdictional language of construction law, one that speaks in terms of enforceability, certainty, and international collaboration.  

As Vietnam pours concrete and policy into these new financial cities, it is also laying the legal foundations for a more sophisticated construction ecosystem. If Singapore’s journey is any indicator, such infrastructure, both physical and institutional, will pay dividends for Vietnam well beyond the skyline. 

Contributed by:

Derek Tay – Associate, Nishimura & Asahi (Singapore) LLP

Nguyen Dinh Huy – Associate, Nishimura & Asahi (Vietnam) Law Firm

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect those of Nishimura & Asahi (Singapore) LLP and/or Nishimura & Asahi (Vietnam) Law Firm. The information provided in this article is for general informational purposes only and should not be construed as legal advice or otherwise.