Da Nang Special Feature: Investment Characteristics and Incentive Policies

NEXORA Law Firm has stationed local lawyers not only in Hanoi and Ho Chi Minh City but also in Da Nang, and is placing increasing emphasis on supporting investment in Vietnam's central region.

01 - Characteristics of the Investment Environment in Da Nang
1-1 A different market and different administrative practice: Da Nang generally processes applications faster than Hanoi or Ho Chi Minh City, but because local authorities are less accustomed to foreign investment, practical implementation can sometimes stall. Consultation with the People's Committee can often help move matters along smoothly.
1-2 Cap on the operating term stated in the IRC: In Hanoi and Ho Chi Minh City, the investment term is set by industry (5-10 years for services, 20 years for manufacturing, 30+ years for real estate), whereas in Da Nang the term for service businesses is instead tied to the amount of capital contributed (2 years for charter capital of VND 30 billion or less, 5 years for capital exceeding VND 100 billion), creating a significant administrative burden from renewing every two years.
1-3 Characteristics of local partner companies: Major Da Nang enterprises are often unfamiliar with global business practices, but tend to be down-to-earth and easy to build strong relationships with. Because local unwritten rules apply, negotiation approaches that work in Hanoi or Ho Chi Minh City can easily lead to misunderstandings here.

02 - Incentive Schemes for Foreign Investors in Da Nang
2-1 Da Nang Hi-Tech Park: a preferential corporate income tax rate of 10% for 15 years (versus the standard 20%), a 4-year tax exemption followed by a 50% reduction for the next 9 years, exemption from import duties, and full exemption from land lease fees (15 to 19 years, depending on the sector).
2-2 Concentrated IT zone: a 50% subsidy toward infrastructure costs, full exemption from land lease fees, and preferential corporate income tax treatment (10% for 15 years, with a 4-year exemption followed by a 50% reduction for the next 9 years).
2-3 Support for supporting industries: subsidies covering up to 50% of technology R&D costs, subsidies for industrial property registration fees (VND 35 million for domestic filings, VND 50 million for international filings), vocational training subsidies, and subsidies for trade promotion and e-commerce site development, among others.