Global Vietnam Lawyers would like to introduce our valued readers to an article by Mr. Tran Minh Quyet titled “Retail licensing decentralization: Will it slow down procedures in practice?” published in The Saigon Times, No.10-2026 (1.838) on March 3, 2026.
***
As Vietnam continues to push forward with administrative reforms and improve its investment climate, adjustments to licensing authority in the retail sector have drawn significant attention from the business community, particularly foreign investors.
One notable change is the shift in authority for granting retail business licenses—from centralized approval by central authorities to provincial People’s Committees.
From the Ministry to local authorities
Previously, retail activities involving foreign elements—especially the issuance or amendment of relevant licenses—required multiple procedural steps in processing applications, including consultation with or approval from the responsible ministry, namely the Ministry of Industry and Trade. While this process helped ensure consistency in state management, in practice it often resulted in prolonged processing times and the emergence of additional intermediary steps.
The decentralization of authority to provincial-level People’s Committees has significantly altered this approach. Specifically, under Government Decree No. 146/2025/ND-CP on decentralization and delegation in the industry and trade sector, the authority to review and approve certain administrative procedures—previously under the Ministry of Industry and Trade—has been transferred to provincial People’s Committees or their authorized agencies.
Clear benefits for investors
According to information released by the Government, decentralization and delegation in the industry and trade sector—including retail business activities—aim to shorten administrative procedures, enhance local autonomy, and improve the investment and business environment.
Based on the author’s practical experience in assisting enterprises with retail business licensing procedures, it can be observed that application processing times have been significantly reduced compared to the past. This improvement is largely attributable to the removal of the step requiring dossiers to be submitted from local authorities to the responsible ministry for consultation—a process that was often time-consuming given the high volume of applications and broad scope of oversight.
Notably, for provinces located far from Hanoi, eliminating the need to submit documents and wait for feedback from central authorities has made the process more flexible and efficient. Meanwhile, central ministries and agencies—typically tasked with substantial macro-level responsibilities—benefit from a reduced administrative burden, which in turn helps improve the overall efficiency of the system.
For many investors, this represents a positive signal of the Government’s efforts to create a more flexible and friendly business environment.
Could implementation still face delays in practice?
Despite its advantages, the current decentralization mechanism has prompted a degree of caution among some investors. A notable legal point is that Decree No. 146/2025/ND-CP was issued with a defined validity period—effective for two years from its implementation date—clearly reflecting its pilot nature.
Given that retail projects are typically developed based on medium- to long-term plans, investors may have understandable concerns about the continuity of this policy once the pilot phase concludes. This raises the question of whether the decentralization mechanism will be maintained, expanded, or reverted to the previous centralized model.
In addition, delegating authority to local governments may carry the risk of inconsistent application across provinces and cities in the absence of unified guidance or effective oversight mechanisms.
Conclusion
The delegation of retail licensing authority to provincial People’s Committees represents a step forward in administrative reform, contributing to a more favorable environment for investment and business. However, for this policy to deliver sustainable long-term benefits and build investor confidence, issues relating to policy stability and consistency in implementation across localities should be clarified following the pilot phase. The results of its implementation in the coming period will serve as an important basis for competent authorities to consider whether to extend or formally codify this decentralization policy in the legal system.
