Violations in construction investment can be fined 1 billion VND

This is the maximum fine in the field of construction investment, exploitation, processing, production and trading of minerals as construction materials.

The Government has just issued Decree 139/2017/ND-CP regulating administrative sanctions for violations in construction investment activities; exploitation, processing and trading of minerals for construction materials, production and trading of construction materials; management of technical infrastructure works; real estate business, housing development, management of house and office use.

Accordingly, the maximum fine in the field of construction investment activities is 1 billion VND; in the field of mining, processing, and trading of minerals for construction materials, production and trading of construction materials; management of technical infrastructure works; real estate business, housing development, management of house and office use is 300 million VND.

The fines prescribed in this Decree are applicable to organizations (except in some cases). For the same administrative violation, the fine for an individual is half the fine for an organization.

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Decree 139/2017/ND-CP stipulates the level of penalties for violations in the construction sector.

The statute of limitations for handling administrative violations in real estate business activities; technical infrastructure management; processing and trading of minerals for construction materials; production and trading of construction materials is 1 year. The statute of limitations for handling administrative violations in construction investment activities; mining of minerals for construction materials; housing development, management and use of houses and offices is 2 years.

The Decree specifically stipulates administrative violations and penalties for investment decision makers, investors or owners, managers and users of construction works.

Specifically, regarding violations of regulations on selecting organizations and individuals to participate in construction investment activities, a fine of 30 - 40 million VND will be imposed on the act of selecting organizations and individuals who do not have sufficient capacity to participate in the following activities: Construction survey; construction planning; construction investment project establishment; construction investment project appraisal; construction investment project management; construction design; construction design appraisal, cost estimates; construction execution; construction supervision; construction investment cost management; construction valuation; construction inspection; construction specialized testing.

In addition to the above regulations, investors using foreign contractors will also be fined from 70 to 80 million VND for one of the following acts: Allowing foreign contractors to participate in construction activities without being granted a construction license as prescribed; allowing foreign contractors to not properly fulfill their commitments in joint venture contracts with Vietnamese contractors or not using Vietnamese subcontractors as prescribed; allowing foreign contractors to use foreign workers to perform construction work that the Vietnamese labor market can meet;...

Late project handover fine up to 50 million VND

The Decree stipulates a fine of 40-50 million VND for one of the following acts: Investing in urban development not in accordance with the plan or behind schedule approved by competent authorities; delaying project handover according to approved schedule.

A fine of 50 - 60 million VND shall be imposed for one of the following acts: Allowing a secondary investor to carry out construction investment that is not in accordance with the approved detailed construction plan or project progress (if any); changing the level 1 investor without written approval from the competent authority; adjusting the project without consideration and approval from the competent authority; not completing procedures to be recognized for land use rights and construction ownership rights as prescribed for completed constructions put into operation and use.

Violation of construction contract regulations fined up to 100 million VND

The Decree clearly states that a fine of 20 - 30 million VND will be imposed for one of the following acts: No joint venture agreement for the contractor being a joint venture contractor; construction contract not using Vietnamese language as prescribed.

A fine of 80 - 100 million VND shall be imposed for one of the following acts: Contract price exceeding the winning bid price or the result of negotiation and negotiation of the construction contract (except for the volume arising outside the bid package permitted by the investment decision maker); contract advance payment exceeding the prescribed percentage or contract advance payment without advance payment guarantee as prescribed; settlement or liquidation of construction contract later than the prescribed time limit for construction contracts using state capital.

The Decree takes effect from January 15, 2018./.

According to VOV