Vietnam environmental protection law 2020: what firms must do

Vietnam environmental protection law 2020 takes effect on 1 January 2022, and it changes what many firms must file and pay. The National Assembly passed Law No. 72/2020/QH14 on 17 November 2020. It replaces the earlier environmental law and brings new rules on permits, recycling duties and waste handling. Firms that run factories, make goods or import packaged products should check their position now.

Sources: Law on Environmental Protection No. 72/2020/QH14, National Assembly of Vietnam, passed 17 November 2020 (English text, Law Database).

What the new law is and when it starts

Law No. 72/2020/QH14 is the main environmental statute in Vietnam. The National Assembly passed it on 17 November 2020. Most of it applies from 1 January 2022. The law says the Government must issue detailed rules for many articles, so some practical steps will come in later decrees. Firms should read the law now and watch for those rules in the coming weeks.

The law covers environmental impact assessment, permits, waste, recycling and the duties of local governments. It reaches projects, factories, industrial zones and service sites.

Sources: Law No. 72/2020/QH14, Article 170 (effect, with Article 29, Clause 3 in force from 1 February 2021) and the articles that leave details to the Government.

One environmental license for many sites

The law uses the term environmental license. A license is needed before operation by investment projects that discharge wastewater, dust or emissions that must be treated, or that discharge hazardous waste. Sites that began operating before the law took effect and meet the same tests are covered too. Urgent public investment projects are exempt.

The timing depends on the project. A project that needs an environmental impact assessment must hold the license before trial operation of its waste treatment works. Grounds for a license include the application file, the approved assessment report where one exists, the environmental master plans and the local limit on what the environment can carry. Relevant technical regulations also apply.

The practical point is simple. Operators should list each site, check whether it discharges treated waste or hazardous waste, and plan for a license application.

Sources: Law No. 72/2020/QH14, Articles 39 and 42.

Environmental registration for smaller sources

Not every site needs a license. The law sets up environmental registration for investment projects that generate waste but do not need a license. It also covers older businesses that started before the law took effect, generate waste and are not licensed. Sites with no waste, or with small amounts treated on site or managed under local rules, can be exempt. Sites tied to state secrets in defense and security are exempt as well.

Registration is a lighter step than a license. A firm should still know which group it falls into, because the group decides the paperwork.

Sources: Law No. 72/2020/QH14, Article 49.

Recycling and waste duties for producers and importers

Article 54 puts recycling duties on firms that make or import recyclable products and packaging. They must recycle at a required ratio and to set specifications. Products and packaging that are exported, or made or imported only for research or testing, are excluded.

A firm has two ways to meet the duty. It can organize the recycling itself. Or it can pay into the Vietnam Environment Protection Fund to support recycling. Firms that recycle themselves must register a recycling plan and send an annual report to the Ministry of Natural Resources and Environment. Payments to the fund must follow the volume or unit of products and packaging.

Article 55 adds a second duty. Firms that make or import products and packaging with toxic substances, or that are hard to recycle, or that get in the way of collection and treatment, must pay into the same fund. The fund can support waste collection, transport and treatment, research on treatment technology and the handling of pesticide containers.

The law leaves the ratios, the amounts and the timetable to the Government. Importers and makers should map their products and packaging now so they can respond once the rules arrive.

Sources: Law No. 72/2020/QH14, Articles 54 and 55.

What happens to existing approvals

The transition rules protect work already done. A complete file that an agency received before the law took effect is handled under the old rules, unless the firm chooses the new ones. Earlier approvals of impact assessment reports, environmental commitments and similar documents count toward the new license process. Certificates with a fixed term can be used until they expire. Licenses to discharge wastewater into water sources or hydraulic works also stay valid until expiry, and they form part of the new license.

This means firms do not start from zero. They should gather every approval, certificate and discharge license they hold, note each expiry date, and match each one to the new system.

Sources: Law No. 72/2020/QH14, Article 171 (transitional provisions).

A short checklist for operators

Firms can act before the detailed rules appear. First, list every site and note whether it treats discharge, produces hazardous waste or creates only small amounts of waste. Second, collect current approvals and their expiry dates. Third, list the products and packaging you make or import, and mark which are recyclable, toxic or hard to recycle. Fourth, name one person to follow the Government's implementing rules and the Ministry's guidance.

Households and city residents are also affected, since the law requires sorting of household solid waste into recyclable, food and other waste. Firms with staff housing or canteens may see local rules on this.

Sources: Law No. 72/2020/QH14, Article 75.

Sources: Law on Environmental Protection No. 72/2020/QH14, National Assembly of Vietnam, 17 November 2020.