Vietnam Enhances Incentives for National Innovation Center: Implications for Business and Startup Community

On May 5, 2025, Vietnam introduced Decree No. 97/2025/ND-CP (“Decree 97”), providing incentive policies and mechanisms for the National Innovation Center (NIC). The new incentives are expected to create a more favorable environment to foster innovation among the country’s business community.

What is the NIC?

The establishment of the NIC is declared under Prime Minister’s Decision No. 1269/QD-TTg, dated October 2, 2019. This entity is a public non-business unit under the Ministry of Planning and Investment, that supports and fosters the startup and innovation ecosystem. Its ultimate goal is to motivate the transformation of Vietnam’s growth model based on science and technology development.

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The Center serves as a platform for establishing a comprehensive innovation ecosystem across the nation and serves as a support foundation for innovative enterprises. It prioritizes technology transfer, research and development (R&D), and commercialization within a flexible institutional testing environment, ensuring a competitive edge both regionally and internationally.

Alongside its headquarters in central Hanoi, the NIC also operates a unit in Hoa Lac High-tech Park, located on the city’s outskirts. In the future, additional units are anticipated to be developed in other regions to better serve the Center’s purposes.

Implementation provisions of Decree 97

Decree 97 becomes effective immediately from its declaration date. Consequently, the following Decrees and regulations are no longer in effect as of this Decree:

• Decree No. 94/2020/ND-CP, issued on August 21, 2020, by the Government, which outlines preferential mechanisms and policies for the NIC;
• Article 113 of Decree No. 31/2021/ND-CP, dated March 26, 2021, that details and guides the implementation of various articles of the Investment Law.

Also read: 8 Regulations and Policies Supporting Startups in Vietnam

Preferential policies for entities operating in NIC units

Under Decree 97, individuals and organizations operating at NIC units are entitled to various incentives regarding policies on labor, investment credits, lands, and funding.

Labor incentives

Foreigners working at NIC units are not required to obtain a work permit in the following cases:

• When performing labor contracts with NIC units in managerial, executive, expert, and technical positions that Vietnamese workers cannot fill according to the Center’s needs; and
• When performing labor contracts with organizations and enterprises operating at NIC units in managerial, executive, expert, and technical positions that Vietnamese workers cannot fill according to production and business needs.

The procedures for verifying that foreign workers are exempt from work permits according to the above provisions shall follow the legal requirements.

Investment credit incentives

Investment projects from innovative start-ups based at NIC units and the Center’s investment projects will qualify for state investment credit loans if they meet all loan requirements stipulated by law.

Innovative start-ups and their affiliates can obtain funding, support, loans, and loan guarantees from state financial resources beyond the state budget, as well as through financial institutions, following legal regulations.

Business registration and establishment of industrial property rights

Eligible entities operating at NIC units that register to establish a business will receive their business registration within one working day from when the business registration authority receives a valid registration dossier. Moreover, these entities will have priority in completing the procedures for establishing industrial property rights ahead of schedule upon request.

Other prioritized policies

Individuals and businesses at NIC units can benefit from the following preferential mechanisms and policies, including: 

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• Mobilizing and securing funding from state research and innovation programs, as well as from domestic and foreign businesses, organizations, and individuals, as permitted by law, to execute ideas leveraging intellectual property, technology, new business models, and those with high growth potential; and
• Accessing preferential mechanisms, policies, and streamlined administrative procedures in line with the law to facilitate innovation and startup activities.

Services and support by NIC units for prospective businesses

Services

The NIC provides public career services that are in line with its functions and goals, which comprise:

• Incubation and Business Support: Workspace, technical infrastructure, and mentoring for startups and R&D-driven firms;
• Organizational Services: Training, research, and publications aligned with Center’s primary technology sectors;
• Consulting, Networking, and Promotional Services for Innovation and Startups: Domestic and international networking, event organization, investor matchmaking;
• Infrastructure Facilitation: Shared laboratories, testing facilities, design tools, and collaborative workspaces;
• Ancillary Services: On-site accommodations and other innovation-support activities; and
• Additional services that align with the Center’s objectives.

Possible support

Decree 97 establishes that NIC units are obligated to provide essential support to startups, innovative businesses, and individuals operating within these facilities, including:

• Facilitating administrative procedures related to research, investment, business activities, and the commercialization of products and services;
• Assisting with entry visa applications, work permits, and residence permits;
• Promoting investment opportunities and connecting to the innovation and startup ecosystem; and
• Establishing offices, research and production spaces, technology demonstration areas, testing and inspection laboratories, and other necessary facilities and utilities within the Center.

Establishment of the National Innovation Fund

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The NIC is authorized to create the National Innovation Fund (NIF) based on the business model. Its purpose is to mobilize resources, oversee the creative startup investment fund, and support, sponsor, and invest in innovation and creative startups.

The NIF functions under market principles, embraces risks, and maintains transparency and publicity. The project for its establishment, along with its charter and operating regulations, must be approved by the Minister of Finance.

Conclusion

Decree 97 presents a transformative opportunity for businesses in Vietnam, especially startups and innovators. By providing streamlined processes, financial support, and a favorable regulatory environment within NIC units, the decree encourages growth, creativity, and competitive advantage in the evolving market landscape. Businesses that leverage these incentives can position themselves for future success and contribute to Vietnam’s dynamic innovation ecosystem.

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