Decree 254/2025/ND-CP: Regulations on Management, Payment, and Financial Settlement of Projects Using Public Investment Capital

Overview

Decree 254/2025/ND-CP was issued by the Government on September 26, 2025, providing detailed regulations on the management, payment, and financial settlement of projects using public investment capital. This document replaces or supplements previous regulations on public investment capital management, aiming to perfect the legal framework for development investment activities from the state budget.

Scope of Application

The Decree applies to:

• Public investment projects using state budget capital
• ODA projects and concessional loans from foreign donors
• Revenue retained for investment but not yet included in budget balance
• Organizations and individuals participating in the management and implementation of public investment projects
• Enterprises and contractors providing goods, services, and construction work for public investment projects

Payment Process for Public Investment Capital

Payment Conditions

To receive public investment capital payment, enterprises/contractors must meet:

• Contracts legally signed in accordance with regulations
• Completed work volume confirmed by the investor and supervising consultant (if any)
• Complete and valid payment documentation as required
• Full accounting vouchers and valid VAT invoices
• Compliance with payment conditions stated in the contract

Payment Documentation

Payment documentation for public investment capital includes:

• Contractor's payment request letter
• Minutes of acceptance of completed volume
• Statement of volume and payment value
• Valid financial invoices (electronic invoices)
• Related accounting vouchers
• Documents proving tax obligation fulfillment (if any)
• Other documents as specified in the contract

Payment Timeline

The Decree clearly stipulates payment deadlines:

• Investors are responsible for reviewing payment documentation within 15 working days from receipt of complete valid documents
• State Treasury makes payment within 5 working days from receipt of complete valid documents from the investor
• If documents are incomplete or invalid, the investor must notify the contractor in writing within 7 working days

Project Settlement Process

Settlement Timing

Public investment projects must be settled when:

• The project completes all volumes and is put into use
• The project completes independent items that can be put into use
• The project is suspended or terminated by decision of competent authority

Settlement Documentation

Project settlement documentation includes:

• Overall project settlement report
• Signed contracts and contract liquidation minutes
• Completion acceptance minutes
• Accounting books and detailed vouchers
• Independent audit report (for projects as required)
• Settlement approval decision

Settlement Responsibilities

• Investors are responsible for preparing settlement reports within 6 months from project completion
• Competent authorities approve settlements within 3 months from receipt of complete valid documents
• For nationally important or Group A projects, independent audit reports are required

Responsibilities of Parties

Investors

• Manage and direct project implementation in accordance with regulations
• Review and approve payment documentation for contractors
• Prepare settlement reports and submit to competent authorities for approval
• Be responsible for the accuracy of payment and settlement data

Contractors/Enterprises

• Fulfill commitments in the contract
• Prepare complete, accurate, and timely payment documentation
• Provide valid vouchers and electronic invoices as required
• Fulfill tax obligations according to law
• Coordinate with investors in acceptance and settlement work

State Treasury

• Control and pay public investment capital in accordance with regulations
• Ensure timely payment when documents are valid
• Refuse payment for non-compliant documents

Violation Handling

The Decree stipulates violations and handling forms:

• Improper payment causing capital loss: handle responsibility according to law, compensate for damages
• Late payment without valid reason: disciplinary action, pay late payment interest
• Providing fake documents and vouchers: administrative fines or criminal prosecution
• Using capital for wrong purposes: recover capital, impose fines as prescribed

Significance for SMEs

For small and medium enterprises participating in public investment projects, Decree 254/2025/ND-CP brings:

• Higher transparency: Clear payment process and specific deadlines help businesses proactively plan finances
• Reduced payment delay risk: Mandatory payment deadlines help protect contractors' rights
• High compliance requirements: Businesses need to invest in electronic invoice systems and strict document management
• Opportunity to access public capital: Clear understanding of procedures helps SMEs more confidently participate in public project bidding

Implementation Recommendations

SMEs should:

1. Review and update internal procedures for preparing payment documentation
2. Ensure electronic invoice system operates stably
3. Store complete vouchers and acceptance minutes
4. Closely monitor payment progress and proactively remind investors
5. Participate in training courses on public investment project management
6. Seek legal consultation when encountering payment and settlement issues

Effective Date

The Decree takes effect from September 26, 2025, and applies to all ongoing public investment projects and those newly commenced after this date.