New governance mechanisms for the National Fund for Science, Technology and Innovation Development outlined in Circular 17/2026/TT-BKHCN

From 16 April 2026, Circular No. 17/2026/TT-BKHCN, together with the Model Charter on the organization and operation of the Fund for Science, Technology and Innovation Development, will be uniformly applied nationwide, from central to local levels, effective from 16 April 2026.

For the first time, a coherent legal framework is established for the entire fund system, laying the foundation for unified governance while ensuring autonomy and flexibility in practice.

Scope and legal status of the fund

The fund is defined as a state financial organization operating on a non-profit basis, having legal status, receiving and using resources from the state budget and other lawfully obtained resources.

Core functions and funding focus

The fund has functions of financing and ordering to implement programs and tasks in science, technology and innovation; supporting funding and subsidizing loan interest to apply technology, transfer technology, upgrade technology, and promote innovation; and supporting activities to strengthen scientific and technological capabilities, develop the innovation ecosystem and startup ecosystem, and foster a culture of innovation and entrepreneurship.

Funding, contracting and support activities are designed to avoid being spread thin, instead focusing on solving major problems of industries, sectors and localities, while raising productivity, quality and competitiveness of the economy.

Governance orientation and ecosystem linkage

Management activities are oriented toward outcomes and closely aligned with market needs, contributing to the formation of an effective science, technology and innovation ecosystem linking the State, institutes and universities, and enterprises.

New mechanisms introduced

The circular introduces new mechanisms including co-financing between the State and enterprises, reception of off-budget resources, and strengthened accountability and oversight, aimed at modern governance.

State-enterprise co-financing

The co-financing mechanism is defined to prioritize the state budget for basic research and application stages, while corporate contributions increase with the maturity and commercialization potential of the technology. The approach is intended to mobilize social resources effectively and promote linkages between research, application and the market.

Shift to output-based management

A fundamental change in the Circular is the shift from “input-based management” to “output-based management”. Funding is allocated in milestones linked to progress and results, rather than broad disbursement. Adjustments, continuation or termination of tasks are allowed based on evaluation results.

Innovation content and risk governance

The circular includes “innovation” content to harmonize with the 2025 Law on Science, Technology and Innovation, and to establish risk governance mechanisms suitable for research characteristics.

Risks that are objective, arise unexpectedly but adhere to proper procedures, may be considered acceptable. Stage-by-stage evaluation is the basis for deciding whether to continue, adjust or terminate tasks, ensuring flexibility and effectiveness.

Risk assessments are conducted by the science council or independent experts, providing the basis to decide whether to continue, adjust or terminate tasks.

Decentralization and implementation flexibility

The circular emphasizes strong decentralization and empowerment, not imposing rigid models. Ministries, sectors and localities are enabled to actively choose operating models that fit practical realities.

Deadline for existing funds to align

Funds already established, whose charter and operating regulations were issued before this Circular takes effect, must review, amend and supplement their charter and operating regulations to align with the provisions of this article and relevant laws within 30 days from the date this Circular takes effect.