Transmission line concession business: Why emphasize obtaining it through a Lao Legal Entity?

输电线路特许业务：为什么强调由老挝法人来拿？

ທຸລະກິດສາຍສົ່ງໄຟຟ້າສຳປະທານ: ເປັນຫຍັງຈຶ່ງເນັ້ນໃຫ້ນິຕິບຸກຄົນລາວເປັນຜູ້ຖື?

Published: 2026-07-23 · LaoPaniti legal guides

You have identified a Transmission line concession opportunity in Laos and are ready to go all in. However, upon reviewing the Electricity Law, you find that the concession is explicitly granted to "Lao Legal Entities" — foreign companies or individuals cannot apply directly. What does this mean? Simply put, you need to establish a Company in Laos or form a Joint Venture with a local enterprise to obtain the entry ticket.

What is a Transmission line concession business?

According to the Electricity Law, a Transmission line concession business refers to the state granting a concession to a Lao Legal Entity in the form of BOT, allowing it to conduct research, design, construction, and operation, and to transfer the project to the government upon expiration of the concession period in accordance with the concession agreement. The term "Transmission line" specifically refers to high-voltage networks with a voltage of 115 kV or above, connecting the national grid and linking with foreign systems, i.e., the national Transmission line system. Projects with a voltage of 500 kV or above also require approval from the National Assembly Standing Committee.

Why must it be a Lao Legal Entity?

The Law restricts the concession to "Lao Legal Entities" primarily to ensure that the project entity has an actual operational presence within Laos, facilitating supervision and Tax. Foreign Investment parties typically need to establish a Legal Entity in Laos or form a Joint Venture with a local enterprise to qualify as the concessionaire. Investment methods may include Joint Ventures between the state and domestic or foreign private entities, conducted through bidding or non-bidding procedures. For examination and approval, the government generally grants permission based on a proposal from the Ministry of Energy and Mines.

Practical advice: Design the entity structure and grid connection level in advance

If you plan to participate in a Transmission line concession project, it is recommended to prepare two things in advance: first, design the entity structure — decide whether to establish a wholly-owned Lao Company or form a Joint Venture with a local partner; second, plan the grid connection level — clarify whether your line will connect to the national grid of 115 kV and above or to a lower-voltage distribution network, as different levels correspond to different approval requirements and commercial conditions.

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This article is compiled by LaoPaniti for reference only and does not constitute legal advice.

FAQ

Can a foreign company directly apply for a Transmission line concession?

According to the Electricity Law, the concession is granted to Lao Legal Entities; foreign companies cannot apply directly. Typically, it is necessary to establish a Legal Entity in Laos or form a Joint Venture with a local enterprise.

What stages are included in a Transmission line concession business?

It includes research, design, construction, operation, and transfer to the government upon expiration of the concession period in accordance with the Agreement.

What approval is required for a Transmission line project above 500 kV?

According to the Electricity Law, approval from the National Assembly Standing Committee is required.

Legal basis

《电力法》

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