The recent trade and investment agreements between Vietnam and its European partners demonstrate a growing emphasis on balancing investment protection with sustainable development and the regulatory power of host states. Although these agreements incorporate familiar mechanisms from international trade-investment law, they represent a step towards establishing more sustainable investment frameworks. However, these mechanisms predominantly reflect the perspectives of Vietnam’s partners, leaving Vietnam’s specific concerns inadequately addressed. Consequently, assessing the agreements’ full impact on Vietnam remains challenging. This chapter evaluates the extent of policy space retained by Vietnam under its recent agreements with the European Union, the United Kingdom, and the European Free Trade Association. It further underscores the importance of Vietnam adhering to relevant regulations while maximising its regulatory authority. These findings are crucial for Vietnam in refining its foreign investment policies, strengthening investment management, and enhancing environmental regulations. Moreover, this analysis serves as a reference for other developing economies facing similar environmental challenges and the pressures of climate change that accompany rapid economic growth.