Real Estate Legal Matters in Vietnam

   In general, it is not permitted to own land in Vietnam as a private entity because the land belongs to the people and the State of Vietnam thereby operates as the administrator.

However an ownership of a right to use land is permitted according to Vietnamese Law. This so-called Land Use Right (“LUR”) Certificate provides the means to lease land from the State for Vietnamese and foreign people. This LUR Certificate entitles the land users to protect their legitimate rights and interests. The sale of a house or real estate is in fact the transfer of the rights for house ownership combined with the transfer of the land from the seller. The right to use land can be directly acquired by different ways that are: lease from the state; sub-lease from a developer of a zone; transfer from another land user; allocation from the state. The legal grounds for Land and House Law of Vietnam are stipulated in the Law on Housing 2005 of Vietnam as well as in the Law on Land 2003. The rights and entitlements of holders of house ownership and the holders of the LUR Certificate are settled in this law.

According to Article 12 of the Law on Housing 2005, the name of the individual who holds the house ownership shall be written in the house ownership right certificate and his/her rights are stipulated in Article 21 that include for example the rights to posses; use; sell; lease; donate; exchange; lend or to let other people stay temporarily in the house. As stipulated in Article 106 of the Law on Land 2003, the one who holds the LUR and house ownership certificate is entitled to exercise the full range of rights over the land/house. As such, land use rights and ownership of assets on the land are combined in the Certificate of Land Use Right and House Ownership Right (LURC).

But the possibilities to acquire land or houses depend on the individual/organization that wishes to do so, because Vietnamese, overseas Vietnamese and Foreigners do not have the same rights. Especially for foreigners, it was often quite challenging to acquire land or houses in Vietnam. Before the year of 2009, foreigners could not legally acquire property but only could make a joint venture with a Vietnamese company. But the Resolution No. 19/2008(ND-QH12, effective January 2009, started to entitle foreigners to own houses in Vietnam under the conditions that the foreigner 1) is hired by an enterprise that currently operates in Vietnam and 2) must have at least a temporary residence card to purchase and own an apartment unit in Vietnam. This five-year piloting program that would end in 2014 is now discussed by the Vietnamese Prime Minister to continue this program after the first five years to support the real estate market and to make it more attractive for foreigners.

Even though about 80,000 expats live and work in Vietnam, only more than 400 cases of foreigners buying houses in Vietnam could be registered. Of course, this might be due to the difficulties for foreigners to buy houses before this pilot program . But this Resolution No. 19, which was guided by Decree No. 51/2009/ND-CP, still does not make it easy to operate in the real estate market in Vietnam for foreigners because of the complicated procedures to register ownership. After the first 5 years, the government stated to have the plan to review the pilot policy and the Ministry of Construction also opened up for the idea to allow foreigners to buy houses no matter if they work and do business here or if they want to buy real estates in Vietnam.

As the Vietnam’s real estate situation seems to stand before a turning point, it is necessary to keep up to date with all legal changes and developments. Due to the fact that Vietnamese law has special provisions for every organization or individual who wishes to operate with land and real estates related to House Law, it is inevitable to know about this legal circumstances in Vietnam.

ANT Lawyers could assist in different land and house related projects and matters such as land ownership, house purchase or sale and is aware of the differences between provisions on house law for foreigners and Vietnamese. Our professionals could advise clients about possibilities and potential risks concerning real estate laws, housing laws in Vietnam and furthermore could support clients with required procedures with the Vietnamese authorities.

We help clients overcome cultural barriers and achieve their strategic and financial outcomes, while ensuring the best interest rate protection, risk mitigation and regulatory compliance. ANT lawyers have Attorneys in Hanoi, Attorneys in Ho Chi Minh and Attorneys in Danang.

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Five types of real estate contracts abolished mandatory notarization procedure

   According to the regulation of Civil Code 2015, some of the transactions which are required to implement the process of notarization and registration according to the regulation of the laws. As real estate transactions are normally at high value, the process of notarization and registration would help parties involved to be protected from falsified transactions.

As the stipulated in the Real estate trading 2014, the real estate trading agreement must be made in writing. The agreement notarizing or authenticating shall be discussed by contracting parties. However, the real estate trading agreement in which on building sale or lease purchase agreements or land transfer agreements concluded by households and individuals who conduct small-scale or irregular transactions of real estate sale, transfer, lease-out, and lease purchase shall not be required to set up enterprises, but they shall make tax declaration as prescribed need to be implemented the mandatory notarization procedure.

The procedure and dossier for notarization the real estate agreement will be implement according to the regulations of Law on notarization 2014.

Our real estate lawyers in Vietnam recommend client to have house leasing contracts voluntarily notarized to better protect their interests in disputes or any future issues.

For more information or legal advice in real estate transactions, we are glad to assist. ANT Lawyers, your lawyers in Vietnam

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New Vietnam Real Estate draft law giving more rights to foreigners in Vietnam

   ANT Lawyers’ real estate legal practice gives client legal advice on real estate legal matters in Vietnam. We are keeping track with changes in the Vietnam legal environment to ensure giving our client the best advice.

Real estate market in Vietnam is experiencing a difficult time. The government has realized that there is a huge demand from the foreigners and oversea Vietnamese investing in Vietnam in owning real estate in Vietnam however the legal regulations on such matter have not yet encouraged them to make the investment.

The Vietnam Ministry of Construction has enacted the fifth Draft of Law on Real Estate Business (amending), which regulates two new noteworthy provisions relating to the scope of real estate business of foreigners and Vietnamese overseas.

While the current regulations in Law on Real Estate 2006 only allow the foreign and oversea Vietnamese organizations, individuals to establish houses, construction works for sale, lease, lease-buy; to invest, reclaim land and set up facilities on the leased land for leasing. The new Draft of Law on Real Estate expands the scope to i) rent houses, construction works in order to sub-lease; ii) foreign and oversea Vietnamese organizations or individuals operating in real estate area, foreign invested capital enterprises, branches, representatives of foreign enterprises, investment funds, branches of foreign banks currently operating in Vietnam are also permitted to rent, buy and own the office areas for their own work or for lease; to buy, rent, lease-buy houses according to Vietnam law on houses.

Our real estate lawyers in Vietnam have experience in the field of real estate and we have solutions for our client based on client’s unique situation.

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The Note of New Provisions of Law on Planning Decree No.37/2019/ND-CP

The Law on Planning 2017 has been effective from January 01st, 2019. On May 07th, 2019, the Decree no. 37/2019/ND-CP details some articles of Law on planning is effective. This Decree details some articles of Law on Planning including the Article 15,17,19,24,25,26,27,30,40,41 and 49 of Law on Planning.

This Decree applies to organizations and individuals involved in the formulation, appraisal, decision or approval, announcement, implementation, assessment and adjustment of the planning under the national planning system and other relevant organizations and individuals.

Therefore, the time duration for formulation of the national comprehensive planning, national marine spatial planning and national land use planning is not over 30 months, since the day approving the planning task. In the case the national planning system and province planning system, the time duration is 24 months.

This Decree details the contents of planning need to be published on the mass media: A summary of the planning contents must be published at least 01 time on the first page of a printed newspaper or on the homepage of the online newspaper for at least 30 days; The planning contents must be announced on news programs and television channels of national radio and television stations or provincial television stations.

The announcement of planning contents is also carried out through the following forms: model display, planning maps; conferences and workshops to disseminate planning contents and plan implementation plans; publications such as books, atlas, introductory videos…

The Decree specifies the professional capacity of this planning consultancy organization not belonging to state agencies. Pursuant to the Law on Planning 2017, the power to organize planning formulation includes: The Government shall organize formulation of the national comprehensive planning, national marine spatial planning and national land use planning; The Prime Minister shall organize formulation of regional planning; Ministry and ministerial authorities shall organize formulation of national sector planning; The People’s Committees of provinces shall organize formulation of provincial planning. However, the planning organization, the Ministries and Ministerial authorities and local governments shall select a planning consultancy in accordance with regulations of the Law on Bidding. The planning consultancy shall have a legal status and satisfy qualification requirements applied to its assigned tasks in accordance with regulations of the Government is regulated at Article 4 Decree 37/2019/ND-CP includes the conditions as follow:

-Planning consultancy organizations must have at least 01 consultant, who is the planning project manager and must have a university degree or higher in the discipline related to the planning to be established to meet the prescribed conditions and at least 05 consultants presided over the planning component or planning contents for the national sector planning and provincial planning to meet the prescribed conditions. Consultancy organizations that formulate planning components or planning contents for national and provincial planning must have at least one consultant meeting the prescribed conditions.

-The Consultants who are managers of planning projects must have a university degree or higher in the discipline related to the planning, and have established at least 01 planning of the same planning level that needs to be elaborated or directly participated in set up at least 02 plans of the same planning level.

-In case the national master plan is first established in Vietnam, the consultant who is the planning project manager must have a university degree or higher in the discipline related to the planning needed to be established and the owner has established at least 02 regional plans or planning for the inter-provincial river basin.

-Consultants who lead the formulation of planning components or planning contents for national and provincial planning sectors must have a university degree or higher in a discipline related to the planning component or planning contents. It is necessary to set up and directly participate in setting up at least 01 planning of the same planning level.

-If the national master plan is first established in Vietnam, the consultant who presides over the planning component or the planning content for the national sector planning must have a university degree or higher in the specialized field. relating to the planning component or the planning content to be prepared and presided over at least 01 planning or directly involved in setting up at least 02 regional or planning for the scope of the inter-river basin the provincial.

Organizations that meet the above requirements may conduct planning consultancy for competent state agencies for planning. In Chapter II of Decree 37/2019/ND-CP stipulating the issue of planning, in this chapter, the responsibilities of planning agencies, for each planning, will specify the responsibilities Specific agencies such as: Responsibilities of agencies that formulate national master plans, national maritime space planning, regional planning; Responsibilities of agencies organizing the formulation of planning components and agencies making planning components… prescribe the time limits, tasks and contents of planning, but the planning contents must comply with orientations and points and development objectives of socio-economic space, regional space, social and technical infrastructure… according to regulations, create uniform consistency and ensure sustainable development objectives.

The Decree details about the information system and the national database about planning at Chapter V of this Decree, includes the contents about information and database as follow:

The information, database of the information system and national database about planning and information, the database is digitized, linked, integrated with each other, linked to the national geographic database and appraised in accordance with the law.

The scale of implementing the construction of national geographic database is determined by district administrative units; use VN-2000 reference frame and coordinate system for all types of information, map database.

Information and database collected to build a national planning information and database system include:

-Database of national planning documents, regional planning, provincial planning, specialized technical planning, special administrative – economic unit planning, urban planning and planning rural areas have been approved and stored according to Article 44 of the Law on Planning;

-Specialized database managed by Ministries, Ministerial authorities, People’s Committees of provinces and cities under the central government, including national statistical database and national statistical indicators system, provincial, district and commune levels; database on water resources; database on geology and minerals; environmental database; database on meteorology and hydrology; database of marine and island environmental resources; database on climate change; land statistics and inventory database; database of land use planning and plans; information and databases related to basic land surveys; database on technical infrastructure systems; database on social infrastructure systems; database on construction; database on urban systems and rural population points; database on housing and real estate market; database on national defense and security; relevant measurement and mapping databases;

-National geographic database is standardized and updated regularly;

-Information and databases on other planning.

The Decree stipulating the planning contents must be announced on the mass media: notices on national radio and television news programs for national planning and regional planning or provincial radio and television stations for provincial plans on summarizing the contents of decisions or approving planning and lists of projects prioritized for investment in the planning period.

Planning law and construction law have a close relationship. An important principle of planning activities is to ensure stability, avoid disturbance to business and production activities of enterprises and people’s lives. Decree 37 is expected to help clarifying issues, reducing overlapping in relevant legal provisions.

ANT Lawyers attorneys, a law firm with offices in Hanoi, Ho Chi Minh City and Da Nang regularly monitor legal changes to update customers regularly.

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