RICH, POOR, PRISON, ALL BECAUSE OF LAND
In a sweltering rented room under the intense heat in early May, Ms. Nguyen Thi Kim Buu (Hamlet 1, Song Trau Commune, Trang Bom District, Dong Nai) is preparing "new" documents to continue complaining about her family's land plot of more than 11,000 m2 that was confiscated to build Bau Xeo Industrial Park (IP) nearly two decades ago. At the age of 70, Ms. Kim Buu is the second generation to pursue the lawsuit. Ms. Kim Buu's mother, Ms. Le Thi Lam, passed away 5 years ago, not long after her family's land was forcibly confiscated in late 2018. Ms. Kim Buu is not the only household complaining. About 50 households here, through many generations, also disagree with the Dong Nai government's decision to confiscate the land to hand over to the investor of Bau Xeo IP.
On January 12, 2004, the Chairman of Dong Nai Provincial People's Committee signed Decision 101/QD-CT-UBND to reclaim more than 440 hectares of land in the communes of Song Trau, Tay Hoa, Doi 61 and Trang Bom Town and "temporarily hand over the entire reclaimed land area" to Tin Nghia Company, Dong Nai Rubber Company and its members to conduct compensation, site clearance, and investment procedures for the construction of Bau Xeo Industrial Park. In February 2004, Tin Nghia Company and Dong Nai Rubber Company contributed capital to establish Thong Nhat Joint Stock Company as the investor of Bau Xeo Industrial Park.
The source of the complaint also started from here. Ms. Kim Buu's family and the households whose land was recovered said that Decision 101 of the Chairman of Dong Nai Provincial People's Committee in 2004, when there was no decision of the Prime Minister on the establishment of Bau Xeo Industrial Park, was "not within the authority". Their land was not within the approved planning boundary, so the land recovery to hand over to the investor of the Industrial Park had no legal basis. Therefore, the people did not comply with the recovery, and have been complaining since 2004. In 2018, Trang Bom District People's Committee issued a notice to organize forced land recovery. Ms. Kim Buu and the households said that Trang Bom District People's Committee's forced land recovery based on Decision 101 was not in accordance with the law, so they continued to complain until now.
"They compensated us only 25,000 VND/m2 and 15 million VND as resettlement money, a total of 11,000 m2 of houses and gardens, they compensated more than 700 million VND, how will we live after the land is taken back", said Ms. Kim Buu. For many years, the 70-year-old woman, on behalf of her 7 siblings, had to live in a friend's rented house to pursue a lawsuit that is not known when it will end...
Multi-generational families with land disputes like Mrs. Kim Buu in Bau Xeo Industrial Park are not rare. The National Assembly's monthly reports on people's petitions are never absent from large petition delegations from local levels to the Central level seeking a fair voice. Most of them are people pursuing land disputes, like Mrs. Kim Buu and the people of Trang Bom District. The number of more than 70% of land-related disputes announced by the authorities is an average statistic over many years.
Nearly four decades of national renovation have created many dollar billionaires. Most of them got rich from real estate. But nearly 40 years of national renovation have also created many generations of people who feel injustice when the land that their ancestors left for many generations is now being reclaimed at a cheap price and then given to businesses to build industrial parks, commercial centers, high-rise buildings and sold at high prices. People's agricultural land was reclaimed at a price of 1 million VND/m2, then planned as residential land, businesses divided it into plots, sold the land, built high-rise buildings, and sold it at 50 million VND/m2. Dr. Nguyen Si Dung, former Deputy Head of the National Assembly Office, said that this increase of 49 million VND thanks to the decisions to reclaim, change planning and allocate land is the difference in land rent.
The difference in actual land rent is much larger than the example Mr. Nguyen Si Dung mentioned. Many people in Thu Thiem (Thu Duc City, Ho Chi Minh City) had their land confiscated at a price of 18 million VND/m2, but only a few years later, when they returned to the project built on their own land, the staff quoted the apartment price at 350 million VND/m2 and it was sold out. A survey by the Vietnam Real Estate Association showed that the difference in land prices before and after the project was up to 700 times in some places, and at least 50 times. This huge profit caused resentment, anger and was the source of injustice. People lost their houses, lost their land, lost their jobs because of socio-economic development projects (KT-XH), for the national and public interest, but they themselves did not enjoy the value that these projects brought. Compensation and resettlement money did not help them have a better life after their land was confiscated. Projects make the economy and society develop, but they keep getting poorer. Land acquisition and site clearance have therefore become the "fear" of many people and the source of long-lasting frustration and complaints.
General Secretary Nguyen Phu Trong, in his opening speech at the 5th Central Conference of the 13th tenure - when the Party Central Committee summarized the resolution on land policy, in May 2022, said: "Many people got rich thanks to land, but there are also many people who became poor because of land, even went to jail because of land, lost the relationship between father and son, brothers because of land...". Land conflicts are increasing with the country's development.
More than 70% of lawsuits nationwide are related to land.
THE SOURCE OF LAND CONFLICTS
If the people are not the beneficiaries of the differential rent created by land acquisition projects, then who are the beneficiaries? The most obvious answer is the enterprises - those who were allocated land that was acquired at a low price and then sold at a very high price. But on many forums, enterprises claim that they are "wrongly accused" because they have been "badly accused".
According to the Constitution, Party resolutions and the current Land Law, land belongs to the entire people and is represented by the State as the owner and managed uniformly. Exercising the right to represent the owner, the State will decide the purpose of land use through planning, land use plans and allow the change of land use purpose. The decision to use a plot of land to build an urban area instead of continuing to keep it as state agricultural land (and only the State is allowed to do this) has created differential land rent.
According to Dr. Nguyen Van Dinh, an investment and real estate legal expert, when implementing real estate projects, in addition to paying in advance for the state to compensate and clear the land, when being allocated land, businesses will have to pay additional money according to the land price as decided by the state. In the surplus method used to determine land prices for most projects of land recovery and conversion of land use purposes, the land price will be calculated so that businesses will enjoy 15% of the added value after the investment project, called profit. 85% of the difference in land rent will have to be paid to the state budget through land use fees. "In theory, 85% of the surplus value is the land use fee that investors must pay to the state, which is mixed into the budget to spend for the people of the whole country according to the State Budget Law, serving public investment," said Mr. Dinh.
But what Mr. Dinh said is just "theory". The picture of regulating differential land rent in practice is very different when it has to go through many complicated processes and procedures but has many loopholes for corruption and negativity. Enterprises find many ways to gain maximum profits. The state has probably never been able to "integrate 85% of the added value into the budget". In most major land-related cases from the North to the South over the past years, provincial and municipal authorities have, in many different ways, allocated land to enterprises at low prices, causing the state to lose revenue from the increased land rent difference. At least a few tens of billions, at most up to thousands of billions of VND.
Dr. Nguyen Si Dung, former Deputy Head of the National Assembly Office
In a major case brought to trial in recent days, on February 23, 2017, former Chairman of the People's Committee of Binh Thuan Province Nguyen Ngoc Hai signed and issued an official dispatch agreeing in principle to hand over 3 plots of land of more than 92,600 m2 belonging to the land fund on both sides of Road 706B (in Phu Hai Ward, Phan Thiet City) to Tan Viet Phat Company without auction, at a price of 1.2 million VND/m2, the starting price for the auction according to the decision from 2013. The subsequent investigation showed that the land handover at a price of 1.2 million VND/m2 was against the regulations because according to the Land Law, the calculation of land use fees and land rent must be determined according to the land price at the time the state agency handed over or leased the land. According to the authorities, the fact that former leaders of Binh Thuan Province handed over 3 plots of land at cheap prices to enterprises caused the state to lose more than 45 billion VND.
In a similar manner, on December 27, 2012, former Secretary of the Binh Duong Provincial Party Committee Tran Van Nam, then Vice Chairman of the Provincial People's Committee, signed decisions agreeing to apply the land price of VND51,914/m2 according to the decision of the Binh Duong Provincial People's Committee from 2006 to calculate land use fees for two land plots of 43 hectares and 145 hectares when converting the purpose and handing over the land to the Binh Duong Production - Import - Export Corporation. According to the verdict, the determination of cheap land prices that were not in accordance with regulations by defendant Tran Van Nam and his accomplices caused a loss of more than VND761 billion to the state.
In many similar cases of cheap sale of "golden land" in Khanh Hoa, Da Nang, or Ho Chi Minh City..., the defendants, who are leaders of provinces and cities, all affirmed that they did not profit or commit corruption when allocating land at cheap prices to enterprises. The authorities could not prove this either. No backpacks of money were found on the railings of their houses. No illicit money was found in the safes or accounts of the suspects. Nor were any shady relationships brought to light. No one understood what had "lubricated" the entire advisory and decision-making system when officials were all aware that allocating land at cheap prices was wrong. However, the amount of money lost is increasing day by day.
"For a long time, the whole system has been pushed to pursue differential land rent. This is the source of injustice and land conflicts," Dr. Nguyen Si Dung summarized. To reduce conflicts, Mr. Dung said that it is necessary to solve the problem of regulating differential land rent, so that part of this added value can be used to help people whose land has been recovered have new housing equal to or better than their old one, as stated in the Party's resolution. "If there is a differential land rent, do not let it fall into the pockets of businesses or officials who have the power to change land use purposes or adjust planning. There needs to be a way to redistribute the differential land rent fairly," Mr. Dung said.
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