Proposal for investors to receive land use rights in accordance with planning
Recently, Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association (HoREA) has just sent a document requesting the National Assembly Standing Committee, a number of National Assembly Committees and the Ministry of Natural Resources and Environment to amend a number of articles and clauses of the Draft Law on Land (amended).
Propose and create conditions for investors to negotiate land use rights (LUR) for land types suitable for planning to implement commercial housing projects.
Create conditions for investors to negotiate land use rights for land types suitable for planning to implement commercial housing projects.
The Association found that Point b, Clause 1, Point a, Clause 4 and Clause 6, Article 128 of the Draft Land Law (amended) have a number of shortcomings and limitations, and are even inconsistent with Resolution 18-NQ/TW dated June 16, 2022 of the Party Central Committee.
Because, point b, clause 1 and clause 6, Article 128 of the Draft Land Law (amended) stipulate: In the case of using land to implement a commercial housing project, an agreement on receiving the right to use residential land is allowed; In the case of implementing a commercial housing project, there must be the right to use residential land or residential land and other land. There is only 1 case where an agreement on receiving the transfer of land use rights for "residential land" and 2 cases where there are land use rights for "residential land" or "residential land and other land" is allowed to use land to implement a commercial housing project.
At the same time, Point a, Clause 4, Article 128 of the Draft Law on Land (amended) allows the case of a commercial housing project with land area managed by the State to be included in the total land area for project establishment and recovered by the State to be assigned or leased to investors without having to go through an auction of land use rights, without having to bid to select investors...
Therefore, HoREA proposes that it is necessary to amend and supplement Point b, Clause 1 and Clause 6, Article 128 of the Draft Law on Land (amended) in the direction of allowing investors to negotiate on receiving the right to use "residential land" or "residential land and other land" or "other land that is not residential land" in accordance with land use planning, urban, construction, housing development programs to implement commercial housing projects, mixed housing and commercial and service projects, to create conditions for investors, especially large real estate corporations and enterprises, with the capacity to invest in developing housing projects, urban areas with large areas of up to tens, tens, hundreds, thousands of hectares, to have both synchronous traffic infrastructure, technical infrastructure, social infrastructure, and many urban utilities and services.
HoREA also proposed that it is necessary to amend and supplement Clause 4, Article 128 of the Draft Land Law (amended) in the direction of assigning the Government to regulate the handling of "land areas managed by the State, the land areas managed by the State" interspersed in commercial housing projects (similar to the provisions of Clause 13, Article 1 of Decree 148/2020/ND-CP on amending and supplementing a number of decrees detailing the implementation of the Land Law) to ensure that there is no loss of state budget revenue and no loss of public assets, which are land resources.
According to Mr. Chau, the amendment and supplementation of Point b, Clause 1, Point a, Clause 4 and Clause 6, Article 128 of the Draft Law on Land (amended) as above aims to fully "institutionalize" Resolution 18-NQ/TW dated June 16, 2022 of the Central Executive Committee of the Party, which stated that institutional views and policies on land must be completed synchronously and in accordance with the institution for developing a socialist-oriented market economy.
There are appropriate policies for each subject and type of land use to unleash potential and maximize the value of land resources, as well as to continue implementing the mechanism of self-negotiation between people and businesses in transferring land use rights to implement urban and commercial housing projects.
Plugging loopholes to avoid losing state revenue
According to Mr. Le Hoang Chau, Chairman of HoREA: “For socio-economic development projects that are in line with land use planning and plans, it is necessary to promptly develop and perfect mechanisms and policies for organizations, households and individuals with land use rights to participate with investors to implement projects in the form of transfer, lease, and capital contribution using land use rights and to ensure the inheritance of correct, accurate and reasonable regulations of the 2013 Land Law”.
The key to avoiding loss of state budget revenue is to "plug" the "loopholes" in the application of land valuation methods to determine land prices.
In addition, the association also expressed concerns that if economic organizations and investors continue to be allowed to receive land use rights through receiving transfers of agricultural land use rights or non-agricultural land that is not residential land, even if it is in accordance with land use planning, to implement commercial housing projects, it will lead to loss of state budget revenue and loss of public assets, which are land resources. In fact, there have been a number of cases of loss of state budget revenue and loss of public assets, which are land resources, in previous years.
However, the association found that the main reason for the loss of State budget revenue and public assets, which are land resources in recent years, is not because the 2013 Land Law allows economic organizations and investors to receive land use rights transfer including "residential land", or "residential land and other land", or "other land that is not residential land", but because of the inadequacies and limitations of applying land valuation methods to value and appraise land; thereby, determining specific land prices to calculate land use fees and land rents for commercial and urban housing projects.
Therefore, HoREA believes that the key issue that needs to be solved is to "close" the "loopholes" in "applying land valuation methods" to "valuate land", "appraise land prices" to "determine specific land prices" to calculate "land use fees, land rents" for commercial and urban housing projects.
On the other hand, the Government is currently focusing on drafting a Decree amending and supplementing a number of articles of Decree 44/2014/ND-CP on land valuation to exercise the State's "rights" in land valuation, deciding on land use fees and land rents, "not following market prices", to perform the function of "the State regulating the economy"; including the real estate market to develop the economy - society for the national and public interests.
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