Is the Ho Chi Minh City Department of Construction responsible for Gamuda Land's violations?

Công LuậnCông Luận26/06/2023


Many issues remain unclear

As previously reported, Gamuda Land Joint Stock Company (Gamuda Land) has committed many violations during the implementation of two apartment buildings A5 and A6 at the Tan Thang Sports and Residential Complex project (commercial name Celadon City, Son Ky ward, Tan Phu district, Ho Chi Minh City).

Specifically, in the document agreeing to allow Gamuda Land to open the sale of future housing for 160 apartments in Apartment Complex A5 and 1,153 apartments in Apartment Complex A6 in document 6351/SXD-PTN&TTBDS of the Department of Construction of Ho Chi Minh City (Department of Construction), it is clearly stated that the investor has provided two minutes dated November 29, 2019 and April 29, 2019 on the acceptance of the completion of underground structure items of Apartment Complex A5.

Is Ho Chi Minh City Construction Department responsible for Gamuda Land's violations? Image 1

Tan Thang Sports and Residential Complex Project - Celadon City.

However, the A5 Apartment Complex was granted a construction permit by the Department of Construction on May 28, 2021. Thus, the underground part of the A5 Apartment Complex was completed by Gamuda Land and had a record of acceptance before being granted a construction permit by the competent authority. There is currently no information on the penalty of the competent authority related to this act. At the same time, questions are also raised about the agency responsible for management and supervision, when allowing a large project like the A5 Apartment Complex to be constructed without a construction permit.

Next, regarding the sale of future housing, Gamuda Land explained to customers that it had sent a notice of eligibility for sale to the Department of Construction. Pursuant to Article 19 of Decree No. 99/2015/ND-CP dated October 20, 2015 of the Government, within 15 days from the date of receipt of the investor's application, the Department of Construction must check the application. If the application has sufficient documents as prescribed in this point, the Department of Construction must send a written notice to the investor that the housing is eligible for sale or lease-purchase. If the application does not have sufficient documents as prescribed, there must be a written document stating the reason.

Is Ho Chi Minh City Construction Department responsible for Gamuda Land's violations? Image 2

In written responses to customers, Gamuda Land said it had properly sent notices of eligibility to open sales of future housing according to Decree 99/2015/ND-CP.

In case the investor has submitted the dossier but the time limit specified in this point has passed and the Department of Construction has not issued a written notice and the housing is eligible for sale or lease-purchase, the investor has the right to sign a contract for sale or lease-purchase of the housing to be built in the future but must be responsible for the sale or lease-purchase of this housing. The Department of Construction must be responsible for notifying or not notifying the housing is eligible for sale or lease-purchase after receiving the investor's application dossier.

With Gamuda Land continuously affirming that it had met the conditions to open for sale the A5 and A6 Apartment Complexes before the announcement 6351, will the Department of Construction be responsible for not issuing a written notice that the housing was eligible for sale or lease-purchase after receiving the application from the investor Gamuda Land, as stipulated in Decree 99/2015/ND-CP? Because this notice is an important factor, related to the decision of the Ho Chi Minh City People's Committee to impose an administrative penalty on this investor and request the return of capital that was mobilized in violation of regulations.

Is it still allowed to open for sale after the warranty period expires?

In addition, the bank guarantee in the purchase and sale of future housing is also a question mark for many customers who have bought apartments at the A5 and A6 Apartment Complex of the investor Gamuda Land.

According to Clause 4, Article 3 of the 2014 Law on Real Estate Business, future houses and construction works are houses and construction works that are under construction and have not been accepted for use. Clause 19, Article 3 of the 2014 Law on Housing stipulates that future houses are houses that are under construction and have not been accepted for use. The bank's guarantee in the purchase and sale of future houses is an important basis, directly protecting buyers of future houses.

Meanwhile, up to now, Gamuda Land's A5 Apartment Complex has not yet received a written approval from the competent authority for the results of the inspection and acceptance work to put it into use. On June 1, the Department of Construction also sent a document requesting the People's Committee of Tan Phu District to prevent Gamuda Land from handing over apartments at A5 Apartment Complex until this construction project has received a written approval from the competent State agency for the results of the inspection and acceptance work to complete the project in accordance with regulations.

Is Ho Chi Minh City Construction Department responsible for Gamuda Land's violations? Image 3

The guarantee period according to the guarantee agreement between Gamuda Land and MSB at A5 Apartment Complex is until January 31, 2023.

However, according to the guarantee agreement No. 0106/2020/TTBL of Vietnam Maritime Commercial Joint Stock Bank (MSB Bank), the maximum guarantee period for A5 Apartment Complex is only valid until January 31, 2023. That is, at the time the Department of Construction issued Notice No. 6351/SXD-PTN-TTBDS on May 8, agreeing to allow Gamuda Land to open the sale of future housing for 160 apartments in A5 Apartment Complex, the guarantee agreement had expired.

Also from the above issues, many customers who are buying apartments at A5 Apartment Complex have expressed their frustration about why Gamuda Land was granted permission to open for sale apartments when there are still many existing issues that have not been clarified.

Mr. D.VT, a customer who signed a sales contract with Gamuda Land to buy an apartment in the Diamond Alnata subdivision, said: “We have sent a petition to the authorities to reflect the investor’s problems, especially the legal issues of the project that have not been resolved by Gamuda Land, but it is unclear why they were still granted a license to open for sale by the Department of Construction when there are still so many problems. Not to mention that this investor, although not yet resolved the existing problems, has asked customers to complete their financial obligations to receive the house.”

This customer also said that because Gamuda Land was late in handing over the apartment as committed in the contract, many conflicts arose between the investor and the customer. This conflict was related to the payment of 18%/year in late handover fee and payment of 30% of the amount paid to the customer who wanted to terminate the contract. These are the rights of the buyer clearly stated in the sales contract. However, currently these legitimate rights of the customer have not been met by Gamuda Land.

Journalists and Public Opinion Newspaper will continue to work with authorities to clarify the above issues.

Previously, on April 13, the Ho Chi Minh City People's Committee issued a decision to fine Gamuda Land for signing a contract to buy and sell apartments at Apartment Building A5 of the Celadon City project without a document from the Department of Construction notifying that it is eligible to sell or lease future housing according to the law.

Pursuant to Clause 4, Article 58 of Decree 16/2022 of the Government, Ho Chi Minh City People's Committee decided to fine Gamuda Land VND 900 million for illegal capital mobilization.

The company must also take remedial measures, which are to return the capital mobilized in violation of regulations. The time limit for implementing remedial measures is 10 days from the date of receipt of the decision. All costs for organizing the implementation of remedial measures shall be borne by the company.

Recently, according to information from the People's Committee of Tan Phu district, Gamuda Land has paid the fine according to the penalty decision and at the same time submitted a complaint against the decision to sanction this administrative violation.



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