Are investors in projects for commercial housing construction in Vietnam required to have a capital deposit to execute the projects?

Main Content

• Are investors in projects for commercial housing construction in Vietnam required to have a capital deposit to execute the projects?
• Do investors in projects for commercial housing construction in Vietnam benefit from the State's incentive policies during the project execution?
• What are the obligations of investors in projects for commercial housing construction in Vietnam?

Are investors in projects for commercial housing construction in Vietnam required to have a capital deposit to execute the projects?

Under Article 21 of the Law on Housing 2014 as amended by Point a, Clause 1, Article 75 of the Law on Investment 2020:

Investors in projects for commercial housing constructions must:

1. Be enterprises or cooperatives established and operated under Vietnamese regulations of law.

2. Have a capital deposit or a bank guarantee to execute each project in accordance with the law on investment.

3. Be licensed for real estate trading as prescribed.

According to regulations, investors in projects for commercial housing construction must have a capital deposit or a bank guarantee to execute each project under the law on investment.

Thus, investors in projects for commercial housing construction are not required to have a capital deposit to execute the investment projects if they have a bank guarantee for the deposit obligation.

Do investors in projects for commercial housing construction in Vietnam benefit from the State's incentive policies during the project execution?

Under Article 25 of the Law on Housing 2014, the rights of investors in projects for commercial housing construction in Vietnam are as follows:

Rights of investors in projects for commercial housing construction

1. Request related agencies to follow procedures for formulation, assessment, approval or implementation of the projects as prescribed.

2. Enter into agreements on housing lease, lease purchase or sale; mobilize capital, collect payments from agreements on housing lease, lease purchase or sale as prescribed in this Law, law on real estate trading and the signed agreement.

3. Exercise rights of land users and trade in products of the projects as prescribed in law on land and law on real estate trading.

4. Transfer part or all of the project as prescribed in law on real estate trading.

5. Manage; operate the technical infrastructure within the scope of the project in conformity with the approval of residential housing projects granted by the competent agency.

6. Request the competent agency to grant the Certificate of housing in the projects prescribed in Article 9 of this Law and law on land.

7. Benefit from incentive policies carried out by the State over the progress of the project as prescribed.

8. Exercise other rights as prescribed in regulations of this Law and relevant law provisions.

Thus, investors in projects for commercial housing construction in Vietnam shall benefit from the State's incentive policies during the project execution.

What are the obligations of investors in projects for commercial housing construction in Vietnam?

Article 26 of the Law on Housing 2014 stipulates the obligations of investors in projects for commercial housing construction in Vietnam as follows:

(1) Obligations of investors in projects for commercial housing construction

(1) Exercise other rights as prescribed in regulations of this Law and relevant law provisions.

(2) Make deposit to carry out the projects as prescribed in law on investment; pay guarantee for housing transactions as prescribed in law on real estate trading; ensure finance to carry out the projects as prescribed.

(3) Build housing and technical and/or social infrastructural works according to the specific planning and approval of residential housing policies granted by the competent agency, satisfy standards of design, standard housing areas and rate of progress of the approved projects.

(4) Reserve the land plots used for technical infrastructure in the projects for social housing as prescribed in law on housing.

(5) Announce the information prescribed in Point b Clause 5 Article 19 of this Law on their websites and at the head offices of their project management board; send reports on implementation of the projects periodically and at the end of the progress of the projects as prescribed in law on housing and law on real estate trading.

(6) Fulfill all commitments in the agreements on project trading, transfer of housing and related documents on housing transactions to clients; conduct transactions in housing sale, lease, or lease purchase and trading in land use rights as prescribed in law on real estate trading.

(7) Apply for the Certificates of housing which are granted to the buyers or the lessees by the competent agency within 50 days, from the date on which the housing is transferred to the buyers or the lessees pay off the contractual total amount unless the buyers or the lessees wish to apply for the Certificates themselves.

In case the housing is built for lease, the investors must file and store documents on housing as prescribed in Article 76 and Article 77 of this Law.

(8) Provide warranty on housing as prescribed in this Law and law on construction; fulfill financial obligations to the State as prescribed.

(9) Abide by effective decisions on actions against violations against regulations on housing development, capital mobilization, advance payment of clients, housing transactions and other transactions prescribed in this Article made by the competent agencies.

(10) Pay compensation if the investor causes damage to clients or organizations, households or individuals involved in housing construction.