Vietnam: How to distinguish between land allocation and land lease by the State? What are the cases of land allocation with land use levy by the State?
How to distinguish between land allocation and land lease by the State in Vietnam?
Similarities:
- Land use rights are granted by the state;
- The beneficiaries of land use rights are all entities with full capacity and land use demand;
- Land allocation and land lease shall comply with the law on land and land use planning and plans;
- The rights and obligations of land users in cases of land allocation and land lease are the same.
Differences:
Distinguishing criteria | Land allocation | Land lease |
Definition | The State allocates land use rights (below referred to as the State allocates land) means that the State issues decisions on land allocation to grant land use rights to subjects having land use demand. (Clause 7, Article 3 of the 2013 Land Law). | The State leases land use rights (below referred to as the State leases land) means that the State decides to grant land use rights to subjects having land use demand under agreements on land use rights lease. (Clause 8, Article 3 of the 2013 Land Law). |
Forms of land use | There are two forms: + Land allocation without land use levy; + Land allocation with land use levy. Depending on each specific case, the State shall select appropriate forms of land use as prescribed in Articles 54 and 55 of the 2013 Land Law. | There are two forms: + Land rent paid annually and; + Land rent paid once for the whole lease period. The 2013 Land Law specifies the case of joint land lease. Land tenants may agree on the payment method when leasing land, except for the case of Clause 2 Article 2 of Decree 46/2014/ND-CP, land rent shall be paid annually. |
Rights of land users | Land allotees may transfer their rights to others through the following forms: transfer, donation, conversion, lease, mortgage, capital contribution by land use rights (according to Article 179 of the 2013 Land Law). | The rights and obligations of land tenants depend on the payment method. + In case of land lease with payment for the whole lease period: the tenant has the rights of the land user as in the case of land allocation by the State. + In case of annual payment of land rent: land users may only transfer rights to land-attached assets. Only in cases where land is leased by the State in industrial parks, export processing zones, industrial clusters or craft villages, he/she shall have the right to sublease the leased land. |
Land use term | - The term of land use when the State allocates land has two forms: + Land used for long and stable term: The State allocates land for long and stable term to users for the purposes specified in Article 125 of the 2013 Land Law. + Land used for limited term. - Where the State allocates land to be used for long and stable term, it is for long-term stable use. | - Land users through the form of land lease have regulations on the term and no form of long-term stable use. The term of land lease on a case-by-case basis is set at a maximum of 50 years, 70 years and 99 years. - The longest lease period is 99 years. |
Land use quotas | The State shall provide for agricultural land allocation limits and land allocation limits in: + Depending on the specific situation of the locality, the People's Committee of the province shall prescribe specific limits for the allocation of residential land. + Allocation quotas for agricultural land are specified in Article 129 of the 2013 Land Law. | There are no regulations on land lease quotas. The area of leased land depends on two factors: + Land use demand and; + Responsive land fund. The specific area for land lease is specified in the land leasing decision or land lease agreement. |
What are the cases of land allocation with land use levy by the State in Vietnam?
Pursuant to the provisions of Article 55 of the 2013 Land Law as follows:
Land allocation with land use levy
The State shall allocate land and collect land use levy in the following cases:
1. Households and individuals that are allocated residential land;
2. Economic organizations that are allocated land to implement investment projects on construction of houses for sale or a combination of sale and lease;
3. Overseas Vietnamese and foreign-invested enterprises that are allocated land to implement investment projects for the construction of houses for sale or for a combination of sale and lease;
4. Economic organizations that are allocated land to implement investment projects on infrastructure of cemeteries and graveyards for transfer of land use rights together with the infrastructure.
Thus, pursuant to the above-mentioned provisions, the State shall allocate land with land use levy in the following cases:
- Households and individuals that are allocated residential land;
- Economic organizations that are allocated land to implement investment projects on construction of houses for sale or a combination of sale and lease;
- Overseas Vietnamese and foreign-invested enterprises that are allocated land to implement investment projects for the construction of houses for sale or for a combination of sale and lease;
- Economic organizations that are allocated land to implement investment projects on infrastructure of cemeteries and graveyards for transfer of land use rights together with the infrastructure.
What are the cases of land lease with annual payment of land rent by the State in Vietnam?
Pursuant to the provisions of Article 56 of the 2013 Land Law, the State may lease land and collect an annual land rent in the following cases:
- Households and individuals that use land for the purpose of agriculture, forestry, aquaculture or salt production;
- Households and individuals that need to further use agricultural land that exceeds the land allocation quotas prescribed in Article 129 of 2013 Land Law;
- Households and individuals that use land for trading and services, mining activities, production of construction materials, production of ceramic products, and non-agricultural production establishments;
- Households and individuals that use land for construction of public facilities for commercial purposes;
- Economic organizations, overseas Vietnamese and foreign-invested enterprises that use land to implement investment projects in agriculture, forestry, aquaculture or salt production, for non-agricultural business and production purpose, for construction of public facilities for commercial purpose, and for implementation of investment projects on houses for lease;
- Economic organizations, self-financed public non-business organizations, overseas Vietnamese and foreign-invested enterprises that use land for construction of non-business facilities;
- Foreign organizations with diplomatic functions that use land to build offices.
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