Vietnam: In which case it is not necessary to establish a Real Estate Trading but still buy and sell real estate?
What real estate is included in Real Estate Trading in Vietnam?
Pursuant to Article 5 of the Law on Real Estate Trading 2014 of Vietnam, the types of real estate that are included in Real Estate Trading include:
- Existing buildings of organizations or individuals;
- Off-the-plan buildings of organizations or individuals;
- Buildings which are public properties to be put on the market permitted by competent agencies;
- Types of lands whose land-use rights are permitted to be transferred (hereinafter referred to as land), leased, sublet as prescribed in law on land.
Vietnam: In which case it is not necessary to establish a Real Estate Trading but still buy and sell real estate?
What are the Real Estate Trading conditions in 2023 in Vietnam?
Conditions of organizations and individuals doing Real Estate Trading are specified in Article 4 of Decree 02/2022/ND-CP, as follows:
- Organizations and individuals shall meet the following criteria to conduct real estate trading:
+ They must establish an enterprise in accordance with the law on enterprises or a cooperative in accordance with the law on cooperatives, with a line of business in relation to real estate trading (hereinafter referred to as enterprise);
+ They must publicize on the enterprise's website, at the head office of the project management board (for projects on real estate trading and investment), at the real estate exchange (for the case of business through the real estate exchange) information about the enterprise (including name, address of head office, contact phone number, name of the legal representative), information about real estate to be put on market as prescribed in Clause 2, Article 6 of the Law on real estate trading, information on mortgage of houses, construction works, real estate projects to be put on market (if any), information on the number, type of real estate products being traded, quantity and types of real estate products sold, transferred, lease-purchased and the quantity and types of remaining products that are still being traded.
If any information that has been publicly at this point changes later, it must be promptly updated upon the change;
+ Trading of eligible real estate as prescribed in Article 9, Article 55 of the Law on real estate trading.
- In case an investor is selected as the investor of a real estate project according to law, such investor must have an equity of not less than 20% of the total investment capital for the project with a land use scale of less than 20 hectares, not less than 15% of the total investment capital, for the project with a land use scale of 20 hectares or more. In performing real estate trading, the project investor must meet the eligibility criteria specified in Clause 1 of this Article.
The equity specified in this Clause is determined based on the results of the most recent audited financial statements or the results of independent audit reports of the operating enterprise (made in the year or preceding year); in case of a newly established enterprise, the equity shall be determined according to the actual contributed charter capital as prescribed by law.
In which case it is not necessary to establish Real Estate Trading but still buy and sell real estate in Vietnam?
Pursuant to Article 5 of Decree 02/2022/ND-CP on this content as follows:
Article 5. Organizations, households and individuals that sell, transfer, lease, lease-purchase real estate on a small scale and discontinuing operations
Organizations, households and individuals that sell, transfer, lease, lease-purchase real estate specified in Clause 2, Article 10 of the Law on real estate trading and are not required to meet the eligibility criteria specified in Article 4 of this Decree include:
1. Agencies and organizations that sell houses and construction works, transfer land use rights due to bankruptcy, dissolution, or division in accordance with law.
2. Agencies or organizations that sell, transfer, lease, lease-purchase real estate as public property in accordance with law.
3. Credit institutions, foreign bank branches, Asset Management Company (AMCs), Vietnam Asset Management Company (VAMCs) that sell houses, construction works, transfer land use rights, transfer real estate projects which are put up as guarantee or collateral for debt recovery in accordance with law.
4. Organizations, households and individuals that sell houses, construction works, transfer land use rights under decisions of courts or competent authorities when settling disputes, complaints, and whistleblowing reports.
5. Organizations, households and individuals that sell, lease, lease-purchase houses and construction works under lawful ownership, transfer, lease or sublease land use rights under their lawful land use rights.
6. Organizations, households, and individuals that sell, lease, lease-purchase or transfer real estate that is invested and constructed by themselves and this real estate is not for being put on market in accordance with the law.
Accordingly, 06 subjects are not required to establish an enterprise when doing Real Estate Trading, including:
- Agencies and organizations that sell houses and construction works, transfer land use rights due to bankruptcy, dissolution, or division in accordance with law.
- Agencies or organizations that sell, transfer, lease, lease-purchase real estate as public property in accordance with law.
- Credit institutions, foreign bank branches, Asset Management Company (AMCs), Vietnam Asset Management Company (VAMCs) that sell houses, construction works, transfer land use rights, transfer real estate projects which are put up as guarantee or collateral for debt recovery in accordance with law.
- Organizations, households and individuals that sell houses, construction works, transfer land use rights under decisions of courts or competent authorities when settling disputes, complaints, and whistleblowing reports.
- Organizations, households and individuals that sell, lease, lease-purchase houses and construction works under lawful ownership, transfer, lease or sublease land use rights under their lawful land use rights.
- Organizations, households, and individuals that sell, lease, lease-purchase or transfer real estate that is invested and constructed by themselves and this real estate is not for being put on market in accordance with the law.
Note: The above 06 subjects are not required to establish a Real Estate Trading enterprise only in case of sale, transfer, lease, lease and purchase of small-scale and infrequent real estate.
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