What are the requirements for establishing a real estate brokerage company in Vietnam? What is the penalty for provision of immovable property trading service without a real estate license?
What is a real estate brokerage in Vietnam?
Pursuant to Clause 2, Article 3 of the 2014 Law on Real Estate Trading of Vietnam, the definition of real estate brokerage in Vietnam is as follows:
“Article 3. Interpretation of terms
For the purposes of this Law, these terms below shall be construed as follows:
…
2. Real estate brokerage means acts as an intermediary between parties in real estate sale, transfer, lease, sublease, lease purchase transactions.”
Real estate brokers will perform tasks such as:
+ Provide real estate information, assist parties in negotiating, concluding contracts in real estate sale, transfer, lease, etc.
+ An authorized representative to perform tasks related to the procedures real estate sale, transfer, lease, sublease, lease purchase transactions.;...
Thus, individuals and organizations establish real estate brokerage companies to provide real estate brokerage services.
What are the requirements for establishing a real estate brokerage company in Vietnam? (Image from the Internet)
What are the requirements for establishing a real estate brokerage company in Vietnam?
The requirements for establishing a real estate brokerage company in Vietnam are specified in Article 62 of the 2014 Law on Real Estate Trading of Vietnam as follows:
“Article 62. Requirements for real estate brokerage service providers
1. Any real estate brokerage service providers must set up the enterprise and there are at least 2 employees obtaining real estate broker license (hereinafter referred to as broker license), excluding cases prescribed in Clause 2 of this Article.
2. Any individual is entitled to provide real estate brokerage services independently provided that he obtains a broker license and pay taxes as prescribed in law on taxation.
3. Any real estate service provider is not entitled to be both a broker and a contracting party in a real estate transaction.”
According to this law, organizations and individuals that want to establish a company providing real estate brokerage services must satisfy the following requirements:
+ Any real estate brokerage service providers must set up the enterprise and there are at least 2 employees obtaining real estate broker license (hereinafter referred to as broker license), excluding cases prescribed in Clause 2 of this Article.
+ Any individual is entitled to provide real estate brokerage services independently provided that he obtains a broker license and pay taxes as prescribed in law on taxation.
+ Any real estate service provider is not entitled to be both a broker and a contracting party in a real estate transaction.
What is the penalty for provision of immovable property trading service without a real estate license?
Based on the provisions of Article 59 of Decree 16/2022/ND-CP of Vietnam stipulating violations of regulations on provision of immovable property trading service as follows:
“Article 59. Violation of regulation on provision of immovable property trading service
1. A fine ranging from VND 40.000.000 to VND 60.000.000 shall be imposed on:
a) Providing independent immovable property trading services without an effective real estate license as per the law;
b) Erasing or fabricating or otherwise altering the real estate license;
c) Leasing, lending, borrowing, or renting real estate license in order to engage in activities relating to immovable property trading;
d) Acting as both the brokers and the parties executing the contract in an immovable property trade.
2. A fine ranging from VND 120.000.000 to VND 160.000.000 shall be imposed on:
a) Providing immovable property trading service without establishing enterprises as per the law or not having sufficient number of employees having effective real estate license;
b) Failing to produce physical copies of immovable property trading contracts which contain all primary details as per the law;
c) Immovable property trading broker service providers, immovable property trading platform service providers, or individuals engaging in independent immovable property trading service provision which fail to fulfill reporting policies as per the law;
d) Immovable property trading platforms that do not have operating regulations or operate against the regulations approved by competent authorities or operate without name, address or change name or address without notifying the authorities;
dd) Charging immovable property trading service fees that are not regulated by the law.
3. A fine ranging from VND 200.000.000 to VND 250.000.000 shall be imposed on:
a) Listing unqualified immovable properties on immovable properties trading platforms;
b) Failing to provide truthful documents and information on the immovable properties being brokered.
4. Additional forms of penalties:
a) Suspension of real estate license for 3 to 6 months for violations under Point c Clause 1 of this Article;
b) Suspension of operation of immovable property trading platforms for 6 to 9 months for violations under Point a Clause 2 and Point a Clause 3 of this Article.
5. Remedial measures:
a) Mandated acquisition of real estate license when providing independent immovable property trading services for violations under Point a Clause 1 of this Article;
b) Mandated submission of fabricated, erased, or otherwise altered real estate license to competent authorities that issue the license for violations under Point b Clause 1 of this Article;
c) Mandated establishment of enterprises when providing immovable property trading services or mandated maintaining of sufficient number of employees issued with real estate license for violations under Point a Clause 2 of this Article;
d) Mandated production of contracts or contracts for provision of immovable property trading services containing all basic information as per the law for violations under Point b Clause 2 of this Article;
dd) Mandated compliance with reporting policies for violations under Point c Clause 2 of this Article;
e) Mandated refund of immovable property trading fees to the payers for violations under Point dd Clause 2 of this Article;
g) Mandated provision of information on immovable properties for violations under Point b Clause 3 of this Article.”
Thus, a real estate service business without a real estate license will be fined from VND 40,000,000 to VND 60,000,000.
At the same time, they are required to have a real estate license in accordance with regulations when providing independent immovable property trading services.
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