Cases in which bidder is not entitled to advance payment refund in Vietnam

Hello, Lawnet would like to answer the following:

1. Cases in which bidder is not entitled to advance payment refund in Vietnam

Specifically, in Clause 6, Article 39 of the Law on Property Auction 2016, the bidder is not entitled to advance payment refund in the following cases:

- He/she has made the advance payment but fails to participate in the auction or price announcement session not due to a force majeure event;

- He/she is deprived of the right to participate in the auction for one of the violations prescribed in Clause 5, Article 9 of the Law on Property Auction 2016;

- He/she refuses to sign the auction minutes under Clause 3, Article 44 of the Law on Property Auction 2016;

- He/she withdraws the offered bid or accepted price under Article 50 of the Law on Property Auction 2016;

- He/she rejects the auction winning result under Article 51 of the Law on Property Auction 2016.

2. Those who may not register for participation in an auction in Vietnam

Pursuant to Clause 4, Article 38 of the Law on Property Auction 2016, the following persons may not register for participation in an auction:

- A person having no civil act capacity, person having lost his/her civil act capacity or having his/her civil act capacity restricted, person having difficulties in cognition or behavior control, or person having no cognition or behavior control ability at the time of registration for participation in auction;

- A person working in the property auction organization that conducts the auction; parent, spouse, child or blood sibling of the auctioneer; person directly engaged in property appraisal or valuation; or parent, spouse, child or blood sibling of the person directly engaged in property appraisal or valuation;

- A person authorized by the property owner to realize property, person entitled to decide on the sale of property, person signing the property auction service contract, or person entitled to decide on the sale of others’ property in accordance with law;

- A parent, spouse, child or blood sibling of the person defined at Point c of Clause 4, Article 38 of the Law on Property Auction 2016;

- A person not entitled to buy the auctioned property under regulations applicable to such kind of property.

3. Auction forms and methods in Vietnam

Auction forms and methods are specified in Article 40 of the Law on Property Auction 2016 as follows:

- A property auction organization shall reach agreement with a property seller on selecting one of the following auction forms:

+ Oral auction;

+ Casting bid tickets directly at an auction;

+ Delivering sealed bid tickets;

+ Online auction.

- Auction methods include:

+ Ascending-price auction;

+ Descending-price auction.

- Auction forms and methods shall be stated in the rules of an auction and notified to bidders.

- The Government shall detail Point d, Clause 1 of Article 40 of the Law on Property Auction 2016.

4. Grounds for canceling the property auction service contract

According to Clause 6, Article 33 of the Law on Property Auction 2016, the property seller may cancel the property auction service contract when having one of the following grounds:

- The auction is held by an organization without the property auction function or conducted by an individual other than an auctioneer, unless it is held by a property auction council;

- The property auction organization intentionally allows an unqualified person to participate in an auction who later becomes the winning bidder;

- The property auction organization commits one of the following acts: failing to publicly display information on property auction; failing to disclose information on property auction; improperly implementing regulations on the sale of auction dossiers or organizations registering for participation in auction; or impeding or restricting bidders from registering for participation in auction;

- The property auction organization colludes or is in cahoots with bidders during the auction, thus falsifying information on the auctioned property, auction dossier or property auction results;

- The property auction organization holds an auction at variance with regulations on auction forms and methods according to the rules of the auction, thus falsifying the property auction results.

Best regards!

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