Guidance on support for stabilizing production and business upon land expropriation by the State in Vietnam from August 1, 2024

Guidance on support for stabilizing production and business upon land expropriation by the State in Vietnam from August 1, 2024 (Image from the internet)

On July 15, 2024, Hanoi issued Decree 88/2024/ND-CP regulating recompense, support and resettlement upon land expropriation by the State in Vietnam.

Guidance on support for stabilizing production and business upon land expropriation by the State in Vietnam from August 1, 2024

Article 20 of Decree 88/2024/ND-CP regulates support for stabilizing production and business upon land expropriation by the State in Vietnam as stipulated in Point b, Clause 1, Article 108 of the Land Law 2024 and is implemented as follows:

* Subjects Eligible for Support to Stabilize Production and Business

- Economic organizations, households, individuals producing and doing business, and foreign-invested economic organizations whose production and business are halted and are entitled to compensation for land will receive support for stabilizing production and business;

- Households and individuals using land leased for agricultural, forestry, aquaculture, and salt production purposes, as per Clause 2, Article 19 of Decree 88/2024/ND-CP, will receive support for stabilizing production.

* Conditions for Support to Stabilize Production and Business

- Households, individuals, economic organizations, and foreign-invested economic organizations entitled to compensation for land;

- Households and individuals using land under a land lease contract, as stipulated in Clause 2, Article 19 of Decree 88/2024/ND-CP, must have a land lease contract.

* Implementation of Support for Stabilizing Production and Business

- Households and individuals whose agricultural land is recovered will be supported to stabilize production and business, including: support for crop and livestock varieties for agricultural production, agricultural encouragement services, forestry encouragement services, plant protection, veterinary services, crop and livestock technical services, and services for business production.

- Economic organizations, households, individuals producing and doing business, and foreign-invested economic organizations eligible under Clause 1, Article 20 of Decree 88/2024/ND-CP will receive monetary support up to 30% of one year's post-tax income, based on the average income of the last three consecutive years.

Post-tax income is determined as the income after personal income tax and corporate income tax have been paid, according to the laws governing income tax for individuals and corporate income tax.

Workers employed under labor contracts by economic organizations, households, individuals producing and doing business, and foreign-invested economic organizations eligible under Clause 1, Article 20 of Decree 88/2024/ND-CP will be subject to employment cessation policies under labor laws, with support duration not exceeding 6 months.

In the case of households and individuals using land leased for agricultural, forestry, aquaculture, and salt production purposes from state-owned farms, forestry enterprises, or agricultural companies converted from state-owned farms, agricultural production groups, or agricultural cooperatives with a land lease contract, the Provincial People's Committee will determine the appropriate support level for stabilizing production for each project.

The Provincial People's Committee will decide the support level, support duration, and periodic disbursement of support funds to suit the local situation.

More details can be found in Decree 88/2024/ND-CP, which comes into force in Vietnam from August 1, 2024.

To Quoc Trinh

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