Notable documents of Vietnam in the previous week (from February 19 to February 25, 2024)

Notable documents of Vietnam in the previous week (from February 19 to February 25, 2024)
Trần Thanh Rin

Land pricing methods from January 1, 2024; road map for gradually decreasing credit extension limits from July 1, 2024; etc., are notable documents that will be covered in this bulletin.

1. Land pricing methods from January 1, 2024 in Vietnam 

On January 18, 2024, at the 5th irregular meeting session, the 15th National Assembly of Vietnam approved the Land Law 2024, replacing the Land Law 2013, which stipulates land pricing methods from January 1, 2024. 

Specifically, land pricing methods according to the Land Law 2024 include: 

(1) Comparison method, carried out by adjusting prices of land plots with similar or identical purposes regarding elements affecting the prices of land transferred on the market or subject to a winning bid for land use rights that the winning bidder has fulfilled financial obligations according to the bid-winning decision through the analysis and comparison of elements affecting land prices after excluding the value of property on land (if any) to determine the price of the land plot subject to pricing; 

(2) Income-based method, carried out by dividing the annual net income per land area by the average savings deposit interest rate of deposits in Vietnam Dong with a 12-month term at commercial banks with 50% of their charter capital owned by the State or the total number of shares with voting rights in a provincial area of 3 consecutive years before the latest quarter with data available before the land pricing;  

(3) Surplus-based method, carried out by subtracting the estimated development cost from the estimated total development revenue of a land plot based on the basis of using land with the highest efficiency (land use coefficient, building density, maximum number of floors of works) according to the land use planning and detailed construction planning approved by a competent authority;

 (4) Method using land price coefficient (coefficient method), carried out by multiplying a land price in the land price list by the land price coefficient. The land price coefficient is determined by comparing land prices in the land price list with the land prices on the market;

(5) The Government of Vietnam shall stipulate other land pricing methods not prescribed in (1), (2), (3), and (4) with the consent of the Standing Committee of the National Assembly of Vietnam. 

See more details in the Land Law 2024, effective as of January 1, 2025. Article 190 and Article 248 of the Land Law 2024 shall come into force as of April 1, 2024, and Clause 9 Article 60 of the Land Law 2024 shall come into force as of the expiry date of Resolution No. 61/2022/QH15.

2. Vietnam’s road map for gradually decreasing credit extension limits from July 1, 2024 

On January 18, 2024, at the 5th irregular meeting session, the 15th National Assembly of Vietnam approved the Law on Credit Institutions 2024, which contains the road map for gradually decreasing credit extension limits. 

Specifically, the total outstanding credit of a commercial bank, cooperative bank, foreign bank branch, people's credit fund, or microfinance institution extended to a single client or a single client and a relevant person of such a client shall not exceed: 

- 14% of its own capital regarding a single client or 23% of its own capital regarding a single client and a relevant person of such a client from the effective date of the Law on Credit Institutions 2024 to before January 1, 2026;

- 13% of its own capital regarding a single client or 21% of its own capital regarding a single client and a relevant person of such a client from January 1, 2026 to before January 1, 2027;  

- 12% of its own capital regarding a single client or 19% of its own capital regarding a single client and a relevant person of such a client from January 1, 2027 to before January 1, 2028;  

- 11% of its own capital regarding a single client or 17% of its own capital regarding a single client and a relevant person of such a client from January 1, 2028 to before January 1, 2029;  

- 10% of its own capital regarding a single client or 15% of its own capital regarding a single client and a relevant person of such a client from January 1, 2029.  

The Law on Credit Institutions 2024 comes into force as of July 1, 2024, excluding Clause 3 Article 200 and Clause 15 Article 210 of the Law on Credit Institutions 2024, which come into force as of January 1, 2025. 

3. Vietnam’s guidelines on bid opening for online contractor selection

This is a content of Circular No. 01/2024/TT-BKHDT dated February 15, 2024 on guidelines on the supply and disclosure of information on the selection of contractors and bidding documents on the Vietnam National E-Procurement System (VNEPS) promulgated by the Minister of Planning and Investment of Vietnam. 

According to the Circular, guidelines on the bid opening for online contractor selection are as follows:  

(1) Regarding a procurement package applying the single-stage one-envelope procedure: 

The procuring entity shall carry out the bid opening and disclose the bid opening record on the System within 2 hours after the deadline for submission of bids. 

(2) Regarding a procurement package applying the single-stage two-envelope procedure: 

- The procuring entity shall open E-Technical Proposals and disclose the E-Technical Proposal opening record on the System within 2 hours from the deadline for submission of bids; 

- After the issuance of a decision on approval of the list of contractors meeting technical requirements, the procuring entity shall disclose such a list on the System, enclosed with a scanned copy of the document approving the list of contractors meeting technical requirements on the System. After a successful disclosure, the System shall send notifications to contractors participating in the procurement package;  

- After disclosing the list of contractors meeting technical requirements, the procuring entity shall open E-Technical Proposals of contractors included in the mentioned list and disclose the E-Technical Proposal opening record on the System. 

Circular No. 01/2024/TT-BKHDT comes into force as of February 15, 2024. 

4. Vietnam's guidelines on collection of tuition fees for 2023-2024 academic year at public educational institutions 

On February 21, 2024, the Ministry of Education and Training of Vietnam promulgated Official Dispatch No. 673/BGDDT-KHTC 2024 on the implementation of Decree No. 97/2023/ND-CP.

According to the Official Dispatch, for consistent implementation, the Ministry of Education and Training of Vietnam, based on the suggestions from the Ministry of Labor - War Invalids and Social Affairs of Vietnam and the Ministry of Finance of Vietnam, requests public educational institutions to collect tuition fees for the 2023-2024 academic year in compliance with Decree No. 97/2023/ND-CP.

Specifically: 

- Public higher education and vocational education institutions that have disclosed the tuition fees for the 2023-2024 academic year higher than the top tuition limit prescribed in Decree No. 97/2023/ND-CP shall adjust such tuition fees in compliance with Decree No. 97/2023/ND-CP; the differences collected by educational institutions shall be refunded to learners or deducted in the next tuition fee collection. The mentioned educational institutions shall carry out the mentioned work publicly for learners and society, ensuring consensus on and consistency of the implementation. 

- Regarding public preschool education and general education institutions 

If provincial People’s Committees and educational institutions have issued the tuition range or tuition fees for the 2023-2024 academic year with increased tuition fees compared to the 2021-2022 academic year, local budgets shall cover the increased amount compared to the tuition fees for the 2021-2022 academic year. The rate of support for each educational institution shall be decided by local authorities.

If local budgets do not cover the increased amount compared to the tuition fees for the 2021-2022 academic year, make adjustments following Decree No. 97/2023/ND-CP. The differences collected by educational institutions shall be refunded to learners or deducted in the next tuition fee collection.

- Regarding regulations not amended by Decree No. 97/2023/ND-CP, continue to comply with Decree No. 81/2021/ND-CP.

See more details in Official Dispatch No. 673/BGDDT-KHTC dated February 21, 2024. 

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