Lease term and lease term extension with the management and business organization in Vietnam from October 15, 2024

Lease term and lease term extension with the management and business organization in Vietnam from October 15, 2024

To be specific, Article 12 of Decree 108/2024/ND-CP stipulates the lease term and lease term extension in Vietnam as follows:

(1) The maximum house rental duration is 05 years. In case of house rental for house and land specified in point b, clause 1, Article 1 of Decree 108/2024/ND-CP under the provisions of the law, the maximum house rental duration is 03 years.

In case of extending the house rental duration as specified in (2), the extension duration shall not exceed the previous rental duration.

(2) Extension of house rental duration

- The extension of house rental duration is applied in case the organization or individual renting the house wishes to continue renting while having used the house and land for the right rental purpose, and has fully and timely paid the house rent and other obligations as per the Contract signed with the house management and business organization. It is not required to perform auction or price listing procedures when extending the house rental duration.

In case the State needs to use the house and land being rented for other purposes or allocates them to agencies, organizations, and units as specified in clause 2, Article 20 of Decree 108/2024/ND-CP for temporary use or handling according to the provisions of the law, the rental duration will not be extended.

- At least 03 months before the rental contract expires, the organization or individual renting the house wishing to extend must send a written request to the house management and business organization.

For rental contracts with a duration of fewer than 03 months, at least 01 month before the rental contract expires, the organization or individual renting the house wishing to extend must send a written request to the house management and business organization.

- Within 15 days from the date of receiving the extension request from the organization or individual renting, the house management and business organization shall consider and decide on the extension or non-extension of the house rental duration and notify the extending organization or individual accordingly.

- In case the house rental duration is extended, the house management and business organization and the organization or individual granted the extension shall sign an Appendix to the House Rental Contract. The house rent will be determined according to the House Rental Price List (including adjustments if the land price issued by the Provincial People's Committee under the provisions of the land law for the property with the house being rented changes) applicable at the time of extension.

More details can be found in Decree 108/2024/ND-CP which takes effect in Vietnam from October 15, 2024.

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