Cases that are considered failing auction in Vietnam

Cases that are considered failing auction in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. What is property auction?

Property auction means a method of selling property involving two or more bidders according to the order and procedures prescribed in the Law on Property Auction 2016, except the case specified in Article 49 of the Law on Property Auction 2016.

(Clause 2, Article 5 of the Law on Property Auction 2016)

2. Cases that are considered failing auction in Vietnam

Specifically, in 1 Article 52 of the Law on Property Auction 2016, an auction shall be considered failing in the following cases:

- No one registers for participation in the auction though the time limit for registration has expired;

- At the auction, no one offers a bid or no one accepts the set price;

- The offered highest bid is lower than the reserve price in case such price is not publicized and an ascending-price auction is conducted;

- The winning bidder refuses to sign the auction minutes as prescribed in Clause 3, Article 44 of the Law on Property Auction 2016;

- The person who has offered a bid withdraws such bid, or the person who has accepted the set price withdraws such price as prescribed in Article 50 of the Law on Property Auction 2016 while no one else offers another bid;

- The case of rejection of the bid winning results prescribed in Article 51 of the Law on Property Auction 2016;

- Only one person registers for participation in the auction though the time limit for registration has expired, in case of property auction prescribed in Article 59 of the Law on Property Auction 2016.

3. What are the types of property required by law to be sold through auction in Vietnam?

Property required by law to be sold through auction, including:

- State property as defined by the law on management and use of state property;

- Property over which ownership by the entire people is established in accordance with law;

- Property being land use rights as defined by the land law;

- Collateral as defined by the law on secured transactions;

- Property for judgment enforcement as defined by the law on enforcement of civil judgments;

- Property being exhibits or means used in administrative violations which are forfeited into the public funds, property distrained to secure the execution of administrative sanctioning decisions in accordance with the law on handling of administrative violations;

- Property being national reserve goods as defined by the law on national reserves;

- Fixed assets of enterprises as defined by the law on management and use of state capital invested in production and business at enterprises;

- Property of enterprises and cooperatives declared bankrupt in accordance with the law on bankruptcy;

- Property being road infrastructure facilities and the right to collect charges for use of road infrastructure facilities in accordance with the law on management, use and operation of road infrastructure facilities;

- Property being the mining right in accordance with the mineral law;

- Property being the right to use or own planted production forests in accordance with the law on forest protection and development;

- Property being the right to use radio frequencies in accordance with the law on radio frequencies;

- Property being non-performing loans and collateral for such non-performing loans of the wholly state-owned organization established by the Government to settle non-performing loans of credit institutions in accordance with law;

- Other property required by law to be sold through auction.

(Clause 1, Article 4 of the Law on Property Auction 2016)

4. What are rules of an auction in Vietnam?

According to Clause 2, Article 34 of the Law on Property Auction 2016, rules of an auction must have the following principal contents:

- Name of property or list of property items, quantity and quality of the auctioned property; place where the auctioned property is located; and documents of title proving the ownership or use right over the auctioned property;

- Time and venue for checking the auctioned property;

- Time and venue for selling auction dossiers;

- Reserve price of the auctioned property, in case such price is publicized;

- Money amount paid for buying auction dossiers, and advance payment;

- Time, venue, conditions and method of registration for participation in auction;

- Time and venue for holding the auction;

- Form and method of auction;

- Cases of deprival of the right to participate in auction, and cases ineligible for refund of advance payment.

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