Increase land compensation prices in Vietnam from January 1, 2026

Increase land compensation prices in Vietnam from January 1, 2026​ (Image from the Internet)

Conditions for compensation when the State recovers land in Vietnam

Under Clause 2, Article 95 of the Land Law 2024, subjects specified in Clause 1, Article 95 of the Land Law 2024 shall be compensated for land when meeting one of the following conditions:

- Possession of a Certificate of Land Use Rights or a Certificate of House Ownership and Homestead Land Use Rights or a Certificate of Land Use Rights, House Ownership and Other Assets Attached to Land or a Certificate of Land Use Rights, Ownership of Property Attached to Land;

- Possession of a land allocation decision or a land lease decision or a decision permitting the change of land use purpose by a competent state agency;

- Possession of one of the documents on land use rights as a basis for granting a Certificate of Land Use Rights, Ownership of Property Attached to Land according to Article 137 of the Land Law 2024;

- Receiving the transfer of land use rights according to legal regulations from a person with legitimate land use rights but has not completed land registration procedures;

- Utilization of land according to an agreement in a mortgage contract to settle debts; a document recognizing the results of an auction of land use rights where the auction winner has fulfilled financial obligations as prescribed by law.

Increase land compensation prices in Vietnam from January 1, 2026

Based on Point e, Clause 1, Article 160 of the Land Law 2024, the compensation amount when the State recovers land is calculated based on specific land prices.

Simultaneously, according to Article 30 of Decree 71/2024/ND-CP, specific land pricing is implemented based on Article 158 of the Land Law 2024 and Articles 4, 5, 6, 7 of Decree 71/2024/ND-CP; alongside the results of aggregating and analyzing information about market land prices; and factors affecting land prices.

To be specific, under Point d, Clause 6, Article 158 of the Land Law 2024, the land price adjustment coefficient method is applied to determine specific compensation pricing when the State recovers land in cases where multiple adjacent parcels with the same usage purpose, which are already priced in the land pricing table yet not qualified for comparison method application.

Under Clause 5, Article 7 of Decree 71/2024/ND-CP, specific land prices are determined by the land price adjustment coefficient method as follows:

Land price of the parcel to be priced (per m2) = Land price in the price table of the parcel to be priced x Land price adjustment coefficient

In which, the land price in the land price table will be constructed according to the area, and position, and submitted to the same-level People's Council to decide on the initial land pricing table to be announced and applied from January 1, 2026. Annually, the provincial People's Committee is responsible for submitting to the provincial People's Council to decide on adjusting, amending, and supplementing the land pricing table for announcement and application from January 1 of the following year.

The adjustment of the land price table will approach market land prices, wherein land compensation is calculated based on specific land prices (including the method of land price adjustment coefficient according to the land pricing table). Hence, from January 1, 2026, depending on the area, the market land price will affect the land compensation price, which may be higher than currently unless compensated by renting land with a one-time payment for the entire lease period wherein the land price calculating land rent will be specific land price decided by the competent provincial People's Committee at the time of approval.

Deadline for compensation payment when the State recovers land in Vietnam

Under Clause 3, Article 94 of the Land Law 2024, regulations regarding the payment of compensation, support, and resettlement are implemented as follows:

- Within 30 days from the effective date of the decision approving the compensation, support, and resettlement plan, the agency, unit, or organization responsible for compensation must pay compensation, support money to the land-recovered individuals or asset owners;

- If the agency, unit, or organization responsible for compensation delays payment, in addition to compensation, support in accordance with the approved plan by the competent authority, the land-recovered individuals or asset owners shall also receive an additional amount equivalent to the late payment interest as prescribed by the Tax Administration Law 2019 calculated on the delayed payment and the delayed duration.

The competent authority for approving the compensation, support, and resettlement plan is responsible for approving the delayed compensation payment plan for land-recovered individuals or asset owners. The budget for delayed compensation payments is arranged from the budget of the level approving the compensation, support, and resettlement plan.

Thus, according to the above regulations, within 30 days from the effective date of the decision approving the compensation, support, and resettlement plan, the agency, unit, or organization responsible for compensation must pay compensation, support money to the land-recovered individuals or asset owners.

If the payment is made after the 30-day period, the agency, unit, or organization responsible for compensation must additionally pay an amount equivalent to the late payment interest as prescribed by the Tax Administration Law 2019 calculated on the delayed payment and the delayed duration.

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