Types of real estate trading agreement in Vietnam

Types of real estate trading agreement in Vietnam (Internet image) 

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

1. Types of real estate trading agreement in Vietnam

According to Clause 1, Article 17 of the Law on Real Estate Business 2014, types of real estate trading agreement include:

- Building sale agreement;

- Building rent agreement;

- Lease purchase agreement;

- Land transfer, lease, and sublease agreement;

- Agreement on transfer of all or a portion of real estate project.

2. Eligibility criteria for organizations and individuals to conduct real estate trading in Vietnam

According to Article 4 of Decree 02/2022/ND-CP, eligibility criteria for organizations and individuals to conduct real estate trading are as follows:

- Organizations and individuals shall meet the following criteria to conduct real estate trading:

+ They must establish an enterprise in accordance with the law on enterprises or a cooperative in accordance with the law on cooperatives, with a line of business in relation to real estate trading (hereinafter referred to as enterprise);

+ They must publicize on the enterprise's website, at the head office of the project management board (for projects on real estate trading and investment), at the real estate exchange (for the case of business through the real estate exchange) information about the enterprise (including name, address of head office, contact phone number, name of the legal representative), information about real estate to be put on market as prescribed in Clause 2, Article 6 of the Law on real estate trading 2014, information on mortgage of houses, construction works, real estate projects to be put on market (if any), information on the number, type of real estate products being traded, quantity and types of real estate products sold, transferred, lease-purchased and the quantity and types of remaining products that are still being traded.

If any information that has been publicly at this point changes later, it must be promptly updated upon the change;

+ Trading of eligible real estate as prescribed in Article 9, Article 55 of the Law on real estate trading 2014.

- In case an investor is selected as the investor of a real estate project according to law, such investor must have an equity of not less than 20% of the total investment capital for the project with a land use scale of less than 20 hectares, not less than 15% of the total investment capital, for the project with a land use scale of 20 hectares or more. In performing real estate trading, the project investor must meet the eligibility criteria specified in Clause 1 of Article 4 of Decree 02/2022/ND-CP.

The equity specified in this Clause is determined based on the results of the most recent audited financial statements or the results of independent audit reports of the operating enterprise (made in the year or preceding year); in case of a newly established enterprise, the equity shall be determined according to the actual contributed charter capital as prescribed by law.

3. Rules for real estate trading in Vietnam

Pursuant to Article 4 of the Law on real estate trading 2014, the rules for real estate tradings are as follows:

- Contracting parties have equality before the law; freedom to conclude a contract on the basis of respect for their legitimate rights and interests provided that such agreement is not in contravention of law.

- Real estate to be put on the market must meet all the requirements prescribed in the Law on real estate trading 2014.

- The real estate trading must be conducted honestly, publicly and transparently.

- Any organization or individual is entitled to conduct real estate trading in the area beyond national defense and security protection zone according to land-use planning approved by competent agencies.

Ho Quoc Tuan

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