Question:
According to Vietnamese regulations regarding investment projects related to land and real estate development and business, are there any limits on the ownership ratio of foreign investors? If so, could you please provide the legal basis and the methods for the Company to ensure the controlling rights of the Investor (CĐT) over the joint venture company (with the capital contribution being 95% from the Investor and 5% from the Company)?
Answer:
1.1. Foreign ownership ratios in Joint venture real estate development projects
Based on Article 28.1.k of the Land Law, foreign investors are allowed to lease land from the state.
According to Article 10.3.b of the Real Estate Business Law, foreign investors are permitted to invest in the construction of technical infrastructure in real estate projects to transfer, lease, or sub-lease land use rights that already have technical infrastructure.
Therefore, it can be understood that there are no restrictions on the ratio of foreign investors in investment projects for constructing technical infrastructure within industrial clusters.
1.2. Mechanisms to ensure the controlling rights of the Investor in the joint venture
Essentially, with the ownership ratio being 95% from the Investor and 5% from the Company, it is ensured that the Investor has full decision-making authority over all matters within the joint venture company.
