Question:
Please advise us the law how to settle the building/asset on the leased land after finishing the land lease contract.
Answer:
For your question in relation to the handling of assets attached to land after the expiration of land lease term, please find the hereunder for your references.
In accordance with point (d) Clause 1 Article 65 of Land Law 2013, upon the expiration of land lease term if the land lease term is not extended, the land shall be recovered by the competent State authority.
In addition, under point (dd) Clause 1 Article 48 of Law on Investment 2014, upon the land’s recovery by the State authority, the Investment project shall be terminated accordingly.
Clause 3 and 4 Article 48 of Law on Investment 2014 provide the handling of assets attached to land after the land has been recovered and the investment project has been terminated as follows:
“3. Investor shall liquidate the investment project by himself in accordance with the laws on liquidation of the assets after the termination of investment project.
- Unless being extended, the Investment project of which the land was recovered by the State and Investor has not liquidated the assets attached to land by himself within 12 months from the recovery date of the land, the State authority which issues the decisions on recovering the land shall be responsible to proceed the liquidation of assets attached to land.”
Therefore, based on above-mentioned provisions, in case the Land Lease Contract between your company and Ho Chi Minh Department of Natural Resource, Environment, Land and House is to be expired without being extended by both parties, the land shall be recovered and returned to the State. After the decision on recovering the land has been issued by Ho Chi Minh People’s Committee, within 12 months your company shall have to carry out the procedure for liquidation of assets attached to land (sale, transfer, give, donation, and etc.) by yourselves. Ending of such time limit, if your company fails to liquidate the assets attached to land, the Ho Chi Minh People’s Committee which had issued the decision on recovering land shall proceed the liquidation procedure of the assets attached to land (e.g. auction).
