Do you want to invest in real estate business in Vietnam? So, what are the scope, conditions and procedures to conduct real estate business in accordance with Vietnamese law? LSX will help you answer the above questions as follows:
Law on real estate business 2014
Law on Investment 2020
Scope of real estate business
Pursuant to the Law on Real Estate Business 2014, foreign-invested enterprises have the following forms of real estate business:
– So, renting houses and construction works for sublease;
– For land leased by the State, it is allowed to invest in the construction of houses for lease; Invest in the construction of houses and construction works other than houses for sale, lease, or lease-purchase;
– To receive the transfer of all or part of the real estate project of the investor to build houses or construction works for sale, lease, or lease-purchase;
– For land allocated by the State, it is allowed to invest in the construction of houses for sale, lease, or lease-purchase;
– Finally, for leased land in industrial parks, industrial clusters, export processing zones, hi-tech zones and economic zones, they may invest in building houses and construction works for business according to the right land use purposes.
Conditions of real estate business
Accordingly, to the Law on Investment 2020, organizations and individuals doing real estate business must establish an enterprise in accordance with the law on enterprises or cooperatives in accordance with the law on cooperatives (hereinafter referred to as an enterprise).
Thus, organizations and individuals doing real estate business must set up enterprises or cooperatives without having to answer the legal capital requirements, except for cases where organizations, households and individuals sell, transfer, lease, lease-purchase real estate on a small scale, irregularly, they are not required to establish an enterprise but must declare and pay tax according to the provisions of law.
Procedures for setting up a real estate business
So, to make an investment in the real estate business in Vietnam, foreign investors have two options: Establishment of a foreign-invested real estate company in Vietnam; Contribute capital and buy shares capital contribution to economic organizations engaged in real estate business in Vietnam.
Establishment of a real estate trading company with foreign capital in Vietnam
Step 1: Prepare business registration documents and apply for a business registration certificate
Business establishment profile includes:
- Business registration application form;
- Charter of the company;
- List of founding shareholders and shareholders being foreign investors (for Joint stock companies); List of members (for two-member limited liability companies);
- So, the certified true copy of your identity card or citizen identification card or passport (if you are an individual); Establishment decision, business registration certificate or equivalent document; identity card or passport with written authorization for capital manager in Vietnam (if an organization) ;
- A certified copy of the issued Investment Registration Certificate;
So, place of application: Department of Planning and Investment where the enterprise’s head office is located.
Step 2: Announce the content of business registration information
So, after granting the registration certificate, the enterprise shall publicly announce on the national portal about enterprise registration; pay fees as prescribed by law.
Step 3: Seal of the Enterprise
Finally, enterprises make seals at seal-engraving establishments or seals in the form of digital signatures in accordance with the law on electronic transactions.
Contributing capital, buying shares or capital contribution to economic organizations engaged in real estate business.
This method will help investors save more time and costs because they do not have to apply for an Investment Registration Certificate. However, investors must ensure that the percentage of capital contributed by foreign investors is in accordance with regulations. If choosing this method, investors only need to carry out the procedures to register for capital contribution, buy shares, and contribute capital at the Department of Planning and Investment.
Step 1: Register to contribute capital, buy shares, and contribute capital to economic organizations. Then prepare and submit the application at the Department of Planning and Investment where the economic organization’s head office is located
Step 2: Transfer shares, contributed capital and change shareholders, members, and owners.
According to the provisions of Article 5 of Decree 02/2022/ND-CP, individuals who have houses under their ownership for other organizations or individuals are not required to establish real estate trading companies.
According to the Law on Investment 2020, the regulation on legal capital of 20 billion VND for real estate companies is removed. Therefore, there is no minimum capital requirement to establish a real estate company. However, for investment and construction companies, the capital must correspond to the value of real estate investment and business.
Finally, hope this article is useful for you to answer the question about: “ Can foreign enterprises do real estate business in Vietnam?”, please contact LSX Law firm: +84846175333 or Email: email@example.com