Regulations on the transfer of land use rights for foreign-invested enterprises

The land use right is a fundamental right of land users. Land users are allowed to transfer or donate their land use rights. How is the transfer of land use rights for foreign-invested enterprises regulated? In this article, NPLaw will analyze some regulations regarding this considerable issue. 

I. Current status of the transfer of land use rights for foreign-invested enterprises

Economic organizations are important land users in the State's land policy and law, especially foreign-invested economic organizations. In land policy and law for foreign-invested enterprises, the transfer of land use rights is one of the significant concerns for enterprises as it directly affects their land uses.

II. Legal regulations related to the transfer of land use rights for foreign-invested enterprises

1. Definition of the transfer of land use rights for foreign-invested enterprises

Pursuant to Point b, Clause 2, Article 185 of the Land Law 2013, foreign-invested enterprises that use land in industrial zones, industrial clusters, export processing zones, high-tech zones, and economic zones paying land lease fee or land sublease fee once have the rights prescribed in Article 174, including the right to transfer land use rights and properties attached to land owned by them. 

In essence, it means the transfer of land use rights of a foreign-invested enterprise, where its members or shareholders transfer land use rights of the enterprise to another subject. 

You are reading information about transfer of land use right by foreign-invested enterprises that is currently of interest.

2. Dossier for the transfer of land use rights for foreign-invested enterprises

A dossier for land use right transfer for foreign-invested enterprises includes:

+ Application for the fluctuation of land and properties attached to land;

+ Approval for the transfer of land use rights and properties attached to land;

+ Land use right certificate;

+ Extract of the cadastral map (or known as cadastral surveying data of the land plot);

+ Business registration certificates of the transferee and transferor;

+ Minutes of the meeting, resolution or decision of the enterprise.

+ Transfer contract.

In specific cases, the competent state authorities may request additional documents and materials related to the transfer in accordance with the specific regulations of each region or locality.

3. Procedures for the transfer of land use rights for foreign-invested enterprises

Step 1: Preparing a complete dossier in accordance with legal regulations

Step 2: Submitting the dossier to the Land Registration Office

Step 3: The Land Registration Office shall consider the dossier

- If the dossier is valid, they shall send information to the tax authorities to determine and notify financial obligations in cases where financial obligations must be fulfilled.

- If the dossier is invalid, they will request amendment and supplement for additional information to complete it.

Step 4: Returning the results.

- Adjusting and updating the changed information in the cadastral dossier.

- Confirming the changed content on the Certificate or issuing the Certificate to the land user in accordance with regulations.

III. Questions related to the transfer of land use rights for foreign-invested enterprises

1. Can foreign-invested enterprises transfer land use rights for the purpose of setting up a headquarters?

Pursuant to Clause 2, Article 14 of the Law on Real Estate Business 2014, overseas Vietnamese and foreign-invested enterprises may purchase or lease houses and construction works for use as offices, production facilities, businesses and services in accordance with the proper function of such houses and construction works.

In addition, foreign-invested enterprises have the right to use land in the following cases:

- Land lease from the State; Land lease and sublease from economic organizations or overseas Vietnamese; or Sublease of land attached to the infrastructure of foreign-invested enterprises.

- Foreign-invested enterprises are entitled to receive the transfer of investment capital, which is the value of land use rights of enterprises using land with the origin of land allocated by the State with land use fee collection or land lease paid once, has been capitalized into the enterprise's capital, except for the case of transferring investment capital as the value of agricultural land and forestry land use rights.

Thus, if a foreign-invested enterprise wants to set up its headquarters, the enterprise must purchase or lease houses and construction works for use as its office or receive land use rights through the above cases.

2. How long will foreign-invested enterprises own the transferred land use rights?

Pursuant to Clause 3, Article 126 of the Land Law 2013, the term of land transfer and lease for foreign-invested enterprises to implement projects in Vietnam is as follows:

- The term of land transfer and lease shall be considered and decided on the basis of the investment project or application for land transfer and lease but not exceeding 50 years.

- For large investment projects with slow capital recovery, projects invested in areas with difficult socio-economic conditions and areas with particularly difficult socio-economic conditions requiring a longer term, the term of land transfer and lease shall not exceed 70 years.

- For housing projects that are sale or sale in combination with lease or lease, the term of land transfer shall be determined according to the term of the project; besides, purchasers of houses attached to land use rights shall be entitled to use land for long-term stability.

Thus, the term of land use of foreign-invested enterprises is considered based on the investment projects according to the above regulations.

3. Can foreign-invested enterprises transfer land use rights for agricultural land?

Pursuant to Clause 1, Article 133 of the Land Law 2013, Economic organizations, overseas Vietnamese and foreign-invested enterprises that need to use land for agricultural production, forestry, aquaculture and salt production shall be considered by the State for land lease to implement investment projects.

Besides, based on Article 183 of the Land Law 2013, foreign-invested enterprises that need to use land for agricultural production shall be considered by the State for land lease to implement investment projects.

4. Can foreign-invested enterprises receive land use rights as a gift?

Pursuant to Clause 1, Article 191 of the Land Law 2013 on cases where land use rights cannot be transferred or donated: Organizations, households, individuals, communities, religious establishments, overseas Vietnamese and foreign-invested enterprises shall not be entitled to transfer or donate land use rights in cases where the law does not allow the transfer or donation of land use rights.

Thus, foreign-invested enterprises are not entitled to receive land use rights as a gift in cases where the law does not allow the donation of land use rights.

IV. Legal consulting services related to land use right transfer for foreign-invested enterprises

The above is the article by NPLaw analyzing some regulations on land use right transfer for foreign-invested enterprises. With a team of experienced lawyers and legal experts, NPLaw provides reputable and professional legal services to ensure the rights and legitimate interests of our Clients.