Land allocation, land lease, land use purpose conversion: new regulations expand opportunities for investors

A notable point in the draft Resolution on Regulations on a number of mechanisms and policies to remove difficulties and obstacles in the implementation of the Land Law of the National Assembly is that the State allows competent authorities to allocate and lease land according to project progress or according to land recovery, compensation, support and resettlement progress. This provision will help investors have land to deploy early, instead of having to wait for the entire area to be cleared before being allocated. This is an important change, helping to save time and costs, while speeding up the project commencement progress.

In addition, the draft also stipulates a number of cases of changing the purpose of using rice-growing land, special-use forest land, protective forest land, production forest land to other purposes without the approval of the Provincial People’s Council. This provision helps shorten an important procedural step, reducing dependence on the decision of the Provincial People’s Council. In addition, the draft adds cases of land allocation and land lease without auction or bidding, such as land area for payment under BT contracts or projects subject to land recovery by the State. This helps reduce procedures for selecting investors in projects with clear policies.

Notably, for projects that change investors due to dissolution, bankruptcy or transfer, the State allows the adjustment of land use term for new investors, on the condition that they must pay additional land use fees and land rent according to regulations. This mechanism contributes to handling “suspended” projects due to changes in investors, while ensuring fairness in financial obligations.

From a practical perspective, this new regulation is expected to help many projects to be implemented soon, instead of being “frozen” when the old investor encounters financial difficulties or goes bankrupt. Allowing the adjustment of land use term for investors inheriting the project will create conditions for restarting unfinished projects, thereby increasing the attractiveness of the real estate market, encouraging industrial and real estate investment capital to develop in a stable and sustainable direction. This is also a solution to limit the waste of land resources when the project is delayed for a long time.

However, investors also need to pay special attention to the accompanying legal obligations. Adjusting the land use term is not a “free incentive”, but must be accompanied by the obligation to pay additional land use fees or land rent according to regulations. In addition, other obligations regarding the environment, construction, and planning must still be fully implemented to avoid legal risks during the implementation process. When receiving a project transfer, businesses should carefully review the legal documents on land, verify the outstanding financial obligations of the previous investor and consult with professional consultants to ensure that the project is legal, transparent and safe.

Conclusion: The new regulations have opened the door to land access for businesses, creating a more flexible mechanism in the project implementation process. However, investors need to be thoroughly consulted on legal matters to take advantage of opportunities without facing legal risks later.

The above are the basic contents on land allocation, land lease, and land use purpose conversion: the new regulations expand opportunities for investors based on the legal provisions at the time of writing the article. If you need advice on the above issue or are interested in other legal services, please contact LS Law Firm immediately via Email: lslawfirm2014@gmail.com for timely support.