Land will be reclaimed if not used, Hanoi issues ultimatum to FLC Group

Four land plots in Hanoi’s Nam Tu Liem district owned by scandal-hit developer FLC Group will be revoked if they remain unused, said the municipal People’s Committee in its ultimatum to the group.

The plots, namely CT1, CT2, LK1.2, and NT, are part of the ĐM1 urban area project in Dai Mo ward, which has been delayed for years.

The committee has issued a decision granting a 24-month extension for FLC to use the land. In the meantime, it must fulfill its financial obligations, including land use fees and rental payments for the four plots in line with legal regulations.

If FLC fails to develop the land plots within the extended period, authorities will reclaim them without compensation for any infrastructure or investments made on them, according to the decision.

Local authorities, including the Tax Department, the Department of Natural Resources and Environment, and Nam Tu Liem district, have been tasked with overseeing the fulfilment of the financial obligations and ensuring that FLC meets its commitments. If the project remains stalled, they will submit a report to the city People's Committee for further action.

FLC was originally a law office founded by Trinh Van Quyet in 2001. After 10 years of development, the firm was officially named FLC Group and listed on the stock exchange.

FLC took resort real estate as its core and then developed into an ecosystem covering many segments such as real estate, aviation, education, high-tech agriculture, medicine and pharmacies, construction, and mining.

In 2021, as chairman, Quyet revealed his ambition to develop up to 400 large-scale multi-utility real estate projects, forming closed ecosystems in potential areas, unexploited or little exploited. He also aimed to turn Bamboo Airways into a fully digitized airline occupying 30% of the domestic aviation market share with a fleet of at least 50 aircraft.

However, after his illegal sale of 74.8 million FLC shares on January 10, 2022, Quyet found himself in the sights of the authorities. In March 2022, the Ministry of Public Security launched legal proceedings against and detained Quyet to investigate stock manipulation and concealing information on stock activities, causing serious damage to investors and affecting market operations.

Investigators also said that Quyet and his accomplices carried out procedures to fraudulently increase the charter capital of Faros Construction JSC (ROS) from VND1.5 billion to VND4.3 trillion ($169.4 million) to appropriate more than VND3.62 trillion from investors.

Since its chairman got into trouble, FLC Group has been in a deadlock and has struggled to restructure. By mid-2024, its total assets had fallen 40% to an estimated VND21 trillion ($827.4 million).

A series of its projects have been revoked in localities nationwide, such as Thanh Hoa, Thai Binh, Quang Ngai, Hoa Binh, Binh Phuoc and Kon Tum. Meanwhile, some others have stagnated or been suspended.