New decree to beef up real estate transfer

The real estate market in Vietnam has grown more active after a gloomy period due to pandemic fallouts, boosted by supportive state policies.

Real estate investment and business are fields that have significant and vital impacts on the country’s socio-economic development. The application of Decree No.76/2015/ND-CP dated September 10, 2015 detailing the implementation of a number of articles of the Law on Real Estate Business 2014 (Decree 76) had seen a number of obstacles arising. Many regulations in the decree were no longer suitable with actual needs and reality.

On January 6, 2022, the government issued Decree No.02/2022/ND-CP detailing the implementation of a number of articles of the law (Decree 02) effective from January 1, replacing Decree 76. This article will summarize and analyze some points to note in real estate transfer activities under the new regulations.

1. Regulations on conditions for the transfer of contracts for purchase and sale or lease-purchase of future houses and for transfer of lease-purchase contracts for existing houses and constructions:

- The transfer of contracts for purchase and sale of houses, lease-purchase of houses to be formed in the future, and of lease-purchase contracts of existing houses and construction works are not applicable to social housing purchase and sale contracts. This condition is supplemented in accordance with the provisions of Article 59 of the Law on Real Estate Business 2014, as well as in line with the systematic and unified regulations guiding the transfer of purchase and sale contracts, lease-purchase for future houses, where previously Decree 76 did not have specific guidelines.

- Detailing and supplementing specific conditions for cases in which it is permitted to transfer contracts of purchase and sale, lease-purchase of houses, and construction works, including:

+ Having a sale, purchase, or hire purchase contract made according to the provisions of Article 6 of Decree 02. In case the parties signed a contract before the effective date of this decree, the signed contract is vital;

+ Those who have not yet submitted dossiers to request competent state agencies to issue certificates of land use rights and ownership of houses and other land-attached assets;

+ Contracts for sale, purchase, lease-purchase of houses and construction works must be free of disputes or lawsuits;

+ Houses and construction work under purchase and sale or hire-purchase contracts and are not subject to distraint or mortgage to secure the performance of obligations as prescribed by law unless otherwise agreed by the mortgagee.

- The transfer of contracts for purchase, sale, lease purchase of houses, and construction works shall be carried out for the entire contract. In case of purchase, sale, lease-purchase of many houses or construction work under the same contract and the parties wish to transfer each house or construction work, the transferer must reach an agreement with the investor to amend the contract for sale, purchase, lease purchase of a house or construction work or sign an appendix to the contract before transferring the contract in accordance with the provisions of this decree.

2. Regulations on the transfer of all or part of real estate projects:

- For the following real estate projects, the transfer shall be carried out in accordance with the provisions of the law on investment:

+ Real estate projects approved by investors according to the provisions of the Law on Investment in 2020

+ Real estate projects are granted investment registration certificates in accordance with the provisions of the Law on Investment in 2020.

- For real estate projects that are not mentioned above, the transfer shall be carried out in accordance with the provisions of the Law on Real Estate Business and Decree 02.

It is understood that only real estate projects that are subject to investor approval and have been granted an investment certificate under the Investment Law 2020 will apply the provisions of the law on investment; and all other cases of real estate projects other than the above two cases will apply according to the provisions of the Law on Real Estate Business and Decree 02.

This provision is consistent with Clause Article 46 of the Law of Investment 2020, ensuring the separation and clarity on the cases of project transfer will apply in accordance with the provisions of the Law on Investment; and other issues will apply according to the provisions of the Law on Real Estate Business.