On November 30, 2024, the National Assembly passed Resolution No. 171/2024/QH15 on piloting the implementation of commercial housing projects through agreements on receiving land use rights or having land use rights (“Resolution 171”). The Resolution takes effect from April 1, 2025 and will be implemented within 5 years.
This Resolution stipulates the pilot implementation of commercial housing projects through agreements on receiving land use rights or having land use rights (pilot projects) nationwide in the following cases: projects of real estate business organizations receiving land use rights; projects of real estate business organizations having land use rights; projects of real estate business organizations having land use rights and receiving land use rights...
Speaking with Lao Dong, Lawyer Pham Thanh Tuan, Hanoi Bar Association, real estate legal expert, assessed that for commercial housing projects (NOM), in case investors are not selected through auction or bidding, enterprises will carry out procedures to approve investment policies and change land use purposes.
Approval of investment policy and change of land use purpose applies to projects in which the enterprise has land use rights or has entered into an agreement to receive land use rights transfer. However, Article 127 of the 2024 Land Law requires that in order to change the land use purpose to implement a New Rural Development Project, the enterprise must have all or part of the existing "residential land".
The above regulations lead to the fact that NOTM projects without “residential land” cannot carry out legal procedures even though the project has carried out procedures such as planning, project establishment, etc.
"The National Assembly's approval of Resolution 171 will remove obstacles for commercial housing projects that have been implemented but do not have "residential land"; thereby creating a synchronous legal mechanism to open up land resources, creating a new supply of commercial housing products to the market" - Lawyer Pham Thanh Tuan assessed.
According to Lawyer Pham Thanh Tuan, these pilot projects need to meet specific requirements. For example, regarding space, although the Resolution applies nationwide, the pilot area must be urban or an area planned as urban (not applicable to projects in rural areas) according to point (a) clause 1 Article 4.
Regarding time, the Resolution is applied on a pilot basis for a period of 5 years, from April 1, 2025 according to Point 1, Article 6.
Regarding the scope, to control the number of pilot projects to avoid breaking the planning, the Resolution stipulates that the total residential land area in all pilot projects does not exceed 30% of the additional residential land in the planning period (compared to the current status of residential land use) in the provincial planning period 2021-2030.
In addition, the pilot project must be consistent with the district-level land use planning, construction planning, and approved local housing development programs and plans (Clause 1, Article 3).
Included in the list of pilot projects, according to which the land plots implementing the pilot project must be submitted by the Provincial People's Committee to the Provincial People's Council for approval (Clause 2, Article 4).
Formal criteria, with a document from the provincial People's Committee allowing enterprises to negotiate to receive land use rights in case the enterprise negotiates to receive land use rights with the land user. This regulation does not apply to projects where the enterprise has the right to use the land (for example, factories, land funds for which the enterprise has been granted a Certificate of Land Use Rights).
