Are individuals doing real estate business required to establish a business?

The Legal Consulting Office of Lao Dong Newspaper responded:

Article 9 of the Real Estate Business Law 2023 (effective from August 2024) stipulates conditions for organizations and individuals when doing real estate business as follows:

1. Organizations and individuals when doing real estate business must establish an enterprise according to the provisions of law on enterprises or establish cooperatives and unions of cooperatives according to the provisions of law on cooperatives. having a real estate business (collectively referred to as a real estate business), except for the cases specified in Clauses 3 and 4 of this Article.

In the case of organizations and individuals providing real estate services, they shall comply with the provisions of Clause 5 of this Article.

2. Real estate businesses must meet the following conditions:

a) Not during the period of being banned from real estate business activities, suspended, or suspended under a court judgment or decision or decision of a competent state agency;

b) Ensuring the ratio of outstanding credit debt and outstanding corporate bonds to equity;

c) Real estate businesses through real estate projects must have equity not less than 20% of total investment capital for projects with land use scale of less than 20 hectares, not less than 15% Total investment capital for projects with land use scale of 20 hectares or more and must ensure the ability to mobilize capital to implement the investment project; In case a real estate business simultaneously implements many projects, it must have enough equity allocated to ensure the above ratio of each project to implement all projects.

3. Individuals doing small-scale real estate business do not have to establish a real estate business but must declare and pay taxes according to the provisions of law.

4. Organizations and individuals selling houses, construction works, construction floor areas in construction works for non-business purposes or selling, leasing, lease-purchasing houses, construction works, The construction floor area of ​​a construction project below the small-scale level does not have to comply with the provisions of this Law but must be declared and paid tax according to the provisions of law; In case an individual sells or leases to buy a house, a construction project, or the construction floor area in a construction project, it must also be notarized and authenticated according to the provisions of Clause 5, Article 44 of this Law.

5. Organizations and individuals when doing business in real estate services must establish an enterprise according to the provisions of law on enterprises or establish cooperatives and unions of cooperatives according to the provisions of law on cooperation. communes (collectively referred to as real estate service enterprises), must meet the conditions prescribed by this Law.

6. The Government stipulates in detail Points b and c, Clause 2 of this Article; regulates the determination of small-scale real estate business specified in Clauses 3 and 4 of this Article.

Thus, from August 2024, individuals doing small-scale real estate business will not have to establish businesses according to the above regulations.