Land access for businesses to be reviewed to address obstacles

Investors' access to land use rights is being regulated by the 2024 Land Law in a more expanded direction, creating a public and transparent environment. VNA/VNS Photo

Although the 2024 Land Law has introduced many changes regarding land acquisition and allocation, businesses still face difficulties in accessing land for projects related to healthcare and education services, especially in the context of high commercial land prices. Deputy Minister of Natural Resources and Environment Lê Minh Ngân talked with Vietnamplus.vn about the issues involved.

Could you explain how the mortgages related to land use rights of entities, businesses and individuals, that are regulated in the Land Law 2024, create favourable conditions for businesses to access land?

The 2024 Land Law provides detailed regulations regarding mortgage rights of economic organisations for each form of land use.

Accordingly, economic organisations that are allocated land by the State with payment for land use, or that lease land with a one-time rental payment for the entire lease term, have the right to mortgage the land use rights and their assets attached to the land at credit institutions authorised to operate in Việt Nam, as well as with other economic organisations or individuals as prescribed by land laws.

Economic organisations that lease land with annual rental payments, as well as overseas Vietnamese and foreign-invested economic organisations, have the right to mortgage their assets attached to the land at credit institutions authorised to operate in Việt Nam, other economic organisations, or individuals as prescribed by law (Point b, Article 34 of the law).

The execution of mortgages under these regulations must meet the following conditions: having a land use right certificate as per the law; the land must not be involved in any disputes or any disputes must have been resolved by competent State agencies, court judgments, decisions or arbitration awards that are legally effective; the land use right must not be under enforcement measures or subject to other measures to ensure judgment enforcement as per the law.

Thus, the 2024 Land Law provides a relatively complete legal framework for businesses to execute mortgage rights related to land use rights. The mortgage of assets when raising bonds secured by real estate, however, is not covered by the Land Law but falls under the scope of the Law on Credit Institutions.

Regarding the recent comments about the difficulties businesses face in accessing land for healthcare and education projects, what is your opinion on this issue?

According to the 2024 Land Law, the State reclaims land when it is deemed truly necessary to implement socio-economic development projects for national and public interests, to optimise land resources, increase land use efficiency and develop modern socio-economic infrastructure.

This applies to 31 specific cases outlined in Article 79 of this law, without distinguishing between projects with domestic or foreign capital, including those related to education, healthcare and sports.

Furthermore, the Land Law allows the State to allocate or lease land without auctioning land use rights or bidding to select investors for projects that use land, as long as they fall under the category of land reclamation by the State (as per Article 79) without using public investment capital.

The law also allows for cases where no public investment capital is used and the project falls under the category of land reclamation outlined in Article 79.

In such instances, investors can negotiate with land users for the transfer of land use rights instead of proposing land reclamation, thereby being able to use the land for socio-economic development projects through negotiated land use rights acquisition.

Therefore, projects providing services in the fields of healthcare and education fall under cases where the State reclaims land as stipulated by the 2024 Land Law, without any distinction in investment capital sources.

Could you elaborate on the methods for land access available to investors in the healthcare and education sectors?

The 2024 Land Law provides very flexible methods for accessing land for projects (including those in the healthcare and education sectors). These methods are adaptable to the practical situation of project implementation and include supportive measures like allocating or leasing land without auctioning or bidding.

The law also includes market-based methods, relying on competition among enterprises to ensure fairness and transparency (such as auctioning land use rights or bidding for investors to carry out land-related projects). Simultaneously, it offers options that grant autonomy to businesses (such as negotiating land use rights transfer or using their existing land use rights).

Thus, according to the Land Law, investors can access land use rights in various sectors, including healthcare and education, with a more open approach. This creates a transparent, fair and conducive environment for investors to access land, enabling them to carry out projects for the socio-economic development of localities in line with the State's policies and regulations.

What is your view on suggestions that the 2024 Land Law's regulations, which set commercial land service tax rates using residential land prices multiplied by 70-80 per cent, result in high commercial land prices, making it difficult for businesses?

The 2024 Land Law stipulates that the land price for calculating land use tax is the land price listed in the land price table.

Specifically, Article 12 of Decree No. 71/2024/NĐ-CP, dated 27 June 2024, of the Government on land pricing, requires that the commercial service land price be specified in a provincial land price table approved by the province's people's council.

Previously, under the 2013 Land Law, Clause 1, Article 11 of Decree No. 44/2014/NĐ-CP of the Government on land pricing stipulated that the price list for commercial service land in urban areas and rural areas was a required part of the land price table issued by the provincial people's committees.

Additionally, Decree No. 44/2014/NĐ-CP of the Government only allowed provincial people's committees to base the pricing of land used for public purposes with commercial intentions and land for constructing offices and non-business facilities, on the residential land prices in the vicinity.

Thus, neither the 2013 Land Law nor the 2024 Land Law included a provision for setting commercial service land prices based on residential land prices but required specific pricing for this type of land in the price list.

The issues mentioned might arise from the implementation process during law enforcement. The Ministry of Natural Resources and Environment will continue to acknowledge, review and pay attention to this matter to address any issues promptly and to continue adjusting relevant policies for the best implementation of the 2024 Land Law in the future.