METHODS AND CONDITIONS FOR FOREIGNERS TO INVEST IN REAL ESTATE PROJECTS IN VIETNAM

I. Methods for foreigners to invest in real estate projects in Vietnam 

Pursuant to the provisions of Points b, d, h, Clause 1 and Points a, b, Clause 3, Article 11 of the Law on Real Estate Business 2014, Foreign-invested enterprises may do real estate business under the following methods: 

- Renting houses, construction works for sublease; 

- For land leased by the State, housing may be invested for lease; investment in the construction of houses and non-residential construction works for sale, lease or lease purchase; 

- Receive the transfer of all or part of the real estate project of the investor to build houses or construction works for sale, lease or lease purchase; 

- For leased land in industrial parks, industrial clusters, export processing zones, hi-tech parks and economic zones, houses and construction works may be invested in doing business according to land use purposes. 

II. Conditions for foreigners to invest in real estate projects in Vietnam 

Pursuant to the provisions of Clause 1, Article 10 of the Law on Real Estate Business 2014, amended by Point a, Clause 2, Article 75 of the Law on Investment 2020 and Points a, b, c, Clause 1, Article 4 of Decree 02/2022/ND-CP, the conditions for foreigners to invest in real estate projects in Vietnam include: 

- Must establish an enterprise in accordance with the law on enterprises or cooperatives in accordance with the law on cooperatives, have real estate business lines (hereinafter collectively referred to as enterprises); 

- The following information must be disclosed on the website of the enterprise, at the headquarters of the Project Management Board (for real estate business investment projects), at the real estate trading floor (for business through real estate trading floors) the following information:    

+ Information about the enterprise (including name, head office address, contact phone number, name of the legal representative);   

+ Information on real estate put into business as prescribed in Clause 2, Article 6 of the Law on Real Estate Business 2014;   

+ Information on the mortgage of houses, construction works, real estate projects put into business (if any);   

+ Information on the quantity, type of real estate products traded, quantity, types of real estate products sold, transferred, leased and purchased and the quantity and types of remaining products that are continuing to do business. 

Note: For public information specified at this point that subsequently changes, it must be promptly updated immediately after the change; 

- Only trading in real estate that meets the conditions specified in Article 9, Article 55 of the Law on Real Estate Business 2014. 

Note: According to the provisions of Clause 2 Article 4 of Decree 02/2022/ND-CP, in case an investor is selected as an investor of a real estate project in accordance with the provisions of law, such investor must have an equity capital of not less than 20% of the total investment capital for a project with a land use scale of less than 20 hectares, not less than 15% of the total investment capital for projects with a land use scale of 20 hectares or more. When conducting real estate business, the project investor must satisfy the conditions specified in Clause 1 Article 4 of Decree 02/2022/ND-CP.

The above article provides basic information about methods and conditions for foreigners to invest in real estate projects in Vietnam.

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Hoang Pham (James) / Managing Partner at: hoang.pham@vselawyers.com

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Attention: This legal update is not an advice and should not be treated as such.