Suggestions to amend the Land Law: It is necessary to improve the accessibility to land resources for businesses

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Workshop to comment on draft Land Law (amended). Photo: H.Diu.

Ensure transparent implementation, avoid consequences

Speaking at the opening ceremony, Pham Tan Cong, Chairman of VCCI, stated that Vietnam's economy and society are undergoing profound changes as it is entering a period of strong industrialization and urbanization. Demand for land use for industrial, commercial and residential purposes increased sharply. Agriculture is also transforming in the direction of modernity, and the need to accumulate land for agricultural production poses many legal problems. The real estate market in the past few years has been volatile, including a state of hot growth and a stagnating freeze.

Therefore, according to the Chairman of VCCI, the legal regulations on land since 2013 have revealed many shortcomings. These include issues such as land finance, the right of enterprises to develop projects using land, the construction of underground works, aerial works, regulations on publicity, transparent planning, land use plans, and administrative procedures on land.

Therefore, Pham Tan Cong requested that businesses and associations contribute ideas for this important law.

Speaking at the workshop, Deputy Prime Minister Tran Hong Ha said that the draft Land Law (amended) is the product of the intelligence gathering of the political system, including the active participation of the Government and the business community.

According to the Deputy Prime Minister, all businesses, regardless of size and type, need to access land, and exploit and use land resources for production and business activities. However, for businesses operating in the real estate sector, the Deputy Prime Minister stated several policies that need to be consulted specifically so that the implementation is clear and transparent, avoiding consequences such as the method of creating the land fund, land fund development, forms of land access (bidding, auction, appointment, self-negotiation, etc.), and must ensure reform of administrative procedures, transparency, etc.

Deputy Prime Minister Tran Hong Ha speaks at the conference. Photo: VGP

Regarding the land economy, the Deputy Prime Minister said that the key is the method of calculating and valuing land. According to the Deputy Prime Minister, if land valuation is not accurate, it will lead to many complicated consequences due to subjective and will-only causes. Currently, there are 5 land valuation methods, but it is difficult to be accurate without building a clear database, reflecting and fully statisticizing the value of land and land business activities. The land price list is the basis for carrying out activities of land acquisition, compensation and use fairly and transparently. At the same time, harmonizing the added value from land will ensure fairness among people, the state and businesses, as well as between regions, regions, localities, even between projects of different natures.

Need to be clear about land prices, land finance

Referring to the current forms of land recovery (enterprises negotiate with people and then the state recovers or the state recovers and allocates clean land to enterprises), Deputy Prime Minister Tran Hong Ha said the draft law is expected to expand some concepts such as the state recovering land to create a land fund for infrastructure development, urban embellishment, environmental protection, etc.

The Deputy Prime Minister stated the paradox of "2 policies and 2 prices", if enterprises themselves agree, the compensation price is very high because the enterprises earn high profits, but only for small-scale projects. In contrast, the Large-scale projects recovered by the state have lower compensation prices because they must ensure fairness and harmonization of objectives, including economic benefits and social issues.

The Deputy Prime Minister also affirmed that the state as a management agency responsible to the people, must determine the price, decide on the land transfer, and orient so that in the transformation process, project developers and people whose land has been acquired, both benefit. Therefore, it is necessary to quantify and have specific criteria on infrastructure, accommodation, livelihoods, social security, and cultural institutions so that resettled people have better living conditions than their old places.

In addition, the Deputy Prime Minister also wants to hear opinions on land use planning, building a land database, settling complaints about land, etc.

At the workshop, representatives of businesses, business associations and some experts gave suggestions for the draft Land Law (amended). Nguyen Quoc Hiep, Chairman of Vietnam Construction Contractors Association, and Chairman of the Board of Directors of Global Real Estate Investment Joint Stock Company (GP. Invest) also expressed concern about land prices.

According to Hiep, to build land prices, it is necessary to have a common data system. All purchase and sale transactions and transfers on the market must be posted and published on this data system. It is possible to determine the transfer price on the market that appears with the most frequency. It is currently not possible to publish and update such transactions.

In addition, he also said that the regulations on compensation and resettlement support when the state recovers land (Chapter 7) have not yet clearly demarcated between types of land acquired and compensation. Therefore, it is necessary to clearly distinguish and separate the concept of compensation between agricultural land and, residential land, commercial land.

According to economic expert Dr. Can Van Luc, land price and land finance issues in the draft Land Law (amended) is the most complicated and difficult issue; because there are many different opinions about determining land price close to market price. Therefore, this problem needs to be focused on solving in a more comprehensive, radical, thorough and consistent manner.

In addition, according to experts, the Land Law is a large law covering and relating to most socio-economic fields, so it needs to be revised and reviewed to ensure compatibility, avoiding contradictions, overlaps and conflicts between the two countries and Land Law with other applicable laws.