Can foreign-invested enterprises lease land to invest and build cemeteries and cemeteries? located in Vietnam?

What is real estate business?

According to the provisions of Clause 1, Article 3 of the Law on Real Estate Business 2014, real estate business is the investment of capital to carry out construction, purchase, and transfer activities for sale and transfer; lease, sublease, lease purchase of real estate; performing real estate brokerage services; real estate trading floor services; Real estate consulting or real estate management services for profit.

Scope of real estate business of foreign-invested enterprises

Pursuant to Article 11 of the Law on Real Estate Business 2014, foreign-invested enterprises are allowed to do real estate business in the following forms:

+ Renting houses and construction works for sublease;

+ For land leased by the State, investment in housing construction for rent is allowed; investment in construction of houses and non-residential constructions for sale, lease, or lease purchase;

+ Receive transfer of all or part of the investor’s real estate project to build houses and construction projects for sale, lease, or lease purchase;

+ For rented land in industrial parks, industrial clusters, export processing zones, high-tech zones, and economic zones, investment in building houses and construction works for business purposes is allowed.

Thus, enterprises with foreign investment are only allowed to do real estate business in the listed forms, and are not allowed to rent land to invest or build cemeteries or graveyards in Vietnam.

Conditions for organizations and individuals to do real estate business

In addition, we would like to inform you more about the conditions of organizations and individuals in general and foreign-invested enterprises in particular that are allowed to do real estate business according to current regulations.

Pursuant to Article 4 of Decree 02/2022/ND-CP, conditions for organizations and individuals doing real estate business, specifically:

+ Must establish an enterprise according to the provisions of the law on enterprises or a cooperative according to the provisions of the law on cooperatives, with real estate business (hereinafter collectively referred to as enterprises);

+ Must publicly disclose on the enterprise’s website, at the headquarters of the Project Management Board (for real estate investment and business projects), at the real estate trading floor (in case of business through a real estate trading floor) information about the enterprise (including name, head office address, contact phone number, name of legal representative), information about real estate put into business according to the provisions of Clause 2, Article 6 of the Law on Real Estate Business, information on mortgages of houses, construction works, real estate projects put into business (if any), information on the quantity and type of real estate products being traded, the quantity and type of real estate products sold, transferred, leased and purchased and the remaining quantity and type of products that are continuing to be traded.

For information that has been made public as prescribed in this Point and is subsequently changed, it must be promptly updated immediately after the change;

+ Only trade real estate that meets the conditions prescribed by law.

Thus, according to current law, real estate businesses need to satisfy the 3 conditions mentioned above. It can be seen that the law has removed the regulation on minimum legal capital to be allowed to do real estate business.

In addition, there are subjects who do not need to establish businesses or cooperatives when doing real estate business, this is stipulated in  Articleu 5 Decree 02/2022/ND-CP.

+ Organizations, households, and individuals selling, transferring, leasing, and leasing real estate on a small scale, irregularly include:

+ Agencies and organizations selling houses, construction works, transferring land use rights due to bankruptcy, dissolution or separation according to the provisions of law.

+ Agencies and organizations selling, transferring, leasing, and leasing real estate that are public assets according to the provisions of law.

+ Credit institutions, foreign bank branches, asset management companies of credit institutions (AMC), asset management companies of Vietnamese credit institutions (VAMC) sell houses, construction works, transfer land use rights, transfer real estate projects that are being guaranteed and mortgaged to collect debt according to the provisions of law.

+ Organizations, households, and individuals sell houses, construction works, transfer land use rights according to decisions of the Court or competent state agencies when resolving disputes, complaints, and denunciations.

+ Organizations, households, and individuals sell, lease, lease-purchase houses and construction works under their legal ownership, transfer, lease, and sublease land use rights under their legal use rights.

+ Organizations, households, and individuals sell, lease, lease purchase, or transfer real estate that they invest in and build that is not a real estate construction investment project for business purposes in accordance with the law.

In short, foreign-invested enterprises are not allowed to rent land to build cemeteries and graveyards. In addition, foreign-invested enterprises also need to meet the above conditions to do real estate business in Vietnam.