Decree No. 17/2006/ND-CP Amending and Supplementing Certain Provisions of Decrees Guiding the Implementation of the Land Law and Decree No. 187/2004/ND-CP on the Conversion of State-Owned Enterprises into Joint Stock Companies

DECREE

Regarding amendments and supplements to certain articles of Decrees guiding the implementation of the Land Law and Decree No. 187/2004/NĐ-CP on the conversion of state-owned enterprises into joint-stock companies

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THE GOVERNMENT

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Based on the Land Law dated November 26, 2003;

Considering the proposal of the Minister of Natural Resources and Environment and the Minister of Finance,

DECREE:

Article 1. Scope of amendment and supplementation

This Decree stipulates the amendment and supplementation of certain articles of Decree No. 181/2004/NĐ-CP dated October 29, 2004 of the Government on the implementation of the Land Law (referred to as Decree No. 181/2004/NĐ-CP), Decree No. 182/2004/NĐ-CP dated October 29, 2004 of the Government on administrative violations in the field of land (referred to as Decree No. 182/2004/NĐ-CP); Decree No. 197/2004/NĐ-CP dated December 3, 2004 of the Government on compensation, support, and resettlement when the State recovers land (referred to as Decree No. 197/2004/NĐ-CP), Decree No. 198/2004/NĐ-CP dated December 3, 2004 of the Government on land use fee collection (referred to as Decree No. 198/2004/NĐ-CP), and Decree No. 187/2004/NĐ-CP dated November 16, 2004 of the Government on the conversion of state-owned enterprises into joint-stock companies (referred to as Decree No. 187/2004/NĐ-CP).

Article 2. Amendment and supplementation of certain articles of Decree No. 181/2004/NĐ-CP

1. Amend Clause 2 of Article 30 as follows:

"2. The compliance with land laws by the applicant for land allocation or lease, in cases where the applicant has previously been allocated or leased land by the State for implementing investment projects for production, business, and services. Based on the self-declaration of the applicant regarding all areas of land and their usage status previously allocated or leased by the State, and their self-assessment of compliance with land laws, the Department of Natural Resources and Environment where the land allocation or lease procedures are being processed shall be responsible for contacting the Department of Natural Resources and Environment where the land was previously allocated or leased to verify the level of compliance with land laws by the land user during the implementation of projects that were previously allocated or leased by the State.

In cases where the applicant for land allocation or lease is an economic organization not owned by the State, they must declare all areas of land and their usage status previously allocated or leased by the State to such economic organization and other economic organizations under the same ownership."

2. Add Clause 4 to Article 30 as follows:

“4. The investment rate per unit area of land is calculated by dividing the total investment capital on land by the total area of land in the project. The People's Committee of the province or centrally governed city shall base on the specific conditions of the locality to determine the minimum investment rate per unit area of land suitable for each type of project and each investment location as a basis for project evaluation and assessment of land demand for investment projects.”

3. Add Point d and Point e to Clause 2 of Article 36 as follows:

“d) Using land to implement investment projects for exploration and exploitation of minerals in accordance with the provisions of the Investment Law and the Minerals Law; using land to provide relocation sites for production and business service facilities due to environmental protection requirements or according to planning that cannot be arranged within industrial parks, high-tech zones, or economic zones.

e) Using land to implement investment projects for public infrastructure including transportation works, power supply, water conservancy, water supply, drainage, environmental sanitation, telecommunications, oil pipelines, gas pipelines, education, training, culture, science and technology, health care, physical education and sports, markets.”

4. Amend Clause 7 of Article 36 as follows:

“7. Land allocated for use for national defense, security, national interests, public interests, construction of industrial zones, non-agricultural production and business sites shall not be converted to residential purposes or land for housing except in cases permitted by competent state authorities as provided in Article 37 of the Land Law and consistent with the grounds for changing land use purposes specified in Article 31 of the Land Law.”

5. Amend Point d and add Points đ, e, and g to Clause 2 of Article 61 as follows:

“d) In cases where land put up for auction has no participants or has failed at least two auctions, or in cases where there is only one investor who proposes a project to allocate or lease a specific area of land for investment in accordance with planning;

đ) Cases involving the use of land to construct resettlement housing, housing for low-income individuals, and housing for civil servants and employees;

e) In cases where land for housing is allocated to civil servants and employees who have transferred their place of work pursuant to a decision by the competent authority;

g) Land that has not yet been compensated or cleared.”

6. Amend Clause 1 of Article 63 as follows:

“1. State-owned enterprises currently using land allocated or leased by the State that are undergoing corporatization may choose between allocating land with payment of land use fees or leasing land.”

7. Add Clause 7 to Article 84 as follows:

“7. Economic units that are self-financed and tasked by competent authorities to build and operate industrial park infrastructure, if granted land leases by the State for investment in industrial park infrastructure, may sublease the land after completing the infrastructure development.”

8. Amend Clause 1 of Article 101 as follows:

“1. The transfer of land use rights for investment projects constructing housing for sale or lease shall be regulated as follows:

a) For cities, towns, new urban areas of cities and towns, or new urban areas planned to develop into cities and towns, it is not allowed to transfer land use rights to households or individuals in the form of selling land plots without constructing houses. Investors may transfer land use rights to economic organizations for areas of land that have completed synchronized infrastructure development according to approved projects or components of approved investment projects; economic organizations receiving the transfer of land use rights must use the land for its intended purpose, in accordance with the construction content and schedule set out in the project.”

b) For other areas, the transfer of land use rights of housing investment projects shall be carried out as prescribed in point a of this clause. In cases where there are projects for synchronous infrastructure construction in residential areas, the investor must complete the project in accordance with the approved content before transferring the land use rights attached to such infrastructure to economic organizations, households, or individuals.”

9. Supplement Article 111a as follows:

"Article 111a. Rights and obligations of land users in cases where land for residential purposes, land for production and business premises, or land for profit-oriented investment projects is granted or leased by the State with exemption or reduction of land use fees or land lease fees

1. A person who is granted land for residential purposes or leased land for housing development projects by the State with exemption or reduction of land use fees or land lease fees shall have rights and obligations under the laws on land as if they were not exempted or reduced from such fees.

2. A person who is granted land for production and business premises or for profit-oriented investment projects by the State with reduction of land use fees or land lease fees shall have rights and obligations under the laws on land as if they were not exempted or reduced from such fees for land with corresponding purposes of use.

3. A person who is granted land for production and business premises or for profit-oriented investment projects by the State with exemption of land use fees or land lease fees shall have rights and obligations under the laws on land as if the State had leased such land annually with payment of lease fees for land with corresponding purposes of use.

In cases where the land user is unable to continue implementing the project during the construction period, the State shall reclaim the land; assets invested on the land shall be handled according to the provisions of Article 35 of Decree No. 181/2004/NĐ-CP.

In cases where the construction phase of the project has been completed but the investor is unable to continue implementing the project, the sale of assets attached to the land is allowed; the buyer of the assets may continue implementing the project and must use the land in accordance with the approved purpose."

10. Amend Clause 1 of Article 119 as follows:

"1. Contracts or documents when land users exercise their rights to convert, transfer, lease, sublease, inherit, gift, mortgage, guarantee, or contribute land use rights as capital must be certified by a state notary or authenticated by the People's Committee of communes, wards, towns, or confirmed by the Management Board of industrial parks, economic zones, high-tech zones according to the following provisions:

a) In cases of transferring, leasing, subleasing, mortgaging, guaranteeing, or contributing land use rights in industrial parks, economic zones, or high-tech zones, confirmation by the Management Board of industrial parks, economic zones, or high-tech zones is required;

b) In cases not covered by point a of Clause 1 of this Article, certification by a state notary is required for organizations, overseas Vietnamese, foreign organizations, and foreign individuals; certification by a state notary or authentication by the People's Committee of communes, wards, towns where the land is located is required for households and individuals; certification by a state notary or authentication by the People's Committee of communes, wards, towns where the land is located is required for both parties involved if one party is a household or individual and the other is an organization, overseas Vietnamese, foreign organization, or foreign individual."

11. Amend Clause 5, Clause 6 of Article 130 as follows:

“5. At least twenty (20) days before the end of the announcement period, the Department of Natural Resources and Environment shall submit to the People's Committee of provinces or centrally-administered cities for a decision to reclaim land.

Within no more than five (05) working days from the date of receipt of the submission, the People's Committee of provinces or centrally-administered cities shall examine, sign, and send the decision to reclaim land to the Department of Natural Resources and Environment, the People's Committee of districts, towns, urban districts, or provincial cities. The decision to reclaim land must include specific reclaimed land area details for each plot of land used by organizations, religious establishments, overseas Vietnamese, foreign organizations, or foreign individuals, and general reclaimed land details for all areas used by households, individuals, or community residents.

If there is land used by households or individuals within the reclaimed area, the People's Committee of districts, towns, urban districts, or provincial cities shall decide on the specific reclaimed land area for households, individuals, or community residents within no more than ten (10) working days from the date of receipt of the decision to reclaim land from the People's Committee of provinces or centrally-administered cities.

6. After the decision to reclaim land by the People's Committee of provinces or centrally-administered cities, the Land Development Organization or the People's Committee of districts, towns, urban districts, or provincial cities shall prepare and submit the compensation and clearance plan.

Within no more than fifteen (15) working days from the date of receipt of the submission, the People's Committee of provinces or centrally-administered cities shall examine, sign, and send the decision to approve the compensation and clearance plan to the Land Development Organization or the People's Committee of districts, towns, urban districts, or provincial cities.”

12. Repeal Clause 3 of Article 149

13. Amend Clause 3 of Article 163 as follows:

“3. Within no more than forty-five (45) days from the date of receipt of the decision to resolve complaints by the Chairman of the People's Committee of districts, towns, urban districts, or provincial cities, if the complainant disagrees with the resolution, they have the right to file a lawsuit with the People's Court or lodge a complaint with the People's Committee of provinces or centrally-administered cities.”

In the case where a complaint is submitted to the People's Committee of the province or centrally governed city, the Chairman of the People's Committee of the province or centrally governed city shall be responsible for resolving the complaint within the time limit prescribed by the Law on Complaints and Petitions. The decision to resolve the complaint made by the Chairman of the People's Committee of the province or centrally governed city is the final decision, which must be publicly announced and sent to the complainant and other persons with rights and obligations related to the matter.

14. Amend Clause 3 of Article 164 as follows:

“3. Within a period not exceeding forty-five (45) days from the date of receipt of the resolution decision of the Chairman of the People's Committee of the province or centrally governed city, if the complainant disagrees with that resolution decision, they have the right to initiate a lawsuit at the People's Court.”

Article 3. Amend Clause 7 of Article 7 of Decree No. 182/2004/ND-CP as follows:

“7. The form and level of administrative penalty shall be determined based on the nature, degree of violation, consequences of the administrative violation, the identity of the person committing the administrative violation, mitigating circumstances, and aggravating circumstances. Mitigating and aggravating circumstances shall be applied according to the provisions of Articles 8 and 9 of the Ordinance on Handling Administrative Violations.”

Article 4. Amend and supplement some articles of Decree No. 197/2004/ND-CP

1. Amending and supplementing Point b Clause 1 Article 3 as follows:

“b) Organizations and individuals granted land by the State for payment of land use fees or lease of land who have prepaid funds to implement compensation, support, and clearance of land surface shall be allowed to deduct the amount of compensation for land and support for land from the land use fee and land lease fee payable to the State; the deduction amount shall not exceed the land use fee and land lease fee payable.”

2. Amend and supplement Clause 1 of Article 9 as follows:

“1. The price of land for compensation purposes is the price of land according to its current use as stipulated and published by the People's Committee of the province or centrally governed city; compensation shall not be provided based on the price of land intended for change of use purpose; in cases where at the time of the land recovery decision, this price does not accurately reflect the actual market transfer price of land under normal conditions, the People's Committee of the province or centrally governed city shall decide on the specific land price to make it appropriate.”

3. Supplement Clause 3 to Article 28 as follows:

“3. In the case where a household or individual whose land is recovered has a living standard classified as a poor household according to the poverty criteria published by the Ministry of Labor, Invalids, and Social Affairs during each period, they shall be supported to overcome poverty; the level of support and the duration of support shall be specified by the People's Committee of the province or centrally governed city but shall not be less than three years and not more than ten years from the date of completion of the land recovery process.”

4. Amend Article 29 as follows:

“Households and individuals directly engaged in agricultural production whose land area exceeds thirty percent (30%) of their agricultural land and who are not compensated by the State with equivalent agricultural land shall be supported to switch professions and create employment opportunities according to the following provisions:

1. They shall be allocated land for payment of land use fees at locations suitable for production surfaces or non-agricultural service businesses; the amount of land allocated shall be determined by the provincial People's Committee based on the availability of land and the amount of land recovered by each household or individual; the price of allocated land shall be equal to the price of equivalent agricultural land plus infrastructure investment costs on the land but shall not exceed the land price at the time of land recovery as stipulated and published by the provincial People's Committee;

2. In special cases where there is no land available for allocation as stipulated in Clause 1 of this Article, members of households within working age shall be supported to train and switch professions; the specific level of support shall be determined by the provincial People's Committee in accordance with local realities; training and switching professions shall mainly be conducted through vocational training at educational institutions.”

5. Supplement Clause 3 to Article 36 as follows:

"3. Households and individuals whose residential land is recovered and need resettlement shall be resettled in conjunction with job creation or profession switching according to the following provisions:

a) If the household or individual is directly engaged in agricultural production and is not compensated by the State with equivalent agricultural land, the resettlement shall be linked to allocating land for production or non-agricultural services as stipulated in Clause 1 of Article 29 of this Decree;

b) If the household or individual is engaged in non-agricultural production or services, the resettlement shall be linked to job creation from non-agricultural production or services; in special cases where there is no land available for resettlement linked to job creation from non-agricultural production or services, the household or individual shall be supported to train and switch professions according to the provisions of Clause 2 of Article 29 of this Decree.”

6. Amend Clause 2 of Article 48 as follows:

“2. The funding to ensure the organization and implementation of compensation, support, and resettlement shall not exceed two percent (2%) of the total compensation and support funds of the project; the specific level shall be determined by the provincial People's Committee in accordance with local realities and depending on the scale, nature, and characteristics of each type of project; the expenditure, settlement, and finalization shall be carried out in accordance with the provisions of the law.

When the land development fund organization or the Compensation, Support, and Resettlement Council at the district level implements compensation, support, and resettlement for multiple projects in the locality, they may adjust the funding extracted from each project to suit the reality, but the total funding for the organization and implementation of compensation, support, and resettlement for all projects shall not exceed two percent (2%) of the total compensation, support, and resettlement funds for those projects.”

 Article 5. Amending and supplementing some articles of Decree No. 198/2004/NĐ-CP.

3. Amending and supplementing Clause 5 of Article 4 as follows:

“2. The land price for collecting land use fee is the land price according to the purpose of land allocation as prescribed and announced by the People's Committee of the province or centrally governed city; in case at the time of land allocation, this price is not close to the actual market price of transferring land use rights under normal conditions, then the People's Committee of the province or centrally governed city shall decide on a specific land price that is appropriate.”

2. Amending and supplementing Point a Clause 2 Article 6 as follows:

"a) When converting from garden or pond land within the same plot with residential house in residential areas which have not been recognized as residential land to residential land, the land use fee shall be fifty percent of the difference between the land use fee calculated based on residential land price and the land use fee calculated based on agricultural land price;"

In case households or individuals are permitted by competent state agencies to change the purpose of land use from garden or pond land which have not been recognized as residential land or agricultural land to non-agricultural production and business land, the land use fee shall be the difference between the land use fee calculated based on non-agricultural production and business land price and the land use fee calculated based on agricultural land price."

3. Amending and supplementing Clause 4 Article 11 as follows:

"4. Not applying exemption or reduction of land use fees in cases of auctioning land use rights to allocate land with land use fees; changing from lease land form to land allocation with land use fees for production and business purposes, except in cases where when changing to land allocation with land use fees falls under the category eligible for exemption of land use fees as stipulated in Article 12 of Decree No. 198/2004/NĐ-CP."

4. Supplementing Clause 4 and Clause 5 into Article 15 as follows:

“4. Households and individuals who are allowed to change the purpose of land use from garden or pond land within the same plot with residential house in residential areas but not recognized as residential land or change the purpose of land use from agricultural land to residential land must pay land use fees according to the provisions of Article 6 of this Decree and households and individuals currently using land granted land use right certificates must pay land use fees according to the provisions of Article 8 of this Decree; if they do not have the ability to pay land use fees to the State, they may record the amount of land use fees owed on the land use right certificate; the amount of land use fees recorded as debt shall be calculated based on the land price at the time of issuance of the land use right certificate.

When households and individuals carry out transactions regarding land use rights (transfer, lease, mortgage, guarantee, capital contribution with land use rights) or gift land use rights to persons outside the scope of inheritance as provided by civil law (except for cases stipulated in Point c Clause 2 Article 110 of the Land Law) or receive compensation for land when the State recovers it, they must pay the State the remaining amount owed. The Land Registration Office under the Department of Natural Resources and Environment where the land is located shall be responsible for amending and deleting the recorded debt amount on the land use right certificate in cases where households and individuals have fully paid the remaining land use fees to the State.

Transactions involving land use rights for land with land use right certificates still recording amounts owed to the State shall not have legal validity.

5. Economic organizations allocated land with land use fees by the State for investment can pay land use fees according to the progress of land allocation recorded in the approved investment project.”

5. Amending and supplementing Clause 1 Article 17 as follows:

"1. Households and individuals currently using land that has been used since October 15, 1993 until the effective date of this Decree and have been granted land use right certificates, if they still owe land use fees, they may continue to record the debt and must pay the land use fees into the State budget according to the provisions of Clause 4 Article 15 of this Decree."

Article 6. Amend Point b Clause 1 Article 19 of Decree No. 187/2004/NĐ-CP as follows:

“b) In the case where a joint-stock enterprise selects the form of land transfer, the value of land use rights must be included in the valuation of the joint-stock enterprise according to the land price already defined and announced by the People's Committee of the province or centrally governed city; if this price does not accurately reflect the actual market price for transferring land use rights under normal conditions at the time of joint-stock conversion, then the People's Committee of the province or centrally governed city shall determine a specific land price that is appropriate. The procedures and formalities for land transfer, payment of land use fees, and issuance of certificates of land use rights shall be carried out in accordance with current laws on land.”

Article 7. Implementation Provisions

This Decree takes effect fifteen days from the date of publication in the Official Gazette. Abolish previous provisions that are inconsistent with the provisions of this Decree.

Ministers, Heads of ministerial-level agencies, Heads of government-affiliated agencies, Chairpersons of provincial and centrally governed city People's Committees are responsible for implementing this Decree.

The Ministry of Natural Resources and Environment, the Ministry of Finance shall provide guidance on the implementation of this Decree./.