VIETNAM Law and Practice Contributed by: Tran Thai Binh and Duong Thi Minh Han, LNT & Partners
3.10 Taxes on Loans The law does not provide for any taxes on loans specifically related to real estate. However, lend - ers (either foreign or Vietnamese incorporated entities) must bear the income tax incurred on the interest earned from such loans. 4. Planning and Zoning 4.1 Legislative and Governmental Controls Applicable to Strategic Planning and Zoning Planning and zoning of regions (rural and urban areas) and projects must be approved by the competent authority (including the People’s Committee at provincial and district level). 4.2 Legislative and Governmental Controls Applicable to Design, Appearance and Method of Construction The design of the building must comply with the master plan (if any) and be appraised and approved. The approved design will form the basis for the competent authority (usually the competent provincial department of construc - tion) to issue a construction permit to the devel - oper before the project is built. Unless exempt - ed, any building or refurbishment that does not have a valid construction permit will be deemed to be violating the laws on construction. 4.3 Regulatory Authorities Parcels of real estate must be developed according to their designated use as approved by the competent authority, subject to the level of planning. The provincial People’s Committee will approve planning on land use at the dis - trict level, which must comply with the planning approved by the senior authority. Any functional areas, subject to size, are required to compose
the sub-zoning for development of investment projects. Generally, laws on construction, (urban) planning and land are the most significant in matters of development and designated use of real estate. 4.4 Obtaining Entitlements to Develop a New Project In developing a new real estate project, project investment and investor selection approval (col - lectively referred to as “Investment Approvals” ) are usually required under Article 29 of the Law on Investment 2020. Depending on the scale, social and economic effects, or national security issues, such approvals may be under the author - ity of the National Assembly, the Vietnam gov - ernment, or the People’s Committee at provincial level. These issuing authorities must consult with the relevant authorities on related aspects and issues in the investment project application (eg, zoning, planning, land use, environment, nation - al defence, etc). Therefore, such opinions influ - ence and impact investment project approval. The application dossier for the project invest - ment approval is provided under Article 33 of the Law on Investment 2020, aiming to describe the suitability of the project with master plans, land- use needs, economic, social and environmental effects, technologies to be used, market access, etc. The law sets forth the timeline for invest - ment projects, and investor selection approval may take three to six months, although it usually takes longer. Basically, the investor may conduct the real estate project after Investment Approvals have been granted and the procedures required on the construction – eg, design assessment approval, construction permits, etc, have been undertaken.
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