VIETNAM Law and Practice Contributed by: Tran Thai Binh and Duong Thi Minh Han, LNT & Partners
5. Investment Vehicles 5.1 Types of Entities Available to Investors to Hold Real Estate Assets Usually, investors may hold real estate assets by: • acquiring the property through project trans - fer (asset deal); • acquiring a property holding entity (share transfer deal); or • obtaining an investment policy for a new real estate project. Foreign investors may establish a new company in Vietnam to invest in real estate projects. The available types of entities include limited liability and joint stock companies. While the scope of real estate trading activities is restricted to for - eign invested companies under the Real Estate Trading Law, foreign-invested companies can engage in a broader range of real estate trading activities by adopting appropriate shareholding ratios and corporate structures. In some cases, foreign investors may enter into a joint venture with local partners who hold LURs over land parcels to set up project companies to develop real estate projects. Investors can also hold real estate by co-oper - ating with other entities through a Business Co- operation Contract (BCC) as provided under the Law on Investment. Although the investors may not have a direct holding in the real estate assets in the BCC, they will have influence in policymak - ing in the entity that owns the real estate assets, depending on the structures agreed therein. 5.2 Main Features and Tax Implications of the Constitution of Each Type of Entity A limited liability company (LLC) is divided into two categories, single-member or multiple-
Foreign-invested enterprises or foreign investors who put money into Vietnam (Law on Invest - ment) either by developing a new real estate pro - ject or completing a major refurbishment, which may also be considered as an investment project under the Law on Investment 2020, are further required to obtain an investment registration cer - tificate under this law. 4.5 Right of Appeal Against an Authority’s Decision There is no mechanism for investors to appeal against rejection by the authorities of an invest - ment project proposal or application under the Law on Investment. However, during the invest - ment implementation stage, the investor has the right to appeal against administrative decisions or the conduct of authorities or officers under the Law on Complaints or the Law on Denounce - ments. 4.6 Agreements With Local or Governmental Authorities Projects using land-use rights, the purpose of which is classified in the entitlement of a land lease, are required to enter into a lease agree - ment with the competent authority. Most agree - ment types with state authorities are executed for projects of public-private partnership under the Law on Public Private Partnership and/or the Law on Tendering 2023. 4.7 Enforcement of Restrictions on Development and Designated Use See 4.3 Regulatory Authorities and 4.4 Obtain- ing Entitlements to Develop a New Project .
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