Land-use rights of foreign-invested enterprises according to Vietnamese law

Land plays an essential role in economic activities. In Vietnam, land-use rights have meaning and nature similar to the ownership of land. Under the doctrinal research method, the paper describes the Vietnamese law of land focusing on foreign invested enterprises’ land-use rights and points out the respective shortcomings. To have the land use rights in Vietnam, a foreign-invested enterprise needs an investment project in Vietnam that has been approved by a state agency, and this project calls for the land. The land-use rights can be established directly from the State representing the landowner and (or) indirectly from the owners of land use rights. In principle, foreign-invested enterprises only have the right to access land-use rights directly from the State. Indirect access to land use rights is more limited. Foreign-invested enterprises only have the right to use the land through the receipt of capital contribution from another enterprise. Contribution of capital by individuals or transfer of ownership of land use rights through other forms is not permitted. Although they have limited access to land use rights, foreign invested enterprises have the same scope of land use rights as Vietnamese enterprises. Thus, Vietnamese law has allowed foreign-invested enterprises to have the right to use the land to carry out investment projects in Vietnam. However, Vietnamese law is not really advantageous. Therefore, it is necessary to identify risks from incomplete legislation. The paper recommends solutions so that foreign-invested enterprises may recognize the legal risks concerning land-use rights and avoid them.

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