Law on Land Use Term in Vietnam: The Issues in Need of

Modification in the Current Situation for Economic Development and

Social Stability

Luan Nguyen Thanh

Department of Legislation, The Government Cipher Commission, Hanoi city, Vietnam

Keywords: Land, non-agricultural land, agricultural land, Land Law, land use term, Vietnam.

Abstract:

Currently, in Vietnam, the law on land use term plays a particularly important part because it both directly

affects the economic benefits (rights to exploit and use land) of land users and the social stability (due to its

potential to causes conflict between the competent authorities of land management and land users when the

land use term expires and land users are not allowed to have more land use term. Studying legal provisions

on land use term to figure out existing shortcomings so as to have appropriate solutions to overcome them is

extremely important, which ensures the lawful rights and benefits of land users and promotes the development

of market economy and stabilizes the social life of Vietnam. Therefore, this paper focuses on analyzing the

content of current regulations on land use term in Vietnam. In particular, it includes the regulations on land

used for long and stable term; land used for limited term corresponding to specific types of land of two main

land groups: non-agricultural land and agricultural land. The article also assesses the impact of these

regulations on the use of land by individuals, households, and organizations in practice. On that basis, it can

detect the nonconformities of the current law on land use term so that to propose solutions to amend these

laws.

1 INTRODUCTION

In Vietnam, the land ownership regime is similar to

China because both countries have a socialist political

regime led by the Communist Party , in which all land

in the country belong to the entire people (Ding,

2003) . In this ownership regime, the State represents

the ‘‘entire people’’, keeps the role of representative

of the owners to exercise their rights to the land.

Owners here are individuals, households,

organizations and they do not have ownership of

agricultural land but only the right to use it through

the State allocation, lease of land and recognition of

land use rights or transfer of land use rights from other

people (the transfer of land use rights from one person

to another by ways of exchange, transfer, inheritance

or donation of land use rights, or capital contribution

with land use rights) together with rights and

obligations prescribed by law (Luan, 2020). When

being granted land use rights by the State or receiving

transfer of land use right, owners may only use land

https://orcid.org/0000-0002-5095-3251

for a certain period of time corresponding to each

specific type of land prescribed by the Land Law

2013, this is the land use term. The purpose of setting

the land use term of Vietnamese lawmakers is to

ensure the maintenance of the entire people's

ownership of land and the position of the ownership

representative of the State (Smith et al., 2007). If the

owners are allowed to use the land permanently, the

ownership regime of the entire people and the

position, the role of the ownership representative of

the State are only in law and have no practical value.

Along with that, the land use term also has the effect

of promoting the owners to actively exploit, use up

the land's full capacity to gain maximum benefits

within that time limit and strictly abide the law so that

the State may consider handing over land use rights

again when the land use term expires. Issues of

current law on land use term in Vietnam will be

presented in this article.

Nguyen Thanh, L.

Law on Land Use Term in Vietnam: The Issues in Need of Modiﬁcation in the Current Situation for Economic Development and Social Stability.

DOI: 10.5220/0010658600003224

In Proceedings of the 1st International Scientiﬁc Forum on Jurisprudence (WFLAW 2021), pages 5-10

ISBN: 978-989-758-598-2

2 LAND USE TERM ACCORDING

TO PROVISION OF CURRENT

LAW

2.1 Types of Land with Long and

Stable using Term

According to Article 125 Land Law 2013, land users

may use land for a long and stable term in the cases

mentioned below from the time of receiving the

issuance of land allocation decisions or recognition of

land use rights by competent state agencies. For this

type of land, the time when owners begin to use land

is clearly determined but the time of termination of

land use rights is not prescribed by Law. Land for

long-term and stable use includes the following types

of land:

- Land for protective forest, for special-use forest

and for production forest which are natural forests

- Agricultural land used by communities include:

+) Communities are allocated land or recognized

land use rights by the State to preserve national

identities associated with the traditions and customs

of the people.

+) Communities which are allocated land or

recognized land use rights by the State shall protect

the allocated land and may use land for combined

purposes of agriculture and aquaculture, but may not

use such land for other purposes.

It can be understood that, stemming from the

policy of prioritizing forest’s protection and

development in the context of global climate change

in which Vietnam is forecasted to be one of the

countries that will suffer the most severe

consequences (Lindegaard 2019), hence, protective

forest land, special-used forest land, production forest

land which are natural forests and forest land used by

communities are of long-term use.

- Residential land used by households or

individuals.

- Land for trading or services, for non-agricultural

production establishments of households and

individuals that are using the land stably and that land

is not allocated for limited term or leased by the State.

- Land for construction of offices includes land for

construction of offices of state agencies, political

organizations and socio-political organizations. For

example: The headquarters of the People's

Committees at all levels, the ministries’ offices under

the Government (Ministry of Public Security,

Ministry of Defence, Ministry of Health ...); Land for

construction of non-business facilities which are not

independent on finance, includes: Land for

construction of facilities in the sectors and fields of

economy, culture, society, health, education and

training, physical training and sports, science and

technology, environment, and foreign affairs and

other non-business facilities. For example: Hospitals

under districts and provinces; Public schools at

primary, secondary and university levels… .

- Land used for national defense or security

purpose.

- Land used by religious establishments includes

land for pagodas, churches, oratories, sanctuaries,

monasteries, religious schools, head offices of

religious establishments and other religious

establishments whose operation is licensed by the

State.

- Land used by religious establishments.

- Land for transportation and irrigation, land with

historical-cultural relics and scenic spots and land

used for the construction of other public facilities for

non-commercial purposes.

- Land for cemeteries or graveyards.

2.2 Types of Land with Limited Term

According to Article 126 of Land Law 2013, the

following types of land can be used by owners within

a certain period of time when there is a decision on

land allocation or land lease by a competent state

agency:

- The term for land allocation, recognition of

agricultural land use rights for households and

individuals directly engaged in agricultural

production (including land for annual crops,

aquaculture and salt production; land for perennial

crops, land for protective forest; land for production

forest) is 50 years.

- The term for lease of agricultural land to

households or individuals must not exceed 50 years.

At the expiry of the term, households or individuals

that have demand shall be considered by the State for

continued leasing of the land.

- The term for land allocation or land lease to

organizations for the purpose of agriculture, forestry,

aquaculture or salt production; to organizations,

households or individuals for the purpose of trading

and services or for non-agricultural production

establishments; to organizations for implementing

investment projects; to overseas Vietnamese and

foreign-invested enterprises for implementing

investment projects in Vietnam, shall be considered

and decided on the basis of the investment projects or

applications for land allocation or land lease, but must

not exceed 50 years.

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+) For large investment projects with slow

recovery of capital, projects in areas with difficult

socio-economic conditions or with especially

difficult socio-economic conditions which require a

longer term, the term of land allocation or land lease

must not exceed 70 years. Areas with difficult socio-

economic conditions or with especially difficult

socio-economic conditions are stipulated in

Appendix II issued under Decree No. 118/2015/ND-

CP such as: Bac Kan province, Cao Bang province,

Ha Giang province, Son La province and Dien Bien

province…

+) For projects on construction of houses for sale

or for a combination of sale and rent or for lease-

purchase, the land use term shall be determined in

accordance with the duration of the project. Those

who buy houses associated with land use rights may

use land for a long and stable term.

- The land lease term for the purpose of office

construction of foreign organizations with diplomatic

functions must not exceed 99 years. At the expiry of

the term, if these organizations are still in need of the

land, the State shall consider extending the land lease

term or leasing another land parcel. Each extension

period must not exceed 99 years.

- The lease term for land which is part of

agricultural land fund for public purposes of

communes, wards or townships must not exceed 05

years.

- Regarding land for construction of non-business

facilities of self-financed public non-business

organization which include land for construction of

non-business facilities includes land for construction

of non-business facilities in the sectors and fields of

economy, culture, society, health, education and

training, physical training and sports, science and

technology, environment, and foreign affairs and

other non-business facilities and other public

facilities involving commercial purpose, the land use

term must not exceed 70 years. At the expiry of the

term, if the land users still have land use needs, the

State shall consider an extension but the extension

must not exceed 70 years.

2.3 Land Use Term in the Cases of

Changing Land Use Purpose

Change of land use purpose means that the owners are

allowed to change the initial land use purpose when

they are first allocated, leased or recognized of land

by the State to land use for other purposes with

approval of the State. For example: Converting rice

cultivation land into land for perennial crops, forest

land, aquaculture land, salt production land, etc.

According to Article 127 of the Land Law 2013, the

land use term in the case of changing land use

purposes are as follows:

- The land use term for households and individuals

upon change of land use purpose:

+) In case the land use purpose is changed from

land for protective forest or special-use forest to land

for other purposes, the term shall be determined on

the basis of the land type of the new purpose. The land

use term shall be calculated from the time of the

decision on approval.

+) In case the land use purpose is changed from

land for rice cultivation, other annual crops, perennial

crops, production forest, aquaculture or salt

production to land for protective forest or special-use

forest, households or individuals may use the land for

a stable and long term.

+) In case the land use purpose is changed among

land categories including land for other annual crops,

perennial crops, production forests, aquaculture or

salt production, households and individuals may

continue using such land for the determined land use

term.

At the expiry of the term, if the land users still

have land use needs, the State shall consider an

extension which must not exceed 50 years.

- For organizations, overseas Vietnamese or

foreign-invested enterprises implementing

investment projects outside industrial parks,

industrial clusters, export processing zones or hi- tech

zones, when the land use purpose is changed, the land

use term shall be determined on the basis of the

investment project or application for land allocation

or land lease (50 years, 70 years or long-term and

stable use of land).

- Economic organizations that change the land use

purpose from non-agricultural land with long and

stable land use term to non-agricultural land with

limited land use term or from non- agricultural land

with limited land use term to non-agricultural land

with long and stable land use term, may use the land

for a long and stable term.

2.4 Land Use Term When Receiving

Transfer of Land Use Rights

According to Article 128 of Land Law 2013, the land

use term in case of transfer of land use rights for the

land with definite land use term is the remaining

period of the land use term defined prior to the

transfer of land use rights. People who acquire land

use rights for the land with a long and stable land use

term may use the land for a long and stable term.

Law on Land Use Term in Vietnam: The Issues in Need of Modiﬁcation in the Current Situation for Economic Development and Social

Stability

3 SOME INADEQUACIES OF

THE CURRENT LAW ON LAND

USE TERM

Based on the analysis of the contents of the

current law on land use term, some inadequacies can

be found as follows:

First, it can be seen that Land Law 2013

stipulating on the land use term which includes ‘‘land

used for long and stable term’’ and ‘‘land used for

limited term’’ is inpropriate. For ‘‘land used for long

and stable term’’, when the owners are given land use

rights by the State or received transfer of land use

rights, the time of termination of land use rights is

unknown. Land use rights of owners only terminate

when the State recovers land or owners transfer land

use rights. Compared with the provisions of Article

144.1 of the Civil Code 2015: ‘‘Time-limit means a

length of time calculated from one point of time to

another point of time’’ (National Assembly, National

database of legal documents 2015), in this case of

‘‘land used for long and stable term’’, there is no land

use term. Thus, it is clear that the regulation of ‘‘land

without expiry date of using’’ to be ‘‘land used for

limited term’’ under the name of ‘‘land used for long

and stable term’’ is unreasonable, contradicting the

provisions of Article 144.1 of Civil Code 2015 on

time limits, which affects the synchronism and unity

of the Vietnamese legal system.

Second, previously, Land Law 2003 (National

Assembly, National database of legal documents

2003) only allowed the term for individuals and

households to directly use land for annual crops, land

for aquaculture and salt production is 20 years while

the term of use of these types of land for economic

organizations is 50 years (López Jerez, 2020). With a

land use term of 50 years for individuals and

households who directly use annual crop land,

aquaculture land, and salt production land which have

been clearly stated in the 2013 Land Law is

undeniably more appropriate. It can not only be based

on the method of short-term or long-term tree

cultivation, or between individuals, households and

economic organizations to determine the land use

term. In many cases, investing in annual crops or

aquaculture is more expensive than investing in

perennial crops, so the short term of land use will

limit farmers’ investment. It can even make them to

overexploited land, resulting in the exhaustion of

agricultural land. On the other hand, a long land use

term will help create an attachment psychology to

land for users, which promotes investment in farming

on land, thereby bringing higher productivity and

economic efficiency. However, although the Land

Law 2013 has increased the term of agricultural land

use to 50 years, it is still relatively short for

agricultural production. To recover the invested

capital and profitability for agricultural production

takes longer time than other production and business

sectors. Meanwhile, Article 126.2 of the Land Law

2013 stipulating that the agricultural land use term is

equal to the land use term for service, commercial and

non-agricultural production establishments (50 years)

is not consistent with the characteristics of

agricultural production (Smith et al., 2007) (Pilarczyk

& Nuoi, 2005)

Third, differences between the use term of

agricultural land (which are land for annual crops,

land for aquaculture and salt production; land for

perennial trees, protective forest land; production

forest land) and use term of residential land,

commercial land, services, non-agricultural

production establishment land of households and

individuals, results in households’ property rights

over agricultural land being protected by the State at

a lower level, more vulnerable to being revoked by

the State.

Fourth, Article 6.1 of Law Amendments to some

articles concerning planning of 37 Laws related to

planning in 2018, stipulates that the land use period is

10 years, while land use with definite time will lead

to the case when the old planning period of land using

ends, the newly developed land use plan shall be

adjusted and changed. Therefore, when the land use

term expires, it is difficult for land users to extend the

land use by the State because their use of land is not

in line with the new approved land use plan . Hence,

the provision of ‘‘the land users are considered for

land use extension when the land use term expires’’

is not clear, which can lead to unnecessary disputes in

practice.

Fifth, the maximum term of land allocation or

land lease is 50 years for organizations to implement

investment projects; Vietnamese residing abroad,

foreign-invested enterprises to implement investment

projects in Vietnam, which is generally short. This

makes it difficult to attract investors to invest large-

scale investment in Vietnam. At the same time,

extending the land use term for an additional 20 years

(the law stipulates that the maximum allocation or

lease of land must not exceed 70 years) as a

preferential measure for investors implementing

projects in the areas with difficult socio-economic

conditions and areas with exceptionally difficult

socio-economic conditions is not appropriate. For

large-capital projects implemented in these areas, the

process of capital recovery and profitability will be

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much slower than those invested in areas with

uniform development regarding the infrastructure, the

level of the labor force, the convenient transportation

position…, hence, the additional 20 years of land use

term will not create a strong attraction for investors to

implement large investment projects in areas with

difficult socio-economic conditions and areas with

exceptionally difficult socio-economic conditions

(van der Burg, 2015).

Sixth, the land use term through the transfer or

receipt of capital contribution of agricultural land use

rights of the owners is very short, so that the owners

do not dare to invest large amounts of capital in

agricultural and industrial production, services,

which will limit the development of the real estate

market (Thanh, 2019).

4 SOME ISSUES NEED TO BE

CHANGED BY THE LAW ON

LAND USE TERM TO

PROMOTE ECONOMIC

DEVELOPMENT AND SOCIAL

STABILITY IN VIETNAM

TODAY

In the context of Vietnam's economy growing rapidly

and integrating into the global economy, the stable

and long-term use of land is the motivation for

investors to invest large-scale capital in implementing

socio-economic development projects. The current

regulations on land use term need some amendments

as follows:

First, the Land Law 2013 needs to revise the

‘‘land used for long and stable term’’ regulation to

‘‘land with indefinite term’’ to make it more

reasonable, avoiding conflicts with the provisions of

the Civil Code 2015 on time limit.

Second, the Land Law 2013 needs to clearly state

if it falls into the case of simultaneously expiry of the

land use term and expiry of old planning period of

land using; the newly developed land use plan has

some changes, thus there will be no extension of land

use term to avoid unnecessary disputes.

Third, for the extension of the land use term, it can

be chose to extend to 99 years for all types of land

with limited term (Derostyne R.V 2013). Extending

the land use term to 99 years is a relatively long

period of time, which will create a peace of mind for

land users. At the same time, it will also overcome the

difference between the land use term of agricultural

land and the residential land, business land (Barai et

al., 2017).

However, is it necessary to continue to maintain

the regulations on land use term? In fact, regulations

on land use term have not been enforced, namely the

allocation of agricultural land to individuals and

households for annual crops, aquaculture in

accordance with the Land Law 1993 (have a term of

20 years, but upon the expiry of this period, the Land

Law was amended to increase the time limit to 50

years, which is extended for another 30 years due to

concerning about uncertainties and disturbances that

may occur in economic and social life. This extension

is really a temporary solution when there is not

enough determination to eliminate agricultural land

use term. In the future, at the end of this extended 30-

year period, similar concerns will continue to be

raised, which are much more complex because the

value of agricultural land is increasing with the

Vietnam's rapid economic development and this will

undoubtedly happen to other types of land with other

land use term (Thanh, 2019).

At the same time, the Land Law 1993, the Land

Law 2003 and the Land Law 2013 all stipulate that

upon the expiry of the land use term, if land users still

wish to use that land, they will be considered by the

State to grant land use rights. A sure thing is that land

users always have the need to continue using the land

at the end of the land use term because it is a benefit

associated with their assets so it is not easy to give up.

In the context of widespread and complicated

corruption in the land sector in Vietnam (Chris

Rowley & Rama, n.d.; Li et al., 2016; Powell et al.,

2019) (Powell et al., 2019), this may be the cause of

negative acts and violations by competent state

agencies such as: Recover land with the reason of

expiry of the land use term (without considering to

reallocate land to owners with expired land) to grant

to other entities or acts of harassment or bribery from

people who want to continue to extend land use. This

is reflected in the land acquisition of Mr. Doan Van

Vuon in Tien Lang district, Hai Phong province in

2012. Accordingly, the People’s Committee of Tien

Lang district acquiring Mr. Doan Van Vuon’s land

due to expiry of land use is not correct. This led to

Mr. Vuon protested by force of land acquisition of

Tien Lang District People’s Committee, resulting in

01 death and 06 injuries (Nguyen, 2019).

Simultaneously, the determination of the land use

term which aims at ensuring the maintenance of the

entire people’s ownership system of land and

protecting the status of State ownership

representative is not necessary because the State’s

ownership status will always be guaranteed through

Law on Land Use Term in Vietnam: The Issues in Need of Modiﬁcation in the Current Situation for Economic Development and Social

Stability

the State exercising the important rights stipulated in

Article 13 of the Land Law 2013 such as: To decide

on master plans, plans on land use; To decide on land

recovery and land requisition; To decide on financial

policies on land… In addition, the regulation of land

use term does not make much sense in promoting the

owners to actively exploit and use all the land's

functions to obtain maximize benefits within the time

limit and strictly abide by the land law so that the

State may consider handing over land use rights when

the land use term expires because in the market

economy, owners always have to do everything to get

the most economic benefits from the assets. The

abandonment of land, destroying land... has been the

basis for the state to implement land acquisition in

Article 64 of the Land Law 2013 .

5 CONCLUSION

Vietnamese lawmakers have defined the land use

term with two types of time: land used for long and

stable term; land used for limited term corresponding

to each specific types of land. The stipulation of land

use term is aimed at maintaining the status of the State

as the ownership representative of the entire people

on land and for the owners to actively exploit and use

land effectively in the land use term. However, the

law on land use term has not brought about the desired

effect but also led to inadequacies due to the different

land use term between land types and short land use

term which is incompatible with the current economic

development and social stability of Vietnam.

Therefore, the law on land use term requires a change

in the direction of extending the land use term of all

types of land to 99 years or more drastically changing

such as abolition of land use term. By the end, land

use term only undergoes land laws and are not

enforced in practice.

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