On June 29, 2022, the Government issued Decree No. 44/2022/ND-CP on the establishment, management and use of information system about housing and real estate market (“Decree 44”). Decree 44 shall officially take effect from August 15, 2022 and shall replace Decree 117/2015/ND-CP dated November 12, 2015 (“Decree 117”). Decree 44 has clearer regulations on sharing and providing information and data, in order to create a safe legal corridor in the real estate market. Some of the outstanding contents that have been amended and supplemented include:
1. Mandatory disclosure of information about real estate projects
Pursuant to Decree 44, information and data must be published online on the portal of the information system on housing and real estate market (website address: http://www.batdongsan.xaydung.gov.vn) and must follow the forms specified in the Appendix attached to Decree 44 in the direction of simplification.
Compared to the provisions of Decree 117, Decree 44 has stricter requirements for the investor of real estate projects to provide a series of legal documents on real estate projects and products eligible for trading during the reporting period to the Department of Construction as follows:
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CONTENTS |
DECREE 44 |
DECREE 117 |
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Content of information and data to be provided |
- Information on real estate transactions of the project in the reporting period: Information on transaction prices, transaction volumes (are defined more specifically than in Decree 117). - Information on the implementation of housing and real estate projects: + Location of project implementation, project scale, total investment capital, project operation time and implementation schedule; + Legal documents of the project: Decision on investment policy, Detailed Plan, Construction Permit or Notice of construction commencement, documents of the Department of Construction on the eligibility of houses to be sold and the rental of houses to be formed in the future (if any). (Article 18.9). |
- Information on real estate transactions of the project: Information on transaction volume and transaction price. - Information on the implementation of housing and real estate projects: + Quantity and implementation situation of projects, quantity of each type of real estate product of the project; + Demand for types of real estate according to statistics and forecasts. (Point b, Clause 1 and point a, Clause 2, Article 13). |
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Time limit for providing information and data to the Department of Construction |
Quarterly: Before the 10th of the last month of the reporting quarter. (Point b, Clause 2, Article 19). |
- Monthly: Before the 5th of the following month of the reporting month. - Quarterly: Before the 10th day of the first month of the following quarter of the reporting quarter. (Point a, Clause 5, Article 13). |
Notes:
a) In case of houses to be formed in the future: The declaration and provision of information and data on real estate eligible for trading and the post of a written notice of the Department of Construction about houses eligible to be sold, the rental of houses to be formed in the future must be done before the investor puts the project’s real estate on sale.
b) In case of project transfer in whole or in part:
- The transferee shall provide detailed information and data on the transferred project, the type of enterprise and the real estate eligible to be put into the transaction.
- The transferer shall adjust and/or amend project information and data.
In fact, the uncertainty about the legality of the project is one of the causes of risks for buyers in the real estate market. In many cases, the investor cannot issue certificates to customers due to the failure of procedure completion as prescribed by law. With these updated regulations, projects will be public and transparent, leading to the creation of a safe and healthy real estate legal environment.
2. Tax information and data for the transfer of certain types of real estate[1]
Information and data to be disclosed include: (i) Total tax collected from real estate transfer; (ii) Total number of transactions of real estate transfer in the area; and (iii) Total value of real estate transfer transactions in the area.
This is a new regulation aimed to reduce the fraudulent transfer pricing for tax evasion, which not only contributes to increase the state budget but also protects the legitimate rights and interests of related parties.
[1] Such as: Independent houses (villas, townhouses); Apartment for living; Land for construction of houses (in the form of subdivision for sale).
Comment: