Door closed on foreign property buys

A State Bank official has said that by law private citizens may not send money overseas to buy real estate

He was responding to a recent advertisement by a Vietnamese company that offered to sell US real estate to Vietnamese nationals.
“Under the current foreign exchange regulations, there is no provision that allows private citizens to send money out of the country to buy property,” said the central bank’s Ho Chi Minh City branch director Tran Ngoc Minh.
The regulations only stipulate that the central bank may consider and permit the transfer of foreign currency out of Vietnam in a few circumstances.
Those include enterprises licensed to invest in overseas projects in compliance with the provisions of the Overseas Investment Law.
Private persons are allowed to transfer money out of Vietnam to study, work, or have medical treatment; or for immigration as authorised by the host country.
Ho Chi Minh City’s Phuong Nam Investment, Informatics and Construction Consulting Shareholding Company (SEI) took out the ad in Saigon Giai Phong (Saigon Liberation) newspaper on December 7 to promote land for sale in an estate called “Diamond Star” in Houston, Texas.
The advertisement said the infrastructure for the project had been completed and that work on the first 10 houses would begin within the month.
“This is a chance for locals to own property in the US,” the advertisement read.
The advertisement said Vietnamese investors could sign a contract with the company’s partner, the US-backed Southern Corporation.
Payment would be made in Vietnam in four stages, 10 per cent when the contract was signed and 30 per cent for each subsequent payment through an account at the Saigon Commercial Joint Stock Bank (SCB).
An executive from the SCB confirmed that the “Diamond Star” project owner had opened an account at his bank for prospective buyers of property in the US, with payment to be made in Vietnamese dong.
Transfers of money for purposes other than schooling, medical treatment or emigration had to be considered and approved by the central bank, said Minh.
“Until now, we haven’t permitted any money transfer for property acquisition,” he said last week.
Meanwhile, a statement issued on December 8 by the the US Consulate General in Ho Chi Minh City said that “any blanket assertions that the US Embassy or Consulate General will notarise property contracts are inaccurate”.
Notarisation, it said, “is on a case-by-case basis, and if there is a reason to suspect fraud or other illegal activity, or if there are some questions as to the veracity of the claims contained in the document, the consular officer will not be able to notarise the document”.
The SEI, which received an outbound-investment licence from the Ministry of Planning and Investment last year to invest in the US real estate sector, teamed up with the US-backed Southern Corporation to develop the Diamond Star project.
No SEI executives were available last week to comment on the project and the advertisement.
In June this year, the company also advertised the Diamond Star project in several local newspapers.