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|The new Decree 25 will be a welcome change for real estate investors in a market muted by COVID-19|
On February 28, 2020, the prime minister signed Decree 25 detailing the implementation of a number of articles of the Bidding Law regarding the selection of developers and project implementation.
This new decree replaces Decree No.30/2015/ND-CP with many new points, with the most important being that the land will be allocated to the winning investors immediately after land clearance and compensation activities, as well as the resettlement of residents, is completed.
Decree 25 has also stoppered a glaring hole in the legal framework, as neither the Land Law nor the Bidding Law clarified which steps need to be done to hand over land to winning developers. This has lead to a great many projects that were delayed by multiple years as localities could not hand over sites and projects to developers who had won the bids for them.
According to Dr. Tran Dinh Thien, former director of the Vietnam Economics Institute and current member of the Economic Advisory Team of the prime minister, this decree will facilitate the resumption of a range of projects which have been delay for years, reducing the losses of developers and the whole society.
“This stagnation should have been dealt with a time ago but better late then never, this will be welcomed by developers, especially at when the industry is suffering from the strong impacts of the COVID-19,” Thien said.
Decree 25 is also expected to open up great opportunities for many local authorities and developers, especially the ones that have completed bidding procedures and are waiting for instructions on land allocation across the country.