I live in Ha Noi. I have a company in Industrial Group X

Question 5:  I live in Ha Noi. I have a company in Industrial Group X, specializing in leasing factories. I would like to ask questions as follows: Are we permitted to let out our factories to a company with 100% foreign capital? Specifically: That is a company of Hong Kong and they set up a new company on the land leased by our company.

Your company that leases factories and Hong Kong’s company that wants to rent your factories must comply with the Real Estate Business Law 2014 and Investment Law 2014 and the relevant guidelines. Your company leases the factories in accordance with Article 10 of the Law on Real Estate Business 2014 and Section I Chapter 2 of Decree 76/2015/ND-CP.

 Any organizations or individuals wish to conduct real estate trading shall set up enterprises complying with regulations on enterprises or cooperatives (hereinafter referred to as enterprises) and have legal capital not smaller than VND 20 billion, excluding cases as follows:

– Any organizations, households and individuals who conduct small-scale or irregular transactions of real estate sale, transfer, lease-out, and lease purchase as stipulated in Article 5 Decree No. 76/2015/ND-CP;

– Any organizations or individuals who provide real estate services as prescribed in Chapter IV of the Real Estate Law 2014.

Real estate business enterprises subject to legal capital stipulated in Clause 1, Article 10 of the Real Estate Business Law 2014 shall be responsible for the truthfulness and accuracy of the amount of legal capital.

According to Article 9 of the Real Estate Business Law 2014, requirements in terms of real estate to be put on the market include:

“1. A building to be put on the market shall satisfy the following requirements:

a) The ownership of the building on land is registered in the Certificate of land use right (hereinafter referred to as Certificate of land). Regarding an off-the-plan building in the real estate project, it is only required to have the Certificate of land as prescribed in regulations of law on land.

b) There is no dispute about the land and ownership of the building on land.

c) The building is not distrained.

2. Types of land permitted to be put on the market shall satisfy the following requirements:

a) There are Certificates of land as prescribed in regulations of law on land.

 b) There is no dispute about the land.

c) The land is not distrained;

d) The land use term is still unexpired.

Therefore, you want to put out a factory to lease, you must obtain a certificate of land use rights, ownership of houses and other assets attached to land; you are eligible for lease of the factory.

Clause 24 Article 1 of Decree No. 01/2017/ND-CP stipulates that economic organizations, overseas Vietnamese, foreign-invested enterprises, households and individuals with annual rental payment; lease land or re-lease land in industrial parks, export processing zones, industrial clusters and craft villages with annual rental payment and have been granted certificates, shall be entitled to lease assets attached to land which have been lawfully created in accordance with the provisions of law, if all the conditions specified in the law on real estate business are met. The lessee must use the property on the land for the purposes stated in the land lease decision issued by the competent authority or in the contract of land lease or land re-lease which were signed.

Therefore, the Hong Kong company with 100% foreign investment will be entitled to rent your company's factory and must use for the purposed stated in the decision that the Hong Kong company signed with your company.

Relevant similar questions:

- Procedures for leasing land for 50 years for production and business of foreign investors

- Procedures for buying houses, buying land for individuals and organizations being foreigners.