PROTECTION OF THE RIGHTS OF REAL ESTATE PURCHASERS ACCORDING TO THE LAW ON DECENTRALIZATION, DELEGATION OF AUTHORITY, ADMINISTRATIVE REFORM, AND DISCLOSURE OF INFORMATION ON REAL ESTATE TRANSACTIONS BASED ON PRACTICAL EXPERIENCES IN HỒ CHÍ MINH CITY
PROTECTION OF THE RIGHTS OF REAL ESTATE PURCHASERS ACCORDING TO THE LAW ON DECENTRALIZATION, DELEGATION OF AUTHORITY, ADMINISTRATIVE REFORM, AND DISCLOSURE OF INFORMATION ON REAL ESTATE TRANSACTIONS BASED ON PRACTICAL EXPERIENCES IN HỒ CHÍ MINH CITY
Đặng Thị Trang
Bạch Tuyết Law Firm LLC
Nguyễn Duy Phúc*
Bạch Tuyết Law Firm LLC
ABSTRACT
The decentralization, delegation of authority, administrative reform, and disclosure of information regarding real estate in Hồ Chí Minh City currently face many shortcomings in the provision and disclosure of real estate information. There is no coordination mechanism between related agencies, and the administrative procedures related to real estate transactions have not achieved uniformity, posing many risks for real estate purchasers. Therefore, the authors propose solutions to address these issues to protect the rights of real estate purchasers based on practical experiences in Hồ Chí Minh City.
Keywords: protection of real estate purchasers’ rights, decentralization, delegation of authority, administrative reform, disclosure of real estate information
I. INTRODUCTION
The real estate market (REM) plays a crucial role in Vietnam’s economy, as well as its economic growth and social welfare. This role is partly reflected by the average contribution rate of the real estate sector during the period of 2012-2022, which accounted for approximately 3.5% of the country’s GDP, contributing 0.5 percentage points to GDP growth (Phạm, Q. D, 2023).
In this context, promoting decentralization and delegation of authority (DDA) in land management and the real estate sector is necessary to enhance efficiency, reduce disputes, and protect the rights of real estate purchasers. This aligns with the spirit of the XIII National Congress of the Communist Party of Vietnam, which aims to overcome overlaps, ensure unified management, and promote the proactivity and creativity of various levels and sectors (Communist Party of Vietnam, 2021).
Additionally, increasing transparency in the real estate market through the disclosure of real estate information and strengthening administrative reforms in real estate-related procedures are key tasks that need to be focused on and promoted. These measures aim to protect the rights of real estate purchasers, build a transparent real estate market, ensure healthy and sustainable development, and contribute positively to the overall prosperity of society.
II. LIMITATIONS OF THE DECENTRALIZATION AND DELEGATION OF AUTHORITY MECHANISM, ADMINISTRATIVE PROCEDURES, DISCLOSURE OF INFORMATION ON REAL ESTATE TRANSACTIONS, AND PRACTICAL EXPERIENCES IN HỒ CHÍ MINH CITY
- Regarding the Decentralization and Delegation of Authority Mechanism
First, there is no sanction for handling and controlling activities in the provision of real estate information that has been decentralized and delegated.
Based on the right to access information recognized in the 2023 Constitution and the 2016 Law on Access to Information, one of the prominent new features of the 2024 Law on Land is the addition of provisions regarding citizens’ rights to land (Article 23) and the right to access information (Article 24).
To ensure citizens’ right to access land information, the responsibility of state management agencies in the field of land to provide information must be seriously and promptly implemented. The responsibility to disclose and provide information online is also stipulated in Decree No. 42/2022/NĐ-CP dated June 24, 2022, which regulates the provision of information and online public services by state agencies on the internet.
According to current legal regulations, the task of providing land information is strongly decentralized and delegated to localities, but in practice, the rate of information provision by state management agencies is still very low and does not accurately reflect the situation of real estate management and use. This makes it difficult for real estate purchasers to understand the legal status of real estate and poses risks when engaging in transactions without fully understanding the legal conditions and status.
According to the assessment report by the Provincial Governance and Public Administration Performance Index (PAPI) research program, the rate of district-level state agencies not responding to citizens’ requests for information has been consistently high from the first assessment round in 2021 until February 21st, 2023.
Specifically, letters requesting information on district-level land use plans for 2022 were sent to 561 district-level People’s Committees (UBND), but only 146 agencies responded (of which only 108 agencies provided information (19%), 6 agencies refused to provide information (1%), 32 other responses (nearly 6%)), and 415 agencies (equivalent to 74%) did not respond to the information requests (United Nations Development Programme (UNDP) in Vietnam, 2023).
According to the authors, the main reason is due to the lack of a sanctioning system to handle violations of land information disclosure. For example, Decree 91/2019/NĐ-CP (amended by Decree 04/2022/NĐ-CP) on administrative penalties in the field of land has not clearly addressed sanctions for violations of citizens’ right to access information.
Similarly, Decree 94/2014/NĐ-CP detailing some provisions of the Law on Real Estate Business regarding the construction and management of information systems and databases on housing and the real estate market has provisions on the responsibilities of each managing agency, but there are no sanctions or guidelines for handling violations in the construction and management of these systems.
It is clear that although legal regulations have stipulated the responsibility to provide information and strongly decentralized and delegated authority to localities in disclosing land and real estate information, in practice, due to the lack of a sanctioning system for non-compliance, many state management agencies have not fully or correctly implemented these regulations, leading to real estate purchasers not being able to access complete and timely land information.
Second, there is no delegation of information access for agencies and organizations related to the implementation of real estate transactions.
Point a, Clause 3, Article 27 of the 204 Law on Land stipulates that contracts for the transfer of land use rights, land use rights and assets attached to land must be notarized or authenticated, except for real estate business cases specified in point b of this clause. Additionally, Article 164 of the 2023 Law on Housing stipulates that in cases of purchase, lease purchase, donation, exchange, capital contribution, or mortgage of housing, the contract must be notarized or authenticated, except as provided in Clause 2 of this Article.
Similarly, Article 44 of the 2023 Law on Real Estate Business stipulates that contracts for the purchase, lease purchase of housing, construction works, and construction floor area where the parties involved are individuals must be notarized or authenticated. Real estate business contracts and real estate service business contracts where at least one party is a real estate business enterprise are notarized or authenticated upon the request of the parties.
In many cases, the notarization of real estate contracts is a mandatory condition for the contract to be effective. The agreement of the notary public to perform the notarization significantly impacts the purchaser’s decision. However, difficulties in accessing information about disputes related to real estate by notary public organizations may cause obstacles for the purchaser in the notarization process or in registering changes after completing notarization procedures. For example, a notary public organization may not be aware of disputes involving the real estate (currently under resolution) and performs the notarization, only for one of the parties to find out about the dispute during the registration of the change in ownership.
Furthermore, one of the conditions for the land user to transfer the right is that the land is not in dispute or the dispute has been resolved by a competent state agency, and the judgment, decision of the court, decision or arbitration award has taken legal effect (this condition was added in the 2024 Law on Land compared to the 2013 Law on Land).
Although the 2024 Law on Land stipulates that citizens have the right to access information on the database of land dispute resolution, complaints, and denunciations (Article 24, Article 165), currently, there is only Regulation No. 03/2017/NQ-HĐTP dated March 16, 2017, of the Judges’ Council on the publication of judgments and decisions on the court’s electronic portal,
without provisions on the responsibility and procedures for publicly disclosing information on land dispute resolution, complaints, and denunciations by the court on the national land information system. Moreover, the publication of judgments and decisions has not been fully and uniformly implemented, and the entry of basic information of judgments and decisions has not been standardized, leading to difficulties in information retrieval.
It is evident that agencies related to real estate transactions cannot access information related to real estate. There are no regulations on delegating information access for agencies and organizations related to real estate transaction procedures, causing difficulties for real estate purchasers in the transaction process, and transactions may not ensure legal effectiveness, posing many risks of disputes and damage for real estate purchasers.
- Regarding Administrative Procedures
First, administrative procedures in the field of land have not been completed and have not been uniformly implemented across 100% of districts.
Implementing Decree No. 61/2018/NĐ-CP dated April 23rd, 2018 of the Government (amended and supplemented by Decree No. 107/2021/NĐ-CP dated December 6th, 2021) on the implementation of the one-stop shop and interconnected one-stop shop mechanism in administrative procedure resolution, Hồ Chí Minh City (Hồ Chí Minh City) has long piloted the use of the VBDLIS (Viettel Business Data Land Information System) software at the City Land Registration Office (VPĐKĐĐ) and 11 branches.
Currently, the most completed system can be mentioned as the Thủ Đức City Land Information Portal, which allows interconnection between VPĐKĐĐ branches, Tax Department, State Treasury, and banks in resolving administrative procedures related to the transfer and mortgage of land and housing in Thủ Đức City (Nguyễn, Q., 2022). This helps simplify administrative procedures in Thủ Đức City and shortens the processing time for dossiers. However, the one-stop shop mechanism in the field of land in Hồ Chí Minh City is not yet uniform and consistent and has not covered 100% of the area, causing difficulties for residents and prolonging the processing time for procedures, posing risks of disputes in real estate transactions.
Therefore, the reform of administrative procedures in the field of land in Hồ Chí Minh City is an urgent task that needs to be prioritized to create favorable conditions and avoid risks for real estate purchasers in the area.
Second, the procedure for providing information upon request has not been specifically regulated, and the response rate is low.
Although the right to access land information is legally recognized, in reality, real estate purchasers still face difficulties in requesting and receiving information from management agencies. A 2023 study by the United Nations Development Programme (UNDP) in Vietnam on the disclosure of land use planning revealed that only 23.7% of agencies provided information upon request, while 67.9% did not respond (United Nations Development Programme (UNDP) in Vietnam, 2024). This indicates that citizens’ right to access information is still not fully guaranteed.
Notably, the study results show that 3 out of 30 agencies had other responses but did not provide the requested information, instead asking for clarification on the place of residence and purpose of using the information, but subsequently gave no further response. This requirement is not necessarily contrary to legal provisions, as Clause 3, Article 13 of Circular No. 34/2014/TT-BTNMT dated June 30th, 2014, by the Ministry of Natural Resources and Environment on the establishment, management, and exploitation of land information systems stipulates cases where data is not provided, including cases where “the purpose of using the data is not appropriate as per legal regulations.”
However, determining whether the purpose of data use complies with legal regulations depends on the subjective will of the information-requesting agency. This leads to instances where agencies responsible for providing information are apprehensive about providing information that may affect or cause disputes with other entities and fear responsibility, thus using the grounds of “the purpose of using the data is not appropriate as per legal regulations” to withhold information.
First, the activity of publicly disclosing real estate information in Hồ Chí Minh City is not centralized, and there is no comprehensive system for publishing real estate information.
For example, regarding future housing transactions, the determination of housing projects eligible for sale or lease purchase falls under the jurisdiction of the Department of Construction (Article 24, Clause 4 of the 2023 Law on Real Estate Business, and Point K, Clause 9, Article 2 of the Decision on the functions, tasks, powers, and organizational structure of the Department of Construction of Hồ Chí Minh City issued with Decision No. 47/2023/QĐ-UBND dated October 27th, 2023).
Meanwhile, the task of land statistics, inventory, and the creation of land use status maps, providing documents, maps, information, and land data to organizations and individuals is carried out by the City Land Registration Office (Article 13 of Decree No. 102/2024/NĐ-CP, and Article 1 of Decision No. 2602/QĐ-UBND dated June 3rd, 2015 of the People’s Committee of Hồ Chí Minh City on the establishment of the City Land Registration Office under the Department of Natural Resources and Environment).
Thus, the provision of information on the list of projects confirmed by the Department of Construction to be eligible for sale or lease purchase of future housing in Hồ Chí Minh City on the website https://soxaydung.hochiminhcity.gov.vn/ is currently only updated until December 2020.
Similarly, the publication of planning information managed by the Department of Natural Resources and Environment on the website https://thongtinquyhoach.hochiminhcity.gov.vn/ or the Department of Planning and Architecture on the website https://qhkt.hochiminhcity.gov.vn/ban-do-quy-hoach.html is not fully updated, making it difficult for real estate buyers to search for planning information. The research group attempted to search for information by entering the correct plot number, map number, and address according to the latest land use right certificate, but the information page responded with “No plot number, map number found.”
Second, the division of information management authority leads to fragmented and dispersed public information.
The division of information management authority is also a cause of the dispersion and inconsistency of publicly disclosed information. A specific example is the disclosure of the legal status of real estate projects, which is often presented in various forms such as land allocation decisions, land lease decisions, land use rights certificates, construction permits, project approval decisions, and notices of eligibility for sale, all of which fall under the jurisdiction and are stored at different agencies.
As a result, searching for and verifying this information becomes challenging because real estate purchasers need to have a legal background to identify the competent authority for issuance, management, and storage to contact. Moreover, verifying information is difficult and time-consuming as it requires contacting multiple information management agencies.
III. PROPOSED SOLUTIONS TO IMPROVE THE LEGAL FRAMEWORK FOR DECENTRALIZATION, DELEGATION OF AUTHORITY, ADMINISTRATIVE REFORM, AND DISCLOSURE OF INFORMATION ON REAL ESTATE TRANSACTIONS BASED ON PRACTICAL EXPERIENCES IN HỒ CHÍ MINH CITY
- Regarding Decentralization and Delegation of Authority
First, adding regulations on sanctions for violations of the responsibility to provide real estate information.
Along with the decentralization and delegation of land management and use, inspection, supervision, and sanctioning will help improve the effectiveness of delegation. To address the issue of unclear regulations on administrative sanctions for violations of citizens’ right to access information, the authors propose adding regulations on sanctions for violations in cases where state agencies at all levels do not fully and correctly fulfill their responsibility to provide information, including land information.
Second, delegating access to land information and establishing a coordination mechanism between agencies and organizations involved in real estate transaction procedures.
The authors propose building an information portal for each real estate category, specifying the agency with primary management responsibility, the agencies responsible for coordinating the disclosure of information, and delegating access to search all real estate information.
For example, for information on real estate projects, the starting point is often investment policy decisions. Therefore, the agency approving the investment policy will disclose the initial information. During the project implementation process, specialized agencies with authority will continue updating project information, including appraisal documents, sale permissions, etc., and have access to search all this information on one platform. Technically, the project or real estate should be identified by a unique identifier for easy reference (Ninh, T. H, 2022).
Additionally, the authors propose establishing an inter-agency information exchange mechanism between the state real estate management agency and other agencies, such as the police and the courts, to ensure comprehensive public disclosure in the spirit of the 2024 Law on Land. For example, after accepting a case, the court will transfer information on the disputed real estate, and the competent authority will publicly disclose the disputed real estate information on the centralized real estate information disclosure system. Similarly, after resolving the case (with an effective judgment or decision), the court will forward the information for the competent authority to disclose the information on the cancellation of the Land Use Rights Certificate or the resolved dispute.
This way, real estate purchasers can easily search for and comprehensively update the legal status of real estate to minimize risks in real estate transactions.
- Regarding Administrative Procedures
First, adding specific guidelines on the case of “the purpose of using the data is not appropriate as per legal regulations” in Clause 3, Article 13 of Circular No. 34/2014/TT-BTNMT.
To address cases where agencies receiving information requests misuse power or avoid providing information, the authors propose adding specific guidelines on the case of “the purpose of using the data is not appropriate as per legal regulations” in Clause 3, Article 13 of Circular No. 34/2014/TT-BTNMT to align with the spirit of ensuring citizens’ right to access information in the 2024 Law on Land.
Second, adding procedures for providing information upon request to the current administrative procedures in the field of land in Hồ Chí Minh City, along with specific guiding documents.
The authors propose adding procedures for providing information upon request to the current administrative procedures in the field of land and having specific guiding documents so that real estate purchasers in Hồ Chí Minh City can easily exercise their right to access information and have grounds to implement complaint and denunciation procedures in cases where state management agencies do not follow the correct procedures.
In addition, it is necessary to establish a dialogue and regular consultation mechanism between competent authorities handling administrative procedures related to real estate and the public, as well as representatives from the business community, to share and find common ground (Nguyễn, N. M, 2010).
- Regarding the Disclosure of Real Estate Information
First, building a centralized system for publicly disclosing real estate information as well as an information extraction system.
According to the authors, building a centralized system for public disclosure of real estate information is the basis for addressing the current lack of transparency in the real estate market in Hồ Chí Minh City. This system will easily disseminate information widely to the public, ensure easy access to a centralized system, and eliminate information disruptions, ensuring the quality and consistency of information from various sources.
Second, adding regulations to delineate the authority for disclosing real estate information in documents defining the functions and tasks of state management agencies in the field of land in Hồ Chí Minh City.
Given the issues arising from the division of authority to manage real estate information, which falls under the responsibilities of various agencies and is scattered across different legal documents, the authors propose adding regulations to delineate the authority for disclosing real estate information in documents defining the functions and tasks of state management agencies in the field of land in Hồ Chí Minh City.
IV. CONCLUSION
To protect the rights of real estate purchasers and build a healthy and developing real estate market based on practical experiences in Hồ Chí Minh City, it is necessary to (i) unify decentralization and delegation of authority and enhance coordination between agencies in land state management (ii) replicate the model of the Thủ Đức City Land Information Portal across other districts in the entire city and establish a coordination mechanism between agencies, and (iii) build a centralized real estate information disclosure and extraction system with the participation and coordination of competent authorities to ensure effectiveness.
REFERENCES
- United Nations Development Programme (UNDP) in Vietnam. (2023). Second-round evaluation report on the public disclosure of district-level land use planning information and provincial land price tables on electronic platforms in 2022.
- United Nations Development Programme (UNDP) in Vietnam. (2024). Third-round evaluation report on the public disclosure of district-level land use planning and provincial land price tables in 2023.
- Communist Party of Vietnam. (2021). Documents of the 13th National Congress of Delegates (Volume I). National Truth Publishing House.
- Nguyễn, N. M. (2010). Administrative procedure reform to promote the development of the real estate market. Legislative Research Journal, 16(177).
- Nguyễn, Q. (2022, July 1). TP. HCM: Public disclosure of land data information. Resources and Environment Electronic Newspaper. https://baotainguyenmoitruong.vn/tp-hcm-cong-khai-thong-tin-du-lieu-dat-dai-343369.html
- Ninh, T. H. (2022). National Land Information System and institutional support for the real estate market. Legislative Research Journal, 18(466).
- Phạm, Q. D. (2023). The role of the real estate market in the economy and solutions for market stabilization in Vietnam. Economic and Forecasting Journal, (10).
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