Summary of Major Changes to the Amended Land Law – Effective January 1, 2025
1. Those currently leasing land with a one-time payment can switch to annual payments =>> This provides flexibility for the business’s operations
2. When transferring land use rights, the amount previously exempted or reduced must be repaid
=>> Avoids negative consequences related to receiving government incentives
3. Strictly regulate conditions for the transfer of land use rights =>> Add additional conditions to ensure real estate transactions are conducted more transparently. Avoid unfortunate incidents like those in the past
4. Businesses may acquire land use rights for rice fields =>> Agricultural land prices may rise significantly as a result. Current agricultural land prices are generally relatively low.
5. Selling assets on land and selling land lease rights to other businesses => Further facilitating the industrial real estate sector
6. Failure to fulfill financial obligations regarding land will result in land confiscation => Reduces the practice of hoarding allocated land. Causes significant waste of resources.
7. Businesses that have violated land regulations may still be allocated or leased land => Provides a second chance for businesses that have previously violated regulations.
8. Construction of worker dormitories in industrial zones is exempt from or eligible for reduced land rent => This increases the supply of rental real estate, which will eventually help lower rental prices. This is very positive.
9. Abolishing the land price framework and determining land prices based on market principles =>> This is the most important provision in the amended Land Law. In essence, landowners will benefit more, and real estate companies will find it easier to acquire land through market mechanisms; however, land acquisition costs will certainly rise as newly determined land prices are expected to increase significantly.
