LEGAL NEWSLETTER , 2022

LEGAL NEWSLETTER

June/ 2022

Dear Value Clients and Partners,

ADK Vietnam Lawyers would like to introduce to you the June 2022 Legal Newsletter with the following main contents:

1. Legal Spotlight

1.1 The Ministry of Construction clarifies the basis of the options to stipulate the term of apartment ownership

The Ministry of Construction has requested to add a new provision on the term of apartment ownership in the homeowner policy instead of the current long-term homeownership. Accordingly, the Ministry of Construction has proposed two options which has been approved by the Government and reported to the National Assembly to request to be included in the National Assembly's Law-making Program in 2023 (Report No. 53/TTr-CP dated March 28, 2022). The Department of Housing and Real Estate Market Management (Ministry of Construction) has just clarified the basis for the options to stipulate the term of apartment ownership, an issue that has attracted the attention of social commentary in recent times. Specifically:

Option 1: The Ministry of Construction proposes that the term of apartment ownership is determined according to the useful life of the construction work based on some of the following bases:

(i) The characteristics of apartment buildings are large-scale constructions, with many people living, over time, the building will be degraded, no longer ensuring safety during uselife. When the useful life is expired according to the provisions of the law on construction or the construction has not expired but it is degraded the competent authority will assess the quality. In case the building can still be used, it will continue to be allowed to use or if it is not safe, it will have to be dismantled for rebuilding.

The above provision is also suitable for the provisions of civil law. Accordingly, property ownership right will be terminated when the property is destroyed or terminated in accordance with law.

(ii) It is necessary for the addition of regulations on the term of ownership of apartment building according to the useful life of the construction work to have legal basis to overcome the difficulties and problems in the renovation and reconstruction of high buildings and acilitate urban embellishment.

(iii) This option still ensures the rights of people living in those apartment buildings. In addition to the rights of the property owners - during the ownership term, the owners of the apartment - in the event of demolition when the safety conditions are not satisfied - still have the right to be relocated on the same location without moving to another one or to be relocated on another location according to the Government’s relocation policy.

(iv) The ownership term of an apartment building may be 50 years, 70 years or longer depending on the quality of the construction work. Currently, according to the provisions of the law on construction, the useful life of the construction work is determined according to the construction design documents (design life) and the actual use term.

(v) This option is based on the experience of many countries around the world (such as China stipulates the ownership term from 50 to 70 years; Thailand stipulates the ownership term of 30 years and can be extended; Singapore and the United State stipulate the maximum ownership term of 99 years and in case of extension, the owner must pay a certain fee etc.). When the apartment building's useful life expires, the ownership period will terminate (unless it is extended) and demolition, reconstruction and urban embellishment will be carried out.

(vi) The Ministry of Construction believes that investment in construction of apartment buildings is still a future trend in urban areas, especially in large urban areas, which require saving land.

After being approved and included in the Law-making Program by the National Assembly, the Ministry of Construction will draft the specific content to consult the experts, scientists and people. The National Assembly will also consider, discuss carefully and assess the overall impacts of this policy before deciding.

Option 2: The Ministry of Construction proposes that the apartment building ownership term is determined according to the land use term in accordance with the law on land. According to the Department of Housing and Real Estate Market Management, there will be 2 situations:

(i) The Law on Land (amended) remains the regulations on long and stable land use term as the current law, the long-term apartment ownership will remain as the current Law on Housing. Therefore, the handling of old and expired apartment buildings will still have the same difficulties and problems currently.

(ii) The Law on Land (amended) stipulates the term of land use for the construction of apartment buildings, the term of ownership of the apartment building will also be determined according to the land use term. When the land use term is expired, the Government will base on the provisions in the Law on Land (amended) to handle apartment buildings that have expired or no longer ensures the quality.

According to the Department of Housing and Real Estate Market Management (Ministry of Construction), the proposals to stipulate the term of apartment ownership start from the actual basis of difficulties and problems in the implementation of the current policy of renovation and reconstruction of apartment buildings.

The news related to the term of apartment ownership is still receiving a lot of public attention at the moment.

1.2 Solving problems in reducing VAT to 8%

On June 20, 2022, the Government issued Decree 41/2022/ND-CP amending and supplementing a number of articles of the Government's Decree No. 123/2020/ND-CP dated October 19, 2020 on invoices and records and Decree No. 15/2022/ND-CP dated January 28, 2022 of the Government on tax exemption and reduction under Resolution No. 43/2022/QH15 of the National Assembly on fiscal and monetary policies for supporting socio-economic recovery and development program.

In order to solve problems in issuing invoices for goods and services that are subject to VAT reduction, ensuring compliance with the contents of the invoice, the Government issued Decree 41/2022/ND -CP with the following modifications:

(i) In case business establishments using the VAT deduction method apply different tax rates when selling goods or providing services, their VAT invoices must state the tax rates of each commodity and service.

(ii) In case business establishments use the VAT % on revenue method when selling goods or providing services, their sales invoices must state the reduced money when selling goods and providing services.

Decree 41/2022/ND-CP comes into force as of its date of signing. From February 1, 2022 to when Decree 41/2022/ND-CP comes into force, business establishments that have followed regulations prescribed in Article 2 of Decree 41/2022/ND-CP are still eligible for VAT reduction, exemption from invoice adjustment, and not subject to administrative violations of tax and invoices.

2. Featured Articles of ADK Lawyer in June

The article “25 potential sighns of violations of enterprises on invoices, anti-fraud of value-adđe tax refund”. The article analyzes 25 signs of violations by businesses on invoices, combating VAT refund fraud, helping competent authorities to strengthen their review and detection of taxpayers showing signs of risk on invoices and tax refund fraud.

To read the above articles in more detail, please visit our website at: https://adk-lawyers.com/en/legal-articles

3. Some prominent legal documents take effect from July 2022

No	Text name	Date issued	Date of Effective
DECREE
	Decree No. 38/2022/ND-CP prescribing statutory minimum wages paid to employees working under employment contracts	12/6/2022	01/7/2022
	Decree No.20/2022/ND-CP amendments to the government's decree No. 119/2015/ND-CP dated november 13, 2015 on compulsory insurance for construction investment activities	10/3/2022	01/7/2022
	Decree No. 123/2020/ND-CP prescribing invoices and records	19/10/2022	01/7/2022
	Decree No. 35/2022/ND-CP on management of industrial parks and economic zones	28/5/2022	15/7/2022
	Decree 33/2022/ND-CP detailing a number of articles of the Ordinance on Market Management	27/5/2022	15/7/2022
CIRCULAR
	Circular No. 09/2022/TT-BLDTBXH providing guidance on implementation of several regulations on livelihood diversification, promotion of the model of poverty reduction and support for employees working abroad under contracts according to Vietnam's target program for sustainable poverty reduction during 2021 - 2025 period	25/5/2022	11/7/2022
	Circular No. 06/2022/TT-BGTVT amending and supplementing a number of articles of Circular No. 36/2015/TT-BGTVT dated July 24, 2015 of the Minister of Transport on management of transportation service prices domestic aviation and aviation service prices	27/5/2022	15/7/2022
	Circular No. 10/2022/TT-BCT prescribing amendments to circulars on rules of origin in the ASEAN trade in goods agreement	01/6/2022	16/7/2022
	Circular No. 01/2022/TT-BVHTTDL amendments to Circular No. 07/2014/TT-BVHTTDL dated july 23, 2014 of the minister of culture, sports and tourism of Vietnam on dossiers written forms of judical expertise; application of professional regulations on judicial expertise in the field of culture; conditions of expertise facilities, equipment and means of office of judicial expertise in relics, antiques, copyrights, and relevant rights	31/5/2022	20/7/2022