Home Real Estate The Great Reset: How the Dai Ninh ‘Super’ Project Escaped the Reckoning

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The Great Reset: How the Dai Ninh ‘Super’ Project Escaped the Reckoning

14 August, 2024

Disciplinary Action Taken Against Officials Involved in the Dai Ninh Project

The Central Inspection Commission disciplines and recommends disciplinary action against officials related to the Dai Ninh project.

The Lam Dong Tax Department addresses the reduction in land use fees and late payment fees for the Dai Ninh super project.

Besides Mr. Nguyen Cao Tri, who else is behind Saigon Dai Ninh?

The Dai Ninh Urban, Commercial, Tourism, and Ecological Resort project (Dai Ninh project) in Duc Trong District, Lam Dong Province, is developed by Saigon Dai Ninh Tourism Investment Joint Stock Company.

The project aims to invest in the construction and business of an urban, commercial, tourism, and ecological resort. It covers an area of approximately 3,595.5 hectares and includes villas, public works, green parks, and other facilities, with a total investment of VND 25,243 billion. The project has a duration of 50 years from the date of issuance of the investment certificate. The investment progress was planned from 2010 to 2018.

In December 2010, Saigon Dai Ninh Company was granted an investment certificate for the project by the Provincial People’s Committee.

After being allocated land and forest for the project, the investor failed to prevent the destruction and encroachment of more than 368 hectares of forest. In 2017, the Lam Dong Department of Finance requested the investor to compensate for the damage to forest resources, amounting to nearly VND 6.7 billion. By mid-2020, the company had only paid nearly VND 1.7 billion.

In the Inspection Conclusion No. 929/KL/TTCP dated June 12, 2020, the Government Inspectorate proposed that the People’s Committee of Lam Dong Province terminate the operation and revoke the Dai Ninh project.

Unfinished items at the Dai Ninh Urban Area project. Photo: Hoang Giam

In June 2021, the Government Inspectorate issued Inspection Conclusion No. 1033/KL-TTCP, amending certain contents of Conclusion No. 929, including withdrawing the request to terminate the operation and revoke the land of the Dai Ninh project. The conclusion also assigned the People’s Committee of Lam Dong Province to continue adjusting the progress and extending the deadline for the project.

In early 2022, the People’s Committee of Lam Dong Province decided to extend the progress deadline for the Dai Ninh project by another 24 months. At the same time, the investor was requested to focus resources on implementing the project.

By August 2022, Saigon Dai Ninh Company had signed a security deposit for the project, submitted a progress commitment, and the People’s Committee of Lam Dong Province had assigned the Department of Natural Resources and Environment to advise on land price appraisal to calculate land use fees for the project.

According to a report in March 2023, the People’s Committee of Duc Trong District coordinated with relevant units to support the investor in completing the legal procedures for the project. In October 2023, the People’s Committee of Lam Dong Province directed the departments, sectors, and relevant units to provide the legal dossiers of the Dai Ninh project. However, the progress report did not mention any plans regarding investment and construction in the project.

As of the end of January 2024, Saigon Dai Ninh Company had completed some procedures, constructed some architectural works, graded roads, and spread crushed stone on some routes. The total investment capital reached VND 2,296 billion, accounting for 9% of the total investment.

In June 2024, the Lam Dong Department of Finance assessed that the basis and conditions for implementing the project in the 2020-2025 term were not feasible. Therefore, they proposed that the Department of Planning and Investment report and suggest that the People’s Committee submit to the Executive Committee of the Provincial Party Committee and the Provincial Standing Committee consider removing the Dai Ninh project from the list of key projects of the province in the 2020-2025 term.

Tycoon Nguyen Cao Tri’s Takeover of the Project

Established in 2010, Saigon Dai Ninh Company had a charter capital of VND 300 billion. In 2017, the company increased its charter capital to VND 2,000 billion. Since its establishment, the company has only had one project, the Dai Ninh Urban Area.

In 2020, Saigon Dai Ninh signed a contract to transfer its charter capital to Capella Holdings Group Joint Stock Company, which belongs to the Capella Group ecosystem of tycoon Nguyen Cao Tri.

After signing the above contract, Mr. Tri used another subsidiary of the Capella Group, Capella Hospitality Company Limited, to buy 51% of Saigon Dai Ninh’s charter capital for VND 1,530 billion. In January 2021, Mr. Tri became the legal representative of Saigon Dai Ninh.

Subsequently, in September 2022, Mr. Tri asked his brother, Nguyen Cao Duc, to stand in his name to buy 7% of the charter capital of Ms. Phan Thi Hoa at Saigon Dai Ninh for VND 700 billion. In total, Mr. Tri owned 58% of Saigon Dai Ninh’s charter capital and had paid Ms. Hoa VND 2,230 billion.

The Dai Ninh Urban Area project is related to two criminal cases. Photo: Hoang Giam

Later, Mr. Tri agreed to sell 100% of Saigon Dai Ninh’s capital to Ms. Truong My Lan, Chairwoman of the Board of Directors of the Van Thinh Phat Group, for VND 3,000 billion. Ms. Lan paid Mr. Tri a deposit of more than VND 463 billion but later changed her mind about the purchase. This amount was then transferred as payment for another transaction between Ms. Lan and Mr. Tri.

Information about the Dai Ninh project was mentioned in the investigation conclusion of a criminal case that occurred at the Van Thinh Phat Group, SCB Bank, and related organizations and units.

In 2023, in relation to this project, the C03 Ministry of Public Security initiated legal proceedings and arrested Mr. Nguyen Cao Tri, Chairman of the Capella Group.

Additionally, the project has led to the prosecution and arrest of a series of officials from Lam Dong Province and the Central Government for investigation.

Land Use Fees for the Dai Ninh Project Reduced from VND 262 Billion to VND 3.2 Billion

On July 2, 2024, the Lam Dong Tax Department reported its review of the Dai Ninh project’s land use fee after inspecting the relevant documents.

In April 2014, the People’s Committee of Lam Dong Province issued a decision approving the land use fee rate for Saigon Dai Ninh Company to pay to the state budget when converting the land use purpose for the Dai Ninh project. The land use fee for an area of 166.5 hectares of residential land in this project was VND 226 billion.

In January 2018, the People’s Committee assigned the Department of Finance to urge organizations with budget debts up to October 2017 to pay. This included VND 158 billion in land use fees owed by Saigon Dai Ninh Company. In case the enterprise was unable to pay, the departments and sectors were requested to evaluate the actual basis for project implementation and consider switching to a land lease method, collecting annual land rent, or revoking the project.

In April 2018, Saigon Dai Ninh Company proposed to switch from the form of land allocation with a land use fee collection to a 50-year land lease with annual rent payment for the Dai Ninh project.

In a report in May 2018, the Department of Natural Resources and Environment proposed to approve the principle of allowing Saigon Dai Ninh Company to adjust the land use form. Specifically, 166.5 hectares of residential land would be changed from the form of land allocation with a land use fee collection to land for production, business, and non-agricultural purposes, with a land lease and annual rent payment.

In October 2018, the People’s Committee of Lam Dong Province decided to adjust the land use form for Saigon Dai Ninh Company. They also assigned the Tax Department to direct the collection of land use fees and late payment fees.

In November 2018, following the directions of the Tax Department, the Tax Office of Duc Trong District (now the Tax Office of Duc Trong – Don Duong) issued a document to revoke the previous notices of land use fee collection from Saigon Dai Ninh Company, totaling VND 158 billion in land use fees and VND 104 billion in late payment fees.

By May 2020, the Duc Trong – Don Duong Tax Office issued a notice to Saigon Dai Ninh Company for land rent from July 2012 to December 2019, with an area of 166.5 hectares, amounting to VND 3.2 billion. Subsequently, Saigon Dai Ninh Company paid this amount to the state budget.

According to the Lam Dong Tax Department, the direction to handle the reduction of land use fees for the Dai Ninh Urban Area project by the People’s Committee was based on the inspection conclusion of the Ministry of Finance.

However, upon reviewing the documents to report to the Central Inspection Commission, the Tax Department found that the adjustment to reduce land use fees and late payment fees, as directed by the People’s Committee, was inconsistent with the provisions of the law.

Therefore, the Department recommended that the People’s Committee review the related decisions and instruct the Land Price Appraisal Council to determine the financial obligations related to the project from February 2012 to October 2018.

Duy Anh