Ho Chi Minh City Proposes Prime Minister to Lease Land to Mercedes-Benz until 2030 I hope that was helpful! Let me know if you would like me to make any changes or modifications to the title.

Mercedes-Benz Vietnam Granted 5-Year Lease Extension in Ho Chi Minh City

The People’s Committee of Ho Chi Minh City has submitted a proposal to the Prime Minister regarding an extension of the operational duration for Mercedes-Benz Vietnam’s project.

Granted Additional 5 Years of Land Lease

The Ho Chi Minh City authorities have requested the Prime Minister’s approval for the rearrangement and handling of public assets concerning the land lot at 693 Quang Trung Street, Ward 8, Go Vap District. This arrangement will take place after an additional five-year land lease period, extending the lease until April 14, 2030.

Mercedes-Benz Vietnam has been granted a five-year extension on their land lease, starting from April 14, 2025, allowing them to continue their project without undergoing land-use auction procedures or investor selection processes for projects involving land use.

Mercedes-Benz Vietnam is responsible for paying land rent at 693 Quang Trung Street, in accordance with current legal regulations.

Mercedes-Benz Vietnam Limited Company is comprised of Saigon Transportation Mechanical Engineering Corporation, which holds 30% of the charter capital, and foreign investor Mercedes-Benz AG Group, which holds the remaining 70%.

During the additional five-year land lease period, the Ho Chi Minh City People’s Committee will instruct the Saigon Transportation Mechanical Engineering Corporation to expedite the completion of the investment project and the construction of the Ho Chi Minh City Automobile Mechanical Industry Park.

Simultaneously, they will introduce the Mercedes Benz Group AG investor to relocate and invest in a car manufacturing and assembly plant within the aforementioned industrial park after the project duration extension expires.

The Ho Chi Minh City authorities will task specialized agencies with preparing the necessary steps to implement the investment project on the land lot in Go Vap District immediately after April 14, 2030.

Mercedes-Benz Contributes Over VND 5,500 Billion Annually to Ho Chi Minh City’s Budget

Prior to this decision, Mercedes-Benz Vietnam Limited Company had requested an adjustment to the project’s operational duration to 35 years, starting from April 14, 1995 (a five-year extension beyond the original project duration).

The Ho Chi Minh City People’s Committee acknowledged that Mercedes-Benz Vietnam operates in the field of high-tech manufacturing, employs a large number of workers, and makes significant contributions to the local and national budgets. During the 2017-2021 period, the company’s average annual tax payments exceeded VND 5,500 billion. The company also complies with tax regulations, filing taxes diligently, and has no tax debts. Additionally, they provide employment opportunities for approximately 800 local workers.

By granting a short-term extension of five years for the land lease (with annual land rent payments), Mercedes-Benz Vietnam will continue to make positive contributions to the city’s budget.

Furthermore, this project duration extension will serve as a foundation for the city to retain this strategic investor and facilitate the relocation of their manufacturing operations to the Automobile Mechanical Industry Park in the future.

The project site aligns with the approved urban construction planning and the revised orientation planning for Go Vap District until 2030. Additionally, there is a basis for determining that the project does not fall into the category of potentially environmentally polluting projects.

Terminating the project at the end of its current duration (April 14, 2025) could result in a reduction in local budget revenues (approximately VND 5,500 billion per year). Moreover, relevant authorities have not prepared a plan for land retrieval and investor selection, a process that could take two to three years.

While the Ho Chi Minh City authorities sought the opinions of central ministries and sectors on this matter, there is currently a lack of clear and specific legal framework to consider and approve project duration extensions in such cases.

The Prime Minister Holds Decision-Making Authority

According to the Ho Chi Minh City People’s Committee, Decree 167/2017 and Decree 67/2021 stipulate that other forms of arranging and handling public assets, specifically land and houses, are subject to the Prime Minister’s consideration and decision, based on proposals from ministers, heads of central agencies, and People’s Committees of provinces…

The Ministry of Finance, in coordination with relevant ministries, central agencies, and local authorities, will conduct an appraisal and report to the Prime Minister for consideration and decision-making.

Additionally, according to Article 124 of the 2024 Land Law, the Prime Minister has the authority to approve land leases without going through auction procedures.

Therefore, the authority to consider the arrangement and handling of houses and land in other forms, as well as the authority to approve land leases without auctions or investor selection, rests with the Prime Minister.

Consequently, the Ho Chi Minh City People’s Committee has submitted this proposal to the Prime Minister for consideration and decision.