The Ministry of Finance, as assigned by Deputy Prime Minister Ho Duc Phoc, is coordinating with the People’s Committee of Ho Chi Minh City and the Ministry of Agriculture and Environment to clarify issues regarding equivalent value principles, land auction requirements, land transfer timing, and land price calculation timing in using land funds for payment in BT projects.
Currently, only one of the two BT projects under consideration by the Ho Chi Minh City People’s Committee is the project “Solving tidal flooding in Ho Chi Minh City, taking into account climate change factors – Phase 1” (abbreviated as the VND 10,000 billion anti-flooding project). The contract for this project was signed in 2016, prior to the effective date of the Law on PPP (Public-Private Partnership Investment).
Phu Xuan tidal control gate of the VND 10,000 billion anti-flooding project in Ho Chi Minh City. Photo: Duy Anh
According to the Ministry of Finance, current regulations stipulate that payment to investors using land funds must ensure the principle of equivalent value, meaning the value of the land fund used for payment should be equivalent to the value of the BT project and determined based on market prices at the time of payment.
However, the BT contract for this project was signed before the new regulations came into force, resulting in shortcomings in the payment plan and authority to decide on the use of state capital.
To address this, the Ho Chi Minh City People’s Committee has repeatedly proposed to the Government to allow adjustments to the payment method. The Ministry of Finance agrees with Ho Chi Minh City’s proposal and suggests implementing payment with land funds based on the equivalent value principle. If there is still a discrepancy, the remaining amount will be paid in cash from the city’s public investment capital.
The Ministry of Finance stated that the Ho Chi Minh City People’s Committee will be responsible for determining the specific land prices for calculating land use fees and land rent at the planned payment sites, ensuring compliance with land-related laws. Simultaneously, they proposed that the State Audit Office conduct an audit of the project as a basis for capital settlement.
Addressing the legal issues of this BT project is considered necessary to promptly untangle the knot, complete the payment to the investor, and promote the progress of this key infrastructure project.
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