Proposed Amendment: Establishing Land Valuation Timelines for BT Project Compensation

In its submission, the Association proposes amendments to numerous provisions related to land allocation, lease, and conversion of land use purposes. Notably, it emphasizes the mechanism for determining land prices in Build-Transfer (BT) contracts.

The Association recommends revising clause 9(b) of Article 4 in the draft Resolution to allow flexible application of the “land price determination time” for land funds used to settle BT contracts signed between July 1, 2025, and the effective date of the Resolution. Under this proposal, land prices can be determined at the time of land allocation or lease decision, as per the BT contract agreement, at the contract signing, or upon the investor’s completion and handover of the project.

Similarly, in Article 5, clause 5, the Association suggests adding a unified provision: the land price determination time for BT contracts must be set at one of three points—when the State decides to allocate or lease the land, when the BT contract is signed, or when the investor hands over the entire project as per the BT contract.

To ensure consistency, the Association also recommends amending clause 3 of Article 1 in the draft Resolution revising Resolution 98/2023/QH15. According to the proposal, in cases where land has not yet been allocated or leased for BT contracts, the Ho Chi Minh City People’s Committee will allocate or lease land based on the audited value of the completed work volume. The land price will be determined at the time of the land allocation decision, the BT contract signing, or the investor’s project handover completion.

Explaining these proposals, the Association highlights that BT contracts were once a crucial mechanism for the State to mobilize social capital for infrastructure development, especially before the Public-Private Partnership (PPP) Law 2020 took effect. However, after the PPP Law halted new BT projects from January 1, 2021, many transitional projects faced challenges in land fund settlements due to inconsistencies in land price determination, causing delays and legal complications for both authorities and investors.

According to the Association, the primary bottleneck is determining the land price calculation time. In many cases, investors complete and hand over BT projects (at time T1), but state agencies delay issuing land allocation or lease decisions, significantly postponing the land price determination time (T2). Applying land prices at T2 may no longer align with the project value established at T1, leading to inequality, unfairness, and substantial risks for investors, potentially affecting the State’s interests as well.

The Association underscores the principle of “price parity at the same time,” meaning the BT project value determination time must correspond with the land payment price determination time. This approach protects both State and investor interests, ensures fairness, and provides a clear legal basis to restore trust and attract social resources for infrastructure development.

The Association urges consideration and inclusion of these points in finalizing the draft Resolution to comprehensively resolve BT contract settlement issues. This ensures consistency and feasibility in implementing the 2024 Land Law and Resolution 98/2023/QH15 in Ho Chi Minh City.