Decree No. 44/2014/ND-CP on Land Price

Legal basis and effect

Decree No. 44/2014/ND-CP dated 15 May 2014 of The Government, issued on the proposal of the Minister of Ministry of Natural Resources and Environment, provides for land price. It is based principally on the Law on Government Organization dated 25 December 2001 and the Land Law dated 29 November 2013.

The Decree takes effect from 1 July 2014. It replaces Decree No. 188/2004/ND-CP on methods for determining Land price and land price frame, Decree No. 123/2007/ND-CP amending Decree No. 188/2004/ND-CP, and Article 1 of Decree No. 189/2013/ND-CP amending Decree No. 59/2011/ND-CP. Transitional handling of specific land prices proposed before the effective date is provided in Article 22.

Scope and subjects of application

The Decree governs methods of land valuation, formulation and adjustment of the land price frame and land price list, determination of specific land prices, and consultancy on land price determination.

It applies to state management agencies in charge of Land, agencies with functions to formulate, adjust and appraise the land price frame, land price list and specific land prices, land valuation consultancy organizations, and other relevant organizations and individuals.

Valuation methods and price frame and list

Article 4 prescribes land valuation methods, including the comparison method and other methods in paragraphs 1 to 4, and Article 5 sets information requirements for their application, including transferred land prices and common market land price data.

The land price frame is formulated on the basis of Land valuation principles under Article 112 of the Land Law, valuation methods, market information, and natural and socio-economic conditions. It stipulates minimum and maximum prices for agricultural land groups, non-agricultural land and other land types. Articles 8 and 9 provide the order and procedures for formulation and adjustment, including a 20% threshold for adjustment when the common market land price increases or decreases compared to the maximum or minimum of the frame.

The land price list is formulated on the same principles and on the land price frame issued by The Government. Article 11 provides contents, including lists for annual crop land (including paddy land), perennial crops and other agricultural land, and for residential land, commercial and service land and production land in urban areas. The list is built by land position classification, and where cadastral maps and land position classification maps exist, they are used as basis. Articles 12 to 14 regulate the order and procedures for formulation, handling of prices in border areas between provinces, centrally run cities, and adjustment when the Government adjusts the frame or market prices fluctuate.

Specific land price determination and adjustment coefficient method

Article 15 provides that the provincial-level People's Committee decides specific land prices based on valuation principles, valuation methods and analysis of parcel information and market prices, for cases under Article 114, Clause 2 of Article 172 and Clause 3 of Article 189 of the Land Law, including as starting price for auction of land use rights when The State allocates land with collection of Land use levy or leases land with one-time rental payment, and for other purposes prescribed.

Articles 16 to 18 set the order and procedures, selection of consultancy organizations, and the land price adjustment coefficient method. The coefficient method is applied, inter alia, where the parcel or project area has a value (calculated by land price in the land price list) of less than VND 30 billion for centrally run cities and less than VND 10 billion for mountainous and highland provinces and less than VND 20 billion for other provinces, and for cases of contiguous parcels with for the same use purpose and similar profitability as prescribed in Article 18. The provincial-level People's Committee issues the land price adjustment coefficient annually.

Consultancy and implementation responsibilities

Articles 19 and 20 prescribe principles and operating conditions for land price consultancy, including organizational and individual practitioner requirements under Article 116 of the Land Law.

Article 21 assigns responsibilities to Ministry of Natural Resources and Environment, ministries and provincial-level People's Committee for organization of formulation, adjustment, tham dinh and promulgation of price instruments and for state management of Land price. Article 24 assigns implementation responsibility to Ministers, Heads of ministerial-level agencies and Chairpersons of People's Committees at all levels.