By Lawyer Luu Thi Hue – UniLaw LLC

BEST REIT LAW FIRMS IN VIETNAM – UNILAW

A Critical Landmark in Real Estate Asset Transfers: The Case of the HCMC Commercial Center Dispute

In the landscape of Foreign Investment in Vietnam, navigating the complexities of large-scale asset transfers requires not just legal knowledge, but strategic litigation experience. A prominent example is Judgment No. 81/2022/KDTM-PT, issued on November 30, 2022, by the High People’s Court in Ho Chi Minh City, concerning a “Dispute over a commercial area transfer agreement”.

The case involved two commercial entities battling over the rights and obligations stemming from a high-value contract to transfer a significant commercial center. The plaintiff sought to enforce specific transfer terms, while the defendant challenged the validity of certain clauses regarding project management and financial clearing. The litigation spanned multiple levels of the judiciary, highlighting the precarious nature of real estate transactions when contracts are not precisely aligned with evolving investment laws.

The High People’s Court ultimately upheld the necessity of strictly adhering to the Law on Real Estate Business and the Law on Investment when executing such transfers. The judgment clarified that any transfer of a commercial project or a portion thereof must be documented through a formal contract that respects the state-approved project boundaries and the developer’s original investment obligations. The court ruled on the financial settlement, ensuring that the buyer’s rights were protected while affirming the seller’s duty to provide all legal documentation required for the transition of ownership. This case serves as a vital reminder for those investing việt nam that the “SPA bottleneck”—the difficulty in finalizing Sales and Purchase Agreements that are fully compliant and transferable—is a reality that requires the expertise of top-tier legal advisors.

Establishing the Foundation for FDI to Vietnam via REITs

To understand why UNILAW is recognized among the best REIT law firms in Vietnam, one must look at the foundational definitions of the Law on Investment. Real Estate Investment Trusts (REITs) and foreign-led real estate projects are governed by a framework that defines what constitutes an “investment project”.

Clause 18, Article 3 of the Law on Investment 2020 states:

“18. Investment project means a collection of proposals for medium-term or long-term capital contribution to carry out business investment activities in a specific area and within a determined period.”

This definition is the bedrock of any REIT structure in Vietnam. It means that every major real estate venture is viewed by the state as a long-term commitment of capital tied to a specific geographic location and timeline, necessitating clear regulatory approval before any activity commences.

The Spectrum of Investment Forms for Foreign Direct Investment in Vietnam

For any entity considering fdi vietnam, the choice of entry is critical. The law provides several pathways, each with distinct administrative requirements. Article 21 of the Law on Investment 2020 outlines these forms:

“Article 21. Investment forms

1. Investment to establish a business organization.

2. Investment by contributing capital, purchasing shares, or purchasing capital contributions.

3. Execution of an investment project.

4. Investment under a business cooperation contract (BCC).

5. New forms of investment and types of business organizations as prescribed by the Government.”

This Article offers the menu of options for investing việt nam. Whether an investor wants to build a new company from scratch, buy into an existing Vietnamese firm, or partner via a BCC (which doesn’t create a new legal entity), the law provides a recognized path. Top law firms specialize in determining which of these five forms maximizes tax efficiency and operational control for the client.

Special Investment Procedures: A 2025 Update for High-Tech and Industrial Projects

As of February 2025, Vietnam has introduced “special investment procedures” to accelerate projects in specific sectors like semiconductors and R&D centers located in industrial or economic zones. This is a game-changer for fdi to vietnam.

Clause 55, Article 36a (added by Law No. 57/2024/QH15) explains the scope:

“55. Except for investment projects prescribed in Article 30 of this Law, investors have the right to choose to register investment according to the provisions of this Article for projects in industrial parks, export processing zones, high-tech zones, concentrated information technology zones, free trade zones, and functional areas in economic zones in the following fields:

a) Investment in the construction of innovation centers, research and development (R&D) centers; investment in the field of semiconductor integrated circuit industry, design technology, manufacture of components, integrated electronic circuits (IC), flexible electronics (PE), chips, semiconductor materials;

b) Investment in the field of high technology prioritized for investment and development, production of products on the list of high-tech products encouraged for development according to the decision of the Prime Minister.”

This provision allows qualified high-tech investors to bypass traditional, often lengthy, appraisal steps in favor of an accelerated registration process. For foreign investment in Vietnam, this means that strategic projects can move from the drawing board to construction much faster, provided they are located in designated zones.

Rigid Conditions for Operating a Real Estate Business in Vietnam

REITs and property developers must navigate the Law on Real Estate Business 2023, which sets high bars for entry to ensure market stability. Article 9 of this Law is particularly important for fdi vietnam.

Article 9 of the Law on Real Estate Business 2023 provides:

“1. Organizations and individuals when conducting real estate business must establish a enterprise according to the law on enterprises or establish a cooperative, union of cooperatives according to the law on cooperatives, having real estate business lines (collectively referred to as real estate enterprises)…

2. Real estate enterprises must meet the following conditions:

a) Not during the period of being banned from real estate business activities, being suspended, or being terminated according to a court judgment or decision of a competent state authority;

b) Maintain the ratio of credit debt and corporate bond debt to equity;

c) Real estate enterprises through real estate projects must have equity not lower than 20% of the total investment capital for projects with a land use scale of less than 20 hectares, not lower than 15% of the total investment capital for projects with a land use scale of 20 hectares or more and must ensure the ability to mobilize capital to implement the investment project…”

Essentially, the law mandates that you cannot just be an individual “flipping” houses on a large scale; you must have a proper legal entity. Furthermore, the 15-20% equity requirement ensures that developers have “skin in the game” and are not purely reliant on borrowed funds, which protects the stability of the overall property market.

Scope of Operations: What Foreign Investors Can and Cannot Do

One of the most frequent questions for those investing việt nam is the limit of their operational scope. Article 10 of the Law on Real Estate Business 2023 distinguishes between domestic and foreign-invested entities.

Clause 4 and 5 of Article 10 specify:

“4. Foreign-invested economic organizations that are required to meet conditions and carry out investment procedures prescribed for foreign investors according to the Law on Investment are entitled to conduct real estate business in the forms prescribed in Clause 3 of this Article.

5. Foreign-invested economic organizations that do not fall under the case prescribed in Clause 4 of this Article are entitled to conduct real estate business in the forms prescribed in Clause 1 of this Article.”

This means if a company has more than 50% foreign ownership, its activities are restricted to Clause 3, which includes building houses for sale or lease on leased land, or infrastructure construction in industrial parks. If ownership is 50% or less, the company enjoys the broader rights of a domestic investor, such as buying existing buildings to resell or lease. UNILAW helps clients structure their Foreign Investment in Vietnam to match these thresholds with their business goals.

The Critical Importance of the Sales and Purchase Agreement (SPA)

For foreign individuals looking at investing việt nam, the “SPA bottleneck” is the most significant hurdle. Our internal legal memos frequently address the “Ms. Zhu” scenario: an investor with a budget who finds that only a tiny fraction of the market is legally accessible.

To be legally viable for a foreign buyer, a property must meet three criteria simultaneously:

1. It must be completed and ready for use.

2. It must be in a project approved for foreign ownership.

3. It must remain within the 30% foreign ownership quota for that specific project.

If these conditions aren’t met, an investor cannot sign a legally binding Sales and Purchase Agreement (SPA) that allows for an official ownership certificate (Pink Book). Many investors are tempted by “Long-term Lease” agreements or “Loan Agreements” as substitutes, but these do not carry the same legal weight as a proper SPA, as seen in the Guozun Cathay Associates case where a developer failed to issue certificates, leading to a forced refund of over 3.4 billion VND.

The 2024 Land Law: New Rights and Obligations for Foreign-Invested Organizations

The Law on Land 2024, effective from August 1, 2024, has redefined the rights of foreign-invested economic organizations (FIEOs). Article 41 of the Law on Land 2024 is a cornerstone for fdi to vietnam:

“228. …foreign-invested economic organizations which are leased land by the State with a one-off rental payment for the entire lease term; foreign-invested economic organizations which are allocated land by the State with the collection of land use fees to implement projects have the following rights and obligations:

…b) Transfer land use rights and assets under their ownership attached to the land during the land use term;

c) Lease or sub-lease land use rights and assets under their ownership attached to the land during the land use term;

d) Mortgage land use rights and assets under their ownership attached to the land at credit institutions permitted to operate in Vietnam;

dd) Contribute capital with land use rights and assets under their ownership attached to the land.”

This provides FIEOs with significant “ownership-like” rights, provided they pay the land rent or fees upfront in a single installment. They can sell the rights, rent them out, or even use them as collateral for loans at Vietnamese banks, which is essential for the Foreign Investment in Vietnam lifecycle.

Restructuring and Capital Contribution: Lessons from the Neosys and Bridge Minds Cases

Successful fdi vietnam often involves internal restructuring. For instance, the Bridge Minds Consulting matter involved an investor from Singapore who faced challenges with late capital contribution.

Clause 2, Article 45 of the Law on Investment 2020 requires:

“199. Investors shall determine the value of investment capital of the investment project by themselves after the investment project is put into exploitation and operation.”

However, if the capital is not contributed according to the registered timeline in the Investment Registration Certificate (IRC), the project faces administrative penalties and banking restrictions. In the Bridge Minds case, UNILAW had to explain the delay to the Department of Planning and Investment (DPI) and the Inspectorate to facilitate a capital increase and timeline adjustment, allowing the project to continue. Similarly, the Neosys case involved complex HS code justifications to ensure that the diverse range of imported equipment for their industrial project was approved under their IRC.

The Role of REITs in Industrial and Infrastructure Development

REIT law firms often advise on the investing việt nam into industrial parks. Under the Law on Investment, projects in economic zones enjoy the longest possible durations.

Article 44 of the Law on Investment 2020 states:

“194. The operation term of an investment project in an economic zone shall not exceed 70 years.

2. The operation term of an investment project outside an economic zone shall not exceed 50 years…”

This 70-year term is a massive incentive for REITs focusing on logistics and factory hubs, as it provides a stable horizon for asset appreciation and rental income. This was a key factor for the a large FDI manufacturing client project in Hải Phòng, a 60-million USD investment in the Đình Vũ – Cát Hải Economic Zone. UNILAW assisted them in navigating the VSIP land lease agreements and ensuring their Export Processing Enterprise (EPE) status was fully protected under customs and tax law.

Dispute Resolution: Litigation and the Protection of Assets

When foreign investment in Vietnam hits a wall, the mechanism for resolution must be clear. Article 14 of the Law on Investment 2020 provides the framework.

“Article 14. Settlement of disputes in business investment activities

1. Disputes related to business investment activities in Vietnam shall be settled through negotiation and conciliation. In case negotiation and conciliation are not successful, the dispute shall be settled by Arbitration or a Court…

3. Disputes between investors in which at least one party is a foreign investor or an economic organization prescribed in points a, b and c Clause 1 Article 23 of this Law shall be settled through one of the following agencies and organizations:

a) Vietnamese Court;

b) Vietnamese Arbitration;

c) Foreign Arbitration;

d) International Arbitration;

dd) Arbitration established by agreement of the disputing parties.”

This Article is the “safety net” for investing việt nam. It allows foreign investors to opt for neutral, international arbitration forums like VIAC or SIAC, which is often a prerequisite for high-stakes REIT transactions. In the HostBill software dispute, for instance, the presence of a clear arbitration clause allowed the Polish investor to assert their copyright claims effectively against a local infringer.

Property Management and Agency: Protecting the REIT’s Cash Flow

A REIT is only as good as its management. UNILAW has extensive experience drafting Real Estate Management Terms, as seen in our work for KWV Consultancy. These terms must clearly define the agent’s authority to collect rent, sign contracts with third-party vendors, and manage common areas without creating unnecessary liability for the fund.

This is particularly relevant under Article 6 of the Law on Real Estate Business 2023, which mandates full transparency:

“44. Not publicizing information about real estate, real estate projects put into business according to the law on real estate business.” is an explicitly prohibited act.

For a REIT, this means every property in the portfolio must have its legal status, encumbrances, and financial obligations publicly disclosed on the developer’s website and the national real estate database. UNILAW ensures that our clients’ disclosures are technically accurate to prevent any future claims of “fraud or deception” as prohibited under Article 8 of the same law.

Exit Strategies and the Repatriation of Capital

The ultimate goal for many involved in fdi to vietnam is the ability to eventually exit and move funds abroad. Article 12 of the Law on Investment 2020 guarantees this right.

“Article 12. Guarantee of the right to transfer assets of foreign investors abroad

After fulfilling full financial obligations toward the State of Vietnam according to the law, foreign investors are allowed to transfer the following assets abroad:

1. Investment capital, investment liquidation proceeds;

2. Income from business investment activities;

3. Money and other assets under the legal ownership of the investor.”

While the law guarantees the right, the execution is purely a matter of administrative compliance. As noted in the Cosmo City investment dispute, if the original purpose of the inbound wire transfer was not properly registered with the bank as “investment capital,” repatriating large sums becomes an immense legal hurdle. A top law firm ensures that every dollar entering the country is correctly coded to facilitate a smooth exit years later.

Why UNILAW is Your Best Partner for REITs and FDI in Vietnam

The journey of investing việt nam is paved with both opportunity and legislative nuance. From the initial fdi vietnam registration to the management of multi-million dollar asset portfolios, the legal landscape is constantly shifting, as evidenced by the Circular 06/2025/TT-BKHĐT and Law No. 57/2024/QH15 updates.

UNILAW stands out not just because we understand these laws, but because we have lived through the disputes that define them. Whether it is representing Safer Overseas Transport in complex logistics licensing, assisting a Japanese-invested distribution client with joint venture restructuring, or protecting the residential rights of individual foreign buyers, our record is one of proven results. We bridge the gap between abstract law and practical business outcomes, ensuring that your Foreign Investment in Vietnam is built on a bedrock of legal certainty.

As the market evolves toward more sophisticated structures like REITs, having a legal partner that understands the intersection of Investment Law, Real Estate Law, and Land Law is no longer optional—it is a necessity. UNILAW is committed to being that partner, guiding you through every “SPA bottleneck” and regulatory change to ensure your success in the vibrant Vietnamese market.