Selected new points in the Draft Law on Land (amended) 2026 – CNC

Background

Fewer than three years after the Law on Land No. 31/2024/QH15 (the “2024 Land Law”) formally took effect, Vietnam’s legal framework on land management and use again faces a large-scale institutional overhaul, with calls for a comprehensive amendment of the 2024 Land Law. Throughout 2024–2025, although the National Assembly continuously issued instruments to remove emerging bottlenecks, practical implementation continued to reveal numerous shortcomings and prolonged legal obstacles. The need to amend the 2024 Land Law reflects urgent demand from both sides: state management agencies seeking to enhance the effectiveness and efficiency of land administration, and the business community seeking to eliminate legal risk and unlock investment resources.

At the workshop on finalizing the Draft Law on Land (Amended) 2026, held on 27 August 2026 in Hanoi and co-organized by the Vietnam Chamber of Commerce and Industry (VCCI) and the Land Administration Department, experts and delegates pointed out that the reconstruction of the legal framework on land could not stop at ad hoc adjustments, but must represent a leap forward in legislative technique and in the philosophy of resource allocation.

The article below introduces the new points of the Draft Law on Land (Amended) 2026, version 03 dated 22 August 2026 (the “2026 Draft”), sets out the shortcomings, obstacles and difficulties of the former land law system that have been addressed in the Draft, and identifies the remaining legal gaps that still warrant further discussion in the period ahead.

Chapter I: Restructuring the provisions and principles in the Draft Land Law (Amended) 2026 to eliminate legal fragmentation.

1. Streamlining the structure of the law and a shift in legislative thinking

The Draft Law on Land (Amended) 2026 reduces the number of articles from 260 (under the 2024 Land Law) to 106. The 2024 Law regulated many administrative and technical matters in excessive detail, rendering the law cumbersome and unable to keep pace with real estate market developments. Streamlining more than half of the articles is not merely a matter of shortening the text; it reflects a shift in the administrative approach: from “deep intervention and control through procedure” to “establishing a general legal framework, increasing decentralization to localities, and expanding self-determination for civil and economic transactions.”

2. Establishing a centralized repeal mechanism to eliminate the matrix of overlapping instruments

The 2026 Draft repeals the entire Law on Land No. 31/2024/QH15 and simultaneously terminates the effect of 12 related amending laws issued piecemeal during 2024–2025, together with National Assembly Resolution No. 254/2025/QH15[1]. During 2024–2026, the piecemeal issuance of numerous amending instruments made it difficult for enterprises, investors and implementing officials to determine which regulation prevailed. Centralized repeal consolidates all provisions into a single unified instrument, reducing the risk of conflict and overlapping among instruments of the same rank.

3. The principle of continuity and safeguards for projects in progress

Through its transitional provisions[2], the Draft Law on Land (Amended) 2026 establishes the principle of continuity: projects that have already been allocated or leased land, or for which compensation and site clearance are underway under the former legal framework, may continue to be implemented without having to redo procedures (save where planning adjustments are required). Previously, each amendment of the Land Law tended to create legal gaps that stalled projects in progress pending a review of their files. The transitional mechanism under Article 107 gives investors confidence to disburse funds and maintain project progress without fear of procedural disruption.

4. Modernizing administration through the codification of digital data infrastructure

Under Chapters II and VII, the 2026 Draft requires land registration, the issuance of certificates and all land-related transactions to be updated and operated synchronously on the National Land Database System. The former paper-based dossier process was prone to an “ask-and-grant” dynamic that prolonged processing times. The shift to digital data is not merely a technological upgrade; it also makes the history of each land parcel public and transparent, thereby reducing administrative procedures and compliance costs for citizens and enterprises.

5. The risk of a “framework law” and the gap in legal predictability

The 2026 Draft sets out a general principle: “the Government shall provide guidance on the implementation of this Law”, establishing a foundational legal framework in the manner of many other “parent laws.” [3]Streamlining more than half of the articles makes the law formally leaner but shifts most of the responsibility for detailed regulation onto decrees and circulars. If implementing instruments are not issued in a synchronized and timely manner before the effective date of 1 March 2027, real estate transactions and projects may be obstructed by legal gaps. Delegating excessive authority to decrees also carries the risk of diminishing the long-term stability and predictability of a law enacted by the National Assembly.

Chapter II: Establishing the order of priority and supremacy of the Land Law within the system of cross-sectoral legal conflicts

1. The principle of “priority of application” in governing land relations

The Draft Law on Land (Amended) 2026 sets out the principle of priority of application of law (lex specialis): where the Land Law and another law differ on land allocation, land lease, auction, tender, land recovery, land valuation, land registration and the issuance of certificates, the Land Law shall prevail[4]. Previously, sectoral laws such as the Law on Investment, the Law on Bidding and the Law on Construction each claimed priority of application, leaving local departments and agencies confused, passing responsibility to one another and stalling many projects. Establishing a clear order of application of law for the Land Law puts an end to this situation and grants implementing agencies clear authority to act.

2. Unifying the criteria for selecting investors through auction and tender

The Draft Law on Land (Amended) 2026 clearly delineates the boundaries and conditions for applying auction of land use rights or tender for the selection of investors to implement land-using projects[5], ensuring consistency with the Law on Bidding and the Law on Investment. During 2024–2025, many localities were unable to determine which projects required auction and which required tender, owing to overlapping instruments, resulting in reluctance and a freeze on approvals of investment policy. Clarifying this boundary standardizes the input process and removes bottlenecks for urban development and housing projects that had been stalled.

3. Enhancing transparency in the procedure for approving changes in land use purpose for commercial projects

Chapter V of the 2026 Draft simplifies the conditions for changing land use purpose to residential land and commercial or service land, removing the multi-layered approval steps that previously applied. Previously, the requirement that an enterprise hold “100% residential land” or hold interspersed state-owned land (canals, shared roads) caused many projects to stall, and some even to fail, for want of completed procedures. The 2026 Draft allows flexible treatment of interspersed state-owned land and changes of land use purpose based on consistency with approved planning, thereby releasing land resources that had been left idle and creating more favourable conditions for investors.

4. Synchronizing the procedure for appraising land use demand with approval of investment policy

Chapter IV of the 2026 Draft integrates the step of appraising land use demand and the conditions for land allocation or lease into the single procedure for appraising and approving investment policy under the Law on Investment. Previously, investors had to conduct two parallel and duplicative procedures before the Department of Finance (formerly the Department of Planning and Investment) and the Department of Agriculture and Environment, at considerable cost and time. Merging these two procedural steps shortens the time needed to complete legal preparation for a project and enables enterprises to bring land into use sooner.

5. The risk of timing mismatch and lag in sector-specific implementing instruments

Although the 2026 Draft has established the principle of priority of application of land law over related relations[6], this provision still carries a risk of inconsistency if sector-specific appraisal procedures are not amended accordingly. If the Ministry of Construction and the Ministry of Finance (formerly the Ministry of Planning and Investment) fail to review timely and amend the circulars and appraisal forms for project appraisal, local officials handling dossiers will remain reluctant to depart from sectoral procedure for fear of non-compliance. A mismatch in the timing of implementing instruments issued by different ministries could stall the practical implementation of the Law, reducing the effectiveness of the new law in removing bottlenecks.

Chapter III: Unlocking financial and land valuation bottlenecks in compensation and payment for private and public-private (BT) projects in the Draft (Amended) Land Law 2026.

1. Fixing the point in time for valuing land used to pay for BT projects

Under Article 104, the Draft Law on Land (Amended) 2026 amends and supplements point a, clause 2a, Article 45 of the Law on Investment in the Form of Public-Private Partnership (PPP): the estimated land price of the land fund used to pay for a BT project shall be calculated according to the Land Price List at the time the project is formulated and the bidding dossier is prepared. Previously, many BT projects were frozen for prolonged periods because the land price was determined at the time of land handover, often occurring years after the works were completed, creating large discrepancies, risking loss to the state budget and undermining investors’ financial plans. Fixing the point in time for land valuation from the project formulation stage makes cash flows transparent and eliminates price-volatility risk for the parties.

2. Standardizing the National Land Price List based on market data infrastructure

Under Chapter XIII, the 2026 Draft establishes a mechanism for periodically formulating the Land Price List, with adjustments and updates required to be based on data from the National Land Price Database System. After the Land Price Framework was abolished, many independent consulting and valuation organizations were reluctant to issue valuation certificates, for want of practical methodology and for fear of legal and criminal liability. Standardizing the Land Price List on a digital data foundation makes valuation more objective, reduces subjective intervention, and brings land prices closer to actual market value.

3. Enhancing transparency in the mechanism for offsetting financial obligations and land rent

Chapter XIII of the 2026 Draft allows an investor to voluntarily advance funds for compensation, support and resettlement, to be deducted directly from the land use levy or land rent payable, in accordance with a clearly defined formula. Where the investor is exempt from land rent, or where the advanced funds exceed the project’s financial obligations, the excess is offset against the investor’s other projects within the same province or is added to investment cost. Looking back at past practice, countless enterprises found themselves “stuck,” spending years merely completing the procedure for finalizing site clearance costs to determine their actual financial obligations. Establishing an automatic offsetting mechanism based on an approved compensation plan not only resolves the practice of stalled dossiers but also enables investors to complete their financial obligations quickly and bring land into productive use.

4. Liberalizing the choice between annual and lump-sum land rent payment

The 2026 Draft expands enterprises’ self-determination: they may choose to lease land with annual rent payment or with a lump-sum payment for the entire lease term, for production and business land. The 2024 Land Law had strictly limited the categories eligible for lump-sum payment, making it difficult for enterprises to mortgage land use rights to raise capital. Restoring and liberalizing the choice of land rent payment method under the 2026 Draft is precisely the mechanism that removes this financial obstacle, enabling enterprises to actively plan their cash-flow management and to access long-term credit for their production and business activities.

5. Discretionary authority in transitional provisions on land price and the risk of avoidance of responsibility

The 2026 Draft grants provincial People’s Committees the authority to decide whether to continue determining land price under the former legal framework or to apply the new law to financial dossiers still in progress[7]. This provision affords flexibility to localities but is not accompanied by quantitative criteria or specific conditions, which may readily lead to inconsistent application among provinces. Owing to a reluctance to bear legal risk, local officials may choose the option that is safest for themselves rather than the option optimal for project progress, creating a new obstacle and increasing the risk of delay and cash-flow disruption for enterprises.

Chapter IV: Removing bottlenecks in civil judgment enforcement and the handling of secured assets consisting of land use rights not yet granted a certificate

1. Mechanism for issuing a first-time certificate directly to the purchaser at a judgment-enforcement auction

Point m, clause 1, Article 23 of the 2026 Draft allows the successful bidder at auction, or the person receiving an asset in satisfaction of debt, to obtain land use rights on the basis of an enforced enforcement decision or an instrument recognizing the results of an auction of land use rights, as grounds for issuing a certificate in respect of a parcel that has never previously been granted a “red book” but is otherwise eligible. This provision carries over from the 2024 Land Law and is not an entirely new mechanism; draft version 03 does not permit the judgment-enforcement authority to unilaterally replace the original dossier of the former landowner, as some earlier materials had described. The provision nonetheless helps address cases where a judgment debtor resists and refuses to sign the dossier applying for a first-time certificate, thereby unlocking judgment-enforcement assets that had been frozen.

2. Delineating the boundary between injunctive measures and a credit institution’s right to dispose of secured assets

The 2026 Draft clearly provides that: conditions for land transactions apply only to land areas that are not subject to compulsory enforcement, injunction pending enforcement, or suspension of transactions under criminal procedure law. It further gives priority of payment to a lawful mortgage that was registered as a secured transaction before the date of the injunction decision. Previously, a credit institution’s lawful mortgage assets were often frozen and their disposal suspended merely because the landowner was implicated in an unrelated case. The new provision protects a bank’s lawful right to recover debt and helps put the handling of non-performing loans on a sound footing.

3. Preserving the validity of pending judgment-enforcement plans during the transitional period

The 2026 Draft provides that cases involving the handling of judgment-enforcement assets under a plan approved before the effective date of the Law may continue to be implemented and a certificate issued, without the need for review or restarting the process. Looking back at past practice, each amendment of the Law tended to place judgment-enforcement authorities and asset purchasers in the exhausting position of spending one to two years merely reviewing the status and origin of the land under the new regulations. This unreasonable delay not only generated very substantial costs in preserving judgment-enforcement assets, but also seriously eroded their auction value through deterioration over time. Providing for the continued implementation of plans in progress is a practical solution that preserves asset value, optimizes processing time and provides absolute reassurance to participants in judgment-enforcement auctions.

4. Separating land of non-compliant agricultural and forestry farms from the scope of judgment enforcement

Clause 3, Article 85 of the 2026 Draft provides that, in respect of land areas of agricultural and forestry companies that have been granted a certificate under an approved land use plan but that have failed to invest, or have allocated land to the wrong beneficiaries, the State shall recover such land to implement land support policies for ethnic minorities and for socio-economic development[8]. This is a provision addressing the general misuse of agricultural and forestry farmland and is not directly linked to civil judgment enforcement as previously interpreted. Nonetheless, the provision helps remove land areas that do not meet legal conditions (including cases of encroachment or “under-the-table” mortgaging) from a state of improper management and use, while ensuring rigour in the State’s management of public land resources.

5. The gap in time-limit sanctions applicable to the Land Registration Authority

Point m, clause 1, article 23 of the 2026 Draft only recognizes the right to acquire land use rights arising from completed judgment-enforcement or auction results; draft version 03 does not prescribe a mandatory time limit or specific legal liability for the Land Registration Authority when handling such cases, nor does it establish a separate mechanism for requesting a certificate for the successful bidder at a judgment-enforcement auction, as noted in section 1 above. This is a substantive gap: absent a hard response deadline (for example, within 30 days) and a mechanism for handling the former landowner’s outstanding tax obligations, the right recognized under point m, clause 1, Article 23 will struggle to take practical effect, remaining dependent on the Land Registration Authority’s processing time.

Chapter V: Enhancing consistency in land use planning and its interaction with the 2025 Planning Law

1. Amending the 2025 Planning Law to eliminate duplicate planning

The 2026 Draft directly amends and supplements Planning Law No. 112/2025/QH15, repealing overlapping content between provincial land use planning and marine spatial planning[9]. Previously, many coastal and urban infrastructure projects were stalled because the same land area was subject to both sectoral planning and land planning with conflicting technical targets. This synchronized amendment entirely eliminates such ambiguity in planning, does away with the situation of “one plot of land wearing two legal coats,” and directly frees up resources for large-scale coastal infrastructure and urban projects.

2. Clearly distinguishing strategic planning from actionable land use plans

Under Chapter III, the 2026 Draft provides that provincial and national land use planning shall govern only strategically significant land targets (such as rice cultivation land, protection forest land, defence and security land, and key infrastructure), while fully decentralizing the authority to adjust detailed land functions to district- and commune-level authorities. Looking back at earlier difficulties, an overly centralized and all-encompassing management process had forced communes and districts to spend years on procedures requesting provincial planning adjustments whenever the need arose to convert a small parcel of land to serve local livelihoods or projects. Clearly distinguishing strategic direction from detailed action plans not only substantially reduces the administrative burden, but also increases local initiative, directly addressing at its root the prolonged “suspended planning” that wastes resources.

3. Automating the updating of land use targets into the national planning system

Under Chapter III, the 2026 Draft integrates the adjustment and updating of land use targets online, through the National Planning Database System. Previously, the manual process of adjusting land targets tended to drag on through many levels, taking from several months to years merely to complete administrative approval procedures. Automating and digitizing the entire target-updating process shortens processing time to just a few weeks, providing local authorities with maximum flexibility to proactively reallocate land resources and to be ready to welcome and attract large investment projects arising outside the original plan.

4. Ensuring transparency in planning and protecting the rights of residents in areas of suspended planning

The 2026 Draft provides that if, three years after the date a plan is published, a project has not been implemented and the state authority has neither adjusted nor cancelled the plan, land users in the affected area shall have their rights to build, mortgage and transfer fully restored. This provision ends the prolonged state of “suspended planning,” under which many households had their property rights restricted and could neither obtain a construction permit nor mortgage their land use rights to raise capital, thereby both preserving the rigour of planning and restoring residents’ lawful rights.

5. The mismatch between land planning and urban-rural planning

Although the 2026 Draft offers a number of solutions to synchronize planning, the relationship between Article 105 and the 2024 Law on Urban and Rural Planning still lacks a clear arbitration mechanism or rule of priority in the event of conflict. This gap means that the classic shortcoming, where a project is “consistent with land use planning but out of step with zoning or 1/500-scale detailed planning” could fully recur in practice. Where two parallel planning systems lack any authority or provision to act as “arbitrator” in determining absolute priority of effect, local officials handling dossiers will again find themselves in a position of confusion, unwilling to grant approval. In the end, it is the investor who continues to bear prolonged legal risk, causing project implementation to stall against its wishes.

Chapter VI: Reconstructing the institutional framework for land recovery, compensation and resettlement, and safeguarding the principle of balanced interests

1. Clearly identifying the list of projects subject to land recovery for national and public interest

Under Chapter VI, the 2026 Draft establishes a closed list clearly enumerating the cases in which the State may recover land for socio-economic development in the national or public interest. Previously, the absence of clear criteria allowed many localities to apply the mechanism of land recovery by administrative decision arbitrarily, even to projects that were commercial in nature, giving rise to numerous disputes and complaints. Adopting a closed list protects the lawful rights of land users and limits the risk of abuse of administrative power.

2. Standardizing the compensation principle of “equal to or better than the former place of residence”

Under Chapter VII, the 2026 Draft requires the technical and social infrastructure of a resettlement area to be completed, and the compensation, support and resettlement plan to be approved, before a land recovery decision is issued. This provision addresses the practice of enforcing site clearance before residents have been provided with new housing, or where a resettlement area lacks electricity, roads, schools or medical stations, giving concrete effect to the principle that residents must receive housing equal to or better than their former place of residence, thereby reducing disputes and complaints.

3. Diversifying compensation to include land for different purposes or housing

The 2026 Draft expands the choices available to a person whose land is recovered: compensation in cash, in land of the same purpose, or in land of a different use purpose or housing (where the locality has a land fund and the resident so wishes).[10]This mechanism removes many bottlenecks in site clearance. On the one hand, the new provision substantially reduces the pressure of cash payment on the state budget or the local Land Development Fund. On the other hand, allowing compensation in commercial or service land, or in housing, gives residents in clear areas a direct opportunity for sustainable occupational change, active livelihood planning, and a share in the appreciation in value generated by the very urban development and infrastructure projects concerned.

4. A flexible negotiated-transfer mechanism for acquiring land use rights for commercial housing projects

Chapter VI of the 2026 Draft allows an investor to negotiate the transfer of use rights over various categories of land (without the requirement that residential land already exists within the project boundary) to implement a commercial housing project, provided this is consistent with approved land use planning. This provision is expected to remove the legal obstacles that had stalled many commercial real estate projects and disrupted cash flow for years, helping diversify the housing supply and ease price pressure.

5. The risk arising from a “negotiation gap” for remaining land areas short of 100%

Although the 2026 Draft expands the negotiated-transfer mechanism for land use rights, it does not provide a mechanism for state intervention to recover the small remaining area (under 10–15%) where the investor has already successfully negotiated with the majority of land users within the project boundary. This continuing shortcoming directly sustains the risk of unreasonable “speculation and price-gouging” by a handful of remaining households who deliberately withhold their land to demand compensation many times its actual value. The absence of a legal instrument enabling the State to definitively resolve this “bottleneck area” places the entire effort and cost the enterprise has already invested in negotiation at risk of collapse, pushing the project into prolonged deadlock with no solution in sight.

(to be continued)

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