VietNamNet Bridge - Creating legal procedures for land
acquisition and compensation is certainly the most sensitive issue in the
amendment of the 2003 Land Law.
Since Doi Moi (renovation), the
State has issued four Land Laws: The Land Law 1987, the Land Law 1993, the
amended Land Laws in 1998 and 2003.
The application of these laws
requires a large number of bylaw documents (decrees, joint circulars and
administrative guidelines). The amended 2003 Land Law will be approved in 2013.
The Land Law 1987 abolished the
cooperative model and the State allocated land to farmers. The farmers were
given a limited number of land use rights in 20 years.
In the 1993 Land Law, the State
extended the land use right for farmers and allowed foreign investors to lease
land. This law also recognized the value of land and the State has the right to
value the land when it is converted to urban and industrial purposes.
The adjustments in 1998 increased
protection of land use rights for domestic enterprises a lot. To increase the
attractiveness to foreign investment, the Government had to keep land prices at
low level and the land compensation was equivalent to just 10 to 30 percent of
the market value.
The expansion of the market
economy in Vietnam has increased the production value of the land. Domestic and
foreign investors, the land users in urban areas require their land use rights
to be guaranteed.
The Land Law 2003 has solved this
problem. The law has expanded the scope of protection of land use rights of
land users, including the benefits attached to the land as the land use rights
and land contribution as capital to establish a company. The land use rights
allocated to investors and families for the purpose of building houses became
the private property ownership which is protected firmly.
In contrast, there is not any
fundamental change in the 2003 Land Law relating to agricultural land. The land
allocation time of 20 years is still a big question: continuing to allocate
land or abolish it? Farmers can exchange and transfer land, but they do not
have the rights to decide the change of the land use purpose. When agricultural
land is converted into non-agricultural land, farmers receive compensation
based on agricultural land prices. The compensation is determined by the State.
This adversely affects the
distribution of wealth in the country and increases social unrest. Compensation
for land and the site clearance serving investment projects has faced growing
opposition from citizens. In the past five years, the number of complaints and
denunciations related to land has doubled, to 12,000 cases a year.
The National Assembly put the
amendment of the Land Law in its agenda. It is needed to have special attention
to create and ensure the rights of agricultural land and forest land. Vietnam
needs to respond immediately to these problems to create fairness in law on
distribution of welfare and ensure social harmony.
From the above analysis, we
propose six modified groups in the 2003 Land Law, including protection of
property rights to land of farmers, improve transparency and consistency in the
law relating to land, flexibility in the form of agricultural land use,
strengthening the accountability of the conversion process for investment
projects, improving accountability and administration of land management,
supporting the process of commercialization of land (agriculture).
Protection of property rights for farmers
As being analyzed in the article,
the currently framed Land Law is very beneficial for domestic and foreign
investors, residents in urban areas and facilitates officials who benefit from
this. Currently, domestic enterprises are demanding to be treated equally with
foreign investors. Specifically, they ask to pay rent "once" and have
the right to use land as capital. The current lease term for commercial
projects is 50 years. For housing projects and development projects, this time
is permanent.
Meanwhile, Vietnamese farmers are
disadvantaged. Strengthening the protection of the land use rights of the
farmers will increase costs for investors in land acquisition. Although this is
certainly inconvenient for local authorities and other relevant agencies that
are accustomed to cheap land acquisition to promote industrialization,
urbanization, but it helps ensure social justice. This will ensure the
achievement of the development and fairness among farmers, investors and the
authorities.
Enhancing consistency and transparency
Ensuring the land-related
interests of the farmers requires to modify not only the 2003 Land Law, but
also to change the legal framework to support this law. To maintain consistency
in the entire legal system, the changes of other laws are also very useful.
This will require amendments to the regulations on asset and wealth in the
Civil Code 2005, amendments to the Land Planning Law 2008 to enhance the
participation of the people; and the amendments to the Housing Law 2008 and the
Law on Real Estate Market 2008.
To improve the transparency of
laws and ensure the law to be simple and easy to understand for users, from a
technical perspective we propose the Government should codify the
administrative documents (guidance, interdisciplinary circulars, decrees and
decisions) relating to land into the law system. For example, the government
can codify bylaw documents relating to agricultural land and land compensation
into the Law on Land Conversion and Compensation.
Increasing flexibility in the use of agricultural land
The above discussion has provided
detailed multidimensional gaps for farmers when they attempt to optimize the
use of the land they are allocated. While domestic and foreign investors are
free to commercialize the right to use, Vietnamese farmers do not enjoy such
benefits.
The Government continues to set
low limits for private agricultural land for farmers, not investors. The 2003
Land Law provides different purpose of agricultural land use types and it is
very rigid in how farmers use that land. This prevents farmers from using their
land for appropriate purposes to take advantage of opportunities in the
domestic and international market.
Legal procedures for land acquisition
Without fundamental changes to
the Land Law, it will still reflect the State's interest focused on the
recovery and conversion of land to promote industrialization. If the business
community at home and abroad are better organized and have more options to influence
the process of drafting the law, the rights of farmers will not be noticed
much, particularly for the agricultural land that is considered as "needed
for conversion to development."
Creating legal procedures for
land acquisition and compensation is certainly the most sensitive issue for the
amendment of the 2003 Land Law. Complying with the legal procedures will
enhance equity and help limit to the lowest level complaints and denunciations
related to land.
Strengthening accountability and oversight in the government’s land
management
When power is divided from the
central government down to the 63 provinces and 17 state-owned groups, the
enforcement of law and administrative rules need to be strengthened.
Moreover, when land is scarce and
valuable asset, it should be the top priority for the prevention of corruption
related to the ineffective land allocation and use. Strengthening the
accountability of state agencies in land-related activities requires the
participation of citizens, social organizations and the media in the process of
policy development and implementation. Specifically, administrative decisions
must have the supervision of the legislature and the judiciary.
The public services supporting the commercialization of land
The role of the State in the
management of land has changed when Vietnam follows the path of modernization.
From the initial role as the one that allocate land and provide land-intensive
services (schools, hospitals, infrastructure and management), the State's role
has shifted from direct intervention in short-term decisions (lease term, land
conversion, land prices, etc.) to the adjustment and operation of the market
when it has completed the above roles. This requires a broad legal framework
for land use, land-use plan of the country, land tax (and property).
Ho Dang Hoa, Le Thi Quynh Tram,
Pham Duy Nghia and Malcolm F. McPherson
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