The Land Law 2024 in Vietnam has been in effect since August 2024, introducing several amendments that are more favorable for Foreign Invested Enterprises (FIEs) compared to the Land Law 2013. Two notable highlights include:

1. Land Use Rights Transfers in Industrial Zones for FIEs

As per the Land Law 2024, foreign-invested enterprises are now permitted to receive transfers of land use rights and assets attached to land in industrial parks, industrial clusters, and economic zones. Previously, under the Land Law 2013, FIEs were only allowed to lease or sublease land in these areas and did not have the right to receive transfers. This new regulation is expected to create more favorable conditions for businesses in their investment, production, and business activities in Vietnam.

2. Flexible Changes in Land Rent Payment Methods

The Land Law 2013 required enterprises to select either annual payments or one-time payments for the entire lease period at the contract signing stage. This selection was irrevocable for the duration of the lease, creating potential cash flow challenges and limiting financial flexibility. While, the Land Law 2024 allows enterprises currently leasing land from the State with annual rent payments to switch to a one-time payment method for the entire lease period. This change requires recalculating the specific land price to determine the rental amount at the time of the decision permitting the switch to the one-time payment method. This change acknowledges the evolving financial circumstances of businesses and provides a mechanism to adapt payment structures accordingly.