How foreign-invested companies access land: State lease, industrial park sublease, allocation for housing, capital contribution, acquisition of a landholding company, and the restrictions on agricultural and sensitive land

The starting point: Article 28 and the limits on a foreign-invested company

A Vietnamese company has broad freedom to acquire land: it may lease from the State, take transfers of land use rights from other users, receive land as a capital contribution and buy at auction. A foreign-invested economic organisation has a narrower list. Article 3(46) of Land Law No. 31/2024/QH15 defines it as an economic organisation that must meet the conditions and follow the investment procedures for foreign investors under the Law on Investment to carry out a project using land, which under Article 20 of Law No. 143/2025/QH15 means, broadly, a company more than 50% foreign-owned; a company at or below that threshold is a domestic land user with the wider routes, even though it has foreign shareholders. Article 28 of the Land Law allows a foreign-invested economic organisation to receive land use rights by six routes: a lease from the State; a capital contribution of land use rights; a transfer of investment capital whose value consists of land use rights, that is, the acquisition of a company or project holding land; a transfer or sublease of land use rights in an industrial park, industrial cluster or high-tech park; State allocation of land for a housing project built for sale or for sale and lease; and special cases such as winning an auction of land use rights, enforcing a mortgage, or a court judgment, arbitral award or recognised mediation settlement. Outside an industrial zone it cannot simply buy land use rights from a Vietnamese company or household.

The route determines the time to obtain land, whether investment policy approval and a deposit are needed, the payments, whether the land can be mortgaged, and the clearance risk. The foreign investor should settle the route before it files for its Investment Registration Certificate, because the IRC records the location and land area and the land documents are part of the dossier (The Investment Registration Certificate).

Route 1: a lease from the State

A State lease (thuê đất của Nhà nước) is the route for a project outside an industrial zone that needs land the investor does not already control. The provincial People's Committee decides the lease, the land authority signs the lease contract and the tax office issues rent notices. The investor chooses whether to pay rent annually or once for the whole term; since 1 January 2026 Article 4(2) of Resolution No. 254/2025/QH15 generally allows either, except where the land comes from a fund managed by a State agency and is leased on annual terms, and land leased by auction from such a fund must be paid for once for the whole term. The economics of the choice are in Land rent, land prices and Resolution 254.

The State selects the lessee in one of three ways. Land that is clear and planned for a use is usually auctioned, and the winning bid becomes the rent. Where land has not been cleared or the project is an urban or housing development, the State runs bidding to select an investor under the Law on Bidding. Land is leased without auction or bidding only in the cases in Article 124 of the Land Law and those added by Article 4(4) of Resolution No. 254/2025/QH15, which include land used to pay for build-transfer contracts, projects in the recovery cases of Article 79 that use no State capital and already have investment policy approval and an approved investor, and energy projects and tourism projects with commercial services in especially disadvantaged areas. A request for land without auction or tender, or for a change of land use, brings the project within Article 24 of the Law on Investment and needs investment policy approval first, as explained in Investment policy approval, together with the deposit under Article 30.

The State leases land only for a use consistent with approved planning, principally the land use targets in the provincial plan and, for construction, the zoning plans under Law No. 47/2024/QH15 on Urban and Rural Planning. Where the land is occupied, the State recovers it from current users, compensates them and then leases it to the investor. Land clearance is the main source of delay on this route, and investors often advance the compensation money, which is then deducted from rent (Land recovery, compensation and non-use).

Route 2: a sublease in an industrial park, cluster or high-tech park

Most foreign manufacturers take land by subleasing serviced plots from the developer of an industrial park, an industrial cluster or a high-tech park, or by renting a ready-built factory. The developer has already obtained investment policy approval, leased the land from the State, cleared it and built roads, power, water and wastewater treatment. The tenant needs no investment policy approval for its own project, pays no deposit, and can move from signing to construction in weeks. Under Article 202 of the Land Law, a developer paying annual rent may sublease only on annual terms, while a developer that has paid rent once for the whole term may sublease with either one-off or annual payment, and the tenant's term follows the remaining term of the park's infrastructure project. The mechanics, the zone types, due diligence on the developer and a lease checklist are in Industrial parks and economic zones.

Route 3: allocation for a housing project

A foreign-invested company that develops housing for sale, or for sale and lease, may receive State land by allocation against a land use levy, on the same footing as a domestic developer. The investor is chosen by auction or bidding unless it already holds the land or has assembled it by agreement with existing users, and housing and urban projects always need investment policy approval. Since 1 April 2025 Resolution No. 171/2024/QH15 has also allowed, as a five-year pilot, commercial housing projects on land acquired by agreement or already held that is not residential land, on sites listed by the provincial People's Council. Real estate business conditions, off-plan sales and project transfers are in Real estate business and development projects.

Route 4: land from a Vietnamese partner, by capital contribution or lease

A Vietnamese company or individual that holds land with transferable rights, meaning land allocated with levy, leased with one-off rent or received by transfer, may contribute its land use rights as capital to a joint venture company, including one with foreign shareholders. The joint venture then holds the land for the remaining term with the rights that attached to it. The contribution is valued by the members unanimously or by a licensed valuation organisation under Article 36 of the Law on Enterprises, the contribution contract must be notarised or certified under Article 27(3) of the Land Law, and the change of land user is registered with the land registration office, which issues a certificate in the company's name. Land held by the partner on annual rent cannot be contributed as a land use right; only the buildings and the lease rights can (Article 41(2)). The partner's land is often its main asset, so its valuation and title deserve close scrutiny (Charter capital and capital contribution).

A foreign-invested company may also lease land or buildings from a Vietnamese land user under a private lease. Where the landlord holds one-off rent or allocated land it may lease the land use right itself; where it holds annual rent land it may lease its buildings and sublet its lease rights. The tenant's position depends on the landlord's continuing compliance, so the lease should require the landlord to keep its rent paid, its permits current and its land free of recovery risk.

Route 5: acquiring a company that already holds land

For many foreign investors, and for nearly all foreign real estate developers, the most efficient route is to buy shares or capital in a Vietnamese company that already holds land. The land stays with the company, so no new land decision is needed, and under Article 41(4) of the Land Law a company that becomes foreign-invested by such an acquisition keeps the rights and obligations attached to its land, according to whether it holds allocated, one-off rent or annual rent land.

The acquisition has its own approvals. Under Article 21 of Law No. 143/2025/QH15 the foreign buyer must register the purchase with the investment registration authority before the change of shareholders is recorded where foreign ownership will rise above 50% or increase above that level, where the target is in a business line with foreign market access conditions, or where the target holds land on islands, in border or coastal communes or in areas affecting defence and security. Merger control may apply above the thresholds described in FAQ 87, and a foreign corporate seller pays tax at 2% of gross proceeds under Decree No. 320/2025/ND-CP (Tax on share transfers and dividends). Buying the company also means buying its history: unpaid rent, unrecorded buildings, planning breaches and delays that could lead to recovery all travel with it, so the land due diligence in Title due diligence and security over land is the core of the deal. Transaction structure is covered in Chapter 8.

Restrictions: agricultural land, border and coastal areas, defence land

Agricultural land. A foreign-invested company may use agricultural land, but usually by leasing it from the State for an approved agricultural, forestry or aquaculture project, with one-off rent available under Article 120(2), or by receiving it as a capital contribution or with an acquired company. It cannot take transfers of agricultural land from households and individuals, which a domestic company, including one at or below 50% foreign ownership, may do once the competent People's Committee approves its agricultural land use plan. Rice land and protection and special-use forest are tightly protected, conversion to non-agricultural use needs permission consistent with the land use plan, and conversion of large areas of rice or forest land needs investment policy approval (FAQ 48).

Border, coastal, island and defence areas. Land in these areas is not closed to foreign-invested companies as such, but control of it is screened. An acquisition of a company holding such land must be registered under Article 21 of the Law on Investment, and the authority consults the defence and public security ministries; a project requesting the allocation of areas affecting national defence or security needs investment policy approval; and foreign individuals and organisations may not own housing in areas reserved for defence and security under Article 16 of the Housing Law.