Land recovery, compensation and non-use: when the State may take land back, the 2026 additions including the 75% rule, recovery for unused land, compensation, support and resettlement, procedure and timelines, and the investor's remedies

Recovery in a system without private ownership

Because land belongs to the entire people, the State does not expropriate land in the Western sense; it recovers (thu hồi) land use rights it previously granted or recognised. The Land Law sets out exhaustively when it may do so, and outside those cases recovery is unlawful. For investors the regime matters in three ways. It is a risk to land the investor already holds, whether through a public project or through the investor's own delay. It is a tool the investor relies on when it needs land occupied by others, because the State's recovery and compensation process is how most project sites are cleared. And it determines what the investor receives if its land is taken.

Land Law No. 31/2024/QH15 groups recovery into four categories: national defence and security (Article 78); socio-economic development in the national or public interest (Article 79); violations of land law (Article 81); and the lawful end of land use, voluntary surrender and danger to life (Article 82). Resolution No. 254/2025/QH15 added cases and changed procedure and compensation from 1 January 2026.

Recovery for defence, security and socio-economic development

Article 78 permits recovery for defence and security purposes such as military bases, defence works and police facilities, and Article 3(1) of the resolution adds compulsory drug rehabilitation facilities managed by the armed forces. Article 79 lists 31 cases of socio-economic development in the national or public interest, from transport, energy, irrigation and telecommunications infrastructure and public facilities, through social housing and resettlement, to industrial parks, industrial clusters, high-tech parks and duty-free areas in economic zones (clause 22), licensed mineral extraction (clause 25), mixed-function urban projects and rural residential projects (clause 27), and projects approved by the National Assembly or the Prime Minister (clause 31). Purely commercial projects outside these cases, such as a stand-alone office building or factory, cannot be assembled by State recovery and must be built on land the investor already holds, obtains at auction or acquires by agreement.

Article 3(2) of Resolution No. 254/2025/QH15 added three cases: projects in free trade zones and in the international financial centre; the creation of land funds to pay for build-transfer contracts or to lease to organisations whose land was recovered so that they can continue in business; and, most significantly for private developers, the 75% rule. Where an investor has been assembling land for a project by agreement with the existing users, the time for completing the agreements (including any extension) has expired, and the investor has reached agreement for more than 75% of the land area and with more than 75% of the land users, the provincial People's Council may approve recovery of the remaining land by the State and its allocation or lease to the investor. The holdouts are compensated as in an Article 78 or 79 recovery, and if the compensation per unit of area is lower than the average price agreed with the other users they receive the difference, which the investor advances and may include in the project's investment cost (Article 3(7)).

Recovery for these purposes may proceed only once the compensation, support and resettlement plan has been approved and resettlement arranged, except in defined cases: national important projects and urgent public investment projects where the plan has been publicly posted, other projects where more than 75% of land users agree to recovery before approval, and projects resettling users on site or along the route of the main works (Article 3(3)).

Recovery for violations, including unused land

Article 81 lists the violations for which land may be recovered: continued use for an unauthorised purpose after a fine; continued destruction of land after a fine; allocation or lease to the wrong person or by an unauthorised body; receipt of land from a person not entitled to transfer it; allowing State-managed land to be encroached; failure to meet financial obligations to the State; and non-use. For agricultural land, non-use means 12, 18 or 24 consecutive months by crop type, combined with a fine and failure to start use by the deadline set.

For investors the decisive provision is Article 81(8). Land allocated, leased, converted or received by transfer for an investment project can be recovered if it is not used for 12 consecutive months from physical handover, or if its use is more than 24 months behind the schedule in the investment project. The investor may obtain an extension of up to 24 months, but must pay the State an additional amount equal to the land use levy or rent for the extension period. If the land is still not put into use when the extension ends, the State recovers it without compensation for the land, the assets on it or the remaining investment costs in the land. Force majeure is excluded (Article 81(9)), and Decree No. 226/2025/ND-CP clarified when the extension period starts. Article 3(10) of the resolution confirms that no compensation for land is paid on recovery under Article 81 or under clauses 1 and 2 of Article 82.

The rule interacts with the Law on Investment, under which a project 24 months behind its IRC schedule without an approved extension can be terminated (The Investment Registration Certificate). Investors should therefore set realistic milestones in the IRC and the land documents, adjust them formally before they are missed, and keep evidence of any force majeure event. The quarterly investment reports, which record land use, are the authority's first source of information about delay (Reporting and ongoing obligations).

Article 82 covers the lawful end of land use: among other cases, the dissolution or bankruptcy of the land user, the expiry of the land term without extension, the termination of the investment project, voluntary surrender of the land and land that has become dangerous to life. On expiry or termination, what the investor may recover for its buildings depends on the terms of its project and lease.

Compensation, support and resettlement

Compensation for recovery under Articles 78 and 79 and the resolution's new cases covers the land, the assets on it, and losses from the interruption of production and business, together with support and, for households, resettlement. Article 5(3) of Resolution No. 254/2025/QH15 sets the basis for compensation for land: the area recovered, the land use term, the price in the provincial land price table multiplied by the adjustment coefficient, and the purpose and form of use. Before 2026 a specific land price was determined for each project; compensation is now based on the table and coefficient without waiting for a specific valuation, which is faster but may be lower than market value in some areas (Land rent, land prices and Resolution 254).

The form of use is decisive. A land user that holds land by allocation with levy or by lease with one-off rent is compensated for the land for the remaining term. A lessee paying annual rent is generally not compensated for the land itself, but for its remaining investment costs in the land and for its assets on it. Assets are compensated at their value: under Article 3(11) of the resolution, a building that must be wholly or partly demolished so that the remainder no longer meets technical standards is compensated at the cost of new construction of equivalent standard, and otherwise at actual damage under provincial rules. Provinces issue unit prices for crops, livestock and forests and set additional support measures (Article 3(11) and (12)). The detailed rules are in Decree No. 88/2024/ND-CP on compensation, support and resettlement, as amended by Decree No. 226/2025/ND-CP and supplemented by Decree No. 49/2026/ND-CP, and in provincial decisions issued under them.

Investors that need land cleared usually advance the compensation money under the approved plan. Under Article 94(2) of the Land Law the advance is deducted from the land use levy or rent payable, and Article 3(8) of the resolution applies the deduction across the whole project and each land decision. An investor that advances more than it can deduct should agree the treatment in advance with the province.

How a recovery for a public project runs

1. Planning and the land use planThe project must fall within an Article 78 or 79 case or a case added by the resolution, and be in the land use plan and approved planning.
2. Notice of recoveryThe competent authority notifies the land user, owners of assets and other interested persons at least 60 days before the recovery decision for agricultural land and 120 days for non-agricultural land (Article 3(9)(a) of Resolution No. 254/2025/QH15, shortening the 90 and 180 days in Article 85 of the Land Law).
3. Survey and inventoryOfficials measure the land and record the assets, crops and business affected; the land user should attend, check the record and add evidence of investment costs.
4. Compensation plan, posting and dialogueA compensation, support and resettlement plan is prepared on the price table and coefficient, posted at the commune People's Committee and residential area and on the commune portal for 10 days; if objections remain, a dialogue is held within 30 days of the consultation (Article 3(9)(b)).
5. Approval and recovery decisionThe plan is approved and the recovery decision issued, normally only after the plan is approved and resettlement arranged, save for the exceptions in Article 3(3).
6. Payment and handoverCompensation and support are paid and the land handed over; if the user refuses, the authority may enforce the decision under the procedure in the Land Law.
7. Complaint or lawsuitThe land user may complain to the authority that issued the decision and then to its superior, or sue in the administrative court; the decision generally remains enforceable meanwhile.

Investor protection and remedies

Within Vietnamese law, a land user may complain against a recovery decision or a compensation plan under the Law on Complaints, first to the authority that issued it and then to the next level, or bring proceedings in the administrative court; since 1 July 2025 first-instance administrative cases are heard by the reorganised regional and provincial courts (FAQ 71). Complaints must be made within the statutory time limits, and the investor should preserve evidence from the inventory stage onward: invoices, construction contracts, valuations, photographs and accounts showing investment in the land.

Above domestic law sit the guarantees in the Law on Investment. Article 9 of Law No. 143/2025/QH15 protects lawful assets against nationalisation and confiscation by administrative measures, and where the State requisitions or recovers assets for defence, security or the national interest, it must compensate under the law. A foreign investor protected by a bilateral investment treaty or an investment chapter in a free trade agreement may also have a claim for expropriation without compensation, or for unfair treatment, enforceable by international arbitration (Investment guarantees and treaties; Chapter 9). Treaty claims are a last resort, but structuring the investment through a protected jurisdiction and keeping records with a claim in mind cost little at the outset (FAQ 50).