Forms of Land Use of Economic Organizations

1.1.1.3. Classification of land use rights

Land use rights are based on the subject (organization, household or individual): Land use rights are now based on the subjective will of the subject and the purpose of land use depends on the subject's decision. These decisions must be within the limits permitted by the competent authority.

Land use rights are based on the object (agricultural land, non-agricultural land or unused land): This means that the land user must use the land for the purpose specified. If there is a change in the purpose of use, it must be reported to the competent authority and must be permitted before it can be implemented.

The land use period can be temporary or permanent, depending on the decision of the competent authority. From there, the land use right of the subject is also decided as temporary or permanent.

Land use rights are based on legal grounds. That means it is necessary to base on the decision of the competent authority when allocating land or leasing to determine the purpose of use and to know whether it is the initial land use right of the organization, individual, or household directly in the decision or the second land use right of the sub-lessee or inheritor [39, p.655].

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1.1.2. Concept and characteristics of economic organizations

1.1.2.1. Concept of economic organizations

According to Clause 27, Article 3 of the 2013 Land Law, economic organizations include enterprises, cooperatives and other economic organizations as prescribed by civil law, except for enterprises with foreign investment capital. We can understand that economic organizations under the 2013 Land Law are only enterprises with entirely domestic investment capital, not including enterprises with foreign investment capital, even if such enterprises are established and legally operating in Vietnam. The concept of other economic organizations as prescribed by civil law is not clear. Considering both the 2005 Civil Code and the 2015 Civil Code

There are no regulations explaining the concept of economic organization, but all give very general contents.

1.1.2.2. Characteristics of economic organizations

If based on enterprises and cooperatives, it can be seen that economic organizations will have some of the following characteristics:

+ Legally registered in accordance with the law

+ Have production and business activities to carry out business development purposes

economy

+ Have clear regulations and organizational structure

+ Have a specific name, address, and assets to operate

+ Has legal status

+ Not a foreign invested enterprise

Basically, economic organizations have many similarities with other organizations.

have legal status, however, in terms of organizations with legal status, economic organizations are in a smaller scope because according to the Civil Code, legal entities are divided into many types, including legal entities that are economic organizations. There is a noteworthy point about the concept of economic organizations: "except for enterprises with foreign investment capital". It can be seen that the regulation of economic organizations to carry out internal management activities in the country of the Vietnamese state, therefore, foreign-invested enterprises are currently not considered economic organizations.

1.1.2.3. Forms of land use by economic organizations

Pursuant to the 2013 Land Law, forms of land use by domestic economic organizations include:

- Receive land use rights from the State: (i) Be allocated land by the State with land use fees collected; (ii) Be leased land by the State with annual land rent collected, lease land with one-time land rent collected for the entire lease term;

- Receiving land use rights from other land users: (i) Receiving land use rights transfer such as conversion; assignment; inheritance, donation; capital contribution (Article 188); (ii) Renting or sub-renting land use rights from other land users.

1.2. Land use rights of economic organizations when the State leases land according to land law

1.2.1. Legal nature of land use rights of economic organizations

Land use rights are the right to exploit useful assets of land to serve the socio-economic development goals of the country. From an economic perspective, land use rights are very important because they meet the needs and interests of users, especially economic organizations, in the process of land use. As the representative of land owners, the State does not directly use land but assigns it to economic organizations, households, and individuals for stable and long-term use, but the State does not lose its land use rights. Because the State implements regulations in the following main forms: Through the collection and approval of land use planning and plans to define specific land use purposes; Through the development and promulgation of legal documents on land management and use, which organizations and households must comply with in the process of land use. This means that, through the process of land use by land users, the State's land use ideas will become reality, and at the same time, land users in the process of use must contribute a part of the benefits. They originate from land use in the form of material obligations to the State through land use tax, land use right transfer tax, etc.

Understanding the legal nature of land use rights, land use rights are the rights of entities that have the right to exploit, benefit and receive profits from the use of land allocated, leased or transferred by the State, transferred from other entities through transfer, lease, sublease, inheritance, gift ... from other entities that have land use rights.

1.2.2. Basis for the emergence of land use rights of economic organizations when the State leases land

According to the law, economic organizations in Vietnam have the right to use land when having the following bases:

(i) The State leases land and collects annual land rent or

Land lease with one-time land rent payment for the entire lease term;

(ii) Receive land use rights transfer such as conversion; assignment; inheritance, donation; capital contribution... and have land use rights recognized by the State;

(iii) Lease or sublease land use rights from other land users and have land use rights recognized by the State.

1.2.3. Contents of land use rights of economic organizations when the State leases land

Firstly, economic organizations when leased land by the State have the general rights of land users, including 1 :

- Granted certificates of land use rights, house ownership rights and other assets attached to land.

- Enjoy the fruits of labor and investment results on land.

- Enjoy benefits from State projects serving the protection and improvement of agricultural land.

- Receive guidance and assistance from the State in improving and enriching agricultural land.

- Be protected by the State when others violate your legitimate rights and interests regarding land.

- Be compensated when the State reclaims land according to the provisions of this Law.

- The right to complain, denounce, and sue about violations of one's legal land use rights and other violations of land laws.

Second, the rights of economic organizations that are leased land by the State and pay land rent once for the entire lease term 2 :

Economic organizations that are allocated land with land use fees or lease land with one-time rental payment for the entire lease term have the general rights and obligations stipulated in Articles 166 and 170 of the Land Law. Economic organizations that are allocated land with land use fees or lease land with one-time rental payment for the entire lease term have the general rights and obligations stipulated in Articles 166 and 170 of the Land Law.

1 Article 166 of the 2013 Land Law.

2 Article 174 of the 2013 Land Law.

During the entire lease term, the general rights and obligations also include the following rights:

- Transfer of land use rights and assets owned by them attached to the land;

- Lease land use rights and assets under one's ownership, attached to the land in cases where the State allocates land with land use fees collected; sublease land use rights and assets under one's ownership for land in cases where the State leases land with one-time rental payment for the entire lease term;

- Donate land use rights to the State; donate land use rights to residential communities to build facilities serving the common interests of the community; donate houses of gratitude attached to land according to the provisions of law;

- Mortgage land use rights and assets attached to land at credit institutions licensed to operate in Vietnam;

- Contribute capital with land use rights and assets under their ownership, attached to the land, to cooperate in production and business with organizations, individuals, Vietnamese enterprises and foreign investors according to the provisions of law.

When the State leases land to a self-financed public service organization with a one-time land rent payment for the entire lease term and the land rent paid does not originate from the state budget, it has the rights and obligations as stated above; the competent state agency approving the exercise of such rights must be in writing. In the case where the State leases land to a self-financed public service organization with a one-time land rent payment for the entire lease term, the rent must originate from the state budget according to Article 173 of the Land Law stipulating rights and obligations.

Organizations that are allocated land by the State with land use fees collected, or leased land with one-time land rent payment for the entire lease term but are exempted from or have land use fees or land rent reduced have the following rights and obligations:

- In case the State allocates or leases land to implement the project

Housing business and exempted from or reduced land use fees or land rent have the same rights and obligations under the land law as cases not exempted from or reduced land use fees or land rent;

- In case the State allocates or leases land to implement an investment project for profit purposes other than those specified in Point a of this Clause and the land use fee or land rent is reduced, the rights and obligations shall be as prescribed by the law on land as in cases where the land use fee or land rent is not exempted or reduced for the type of land with the corresponding purpose of use;

- In case the State allocates or leases land to carry out investment projects for profit purposes other than those prescribed in Point a of this Clause and exempts them from land use fees or land rent, they have the same rights and obligations as those prescribed by the land law as in the case where the State leases land and pays annual rent for the type of land with the corresponding purpose of use.

Third, the rights of economic organizations and public service organizations to use leased land and pay annual land rent 3 :

When the State leases land to economic organizations and public service organizations and collects annual land rent, it has the following rights and obligations:

- General rights and obligations stipulated in Articles 166 and 170 of the Land Law;

- At credit institutions licensed to operate in Vietnam, mortgage of assets owned by them attached to leased land;

- Sell assets owned by oneself attached to leased land when meeting the conditions specified in Article 189 of this Law; the buyer of the assets shall continue to be leased land by the State for the determined purpose;

- Contribute capital with assets owned by oneself attached to the leased land; the recipient of the capital contribution with assets shall continue to be leased land by the State for the determined purpose;

3 Article 175 of the 2013 Land Law.

- Subleasing land use rights in the form of annual land rental payment for land with built infrastructure in cases where investment in construction and business operation of infrastructure for land in industrial parks, industrial clusters, export processing zones, high-tech zones, and economic zones is permitted.

Economic organizations and public service organizations using land leased from organizations, households and individuals outside industrial parks, industrial clusters and export processing zones have the rights and obligations prescribed by the law on civil matters.

Therefore, according to the above provisions, the State leasing land to economic organizations is only allowed to mortgage its own assets attached to the leased land at credit institutions licensed to operate in accordance with the provisions of Vietnamese law. Thus, when the State leases land to economic organizations, those economic organizations are not allowed to mortgage the right to use that land.

Fourth, regulations on the rights of economic organizations to lease land to build underground works 4 :

The State leases land to economic organizations for investment in underground construction and has the following rights and obligations: (i) In case of land lease with one-time payment of land rent for the entire lease term, they have the same rights and obligations as economic organizations as prescribed in Clauses 1, 2 and 4, Article 174 of the Land Law; (ii) In case of land lease with annual payment of land rent, they have the same rights and obligations as economic organizations as prescribed in Clause 1, Article 175 of the Land Law.

Fifth, regulations on receiving land use rights 5 :

Economic organizations, households and individuals may receive land use rights through land use right transfer, except for the cases specified in Article 191 of the 2013 Land Law. Specifically as follows: (i) Organizations, households, individuals, residential communities, religious establishments, Vietnamese people residing abroad, and foreign-invested enterprises are not allowed to receive land use rights transfer or donation in cases where the law does not permit the transfer or donation of land use rights; (ii) Economic organizations are not allowed to receive land use rights transfer or donation;

4 Article 178 of the 2013 Land Law.

5 Point b, Clause 1, Article 169 of the 2013 Land Law.

be allowed to transfer the right to use rice-growing land, protective forest land, and special-use forest land of households and individuals, except in cases where the land use purpose is changed according to the land use planning and plan approved by a competent state agency.

Land use rights (LUR) transactions are contracts or unilateral legal acts that create rights and obligations of the parties with respect to LUR. Types of LUR transactions include: conversion, assignment, donation, inheritance, capital contribution, mortgage, lease (sublease). According to the provisions of the 2013 Land Law (Land Law), the party converting, assigning, donating, inheriting, capital contributing party with LUR, mortgagor, lessor (sublessor) of LUR (collectively referred to as the party conducting the LUR transaction) and the party receiving the conversion, assignee, donee, inheritor, capital contributing party with LUR, mortgagee, lessee (sublessee) (collectively referred to as the parties participating in the transaction) only have the right to transact and conduct the transaction when meeting the following conditions:

- The party conducting the transaction must be the land user.

- Must be permitted by Land Law for transaction.

- No restriction on the right to decide.

1.2.4. Factors affecting legal regulations on land use rights of economic organizations

One is the economic factor.

In order to effectively carry out social management activities, the State cannot fail to promulgate laws that are suitable for the country's socio-economic management needs. The issues that need to be emphasized in the legislative process are to synchronously build different types of markets in the current society with the ultimate goal of providing legal types that are suitable for the needs, development and objective laws of society, especially the laws of socio-economic development.

In addition, the interests of the parties involved in economic organizations are one of the fundamental factors affecting the law on land use rights of organizations.

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