b) Time and place of property auction;
c) List of assets, quantity and quality of assets to be auctioned;
d) Starting price of the auctioned property;
d) Location and time of display of auctioned assets;
e) Location and time limit for consulting auction property documents;
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g) Location and deadline for registration to purchase auctioned assets;
h) Other necessary information related to the auctioned property, including information that the owner of the auctioned property requests to be publicly announced.
The purpose of announcing the auction of assets as strictly regulated above is to demonstrate objectivity in the auction process, expand the number of people who want to buy assets, and contribute to establishing the most reasonable asset purchase price.
2.1.3. Register to participate in property auction
According to the current law on property auctions, individuals and organizations wishing to participate in auctions must register to participate and pay an auction participation fee and a deposit to the auction organizer. Such a regulation is necessary so that the auction organizer can grasp the number and qualifications of auction participants so that timely and appropriate adjustments can be made before the auction takes place. This deposit is a measure to ensure the participation of auction participants in the auction during the auction process.
According to Decree 05/2005/ND-CP, the deposit agreed upon by the auction organization and the person with the property to be auctioned is not more than 5% of the starting price, which is too low. In many cases, this deposit is too small, leading to the winning bidder giving up. Therefore, Decree 17/2010/ND-CP
has raised the deposit level higher: minimum 1% and maximum not exceeding 15% (Clause 1, Article 29) to overcome the situation of not participating in the auction or participating in the bid but refusing to buy and being willing to lose the deposit in case of refusing to buy the property with the purpose of causing difficulties for people with related rights and interests or for the purpose of profiteering. At the same time, the ceiling regulation with a certain flexibility still ensures compliance with the reality of each locality. According to current regulations, the deposit level is not more than 15% of the starting price of the property depending on the type and value of the property. The specific level will be decided by the auctioneer. In reality, if the deposit is too high, it will be difficult to expand the number of auction participants, but if it is too low, it will be the basis for negative consequences. It is necessary to stipulate the obligation to pay a deposit as a mandatory obligation, in addition to acting as a guarantee, the regulation of the maximum deposit level is to limit the arbitrariness of property auction organizations and competent authorities. In case the person paying the deposit successfully purchases the property, that amount will be deducted from the purchase price, if not, this amount will be refunded to the person paying. In case the person registering to buy the auctioned property has paid a deposit but does not participate in the auction without being in a case of force majeure, the deposit belongs to the property auctioneer , unless the parties have another agreement. The auction participant registers with the auctioneer within the notice period and pays the deposit. Thus, to obtain a registration number, the registration form has the address, account and confirmation of the deposit.
Based on the above reality, to protect the rights of auction participants and auction winners, the law on property auctions must have regulations on the responsibilities of the auction organizer and the person whose property is being auctioned when these people violate the obligations committed to the auction participants; as a measure to guarantee obligations in law.
Under current civil law, the auctioneer must return the deposit to the winning bidder plus an amount at least equal to the value of the deposit.
To register for the auction, organizations must present their business registration certificate, establishment decision, tax code of the tax authority, letter of introduction or authorization letter of the person registering to participate in the auction... For types of assets that the business entity must have conditions for according to the provisions of law, in addition to the documents regulating the correct business above, there must also be a license from the competent authority such as petroleum business, toxic waste treatment. For individuals, present their identity card, household registration...
The auction is organized according to the principle of objectivity, which does not mean that any subject can participate in the property auction. To ensure the auction is successful and objective, the law has also established very strict regulations for those who are not allowed to participate in the property auction.
The first case is for "persons without civil act capacity, persons who have lost or have limited civil act capacity, or persons who at the time of the auction are not aware of or in control of their actions". The subject participating in the transaction has full civil act capacity, which is considered a condition for the validity of the civil transaction. The subjects as prescribed above do not have sufficient qualifications to participate in civil transactions, but their status as subjects participating in the transaction is established through a representative.
In the second case, based on the principle of objectivity in the auction process, to limit collusion and difficulties in selling assets of property owners, as well as abuse of power and authority, the law has listed entities that are not allowed to participate in property auctions.
People working in the property auction organization where the property auction is conducted, parents, spouse, children, siblings of that person; people directly appraising and valuing the property, parents, spouse, children, siblings of that person.
Person authorized by the owner to sell property; person who decides to confiscate property that is evidence or means of administrative violation; person with authority to decide to sell state property; person who signs contract to hire an auction organization to auction state property; individual or organization that has the right to sell other people's property according to the provisions of law.
People who do not have the right to purchase auctioned property according to the provisions of law, including:
a) People who are not allowed to participate in purchasing assets to enforce judgments according to the provisions of law on civil judgment enforcement;
b) Persons who are not eligible to purchase assets for certain types of assets according to the provisions of law on that type of asset.
People who are not allowed to receive land use rights transfer; people who are not in the case of being allocated land by the State with land use fees or land lease according to the provisions of the law on land.
2.1.4. Display of auctioned assets
At the same time as the notification process, Article 3 of Decree 17/2010/ND-CP also regulates the display and viewing of auctioned assets to ensure that specific and detailed information is clearly available to all auction participants. This regulation aims to create conditions for auction participants to see the assets and original documents in person, helping them feel secure about the quality and legal origin of the assets to make the right decision when participating in the auction of assets. For assets of small value, it may not be necessary to display them to reduce costs, but it is necessary to create conditions for buyers to see them in person.
If the buyer does not see the goods in advance and does not question the quality of the goods, he or she will not have the right to question the quality of the goods after the auction.
For real estate auctioned assets, auction participants may directly view the assets from the time of listing and public announcement until two days before the auction opening date.
For property auctioned that is movable property, at least two days before the auction date, the auctioneer must create conditions for auction participants to view the property. The name of the person whose property is being auctioned and information about the property must be clearly stated on the property or on the property sample.
To ensure the flexibility of property auctions, the law stipulates that property auctions can be held at the headquarters of the property auction organization, at the location of the property, or at another location as agreed between the property auction organization and the person whose property is being auctioned. The location and time of the auction must be widely announced, and at least notified to those who have registered to participate.
2.2. PROCEDURE FOR AUCTION OF ASSETS
2.2.1. Principles of property auction
The auction of assets must be carried out in accordance with the principles of publicity, honesty, and ensuring the rights of the parties participating in the auction of assets. To effectively implement this principle, the State must have a strict legal mechanism to manage the buying and selling activities in the auction of assets. The auction of assets is directly related to the interests of the person whose assets are for sale and the buyer, so it must be sold at the correct value and avoid confusion for the buyer. The participating parties must cooperate and help each other, protect their own rights and legitimate interests and those of others. If the auctioneer has an act of
Fraud, collusion, connivance with buyers or other violations of auction laws will be handled according to the law.
2.2.2. Form of property auction
Property auctions have been around for a long time, closely associated with the process of exchanging goods between people . The assets put up for auction can be of small value or large value such as real estate. There are many forms of auctions in the world, traditionally, auctions include the following main forms:
Ascending auction. This is arguably the most common form of auction. Bidders bid openly against each other, with each subsequent bid being higher than the previous one. An auctioneer may announce a price, bidders may bid in person or by proxy, or bids may be submitted electronically with the highest bid. The auction ends when no further bids are made. Additionally, if the seller has set a minimum pre-sale price (the asking price) and the final price does not reach that level, the item remains unsold. Auctions in the UK are commonly used for property, most notably antiques and art, but also second-hand goods and real estate.
First-price sealed bid auction, in this type of auction, all participants place bids simultaneously, without anyone knowing anyone else's bid. The highest bidder wins the item. This type of auction is different from a British auction, in which participants can only make one bid. Furthermore, because participants cannot see the bids of other participants, they cannot adjust their bids accordingly. First-price sealed bid auctions are often used for government contracts and mining leases.
The Vickrey auction was proposed by William Vickrey, a Columbia University professor and 1996 Nobel Prize winner in Economics. Participants can
multiple, random bids, with the highest bidder winning the overall price and paying the price of the second-highest bidder. This method encourages bidders to bid the true value of the item. In practice, Vickrey auctions are rarely used.
Franchise auction. This is an open-ended auction for reproducible products (recordings, software, pharmaceutical formulas), where bidders publicly place their highest bid (which can be adjusted or withdrawn), and the seller can consider ending the auction at any time once they have chosen a satisfactory price. The winning bidders are those who bid at or above the chosen price, and receive a copy of the product.
American Auction. The buyer's valuation is of a set of items in different quantities and types (called a combination). For example, if bicycle wheels and frames are sold separately in an auction, a combination of one wheel or one frame is worth nothing to the bidder, but two wheels and a frame are worth $200. If forced to buy in separate auctions, the bidder may find himself in a dilemma: he wins some of the items offered earlier but loses the items offered later; on the other hand, if he loses in the first auction, he will not get the desired combination. This situation can be resolved by selling all the items at once and allowing the bidder to register a bid for a combination of items. Such a combination bid will offer one price to pay for all the items in the combination, if you win you get the combination, otherwise you don't have to buy anything in the combination.
Single price auction. In this format, bidders are given a price range that they can bid on, and a single price that can be the highest or lowest of the bids wins. For example, if an auction sets a maximum price of 10; the five highest bids are 10, 10, 9, 8, 8, then 9 will be the winning bid because the bidder
highest single bid. This format is common in online auctions.
In a bare auction, the property may not be sold if the final price is not high enough to satisfy the seller. In cases where the reserve price is known to the auctioneer, but not necessarily to the bidders, it may have been set in advance as the property is not allowed to be sold. A bare auction is safer for the seller as they are not forced to accept a low price, but this possibility may result in a lower final price, if this means less interest than is generally the case in the sale.
A reverse auction is a type of auction in which the positions of buyer and seller are reversed, with the primary goal of reducing the purchase price. In a regular auction (also known as a forward auction), buyers compete to obtain a good or service. In a reverse auction, sellers compete to provide a good or service by offering progressively lower bids. At the end of the auction, the lowest bidder wins.
A silent auction is a variation of an auction in the UK, where bids are written on a piece of paper. Often used in charity events, this type of auction involves the purchase of a set of similar items, with bidders placing their bids on a piece of paper next to the items, with or without the knowledge of how many other bidders there are and what their bids are. The highest bidder buys the item at the price they have bid.
A Dutch auction is also known as an open-bid auction with a descending price. In a traditional Dutch auction, bids are raised at a high price and then lowered until a bidder accepts the auction price. The successful bidder announces the price. The most famous example of a Dutch auction is the Tulip auction. "Auction