Decree No. 11/2013/ND-CP dated January 14, 2013 of the Government on management of urban development investment

THE GOVERNMENT

Decree No. 11/2013/ND-CP of January 14, 2013, on management of urban development investment

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the November 26, 2003 Law on Construction; June 19, 2009 Law No. 38/2009/QH12 Amending and Supplementing a Number of Articles of the Laws Concerning Capital Construction Investment;

Pursuant to the June 29, 2006 Law on Real Estate Business;

Pursuant to the June 17, 2009 Law on Urban Planning;

At the proposal of the Minister of Construction,

The Government promulgates the Decree on management of urban development investment.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation and subjects of application

1. Scope of regulation

This Decree regulates activities related to urban development investment, including urban planning; formulation and publication of plans on urban development areas; construction investment, operation and transfer of urban development investment projects.

2. Subjects of application

This Decree applies to domestic and foreign organizations and individuals involved in activities related to urban development investment.

Article 2. Interpretation of terms

In this Decree, the terms and expressions below are construed as follows:

1. Urban development area means an area demarcated for urban development investment in a given period. Urban development areas include new urban development areas, expanded urban development areas, urban renovation areas, urban conservation areas, urban reconstruction areas and areas with particular functions.

An urban development area may include one or more than one urban functional zone. An urban development area may lie within the administrative boundaries of one or more than one province or city. An urban development area may consist of one or more than one urban development investment project.

2. New urban development area means an area in which a new urban center is expected to be built in the future under an urban master plan approved by a competent authority and investment to be made to build synchronous new urban infrastructure.

3. Expanded urban development area means an urban development area embracing an existing urban center and a new urban center which have their urban infrastructure synchronously connected.

4. Urban renovation area means an urban development area in which construction investment is made in order to improve the quality of the existing urban center without substantially changing the urban structure.

5. Urban conservation area means an urban development area aimed to conserve and promote urban cultural and historical values.

6. Urban reconstruction area means an urban development area in which investment is made to build new constructions on the foundations of demolished old constructions of an existing urban center.

7. Area with particular functions means an urban development area aimed to form zones with particular functions such as economic zone, tourist-resort zone, university campus, etc.

8. Urban development investment project means an investment project to construct a work or a complex of works in an urban development area decided and announced by a competent authority.

Urban development investment projects include investment projects to construct urban centers and investment projects to construct works in urban centers.

9. Urban center construction investment project means an investment project to construct works (including houses, technical infrastructure, public works, etc.) on an assigned land plot in an urban development area under a master plan approved by a competent authority.

Urban center construction investment projects include the following types:

a/ New urban center construction investment project, which means an investment project to construct a new urban center on a land plot converted from land of other types into urban construction land;

b/ Urban center reconstruction project, which means a project to construct new architectural works and technical infrastructure on the foundations of demolished works under an urban master plan approved by a competent authority;

c/ Urban center renovation and improvement project means a project to renovate and improve the appearances or structures of works in an existing urban center without changing more than 10% of land use norms of the area;

d/ Urban center conservation and embellishment project means a project to conserve and promote cultural, historical and architectural values of works and landscape in a cultural heritage zone of an urban center;

dd/ Complex urban center construction investment project means an investment project to construct an urban center which may include newly constructed, renovated, upgraded, reconstructed, conserved and embellished works.

10. Investment project to construct works in an urban center means an investment project on new construction; or expansion, renovation or improvement of architectural works and technical infrastructure.

11. Investor means an organization or individual that owns capital or is assigned to manage and use capital for investment in an urban development investment project.

12. Grade-1 investor means an investor assigned by the State to implement an urban development investment project. Grade-1 investors may be:

a/ Functional state management agencies;

b/ Management boards of urban development areas; construction investment management boards authorized by competent state agencies;

c/ Enterprises of all economic sectors and cooperatives;

d/ Social, political and professional organizations that satisfy the conditions specified by law.

13. Secondary investor means a grade-2 investor or an investor of a lower grade investing in an urban development investment project through the lease, assignment or receipt from transferors of the rights to use land with infrastructure under an urban development investment project for work construction investment.

14. Urban services means public services provided in an urban center, such as management, operation and maintenance of the technical infrastructure system; environmental sanitation and protection; management of parks and greeneries; urban lighting, water supply and drainage; condominium management; funeral and waste treatment services; public transport; protection of order and security in urban development areas; health care, education, commerce, entertainment, sports and physical training, and other public services.

Article 3. Principles of urban development investment

1. Being in line with national and local socio-economic development master plans, construction and urban planning, plans on construction of urban development areas, and compliant with the law on construction investment and relevant laws.

2. Assuring synchronous development of technical infrastructure, social infrastructure, urban architecture and landscape in combination with security and defense.

3. Assuring economical and efficient exploitation and use of resources; protecting the environment and responding to climate change and natural disasters for the purpose of sustainable development.

4. Creating a healthy living environment for urban residents; assuring the interests of the community in harmony with those of the State and investors.

5. Maintaining and promoting the national cultural identities, conserving and embellishing existing cultural and historical relics.

Article 4. Land reserved for urban development investment

1. Provincial-level People’s Committees shall assign provincial-level Construction Departments as focal agencies to formulate urban development programs for their localities and for each urban center, and submit them to provincial-level People’s Committees for approval.

2. Provincial-level People’s Committees shall base themselves on urban master plans, urban development programs, plans on construction of urban development areas and land use plans approved by competent authorities to direct the creation of land areas for urban development investment projects in announced urban development areas.

3. Provincial- and district-level People’s Committees shall, as decentralized, organize or guide investors in the payment of compensations and provision of supports for and resettlement of persons whose land is recovered in accordance with the land law.

4. The assignment or lease of land for urban development investment must be based on results of selection of investors in the form of appointment, bidding, assignment of land for construction of social houses, or auction in accordance with law.

5. The recovery of the whole or part of land areas assigned or leased for urban development investment projects which are not implemented or are implemented behind schedule complies with the land law.

6. Land reserved for construction of social houses and resettlement houses must be demarcated right upon the formulation and approval of zoning plans and detailed plans.

7. After obtaining written consent of the Ministry of Construction, provincial-level People’s Committees shall specify areas in which the rights to use land with invested infrastructure may be transferred to local inhabitants for building their own houses under detailed plans of approved projects.

Article 5. Capital for investment in urban development

1. Capital for investment in urban development areas includes state budget capital, official development assistance (ODA) and capital from other economic sectors.

2. Provincial-level People’s Committees may use existing investment funds (including local development investment fund, land development fund, infrastructure development fund, housing development fund, etc.) to create sources for investment in urban development areas.

Article 6. Encouragement of, supports and incentives for, urban development investment projects

1. The State adopts policies to encourage and provide suports and incentives for urban development investment projects that satisfy one or more of the following criteria:

a/ Construction of framework technical infrastructure and social infrastructure works for public interests which are incapable of capital recovery and not on the lists of works which must be constructed by investors;

b/ Construction of social houses, resettlement houses and renovation or reconstruction of residential areas and old condominiums in accordance with law;

c/ Construction of houses for lease;

d/ Construction of works applying new and environment-friendly technologies.

2. The State adopts support policies including:

a/ Timely and free-of-charge provision of information on master plans and plans on construction of urban development areas;

b/ Supports for investment in projects to build public-utility service capacity for the areas.

3. Other cases eligible for incentives in accordance with law.

Chapter II

URBAN DEVELOPMENT AREAS

Article 7. Requirements of formulation, appraisal and approval of urban master plans

1. The formulation, appraisal and approval of construction and urban master plans comply with the Law on Construction, the Law on Urban Planning and relevant guiding documents.

2. For urban centers expected to have their boundaries expanded or urban development areas with a forecast population size equal to that of  urban centers of grade I or higher grade, provincial-level People’s Committees shall submit planning tasks and general plans to the Ministry of Construction for appraisal and subsequent submission to the Prime Minister for approval.

3. Within 30 days after a general plan is approved, the provincial-level People’s Committee shall direct the formulation of a zoning plan for approval under regulations.

4. For a zoning plan for zones with a population size equal to that of grade-IV or higher-grade urban centers in a special-grade or grade-I urban center or an urban center of a size determined in an approved master plan as equal to that of grade-I urban centers, the provincial-level People’s Committee shall obtain the Ministry of Construction’s consent before a competent authority approves such plan.

5. The time limit for the Ministry of Construction to consider and give its opinions on a zoning plan specified in Clause 4 of this Article is 15 working days after receiving an official letter for consultation and a planning dossier.

Article 8. Responsibility to make dossiers of proposal on urban development areas

Based on socio-economic development master plans, regional construction master plans, general urban plans, zoning plans and urban development programs, provincial-level People’s Committees shall make dossiers of proposal on urban development areas and submit them to the Prime Minister for decision or decide on urban development areas according to their competence prescribed in Article 9 of this Decree.

Article 9. Competence to decide on urban development areas

1. The Prime Minister shall decide on the following urban development areas after receiving the Ministry of Construction’s appraisal opinions on contents specified in Clause 3 of this Article:

a/ Urban development areas in urban centers with general plans under the approving competence of the Prime Minister;

b/ Urban development areas within the administrative boundaries of two or more provinces;

c/ Urban development areas aimed to form new urban centers with a population size equal to that of grade-IV or higher-grade urban centers under approved master plans;

d/ Urban development areas of security or defense importance.

2. Provincial-level People’s Committees shall decide on remaining urban development areas.

3. Contents of appraisal of proposed urban development areas:

a/ Conformity with the socio-economic development master plan, general planning orientations for the national urban system, other sectoral development master plans and strategies assosiated with security and defense;

b/ Conformity with the approved master plan, zoning plans and urban development programs;

c/ Feasibility of plans on construction of urban development areas.

4. The number of sets of a dossier of proposal on an urban development area submitted to the Ministry of Construction for appraisal is 10.

5. The time limit for appraisal of a proposal dossier is 30 working days.

6. A draft decision approving an urban development area must have the contents specified in the form provided in the Appendix to this Decree.

Article 10. Contents of a dossier of proposal on an urban development area

1. A written proposal.

2. A brief report on the proposed urban development area, containing:

a/ Name of the urban development area;

b/ Location and boundaries of the urban development area (with illustrative plans);

c/ Description of the actual state of the urban development area;

d/ Grounds for the formation of the urban development area;

dd/ Characteristics/main functions of the area;

e/ Introduction of basic contents of the approved urban master plan;

g/ Plan on construction of the urban development area;

h/ Projected duration of implementation;

i/ Preliminary cost estimate and projected resources for urban development investment;

k/ Proposed form of management or establishment of the management board of the urban development area as prescribed in Article 13 of this Decree. A new management board may be established or an existing management board may be assigned to manage each urban development area.

Article 11. Contents of a plan on construction of an urban development area

1. Determination of a list of projects in the urban development area on the basis of the zoning plan, for grade-IV or higher-grade urban centers, or the general urban plan, for grade-V urban centers and zones with particular functions.

2. Determination of the order of construction investment and schedule of implementation of urban development investment projects, assuring that framework technical infrastructure projects and a number of essential social infrastructure works of the area are constructed before other component projects.

3. Relocation and resettlement plans.

4. Capital plan and capital mobilization models.

5. Management and realization of capital mobilization models.

Article 12. Announcement of urban development areas and construction plans

1. Within 30 days after issuing a decision approving an urban development area, a provincial-level People’s Committee shall announce such urban development area and its construction plan; provide information to and create conditions for investors to invest in urban development projects.

2. The public announcement of urban development areas and their construction plans must be made in the mass media and other media suitable to specific local conditions.

3. To-be-announced contents include the main contents of the decision approving an urban development area and the plan on construction of such area for investors to know, select and make decision on investment in projects.

Article 13. Urban development area management boards

1. Position and functions of urban development area management boards

a/ Depending on local conditions, chairpersons of provincial-level People’s Committees shall decide to establish urban development area management boards in accordance with Clause 2 of this Article. An urban development area management board is a non-business unit attached to the provincial-level People’s Committee, having the legal person status and its own seal, and submitting to the direction and management by the provincial-level People’s Committee and to the professional direction and guidance by the provincial-level Construction Department and other specialized provincial-level Departments;

b/ The urban development area management boards function to assist the provincial-level People’s Committee in performing a number of tasks of urban development investment management in urban development areas, including: managing and supervising the process of urban development investment under master plans and plans; assuring synchronous connection and management of the framework technical infrastructure system and technical infrastructure connection among projects at the stage of construction investment; directly managing projects funded by the state budget assigned by the provincial-level People’s Committee; and other tasks regarding the construction of the urban development area as assigned by the provincial-level People’s Committee.

2. Cases of establishment or dissolution of urban development area management boards

a/ Urban development areas which must have a management board include: urban development areas in urban centers with general plans to be approved by the Prime Minister; and urban development areas specified in Clauses 2, 5, 6 and 7, Article 2 of this Decree;

b/ For urban development areas other than those which must have a management board specified at Point a, Clause 2 of this Article, chairpersons of provincial-level People’s Committees shall base themselves on local urban development needs to decide to or not to establish a management board;

c/ Depending on urban development needs, size and importance of urban development areas and its socio-economic development conditions, a province may establish one or more than one urban development area management board; an urban development area management board may be assigned to manage one or more than one urban development area;

d/ For an urban development area lying in two or more provinces, the Ministry of Construction shall coordinate with People’s Committees of related provinces in establishing a coordinating board for such area to direct and assist local urban development area management boards in synchronously performing the process of urban development investment;

dd/ Chairpersons of provincial-level People’s Committees shall decide to dissolve urban development area management boards after these boards complete their assigned tasks in accordance with law, or when these tasks are transferred to other urban development area management boards.

3. Tasks and powers of urban development area management boards

a/ To assume the prime responsibility for, and coordinate with related agencies in, working out five-year and annual plans on construction of urban development areas, then submitting them to provincial-level People’s Committees for approval, and organizing their implementation;

b/ To organize activities to promote investment in urban development areas; to study and propose preferential policies and special mechanisms applicable to construction activities in urban development areas;

c/ To work out plans on selection of investors in urban development areas, then submit them to provincial-level People’s Committees for decision; to guide and support investors in the process of investment preparation and implementation of urban development investment projects;

d/ To manage or perform the function of the investor in projects in urban development areas funded by the state budget as assigned by provincial-level People’s Committees;

dd/ To monitor and supervise the implementation of approved urban development investment projects in accordance with the master plan, plans and set schedules; to summarize and propose, and coordinate with functional agencies in handling, matters arising in the course of investment;

e/ To assume the prime responsibility for, and coordinate with functional agencies, service providers and investors in, assuring synchronous connection and management of the framework technical infrastructure system and connection of technical infrastructure among projects at the stage of construction investment until the completion of the handover of these projects to urban administrations;

g/ To build databases providing information on urban development areas; to summarize and report to provincial-level People’s Committees and the Ministry of Construction on the implementation of investment projects on a biannual and annual basis or at the latter’s request, and implement plans on construction of urban development areas assigned to them for management;

h/ To perform other tasks and exercise other powers in the management of urban construction investment and development within urban development areas assigned or authorized by provincial-level People’s Committees in accordance with law.

4. Operating expenses of urban development project management boards are partially covered by the state budget, allocated project management funds and collected service charges in accordance with law.

Chapter III

URBAN DEVELOPMENT INVESTMENT PROJECTS

Section 1

INVESTMENT PROJECTS TO CONSTRUCT URBAN CENTERS

Article 14. Detailed plans of projects

1. The formulation, appraisal and approval of detailed plans of investment projects to construct urban centers must comply with the law on urban planning.

2. The adjustment of the detailed plan of a project must comply with the law on urban planning and not exceed the capacity of the urban infrastructure system determined in the approved urban plan and cause no bad impacts on the urbanscape or reduce the quality of life of inhabitants of the urban area.

3. The formulation and adjustment of detailed plans of urban development projects must identify spaces for construction of common-use technical infrastructure works for installation of technical lines, chambers, trenches and tunnels.

Article 15. Management of construction investment

The formulation, appraisal, approval and management of implementation of investment projects to construct urban centers must comply with the law on construction, this Decree and relevant laws.

Article 16. Conditions for project investors

1. For investors being state agencies:

a/ Having their functions relevant to the implementation of projects;

b/ Having made reasonable project proposals suitable to the master plan and plans on construction of urban development areas.

2. For investors being enterprises:

a/ Having made business registration under the Law on Enterprises and relevant to the project implementation, and satisfying all the conditions specified by the Law on Real Estate Business (if their projects have business products);

b/ Having own investment capital which must not be lower than 15% of the total investment capital of projects using under 20 hectares of land or 20% of the total investment capital of projects using 20 hectares or more of land, for investment projects to construct urban centers;

c/ Having own investment capital which must not be lower than 20% of the total investment capital, for remaining projects;

Investment capital owned by investors specified at Points b and c above must be real capital of investors available by the year preceding the year of implementation of urban development investment projects indicated in the financial statements of investors and certified by independent audit organizations. For newly established enterprises and cooperatives, there must be a written certification of a competent agency defined by law.

d/ Having made reasonable project proposals in line with the master plan and plans on construction of urban development areas;

dd/ Having managerial staff and human resources that are professionally capable and experienced, and committing to implement the approved project contents and schedules.

3. For investors being political, socio-political or socio-professional organizations:

a/ Having their functions relevant to the implementation of projects;

b/ Having made reasonable project proposals suitable to the master plan and plans on construction of urban development areas;

c/ Only implementing projects within land areas assigned by competent state agencies for their operations according to assigned functions and tasks.

Article 17. Obligations of grade-1 investors

1. To make detailed plans (for project implementation areas without approved detailed plans), urban designs and investment projects to construct urban centers, then submit them to competent authorities for approval, and implement approved detailed plans.

2. To construct works according to approved detailed plans and project schedules.

3. To construct technical and social infrastructure works compatible with the infrastructure system of surrounding areas according to approved project implementation schedules.

4. To assure temporary connection between technical infrastructures inside and outside the project area in case the latter has not yet been invested according to approved plans.

5. To comply with requests of provincial-level People’s Committees for contributions to building infrastructure in the areas and handover land areas with infrastructure for the construction of social houses in accordance with the housing law.

6. To provide services of managing houses and technical infrastructure systems and other urban services within the project areas pending the handover.

7. To manage the operation and guarantee the quality of works not transferred or before transfer to local administrations.

8. To supervise the construction investment by secondary investors (if any) to assure its conformity with approved detailed plans and project schedules.

9. To guide procedures and coordinate with secondary investors (if any) in carrying out procedures for the transfer of land with technical infrastructure or other products of projects in accordance with law.

10. Other obligations specified by law.

Article 18. Obligations of secondary investors

1. Secondary investors shall perform the obligations specified in Clauses 1 thru 8, Article 17 of this Decree.

2. Secondary investors shall submit to the management by grade-1 investors in the process of construction investment and comply with approved detailed plans; make construction investment under contracts signed between the two parties, the construction law and relevant laws.

3. Other obligations specified by law.

Article 19. Change of investor

1. Change of investor means the transfer by the investor of the whole urban development investment project to another investor.

2. The change of investor must not change project objectives and must assure the interests of customers and related parties and comply with the law on management of state budget-funded projects (if any), investment law, real estate business law and relevant laws.

3. The change of grade-I investors must be approved in writing by competent state agencies. Agencies competent to decide to select or assign investors to implement projects are competent to approve change of investor. An investor shall send a written report and relevant legal documents (5 sets) on the change of investor to a competent state agency mentioned above. The time limit for consideration and reply by a competent state agency is 30 days after receiving a dossier from an investor.

4. New investors must fully satisfy the conditions specified in Article 16 of this Decree.

Article 20. Investment approval

1. Investors may be selected through the auction of land use rights or bidding of projects or in the form of direct appointment in accordance with the land law, housing law and relevant laws. Provincial-level People’s Committees shall issue decisions on selection of investors based on bidding or auction results or decisions on assignment to investors in case of direct appoitment.

2. Particularly for state budget-funded projects, persons competent to decide on investment are competent to decide on selection of investors.

3. After being selected, project investors shall make dossiers of proposal for investment approval in accordance with Article 26 of this Decree and submit them to provincial-level People’s Committees for consideration and decision on investment approval or submission to competent authorities for decision on approval of investment in projects in accordance with Articles 21, 22, 23, 24 and 25 of this Decree.

4. Investment approval decisions of competent agencies serve as a legal ground for investors to submit projects to competent agencies for appraisal, approval and implementation of projects.

Article 21. Competence to approve investment in new urban center construction projects

1. The Prime Minister shall decide on investment approval after receiving appraisal opinions of the Ministry of Construction on the following projects:

a/ Projects using 100 hectares or more of land each;

b/ Projects lying within the administrative boundaries of two or more provinces or in areas of security or defense importance.

2. Provincial-level People’s Committees shall decide on investment approval for projects using between 20 and under 100 hectares of land after obtaining the written consent of the Ministry of Construction.

3. Provincial-level People’s Committees shall decide on investment approval for remaining projects.

Article 22. Competence to approve investment in urban center reconstruction projects

1. The Prime Minister shall decide on investment approval after receiving appraisal opinions of the Ministry of Construction for projects using 50 hectares or more of land and projects in areas of security or defense importance.

2. Provincial-level People’s Committees shall decide on investment approval after obtaining the written consent of the Ministry of Construction for projects using between 10 and 50 hectares of land; projects in areas subject to development restrictions or historical inner cities (indicated in general plans) of special-grade urban centers; and projects within the scope of protection of relics recognized as national or special national relics.

3. Provincial-level People’s Committees shall decide on investment approval for remaining projects.

Article 23. Competence to approve investment in urban center conservation or embellishment projects

1. Provincial-level People’s Committees shall decide on investment approval after obtaining the written consent of the Ministry of Construction on the following projects:

a/ Projects in areas of security or defense importance, areas of national or special national relics recognized by competent authorities in urban centers;

b/ Projects in areas subject to development restrictions or historical inner cities (indicated in general plans) of special-grade urban centers.

2. Provincial-level People’s Committees shall decide on investment approval for remaining projects.

Article 24. Competence to approve investment in urban center renovation or improvement projects

Provincial-level People’s Committees shall issue decisions approving investment in urban center renovation or improvement regardless of their size in accordance with the law on construction, this Decree and relevant laws.

Article 25. Competence to approve investment in complex urban center construction projects

1. The competence to approve investment in complex urban center construction projects is the same as for urban center reconstruction projects if within the project boundary:

a/ The land area for reconstruction is 10 hectares or more;

b/ The project’s land area for reconstruction lies within an area of security or defense importance; an area subject to development restrictions or a historical inner city (indicated in the general plan) of a special-grade urban center or an urban center with a relic recognized by a competent authority as a national or special national relic.

2. The competence to approve investment in other projects is the same as for new urban center construction projects.

3. The provisions of Article 40 of this Decree applicable to conservation or embellishment projects additionally apply to projects having works identified by competent authorities as cultural heritages within their boundaries.

Article 26. Dossiers of proposal for investment approval

A dossier of proposal for approval of investment in a project comprises:

1. A written request for investment approval for project implementation.

2. The decision approving the result of the investor selection or decision on investor appointment, or written certification of land use rights for investors being users of land plots for project implementation.

3. The project dossier specified in Article 32 (excluding the miniature model of the project implementation area specified in Clause 3, Article 32).

4. Enclosed legal documents: The decision approving the urban development area and plan on construction of urban development area; detailed planning dossier; documents evidencing the financial capability, investment and management experience of the investor for project implementation, and other relevant legal documents.

Article 27. Time for examination of dossiers of proposal and decision on investment approval

1. For a project subject to investment approval decision of the provincial-level People’s Committee without consulting the Ministry of Construction, the provincial-level People’s Committee shall organize the examination of the dossier and issue a decision on investment approval within 45 working days after receiving 10 valid dossier sets from the investor as prescribed in Article 26 of this Decree.

2. For a project subject to investment approval decision of the provincial-level People’s Committee and consent of the Ministry of Construction: Within 7 days after receiving 16 valid dossier sets as prescribed in in Article 26 of this Decree, the provincial-level People’s Committee shall send an official letter for consultation enclosed with one dossier set to the Ministry of Construction. Within 15 working days after the official letter for consultation, the Ministry of Construction shall send to the provincial-level People’s Committee a written reply as specified in Article 28 of this Decree. In case of necessity, the Ministry of Construction shall consult related ministries and sectors. In this case, the time limit for examination and written reply by the Ministry of Construction is 30 working days after receiving an official letter for consultation. The time limit for the provincial-level People’s Committee to issue a decision is 15 working days after receiving a written reply of the Ministry of Construction.

3. For a project subject to decision of the Prime Minister, the provincial-level People’s Committee shall send 10 dossier sets of proposal for investment approval to the Ministry of Construction for examination. Within 7 days after receiving a complete and valid dossier as specified in Article 26 of this Decree, the Ministry of Construction shall receive and examine the dossier and send it to related ministries and sectors for opinion. Within 15 working days after receiving an official letter for consultation, related ministries and sectors shall give their opinions. Within 20 working days after receiving written replies from related ministries and sectors, the Ministry of Construction shall submit to the Prime Minister an examination document as specified in Article 29 of this Decree. The Prime Minister shall issue a decision to assign the investor to implement the project within 30 working days after receiving the examination document from the Ministry of Construction.

Article 28. Contents of consultation on proposals for investment approval for project implementation

1. Compliance with the approved urban master plan, urban development program, urban development area and plan on construction of urban development areas; observance of relevant laws.

2. Factors assuring the feasibility and efficiency of the project, including the necessity of investment; project implementation schedule; and socio-economic efficiency of the project associated with security and defense.

Article 29. Contents of examination of proposals for investment approval for project implementation

1. Factors assuring the compliance of the project with the approved urban master plan, urban development program, urban development areas and plan on construction of urban development areas, and the population size limit appliable to the project implementation area; and observance of relevant laws.

2. Factors assuring the feasibility of the project, including the need to use land and natural resources (if any); and factors affecting the project such as defense, security and environmental protection.

3. Factors assuring the efficiency of the project, including the necessity of investment, implementation schedule and socio-economic efficiency of the project.

Article 30. Contents of investment approval decisions

An investment approval decision contains the following principal details:

1. Name of the project and name of the investor.

2. Location, boundaries and land area of the whole project.

3. Objectives of the project.

4. Investment form.

5. Preliminary description of the project (jobs, products, etc.).

6. Estimated total investment.

7. Investment capital source(s).

8. Projected implementation duration and schedule; investment phases (if any).

9. Mode of land assignment or lease, transfer of land use rights (if any).

10. Land reserved for construction of social houses, houses for lease or financial contribution (if any).

11. Infrastructure works transferred to the State.

12. Provisions applicable to involved parties in the management of construction, operation, trading and transfer of works.

13. Decisions on the State’s supports and incentives for the project.

14. Obligations of the investor toward the State and locality.

15. Expected administrative management unit for the project. Regulations on coordination in administrative management, administrative transfer, security and public services between the investor and related local agencies in the course of project implementation.

Article 31. Grounds for project formulation                        

1. General master plan, zoning plan and detailed plan.

2. Plan on construction of urban development area.

3. Decision approving the result of investment selection or investor appointment decision or written certification of land use rights in case the investor is the user of the land plot for project implementation.

4. Relevant legal documents.

Article 32. Project dossier

1. The description of the project with the following principal details:

a/ Necessity and legal grounds of the project;

b/ Investment form and investor;

c/ Size, area, site boundaries and actual state of the land plot;

d/ Plan on ground clearance, plan on resettlement and job training and seeking supports for laborers in the area subject to ground clearance;

dd/ Numbers and percentages of different types of houses and apartments, plan on product sale; measures and plan for provision of public services and other urban services;

e/ Econo-technical explanations for investment, business plans for capital recovery; total investment; socio-economic efficiency of investment; land assignment, transfer of land use rights, land rent or use of the land fund to create capital for infrastructure construction, and capital sources for different investment and business stages;

g/ Explanation of the financial, investment and management capability and experience of the investor for project implementation;

h/ Implementation method:

- Form of project management;

- Investment phases, implementation schedule and method of implementation organization.

2. Dossier of the basic design of the project.

3. Dossier of urban design and miniature model of the project implementation area.

4. Dossier of component projects to serve resettlement and ground clearance (if any).

5. Contents of coordination between the investor and local administration in the following activities:

a/ Construction of technical infrastructure works outside the fence and the State’s technical infrastructure works running through the project area;

b/ Construction of offices of administrative agencies and social infrastructure works (if any);

c/ Infrastructure facility items (if any) to be transferred without compensations and transfer schedule;

d/ Responsibility to provide public services and other urban services;

dd/ Identification of the obligations and responsibilities of and relationship between the project investor and involved parties in the above coordinated activities;

e/ Proposals for supports and incentives for the project;

g/ Proposal on administrative management and new administrative units and plan on handover of administrative management to the local administration (if any).

Article 33. Adjustment of projects

1. In case an investor requests change or addition of any of the following contents: objectives, size, land use function and product structure, it shall send a written proposal enclosed with 5 sets of the dossier of project adjustment to a competent investment approving agency for consideration and approval.

2. Agencies competent to approve project investment may consider and issue written replies on the requested change or addition of the project contents mentioned in Clause 1 of this Article. The time limit for consideration and issuance of a written reply is 30 working days after receiving a project dossier.

3. For projects subject to consultation or appraisal by the Ministry of Construction, before submitting a dossier to a competent agency for consideration and approval, the investor shall send 3 sets of the project dossier to the Ministry of Construction for opinion. The time limit for consideration and reply by the Ministry of Construction is 15 working days after receiving the document and project dossier from the investor. In case the Ministry of Construction must consult related ministries and sectors, the time limit for consideration and reply is 30 working days after receiving the document and project dossier from the investor.

4. The adjustment of projects and appraisal and approval of project adjustments must comply with the construction law and relevant laws.

Article 34. Implementation schedules of projects

1. The implementation of a project must keep up with the set schedule of the project and common implementation schedule of the whole urban development area.

2. In case the investor makes a proposal for adjustment of the project implementation schedule leading to delayed commissioning of the project, the investor shall explain it in writing for written approval from the provincial-level People’s Committee. The time limit for consideration and reply by the provincial-level People’s Committee is 30 working days after receiving the written proposal and explanation from the investor.

3. The handling of breaches of the implementation schedule of a project must comply with the construction and land laws and relevant laws.

Article 35. Investment in construction of the social infrastructure system

1. Investors shall construct synschronous social infrastructure works according to the building schedules of houses and assure service quality to meet the needs of inhabitants to live in the areas.

2. In case the local administration directly invests in the construction of social infrastructure works in urban centers with state budget funds, units assigned by the State to construct these works shall construct these works according to the approved schedule of the project and assure the entirety of the project as secondary investors.

3. In case the local administration cannot allocate budget funds for the construction of these works according to the initial plan of the project, the investor shall invest in the construction of these works in an appropriate form (BT, BOO, etc.).

Article 36. Completion and transfer of works for operation and use

1. Procedures for completion of works

a/ The testing for acceptance of completed works must comply with the law on management of quality of construction works;

b/ The archive of records on works must comply with the law on archive, law on construction and relevant laws.

2. Investors shall complete procedures for recognition of land use rights and work ownership in accordance with law for completed works to be put into operation and use.

3. Transfer and operation of technical and social infrastructure works

a/ For completed technical and social infrastructure works, investors may operate or transfer them to parties assigned to manage and operate them according to the initial objectives of the project.

Investors shall take responsibility for the quality of works and provide warranty for transferred works in accordance with law. Before transferring used works, investors shall assess their quality and value, and complete necessary maintenance.

b/ For technical and social infrastructure works not for transfer or not yet transferred, investors shall manage them and assure their operation quality.

c/ Transferees shall manage and operate transferred works according to their functions and utilities and maintain them in accordance with the construction law.

For works to be transferred to parties already identified in project contents, such parties have the right and obligation to manage the quality and test for acceptance such works throughout the course of construction until they are completed for handover and use.

d/ Procedures for transfer of works are carried out as prescribed by law, requiring work completion dossiers and work construction investment finalization documents.

4. For works which require the transfer of administrative management to the local administration, investors shall plan and conduct the transfer of administrative management to the local administration under Article 38 of this Decree. Pending the transfer of the whole project, investors shall coordinate with local administrative management units in carrying out administrative procedures for households to move in.

Article 37. Urban services

1. Project investors shall organize the provision of urban services to meet the needs of inhabitants moving in the project areas according to the project objectives until their projects are transferred to local administrations or professional service management organizations or businesses.

2. Local administrations shall prepare necessary conditions for and direct the transfer of the management and provision of urban services to professional service management organizations or businesses.

Article 38. Transfer of administrative management

1. Based on the investment, construction and operation schedules of its project, an investor shall coordinate with the local administration in working out a plan on transfer of administrative management in the project implementation area, and submit it to a competent authority for approval before it is implemented by involved parties, covering:

a/ Coordination in the administrative management between the investor and administrative management unit pending the transfer as stated in the investment approval decision;

b/ Transfer of management upon completion of the construction of the work for operation and use;

c/ Transfer of administrative management upon completion of the whole project.

2. Provincial-level Home Affairs Departments shall take the prime responsibility for, and coordinate with district-level People’s Committees in, directing the transfer of administrative management at the request of investors and according to approved transfer plans. The order and procedures for transfer of administrative management must comply with the law on organization and operation of local administrations.

3. The time limit for transfer is 3 months after an investor completes its project and fulfills other responsibilities specified by law.

4. Administrative management units shall publicly notify their working offices and organizational structures suitable to the scale of transferred administrative management to assure the interests of inhabitants living in the project areas.

Article 39. Raising of capital and dealing in project products

1. Investors may raise capital in accordance with law for the implementation of their projects according to the approved contents and schedules of projects.

2. Project products include land with infrastructure, houses (villas, semi-detached houses and condominium apartments), infrastructure works and other works.

3. The dealing in project products must comply with this Decree, the real estate business and housing laws and relevant laws.

Section 2

INVESTMENT PROJECTS TO CONSTRUCT URBAN WORKS

Article 40. Management and construction investment of investment projects to construct urban works

1. Investment projects to construct urban works must comply with the construction law, this Decree and relevant laws.

2. For special-grade urban centers: Before investment projects to construct  works in areas subject to development restrictions or in historical inner cities (indicated in the general plan) are approved by competent authorities, provincial-level People’s Committees shall obtain the written consent of the Ministry of Construction to the contents specified in Clause 3 of this Article.

3. Contents of consultation of the Ministry of Construction

a/ Conformity with the approved urban master plan, urban development areas and plans on construction of urban development areas; and compliance with relevant laws;

b/ Factors to assure the feasibility and efficiency of the project, including the necessity; objectives and implementation schedule; and socio-economic efficiency of the project.

4. For a project specified in Article 2 of this Article, within 7 days after receiving a written request of the investor and 15 sets of the project dossier (specified by the law on management of work construction investment projects), the provincial-level People’s Committee shall send an official letter for consultation (enclosed with 1 project dossier set) to the Ministry of Construction. Within 15 working days after receiving the official letter for consultation, the Ministry of Construction shall reply in writing to the provincial-level People’s Committee on the contents specified in Clause 3 of this Article. The provincial-level People’s Committee shall issue, within 15 days after receiving the written consent of the Ministry of Construction, a written approval for the investor to implement the project.

5. For projects to conserve and embellish cultural heritage works

a/ The implementation of these projects must neither change nor harm the original cultural, architectural and historical values of the works;

b/ The formulation, appraisal, approval and implementation of conservation and embelishment projects in urban development areas must comply with the cultural heritage and construction laws, this Decree and relevant laws;

c/ For projects to conserve and embellish works classified as national relics or special national relics, within 7 days after receiving a written proposal and 10 sets of the project dossier from an investor, the provincial-level People’s Committee shall obtain written consent of the Ministry of Construction before the project is approved by a competent authority. Within 15 working days after receiving an official letter for consultation, the Ministry of Construction shall reply in writing on the contents specified in Clause 3 of this Article;

d/ For projects to conserve and embellish works classified as provincial-level relics, investors shall consult provincial-level Planning and Architecture; Construction; Culture, Sports and Tourism Departments before submitting their projects to competent authorities for consideration and approval. Within 15 working days after receiving official letters for consultation and project dossiers, the above provincial-level Departments shall issue written replies.

Chapter IV

RESPONSIBILITIES OF STATE MANAGEMENT AGENCIES

Article 41. The Ministry of Construction

1. To uniformly manage the urban development nationwide.

2. To elaborate orientations, strategies and master plans on development of the national urban system, national key programs and projects on urban development, and urban development targets within the national socio-economic development tasks in each period, submit them to the Prime Minister for approval and organization of implementation.

3. To formulate and submit to competent authorities for promulgation or promulgate according to its competence mechanisms, policies and legal documents on management of urban development investment, policies and solutions to manage the urbanization process, models of urban development management, and guide and inspect the implementation thereof.

4. To assume the prime responsibility for, and coordinate with related ministries and sectors and localities in, controlling the urban development process in line with orientations of the approved overall master plan on development of the national urban system, urban master plan and urban development plans.

5. To assume the prime responsibility for, and coordinate with related ministries and sectors in, appraising plans under the approving competence of the Prime Minister provided in Clause 2, Article 7 of this Decree.

6. To give its written consent for provincial-level People’s Committees to approve zoning plans specified in Clause 4, Article 7 of this Decree.

7. To assume the prime responsibility for, and coordinate with related ministries and sectors in, appraising proposals on urban development areas under the deciding competence of the Prime Minister provided in Clause 1, Article 9 of this Decree.

8. To assume the prime responsibility for, and coordinate with related ministries and sectors in, appraising proposals for investment approval for urban development investment projects under the investment-approving competence of the Prime Minister provided in Clause 1, Article 21 and Clause 1, Article 22 of this Decree; and give its written consent for provincial-level People’s Committees to decide on investment approval for urban development investment projects specified in Clause 2, Aricle 21; Clause 2, Article 22; and Clause 1, Article 23 of this Decree.

9. To give its written consent for provincial-level People’s Committees to approve investment in projects to construct urban works specified in Clause 2, Article 40 of this Decree.

10. To build and manage a database and provide information on urban development nationwide.

11. To guide, examine, inspect and settle complaints and denunciations, and handle violations in the field of urban development according to its competence.

12. To perform other tasks of managing urban development investment as assigned or authorized by the Government or Prime Minister.

Article 42. The Ministry of Planning and Investment

1. To assume the prime responsibility for, and coordinate with the Ministry of Construction and Ministry of Finance in, working out plans on allocation of construction investment capital for central budget-funded urban development investment projects; to mobilize ODA for programs and projects on development assistance and urban renovation and upgrading.

2. To assume the prime responsibility for, and coordinate with related ministries and sectors in, guiding localities in provide investment incentives for urban development investment projects.

Article 43. The Ministry of Finance

To assume the prime responsibility for, and coordinate with related ministries and sectors, elaborating and guiding the application of financial and tax incentives for urban development investment projects.

Article 44. The Ministry of Natural Resources and Environment

1. To examine, urge and guide localities in reviewing, adjusting or supplementing land use master plans and plans and preparing land funds for construction of urban development investment projects.

2. To specifically guide the use of land funds for urban development, the minimum resettlement ratio and application of land-related incentives for urban development investment projects.

Article 45. Related ministries and sectors

1. To formulate and manage sectoral master plans according to their functions and tasks assigned by the Prime Minister to serve as a basis for urban development.

2. To perform according to their competence the state management of urban development investment projects.

Article 46. Provincial-level People’s Committees

1. To uniformly manage the urban development in their localities; to build apparatuses capable of satisfying the state management requirements in the practical urban development.

2. To direct the review, evaluation and identification of urban development areas, work out plans on construction of urban development areas, establish urban development area management boards, and assure the rational and effective transition in a short period and sustainable urban development in the future; to call for investment in urban development projects in their localities.

3. To organize the ground clearance in accordance with law; and to establish organizations to manage and develop urban land funds.

4. To create housing funds for resettlement and temporary residence for the clearance of grounds for state budget-funded projects and projects funded by other capital sources.

5. To organize the construction of technical infrastructure works ouside project boundaries which are synchronously connected with urban framework technical infrastructure systems.

6. To direct the receipt of transferred urban development investment projects and organize apparatuses for administrative management of these projects.

7. To build and manage urban development information systems in their localities; to make and send biannual reports on assessment of urban development in their localities to the Ministry of Construction for summarization and reporting to the Prime Minister.

8. To assume the prime responsibility for, and coordinate with the Ministry of Natural Resources and Environment and the Ministry of Construction in, reviewing, adjusting or supplementing land use master plans and plans before allocating land funds for urban development.

9. To specify preferential mechanisms and incentives for calling all economic sectors to invest in urban development.

10. To inspect, examine and handle violations according to their competence.

Chapter V

TRANSITIONAL HANDLING

Article 47. General principles

The transitional handling of current regulations on management of urban development investment must be made from the effective date of this Decree and on the following principles:

1. Restoring order in the urban development: Construction investment must be in line with approved national urban development orientations, master plan and zoning plans and assure the synchronous connection of projects in each urban development area;

2. Ensuring the implementation of urban development investment projects in line with approved plans on construction of urban development areas, preventing spontaneous and excessive development and wasteful use of land resources and  social resources;

3. Mitigating impacts on the progress and efficiency of projects, rights and legitimate interests of involved parties.

Article 48. Transitional handling of regulations on urban planning and identification of urban development areas

1. For urban centers covered by the approved master plan but having no zoning plan, detailed plan, urban design and urban development program yet, provincial-level People’s Committees shall, from the effective date of this Decree, direct the elaboration of zoning plans, detailed plans, urban designs, regulations on management of architectural planning and urban development programs for approval in accordance with the urban planning law and for use as grounds for identification of urban development areas and elaboration of construction plans as specified in Article 8 of this Decree.

2. For urban centers covered by the approved master plan, zoning plans and urban development programs but having no identified urban development areas, provincial-level People’s Committees shall, from the effective date of this Decree, direct the identification of urban development areas; and approve these areas according to their competence or submit them to competent authorities for decision under Article 9, and establish urban development area management boards under Article 13 of this Decree.

Article 49. Transitional handling of projects assigned on the basis of compliance with the approved master plan and zoning plans

1. Provincial-level People’s Committees shall direct the review or addition of projects in the list of projects in urban development areas, assuring that these projects are implemented according to plans on construction of urban development areas and this Decree.

2. For investment projects to construct urban centers with houses, provincial-level People’s Committees shall direct the review or adjustment of the projects to assure that these projects reserve a certain portion of their land areas for social houses in accordance with the housing law and relevant laws.

Article 50. Transitional handling of projects assigned before the master plan and zoning plans are approved by competent authorities

Provincial-level People’s Committees shall direct the review and classification and transitional handling of projects as follows:

1. The transitional handling of projects that are in line with the approved master plan and zoning plans must comply with Article 49 of this Decree.

2. For projects not in line with the approved master plan and zoning plans:

a/ For projects of which technical infrastructure is not yet constructed or has been partially constructed: Provincial-level People’s Committees shall direct the review and adjustment of these projects to be in line with the master plan and zoning plans, and manage the project investment in accordance with this Decree and relevant laws;

b/ For projects of which technical infrastructure system has been completely constructed: Provincial-level People’s Committees shall direct the review and inspection of the connection of infrustrcture; adjust these projects to be in line with the master plan and zoning plans, and assure connection with the common infrastructure system of the area; and adjust project schedules according to plans on construction of urban development areas;

c/ For projects of which the technical infrastructure system has been completely constructed and works are being constructed: Provincial-level People’s Committees shall direct the review and adjust project land areas in which works are not yet constructed to be in line with the master plan and zoning plans; adjust the structure of houses of these projects to meet the market demand; and adjust project implementation schedules according to plans on construction of urban development areas;

d/ For projects of which all works have been roughly constructed: Provincial-level People’s Committees shall direct the review and request investors to concentrate on synchronously completing the social infrastructure and other works for commissioning these projects.

3. For projects in urban centers covered by the master plan and falling under the approving competence of the Prime Minister which are adjusted in the cases specified at Points a, b and c, Clause 2 of this Article, an investor shall, before submitting project adjustments to a competent authority for approval, send 3 sets of the project adjustment dossier to the Ministry of Construction for its written consent to the following contents: conformity with the approved urban master plan, urban development areas and plans on construction of urban development areas; and compliance with relevant laws. The time limit for consideration and issuance of a written reply is 30 working days after receiving a document for consultation, a set of the project adjustment dossier and relevant legal documents.

4. Investment projects to construct urban centers with houses must also comply with Clause 2, Article 49 of this Decree.

Article 51. Transitional handling of projects specified in Clauses 1 and 2 of Articles 21 and 22; Clause 1 of Article 23; Clause 2 of Article 40

In case an above-mentioned project in which investment has been approved or is approved before the effective date of this Decree must be adjusted in the contents specified in Clause 1, Article 33, its investor shall, before obtaining approval of the adjusted project, send 3 sets of the project adjustment dossier to the Ministry of Construction for its written consent to the following contents: conformity with the approved urban master plan, urban development area and plan on construction of the urban development area; and compliance with relevant laws. The time limit for consideration and issuance of a written reply is 15 working days after receiving a document for consultation, a set of the project adjustment dossier and relevant legal documents.

Chapter VI

IMPLEMENTATION PROVISIONS

Article 52. Organization of implementation

Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees, heads of political, socio-political and socio-politico-professional organizations and related organizations and individuals shall implement this Decree.

Article 53. Effect

1. This Decree takes effect on March 1, 2013.

2. This Decree replaces the Government’s Decree No. 02/2006/ND-CP of January 5, 2006.

3. The Government’s regulations on urban development investment promulgated before the effective date of this Decree which are different from the provisions of this Decree will be superseded by the provisions of this Decree.-

On behalf of the Government
Prime Minister
NGUYEN TAN DUNG