Minimum equity requirements for leasing or acquiring land from the Government in Vietnam

In Decree 43/2014, the Government now imposes a much higher financial standard when it decides to lease or allocate land to an investor. In particular, an investor in real estate projects or projects not funded by State budget now must have at least 20% equity capital for projects using less than 20ha of land or 15% for projects using 20ha of land or more. In addition, the investor must also demonstrate that it can raise financing for the project. It is not clear if the investor must have all required equity at the beginning of the project or it can be injected by installments. In any case, investors in large scale infrastructure projects may find it difficult to meet the minimum equity capital requirement in Decree 43/2014.