Duong Van Quy[1]
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| Rach Gia land reclamation area, Kien Giang province__Photo: VNA |
This article examines the current legal framework regulating land reclamation in Vietnam, with particular attention to the 2024 Land Law (the Land Law) and related instruments. On that basis, it proposes legal reforms aimed at enhancing regulatory coherence, ensuring sustainable land resource governance, and guaranteeing public interests.
Introduction
Land reclamation is increasingly adopted by many countries as an essential strategy for expanding land availability and meeting development demands. In Vietnam, the number of reclamation projects has risen sharply in recent years, contributing to the growth of coastal urban areas, industrial parks, and tourism infrastructure. However, this activity also raises a host of legal challenges, particularly those concerning land use rights, environmental protection, and marine resource management. The Land Law has introduced significant provisions on land reclamation, yet the regulatory framework remains fragmented, especially in terms of harmonization between land, marine and environmental protection legislation. Such legal inconsistencies are likely to cause enforcement difficulties and jeopardize the long-term sustainability of reclamation projects. Therefore, a comprehensive legal analysis is necessary to assess the current legal framework, identify existing gaps, and propose measures to improve regulatory coherence and effectiveness. This aims to move toward a more transparent, efficient, and legally robust regime for managing land reclamation activities in Vietnam.
Current regulations on land reclamation
Definitions of land reclamation and reclaimed land
The definition of “land reclamation” is provided in Article 3.30 of the Land Law. It reflects the technical process of expanding terrestrial land area seaward. However, this definition focuses solely on the act of reclaiming land, without offering a specific legal concept of “reclaimed land”, i.e., the land area formed as a result of reclamation activities. The absence of a clear definition of reclaimed land is likely to pose challenges for implementation and governance, particularly in the classification of land types and the determination of land use rights arising from reclamation activities.
A comparative analysis of Article 23.3 of the 2015 Law on Marine and Island Resources and Environment (the Marine Law) reveals a significant regulatory divergence. The Marine Law defines the width of the coast protection corridor as measured from the mean sea level over many years toward the mainland or islands. It also imposes legal restrictions on land reclamation activities within this coast protection corridor.
The divergence in the demarcation criteria - the lowest tidal waterline (under the Land Law) versus the mean sea level (under the Marine Law) - might give rise to legal inconsistencies in practice. Specifically, if a reclamation area is located within the coast protection corridor, conflicts could emerge regarding land use rights and permissible activities.
Such inconsistencies highlight the need for greater harmonization between the Land Law and the Marine Law. A unified and coherent legal approach is essential to avoid overlaps, legal ambiguities, and jurisdictional disputes in the management and allocation of reclaimed coastal areas.
Land use planning and identification of reclamation areas
The Land Law and Government Decree 102/2024/ND-CP (Decree 102) provide clear and detailed regulations on land use planning and identification of reclamation areas, with the aim of ensuring consistency in the governance of land and marine resources. Under these instruments, provincial- and district-level land-use master plans are required to have the content on delineation of specific boundaries, surface areas, and locations of reclamation areas. This requirement enhances the transparency and scientificity of reclamation master plans and helps prevent conflicts with other relevant master plans, such as those on construction, transportation and urban development.
Articles 65 and 66 of the Land Law stipulate that land use master plans must clearly identify the area and location of reclamation areas for agricultural and non-agricultural purposes. Moreover, reclamation areas must conform to local master plans to ensure consistent socio-economic and infrastructure development. This provision ensures that land reclamation projects are aligned with long-term development strategies. It also helps avoid inefficient resource allocation and land use conflicts.
Additionally, Decree 102 elaborates the technical requirements for formulation of land use master plans and plans in reclamation areas. These activities must be conducted with precision, using modern legal and technical tools such as geospatial mapping and geographic coordinate systems. Land reclamation projects are also required to be included in provincial- and district-level master plans, including also land use, construction and transportation master plans. This aims to promote complete infrastructure development and reduce conflicts that may arise from overlapped master plans.
Compared to the previous land legislation, the Land Law and its implementing decree, Decree 102, introduce more robust and detailed planning requirements. These include mandatory reliance on the principles of sustainable development, environmental protection, and balanced interests of investors, local communities, and the State.
Approval of investment policy for and implementation of land reclamation projects
The Land Law and Decree 102 have established a comprehensive legal framework governing the approval of investment policy for and the implementation of land reclamation projects. This framework ensures that such projects adhere to core principles on national defense, security, environmental protection, and sustainable development. According to Article 190 of the Land Law, land reclamation activities may only be undertaken upon receiving the investment policy approval from the National Assembly or the Prime Minister - particularly for sensitive zones such as nature reserves, military areas, or sites of cultural and historical significance.
Under this legal regime, land reclamation activities must either constitute an independent investment project or form part of a larger investment project in accordance with law. Investors are required to satisfy stringent conditions concerning environmental impact assessment, conformity with relevant master plans, and marine resource protection. Decree 102 specifies procedural steps necessary for project execution, which include the preparation of feasibility study reports, appraisal and approval of construction designs, execution of works, and acceptance testing of completed reclamation works. Each of these steps must conform to the regulations on construction, and natural resources and environment.
Notably, the above regulations introduce a coordinated approach whereby both the allocation of marine areas and land areas are to be processed simultaneously. This is intended to ensure procedural consistency, reduce administrative delays, and streamline project implementation. Furthermore, the regulations underscore the importance of the acceptance testing of the reclamation works as a prerequisite for issuing a land use rights certificate and for proceeding with land exploitation and use.
Land recovery, allocation and lease, allocation of marine areas for reclamation projects
The Land Law and Decree 102 set out clear and detailed provisions on the recovery, allocation and lease of land, and the allocation of marine areas for the purpose of land reclamation. These provisions establish a legal framework intended to facilitate land reclamation projects that contribute to national socio-economic development. Pursuant to Article 79.24 of the Land Law, the State may recover land for land reclamation projects that serve public or national interests, with the aim of optimizing land and infrastructure resources and implementing policies on environmental protection and social welfare.
The processes of allocating and leasing land and allocating marine areas for reclamation activities must comply with stringent conditions, including conformity with an approved reclamation plan. Decree 102 sets out specific rules on the duration for which marine areas may be allocated to organizations or individuals, based on the approved investment project’s reclamation plan. Once the reclamation activities have been completed, the reclaimed land may continue to be used in accordance with the land law.
A key regulatory development is the simultaneous performance of land and marine area allocation procedures. This approach ensures coherence and continuity in the management of coastal land resources. Article 190.6 of the Land Law affirms that reclaimed land will be allocated or leased only after the reclamation works undergo acceptance testing, and all relevant financial obligations are fulfilled. This helps ensure that post-reclamation land use is properly regulated and consistent with approved land use master plans.
It can be seen that the Land Law and Decree 102 have introduced significant improvements by specifying the procedures for allocating marine areas in parallel with land allocation for reclamation projects. The lack of such provisions in the previous regulations had resulted in inconsistent management among competent authorities, causing regulatory uncertainty and delays in project implementation. The new legislative framework remedies these shortcomings by enhancing transparency and procedural efficiency.
Nonetheless, certain challenges remain, particularly those regarding the time and cost associated with administrative procedures. The concurrent performance of land and marine area allocation procedures might increase procedural complexity and potentially delay project execution, thereby affecting overall investment efficiency.
Financial obligations and determination of land use levy after reclamation
The implementation of land reclamation projects in Vietnam requires compliance with not only technical, environmental and legal regulations but also financial obligations imposed on land users following reclamation. The Land Law and Decree 102 set out specific provisions regarding revenues from land-related public services, aiming to ensure transparent and efficient management, exploitation and use of reclaimed land.
Article 153.1 of the Land Law enumerates various financial revenues associated with land, including land use levy, fines for administrative violations, compensation for damage, land use tax, income tax from land use rights transfer, and charges and fees related to land management and use. Notably, Article 154 of the Land Law introduces a list of land-related public services, such as land information provision, cadastral survey, and issuance of land use rights certificates. This marks a significant improvement over the 2013 Land Law, where the provisions on financial obligations and public services remained fragmented and not specific enough.
A major novel point of Decree 102 is the introduction of the surplus method for determining the value of reclaimed land. Article 75.1 requires land valuation to reflect the total development costs, including the approved reclamation expenses. This approach ensures a fair and realistic valuation of reclaimed land, grounded in actual project costs. Moreover, Article 75.3 addresses how to deal with discrepancies between the account-finalized reclamation costs and the estimated expenses included in total development costs. If the reclamation costs exceed the estimated expenses, the difference will be included in the project’s costs. This facilitates financial clarity and flexibility in project cost management. The adoption of concrete land pricing methods and cost reconciliation mechanisms not only enhances administrative transparency but also reduces the likelihood of legal disputes between the State and investors.
Issuance of land use rights certificates and post-reclamation land management
Decree 102’s provisions on the issuance of land use rights certificates (LURCs) for reclaimed land have established a clear legal framework for the management and legal recognition of land formed through reclamation activities. According to this framework, the issuance of LURCs is contingent upon two major conditions: (i) fulfillment of financial obligations, and (ii) acceptance testing of completed reclamation works. While this procedure applies to both land and reclaimed land, a key distinction is that LURCs for reclaimed land are only issued once the competent authorities have approved the acceptance testing results.
Under current regulations, the process of acceptance testing for reclamation activities must involve specialized agencies under provincial-level People’s Committees. Once the investor has fulfilled all financial obligations and submitted the official notice of acceptance testing, the natural resources and environment agency shall propose the competent authority to issue an LURC. The framework allows two procedural options for issuing LURCs, depending on the progress of completion of the reclamation work under the approved master plan.
Meanwhile, earlier regulations lacked specific provisions governing the acceptance testing of reclamation projects and the issuance of LURCs for reclamation areas, thus leading to inefficiencies in land management and project implementation progress.
The updated regulations address these deficiencies by introducing a comprehensive mechanism for acceptance testing and certificate issuance, thereby enhancing procedural transparency and administrative control. Nevertheless, practical challenges remain. Complexities in determining financial obligations and the protracted time of the acceptance testing process may delay the issuance of LURCs, particularly for large-scale projects. Moreover, the intricacies involved in determining reclamation-related costs and associated fees may create legal uncertainty for investors in identifying their financial obligations.
Recommendations for improving legislation on land reclamation
Firstly, it is a need to introduce an official definition of “reclaimed land” in the land legislation. As it stands, the Land Law provides a definition of “land reclamation” but is silent about land formed from the process of land reclamation. This is likely to challenge land management and determination of land use rights. Therefore, a specific and legally recognized definition should be established, clearly distinguishing reclaimed land that is formed through artificial interventions, from naturally accreted coastal alluvial land that arises from sediment deposition through natural hydrological processes. This distinction would help tailor more appropriate regulatory regimes and prevent inconsistent application of law in practice.
In parallel, the scope of permissible reclamation areas should be explicitly defined in the Land Law. This would help clarify for which marine areas and under what conditions the reclamation may be carried out. Such provisions must also be harmonized with the Marine Law to avoid regulatory overlaps and ensure effective coordination in the governance of marine space and reclaimed land.
Secondly, it is suggested to raise the effectiveness of planning work and supervision of the use of reclaimed land. One of the most critical solutions for improving the management of reclaimed land is to formulate both national master plans and detailed local plans. Master plans for reclaimed land should be integrated with master plans on urban areas, transport infrastructure, environmental protection, and coastal economic development to ensure consistency of and prevent overlaps in planning instruments.
The Land Law should elaborate the procedures for formulating, appraising and approving reclamation master plans. In addition, there should be a clear mechanism for disclosure of reclamation plans and community consultation before project approval. These processes are essential to ensure transparency, build public consensus, and minimize conflicts of interest between investors and local communities.
Thirdly, it is required to simplify legal procedures and step up administrative reform. At present, the procedures for approval of investment policy for land reclamation projects remain complex and, for large-scale projects, are often prolonged because these projects are subject to approval by the National Assembly or the Prime Minister. This reduces procedural flexibility and frequently causes delays in project implementation, thereby hindering potential investment opportunities.
To address this, it is necessary to delegate approval authority based on project scale. Specifically, provincial-level People’s Committees should be empowered to approve small-scale projects, while the central-level appraisal council should, instead of having to await decision from the National Assembly or the Prime Minister, be assigned to approve investment policy for larger projects.
Moreover, the procedures for allocating land and marine areas should be integrated into a unified administrative process, thereby eliminating redundant steps and accelerating project implementation. Furthermore, simplification of the procedures for issuing LURCs after reclamation is essential. Another option could be the introduction of a temporary certification mechanism, which would allow investors to proceed with certain activities pending the completion of acceptance testing of reclamation works.
Fourthly, regulations on finance and post-reclamation land governance should also be issued. An existing gap in the Land Law lies in the lack of a comprehensive mechanism for determining the value of reclaimed land and determining the corresponding financial obligations after project completion. Also, the current legislation still contains several legal ambiguities, particularly those related to land use levy exemption or reduction for projects serving public interests; and clarification of financial responsibilities between the State and investors in land reclamation projects implemented after the model of public-private partnership.
In addition to clarifying these issues, there is a pressing need to strengthen inspection and oversight mechanisms over reclaimed land once it has been allocated or leased. The State should adopt stricter control policies to prevent speculation, misuse or abandonment of reclaimed areas - practices that not only waste valuable resources but also undermine sustainable coastal development.
Conclusion
Land reclamation has emerged as a strategic solution to expand spatial capacity for urbanization, industrial development and coastal tourism in Vietnam. However, to ensure the long-term viability and legal certainty of such activities, it is essential to establish a comprehensive legal framework that addresses technical and institutional dimensions of land reclamation governance. In the context of growing environmental pressures and climate change, legal certainty and institutional coordination in land reclamation are no longer optional but are prerequisites for sustainable coastal development. Strengthening Vietnam’s legal framework in this field will not only optimize the use of newly created land resources but also ensure that development goals are pursued in balance with ecological conservation.-
[1] Lawyer, FIRST COUNSEL LAW FIRM
