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Broom to clean sector
Real estate entities violating business regulations are going to be squeezed. Decree No 23/2009/ND-CP, dated February 27, 2009 will come into force on May 1, 2009 and usher in bigger administrative penalties on construction, property transaction, construction material trading, project development and management violations.
Accordingly, construction work with no licence, wrongly assessed design and unconformity with the scale 1/500 master plan, will be suspended. Repeated violations will be hit with VND300-VND500 million ($17,647-$29,411) fines and banned from receiving construction licences. Project developers taking on construction work without sufficient capacity will be fined VND30-VND40 million ($1,764-2,352).
The decree also allows for a VND80-100 million ($4,705-$5,882) fine for contractors who wrongly check and take over projects, hand unchecked or incorrectly-checked projects to developers and report incorrect survey data. Ho Chi Minh City Construction Department chief inspector Ho Thi Kim Loan said current VND100,000-VND200,000 ($6-$12) penalties for illegal residential construction were too small to raise people’s awareness of law-breaking.
“The decree aims to stop illegal construction and trading,” said the Ministry of Construction’s chief inspector Pham Gia Yen. Starting from January 1, 2009, all real estate firms have to make purchases done on real estate trading floors. The regulation, however, was still too general as projects often have hundreds of small components, leading to confusion about what kinds of property should be put on trading floors.
The confusion will be reduced when the decree gives more definitions about what real estate products needed to be put on the trading floor with the emphasis on real estate firms not eligible for property trading can be penalised up to VND60-VND70 million ($3,529-$4.117).
A VND40-VND50 million ($2,352-$2,941) fine was also stipulated for illegally manufacturing and trading in construction materials which fail to conform to quality standards and have unclear origin.
But Phuc Duc Real Estate Limited Company director Lam Van Chuc argued that how many new pecuniary penalties for illegal real estate business was not as important as how long it took the government to assess and grant construction licences to real estate firms. He said delays to construction licencing was what big multinationals really feared.
“We need to solve the core problems of time-wasting administrative processes to speed up and enhance the investment efficiency rather than just catch someone’s errors to make fines,” Duc said.
VietNamNet/VIR
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