Land Right Issues in Lao PDR. Presented by William Greenlee 30 August 2011

Transcription

1 Land Right Issues in Lao PDR Presented by William Greenlee 30 August 2011

2 DFDL MEKONG Established in the Lao PDR in 1994 Offices in 10 cities in the Mekong Region, Singapore and Bangladesh Vientiane, Lao PDR Bangkok, Phuket and Koh Samui, Thailand Hanoi and Ho Chi Minh City, Vietnam Phnom Penh, Cambodia Yangon, Myanmar Singapore Bangladesh 2

3 DFDL MEKONG About us 150+ Legal Professionals 250+ Total Staff 10 Full Offices 1 Regional Head Office Specialty Practice Groups Corporate & Commercial Major Project and Energy Tax, Customs & International Trade Real Estate Securities 3

4 WILLIAM D. GREENLEE, JR. Partner, Country Managing Director, the Lao PDR, Head of China Desk William s practice focuses on M&A and corporate and project finance. He is active in negotiating, structuring, documenting and managing large private equity and opportunity-fund companies and transactions. He recognizes business opportunities, advising global executives as to business development issues and key investment strategies, detailing legal and transactional risk. He has an extensive background in international transactions, finance, corporate, securities, international regulatory compliance for industries that include banking, mining, electric power, manufacturing, property development and tourism. Education & Memberships: B.A. degree (University of Oregon) in Asian Studies and East Asian Literature and Juris Doctor (University of San Francisco, California). Member of the State Bar of California, State Bar of Nevada, State Bar of California International Law Section and a member of The Inter-Pacific Bar Association. William.Greenlee@dfdlmekong.com 4

5 Land Right Issue in Lao PDR 5

6 LAO PDR - GENERAL OVERVIEW Lao PDR Laws/regulations relevant to land rights: Land Law No. 04/NA, dated 21 October 2003 Executive Decree No. 03/PR regarding fees and service charges (Amended), dated 19 November 2008 Executive Decree No. 02/PR regarding State s Land Lease and Concession Fees Rate, dated 18 November 2009 Presidential Edict of the President of the Lao PDR No. 01/OP on Land Tax, dated 8 May 2007 Decree No. 135/PM regarding Granting of State Land for Lease or Concession, dated 25 May 2009 Decree No. 88/PM regarding the Implementation of the Land Law, dated 3 June 2008 Investment Promotion Law No. 02/NA, dated 8 July

7 LAO PDR - GENERAL OVERVIEW continued Land: Land of the Lao PDR is under the ownership of the national community which the State is charged with the centralized and uniform management throughout the country and with the allocation to individuals, families and economic organizations for use, lease or concession. Acquisition of Land Use Rights to Lao Citizens: 1. Allocation by the State 2. Transfer 3. Inheritance Right to Use Land: The right to use land means the right to use land for certain purposes in order to provide for the needs of the holder of such land use rights, in must be in accordance with the land allocation plan of the State. 7

8 PROPERTY: LAND OWNERSHIP Foreigners generally cannot own land (i.e., land use rights or usufructs): must hold via lease or concession Lease Terms for Foreign Investors: 30 years from individuals 50 years from the Government (Concession) 99 years for embassies and international organizations Extendable with Government approval Specific limits apply in electric, mining and plantation sectors 2009 Investment Law: Other than land lease or land concession from the Government or Lao national, foreign investors with Registered Capital (equity) of not less than $500,000 to be allowed to hold land use rights (not exceeding 800 m 2 ) for residential or business purposes. 8

9 PROPERTY: STRUCTURES ON LAND Buildings/Structures/Fixtures Lease Agreement must specify rights of lessor and lessee with respect to buildings/structures/fixtures Own buildings (not land) Risk: ownership reverts to lessor upon lease termination Lease Agreement must specify whether lessor is to compensate lessee for buildings/structures/fixtures constructed, otherwise no compensation payable Land ownership structures available 9

10 PROPERTY: STRUCTURES ON LAND continued Foreigners are also permitted to: Use fixed assets on land leased as security Sub-lease their leasehold rights Use a lease agreement or concession agreement as capital contribution in a Lao PDR entity (subject to prior approval from the Government) 10

11 TRANSFER OF LEASES The Land Law provides for transfer of leases when: Secured collateral; Inheritance by the beneficiaries of a deceased lessee; or When such leases form part of the capital contribution of a legal entity. 11

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