Decree 172/2024/ND-CP: Auction Law Guidance in Vietnam

To ensure transparency, fairness, and efficiency of auction activities, our State has prohibited the implementation of many legal regulations. Decree 172/2024/ND-CP: Auction Law guidance in Vietnam, effective from January 1, 2025, replacing Decree 62/2017/ND-CP and Decree 47/2023/ND-CP and providing detailed instructions on the Auction Law 2016, is one of the important legal documents, providing detailed regulations and instructions on the implementation of the Law on Property Auction, contributing to creating a healthy and sustainable market. Through the article below, Viet An Law will analyze this Decree.

Amended and supplemented content in Decree 172/2024/ND-CP: Auction Law guidance in Vietnam

Revocation of the Certificates of Operation Registration of an asset auction enterprise

Clause 19, Article 1 of the Decree amending and supplementing the time limit for revoking the Certificates of Operation Registration under Article 32 of the Law on Property Auction 2016 details 02 cases of revoking the Certificates of Operation Registration of property auction enterprises at the request of competent authorities as follows:

• Upon receiving a request from a competent authority to revoke the Certificates of Operation Registration, within 03 working days, the Department of Justice shall notify in writing and request the legal representative of the property auction enterprise to come to the headquarters of the Department of Justice to explain. After 10 working days, if the requested person does not come to explain, the Department of Justice shall issue a decision to revoke the Certificates of Operation Registration, except in cases of force majeure or objective obstacles that prevent the requested person from coming to explain.
• In case the explanation has been received, the competent state agency is responsible for coordinating to verify the contents of the enterprise. Then, two cases will occur:
• Not revoking the Certificate of Operation Registration within 03 working days from the date of determining that the asset auction enterprise is not subject to the proposed revocation or the competent authority has a written request not to revoke the enterprise’s Certificate of Operation Registration.
• Revoke the Certificate of Operation Registration of the property auction enterprise within 03 working days from the date of disapproval of the explanation and determination that the property auction enterprise is in a case where the Certificate of Business Registration of the enterprise is revoked.

Requirements and conditions regarding the National property auction portal 

Pursuant to Clause 28, Article 1 of the Decree amending and supplementing the conditions for online auctions, specifically the authority of agencies and detailed regulations on stopping auctions according to Articles 14, 15, 16 of Decree 62/2017/ND-CP detailing the National property auction portal and the property auction information page, specifically as follows:

Requirements and conditions for the National property auction portal, online auction information page (Article 5), amending and supplementing Article 14 of Decree 62/2017/ND-CP

• Requirements for publicity, transparency, unrestricted access, access to information, stable and continuous operation and must reach level 3 according to legal regulations on ensuring information system security, meeting requirements for connection, integration and data sharing through the national data integration and sharing platform, requirements for technical infrastructure, facilities and staff necessary for the operation of the National property auction portal, the property auction information page and having minimum professional functions such as ensuring safety, security of information of auction participants, access accounts, participation in bidding, paid prices with private codes, publicly and honestly displaying the bid prices of auction participants;
• Continuously display the starting price of the auctioned property, the highest bid, and the lowest bid;
• Record information and retrieve transaction history. Auction participants cannot submit registration documents to participate in the auction after the deadline for submitting documents, make bids after the end of the auction…

Appraisal and approval of online auction information pages (Article 6) amends and supplements Article 16 of Decree 62/2017/ND-CP

• The Director of the Department of Justice decides to establish the Council for Appraisal of the property auction information page and promulgates the Council’s operating regulations, with the composition including a representative of the Department of Justice as Chairman of the Council, a representative of the Department of Information and Communications, relevant agencies and organizations, and experts with qualifications and experience in the fields of auction and IT.
• The Appraisal Council is responsible for appraising the conditions for the property auction information page; the feasibility and effectiveness of the Project when it comes into operation. The Director of the Department of Justice reviews and approves the property auction information page within 90 days.

Stop conducting online auctions (Article 7), amending and supplementing Article 16 of Decree 62/2017/ND-CP.

• Annually or in exceptional cases, the Department of Justice shall inspect the management and operation of the property auction information page.
• The organization with the property auction information page is responsible for upgrading the DGTT system within 90 days from the date of receiving the request.

Responsibilities of agencies, organizations, and individuals in building, managing, operating, and using the National property auction portal and property auction information page:

Decree 172/2024/ND-CP amends Article 16 of Decree 62/2017/ND-CP, which specifically stipulates the responsibilities of the subjects, including:

• Ministry of Justice;
• National property auction portal operator;
• An online auction website owner for the development, management, and operation of its online auction website;
• Responsibilities of auction participants when participating in the National property auction portal, the property auction information page, such as ensuring equipment when participating in the auction;

Bidding, accepting price, choosing bidding method, accepting price in the radio frequency usage rights auction

Clause 38, Article 1 of Decree 172/2024/ND-CP amends and supplements Article 10 of Decree 62/2017/ND-CP detailing the bidding and acceptance of prices in auctions of radio frequency use rights, including the following contents:

• Methods for offering bids and accepting prices;
• Offering bids or accepting prices according to two stages;
• Offering bids based on the number of frequency band blocks to be purchased. Specific regulations for the case of bidding and accepting prices in two stages will include the stage of determining the number of frequency band blocks winning the auction, and the stage of determining the location of the frequency block winning the auction. For the case of bidding according to the number of frequency band blocks registered to buy and changing the frequency band block bid at the auction rounds, the auction will include many bidding rounds, the auction participants have the right to change the bid from one frequency band block to another frequency band block at the bidding rounds, ensuring that the participating enterprises have the flexibility to decide on the frequency block they want to buy based on the developments of the auction and the financial capacity of the enterprise.

Order and procedures for online auctions amended and supplemented Articles 10, 11, 12 of Decree 62/2017/ND-CP

• Auction participants who register to participate in the auction and purchase the auction invitation documents will be provided with an access account by the property auction organization.
• Auction participants use their access accounts to view assets, submit auction application documents, deposit deposits, and attend the auction according to the Auction Regulations.
• The bidding time of the auction is agreed upon by the property auction organization and the property owner, but is at least fifteen minutes.
• Public and transparent, the auction results are publicly posted on the National property auction portal or the auction information page and sent to the auction participants’ email addresses immediately after the auctioneer announces the auction winner.
• The auction minutes must record the start time of the auction, and the end time of the auction recorded by the auction system, must be extracted, confirmed by the property auction organization operating the auction information page, and attached to the auction minutes.

Handling violations of auction winners of land use rights in cases of land allocation and lease to implement investment projects and mineral exploitation rights, amending and supplementing Article 70 of the Auction  Law 2016

From January 1, 2025, the winner of the auction of land use rights in the case of land allocation or lease to implement investment projects or mineral exploitation rights who violates the obligation to pay the auction winning price, depending on the nature and severity of the violation, may be subject to the following sanctions:

• Ban from participating in auctions for 02 to 05 years in case the auction winner does not pay the auction-winning money;
• Ban from participating in auctions from 06 months to 03 years in case the auction winner does not pay the full auction winning money.

The statute of limitations for handling violations against auction winners is 01 year from the date of issuance of the decision to cancel the decision to recognize the auction results.

The decision to prohibit participation in the auction must be issued under the procedure and include all basic legal contents. This decision shall be publicly posted on the National property auction portal within 07 working days from the date of issuance of the decision.

The above is the legal advice of Viet An Law on Decree 172/2024/ND-CP: Auction Law Guidance in Vietnam. If you have any other questions related to legal issues in property auctions, please contact Viet An Law for more specific and detailed advice. Sincerely, thank you!