New regulations on real estate brokerage in Vietnam from August 1, 2024

The real estate business has been a “hot” field for many years, including real estate brokerage business. Recently, the National Assembly passed the Law on Real Estate Business 2023, and it officially took effect on August 1, 2024. The change in the Law on Real Estate Business has a significant impact on real estate business sectors, including real estate brokerage. Therefore, the new regulations on real estate brokerage from August 1, 2024, always receive attention from many subjects in society. To learn more, please follow the article below on Viet An Law.

What is real estate brokerage?

Real estate brokerage is one of the popular business professions today, especially in the context of major changes in real estate law.

Real estate brokerage concept

Pursuant to Clause 2 and Clause 11, Article 3 of the Law on Real Estate Business 2023, real estate brokerage is one of the real estate service business lines. Which, real estate brokerage is the act of intermediary for parties in buying, selling, transferring, leasing, subleasing, and leasing-purchasing real estate.

Real estate brokerage content

Pursuant to Article 62 of the Law on Real Estate Business 2023, the contents of real estate brokerage activities include:

• Look for partners who meet conditions set out by clients for negotiation and conclusion of contracts.
• Act as an authorized representative to follow procedures for real estate sale and purchase, transfer, lease, sublease, or lease purchase.
• Provide information and assist relevant parties in negotiating and concluding real estate sale and purchase, transfer, lease, sublease, or lease purchase contracts.

New regulations on real estate brokerage from August 1, 2024

August 1, 2024, is the official date when the Law on Real Estate Business 2023 takes effect. The Law on Real Estate Business 2023 has many new points compared to the Land Law 2014. Including new content regulating the field of real estate brokerage. Specifically as follows:

Conditions for the business of real estate brokerage services and practice

For organizations

Under Clause 1, Article 61 of the Law on Real Estate Business 2023, real estate brokerage service business organizations must meet the following conditions:

• Must establish a real estate service enterprise as prescribed in clause 5 Article 9 of Law on Real Estate Business 2023;
• There must be a regulation on the provision of real estate brokerage services are available;
• There are material and technical facilities to serve the provision of brokerage services as prescribed by the Government;
• at least 01 employee is possessing a practicing certificate as a real estate broker;
• Before providing real estate brokerage services, the real estate brokerage enterprise shall be required to provide its profiles to the real estate authority of the province or city where it is located for publishing on the housing and real estate marketing information system as prescribed in Law on Real Estate Business 2023.

Compared with the Law on Real Estate Business 2014, lawmakers have added several conditions on operating regulations, facilities, techniques, etc. for real estate brokerage service businesses. However, the minimum number of individuals with real estate brokerage certificates in the organization has been reduced from 02 to 01 person.

For Individuals

Previously, under the old Law, individuals could conduct independent real estate brokerage services. However, from August 1, 2024, individuals can practice real estate brokerage but cannot practice independently and must practice within a certain organization.

Specifically, in Clause 2, Article 61 of the Law on Real Estate Business 2023, individuals practicing real estate brokerage shall be required to meet the following eligibility requirements:

• Must possess a practicing certificate as a real estate broker;
• Must work for an enterprise providing real estate trading floor services or a real estate brokerage enterprise.

Real estate brokerage remuneration and commissions

Currently, the Law on Real Estate Business 2023 only has specific regulations on remuneration and commissions for individuals practicing real estate brokerage, but no longer has general regulations on remuneration and commissions for organizations and individuals doing real estate brokerage business. Thus, pursuant to the current Law, real estate brokerage service businesses will not collect remuneration and commissions from clients as before but will switch to collecting service fees.

Pursuant to Article 63 of the Law on Real Estate Business 2023, the remuneration of individuals practicing real estate brokerage is as follows:

• Real estate brokers are entitled to remunerations and/or commissions paid by enterprises providing real estate trading floor services or real estate brokerage enterprises.
• The real estate brokerage remuneration or commission shall be agreed upon by the real estate broker and the enterprise providing real estate trading floor services or a real estate brokerage enterprise. The real estate brokerage remuneration is not dependent on the price of the transaction conducted with the assistance of the broker.

Rights and obligations of real estate brokerage service businesses and individuals practicing real estate brokerage

Pursuant to the Law on Real Estate Business 2023, the rights and obligations of real estate brokerage service enterprises and individuals practicing real estate brokerage have been expanded and regulated more specifically than the previous Law on Real Estate Business 2013.

Rights and obligations of real estate brokerage service enterprises

According to Article 64, 65 of the Law on Real Estate Business 2023, real estate brokerage service enterprises have the following rights and obligations:

• Rights:
  • Provide real estate brokerage services as prescribed;
  • Request relevant organizations and individuals to provide documents and information on real estate to be transacted;
  • Collect service charges from clients as agreed upon between the parties;
  • Refuse to provide brokerage service if the real estate fails to meet conditions for being put on the market;
  • Request relevant organizations and individuals to compensate for damage caused by their negligence;
  • Exercise other contractual rights.
• Obligations:
  • Provide adequate and truthful documents and information on the real estate for which its brokerage service is provided, and assume responsibility for provided documents and information;
  • Organize annual training and refresher training courses to improve knowledge in real estate brokerage for its brokers;
  • Fulfill tax obligations to the State;
  • Compensate for damage caused by its negligence;
  • Submit reports as prescribed by law and bear the inspection by competent authorities;
  • Discharge other contractual obligations.

Rights and Obligations of individuals practicing real estate brokerage

• Rights:
  • Provide real estate brokerage services as prescribed;
  • Request relevant organizations and individuals to provide documents and information on real estate to be transacted;
  • Refuse to provide brokerage service if the real estate fails to meet conditions for being put on the market;
  • Request relevant organizations and individuals to compensate for damage caused by their negligence;
  • Receive brokerage remunerations and/or commissions as prescribed.
• Obligations:
  • Provide adequate and truthful documents and information on the real estate for which its brokerage service is provided, and assume responsibility for provided documents and information;
  • Fulfill tax obligations to the State;
  • Compensate for damage caused by its negligence;
  • Comply with regulations on the operation of the real estate trading floor or the real estate service enterprise for which the individual is working;
  • Attend annual training and refresher training courses in real estate brokerage.

Through the above article, Viet An Law has sent new regulations on real estate brokerage from August 1, 2024. If you still have questions or need support on other legal issues, please contact Viet An Law for timely support.