Article 4.2 of Decree 02/2022 stipulates that an investor selected as an investor in a real estate project in accordance with the law must have equity of at least 20% of the total investment capital for projects with a land use area of less than 20 hectares, at least 15% of the total investment capital for projects with a land use area of 20 hectares or more. Equity shall be determined on the basis of the latest annual audited financial statements or the independent audit report drawn up in the year in which the real estate activity was carried out or in the year preceding that in which the real estate activity was carried out. In particular, in the case of a newly created company, own funds are determined on the basis of the actual initial capital contributed instead of the committed amount of initial capital. 1. Statutory capital of at least VND20 billion is no longer a requirement for real estate companies Start with these five videos that cover fundamental legal issues in the real estate industry. A must for members just starting out. Each real estate project, subdivision or infrastructure must apply for and obtain an environmental permit from the Ministry of Environment and Natural Resources in accordance with the General Law on Environment and Natural Resources 64-00, which regulates pollution, the production and control of toxic and hazardous substances, and the treatment of domestic and municipal waste, inter alia. Ecological due diligence is highly recommended for the purchase of undeveloped land as well as for the purchase of off-plan real estate. (1) The transfer of all or part of a real property project takes place if it meets all the conditions specified in section 49 of the Real Estate Act, if the project is carried out in accordance with the approved schedule and content. Despite global fears of a sharp economic slowdown, the continued growth of the Dominican economy bodes well for the local real estate market in 2019 and 2020. In 2019, projects submitted and approved for tax exemptions under Law 158-01 on Tourism Incentives (CONFOTUR) recorded a 65% year-on-year growth. Dominican real estate in all sectors is considered a very attractive investment in the Caribbean compared to other destinations in the region.
The recent diversification of the market into new areas such as financing tourism projects through investment funds, low-cost housing and senior housing, coupled with increased long-term funding from local banks, is a good sign that the boom will continue. Under Dominican law, there are different types of real estate ownership. The most common is absolute ownership, similar to the common law concept, which grants title holders the right to enjoy, use and dispose of their property under section 51 of the Constitution. As in most jurisdictions of the Torrens system, there are still parcels of land in the Dominican Republic that are not registered. However, most properties in the country and 100% of commercial properties fall under the registered category. Unregistered property is subject to the French “ministerial” system, in which deeds relating to real estate are filed in a special register that serves only as a registration of documents, without any guarantee. The Dominican Civil Code stipulates that all matters concerning real estate in the Dominican Republic are governed solely by local law, regardless of the owner of the property (a Dominican or foreign natural or legal person) or the place where the contract was signed. This is a rule of public policy which cannot be modified or repealed by the Contracting Parties. If a transaction also involves real estate from another jurisdiction, the part of the transaction relating to Dominican real estate must be governed by Dominican law. Therefore, all closing documents must be prepared, executed and enforced in accordance with Dominican laws. However, for probate purposes, a conflict of laws law enacted in December 2014 allows foreigners to have inheritance rules related to real estate in the Dominican Republic determined by their national law.
Previously, Dominican rules of succession applied in all cases. According to Article 9 of Decree 02/2022, the transfer of a real estate project must follow the following principles, in whole or in part: Thus, compared to Decree 76/2015/ND-CP, Decree 02/2022 removed the condition that real estate companies must have a legal capital of at least VND20 billion and added the condition of disclosure of information. (3) Only trade in immovable property that meets the conditions laid down in Article 9 (immovable property put into operation) and Article 55 (immovable property established and put into service in the future) of the Law on Real Estate Activities. Landlords and tenants are subject to strict liability (custodial liability) for property they own or rent, for damage suffered by third parties on their property if the property played an active role in causing the damage, or for environmental damage. – The transferor and the buyer must conclude the signing of a transfer contract within a maximum period of 30 days from the date of the decision to transfer the real estate project or part of the project. The contract for the transfer of the project or part of the project is at the same time the contract for the transfer of the land use rights of the project or part of the project (with the exception of the annual rent). Since 1920, the Dominican Republic has used the Torrens system for the registration of real estate. This system was developed in Australia in the 19th century and is now widely used in many countries. In the Torrens title system, a real property register is maintained by the government, which guarantees inalienable title to the real property contained in the register.
Real estate ownership is transferred through the registration of ownership instead of using deeds. The Registrar has a duty to ensure that only legally valid amendments are made to the Register. All interests that affect or restrict the property rights of the registered owner, such as mortgages, easements, liens, etc., must also be registered. The interest in real estate (ownership, mortgages, liens, etc.) is valid and enforceable against third parties only if it is registered with the office where the registry is located (referred to in the Dominican Republic as the “Registry of Securities”). After check-in, the system guarantees title and priority on a first-come, first-served basis. Another important step in the real estate sector was the construction of Ciudad Juan Bosch (Juan Bosch City), a mega-project with low-cost housing near Santo Domingo, built under the incentives and regulations of Law 189-11 on Trusts, the first real proof of the benefits of the Statute for low-income Dominicans, whose model has now been replicated in all major cities across the country. (1) must constitute a partnership or a company in accordance with the Companies Act or constitute a cooperative in accordance with the Act respecting cooperatives having a branch of activity related to real estate; 2. Equity of the investor selected as an investor in a real estate project Other types of real estate ownership recognized under Dominican law include (1) condominium ownership under Condominium Law 5038 of 1958, where two or more co-owners share ownership of residential or commercial property or both, each enjoying all rights to their own units and common rights to common areas; and (2) the division in which several co-owners jointly exercise the same right to full ownership of the same property as a whole. (3) contracts for the sale or hire-purchase of houses or immovables, which must be exempt from litigation or legal proceedings; and – transfer contract of all (or part) of the real estate project.
gvlawyers.com.vn/legal-alert-no-01-january-2022/ (3) In the case of real estate projects not listed in point (2) above, the transfer shall be carried out in accordance with the Real Estate Act and Decree 02/2022. New legal framework for real estate transactions in accordance with Decree 02/2022/ND-CP In accordance with Decree 76/2015/ND-CP, the contract forms issued under the Decree in the real estate transaction are only intended for the reference of the parties during the contract negotiation process, but according to Decree 02/2022, the parties must use the contract forms established in this decree. These forms of contract include: On the legislative level, the only new development has been the adoption of a new law on real estate evictions: Law 396-2019 of 1 October 2019, which will now regulate the granting of public authority for customs clearance purposes. 6. Details of the procedures for the transfer of all or part of a real estate project, the investment of which is decided by the People`s Committee of the province or by the Prime Minister Accordingly, Articles 11 and 12 of Decree 02/2022 establish the modalities for the transfer of all and part of real estate projects, including: In accordance with Article 4.1 of Decree 02/2022, Organizations and individuals, who trade in real estate (excluding organizations, households and individuals who sell, transfer, rent, rent and buy real estate irregularly) must meet the following 3 groups of conditions: This decade, the Dominican real estate market is booming, as well as the Dominican economy, which grew by almost 6%. the highest in America.
