The division of land use rights in the case of divorce between a Vietnamese and a foreigner is a complex legal issue, subject to simultaneous regulation by the law on marriage and family, the land law and provisions related to civil procedure, especially in the context that Vietnam has promulgated and applied the Land Law 2024 together with the latest guiding documents.

This article will focus on a comprehensive analysis of the current legal provisions on the division of land use rights as common property of spouses in marriages involving foreign elements, clarifying the principles of division of common property upon divorce, particularly with respect to land use rights, including factors such as the origin of the property, the time of registration of land use rights, the name of the person recorded on the certificate, the provision that foreigners are not permitted to have their names on land use right certificates in Vietnam, and the impact of these factors on the division of property upon divorce.

1. Legal provisions on common property of spouses and principles of division of property upon divorce involving foreign elements

According to the Law on Marriage and Family 2014, common property of spouses includes property created by husband and wife, income from labor, production, business activities, yields, profits arising from separate property and other lawful income during the marriage, except for cases stipulated in Clause 1 Article 40 of this Law; property inherited jointly by husband and wife or given jointly and other property that husband and wife agree to be common property. Land use rights acquired by husband and wife after marriage are common property of spouses, except where husband or wife inherits separately, is given separately or acquired through transactions with separate property.

The principle of settlement of property of spouses upon divorce is stipulated in Article 59 of the Law on Marriage and Family 2014. Accordingly, common property of spouses is not necessarily divided equally but must take into account factors:

• Circumstances of the family and of husband and wife;
• Contribution of husband and wife in creating, maintaining and developing the common property;
• Protection of legitimate interests of each party in production, business and profession so that the parties have conditions to continue working to generate income;
• Fault of each party in violating rights and obligations of husband and wife.

Common property of spouses is divided in kind, if it cannot be divided in kind then divided by value; the party receiving property in kind of greater value than his or her share must pay the other party the difference. Separate property of husband and wife belongs to that person, except where separate property has been merged into common property under provisions of this Law. In case of merger or mixing between separate property and common property and husband or wife requests division of property, he or she shall be paid the value of his or her contribution to that property, except where husband and wife have other agreements.

For marriages involving foreign elements, Article 127 of the Law on Marriage and Family 2014 stipulates: divorce between a Vietnamese citizen and a foreigner or between foreigners residing permanently in Vietnam shall be settled according to Vietnamese law. Division of common property of spouses in this case also applies the above principles, while complying with specific provisions on land use rights for foreigners.

2. Provisions of the Land Law on land users and the right to have names on certificates

The Land Law 2024 clearly stipulates land users including:

• Domestic organizations;
• Religious organizations;
• Domestic individuals;
• Overseas Vietnamese who are Vietnamese citizens;
• Residential communities;
• Foreign organizations with diplomatic functions;
• Persons of Vietnamese origin residing overseas;
• Economic organizations with foreign investment capital.

Foreign individuals are not subjects to whom the State allocates land, leases land, recognizes land use rights, or allows receipt of transfer of land use rights in Vietnam. Therefore, foreigners are not permitted to have their names on land use right certificates (red books) in Vietnam.

Clause 4 Article 135 of the Land Law 2024 stipulates: where land use rights are common property of husband and wife, both names of husband and wife must be recorded on the Certificate of land use rights, ownership of assets attached to land, except where husband and wife agree to record the name of one person as representative of both. However, this provision only applies where both spouses are domestic individuals or overseas Vietnamese who are Vietnamese citizens. In cases where one party is a foreigner, only the Vietnamese spouse may have his or her name on the land use right certificate.

Recording names on the land use right certificate signifies lawful establishment of land use rights, serving as the basis for exercising rights of transfer, donation, inheritance, mortgage, capital contribution with land use rights. However, recording the name of one person alone on the certificate does not automatically determine that it is separate property of that person but must be based on the origin of the property and provisions on common and separate property of spouses.

3. Impact of foreign nationality on land use rights

According to current provisions, foreign individuals are not recognized as land users in Vietnam, are not permitted to receive transfer, donation, inheritance of land use rights, and are not permitted to have their names on land use right certificates. Foreigners may only own houses in Vietnam in certain cases such as purchasing apartments or separate houses in commercial housing investment projects but are not permitted to own land use rights attached to such houses. Land use rights in such cases remain with the project investor or domestic organizations or individuals.

In cases where the husband or wife is a foreigner, when purchasing land during marriage in Vietnam, land use rights may only be recorded in the name of the Vietnamese spouse. However, if the property is formed from common funds of husband and wife then in essence land use rights remain common property of spouses, although the certificate records only the Vietnamese spouse. Upon divorce, the foreign spouse is not permitted to receive land use rights in kind but only to receive the value of the property corresponding to his or her contribution, except where there is another agreement consistent with Vietnamese law.

4. Determination of origin of land use rights

The origin of land use rights is an important factor to determine whether it is common property or separate property of spouses. According to Article 33 and Article 43 of the Law on Marriage and Family 2014, land use rights acquired by husband and wife after marriage are common property of spouses, except where husband or wife inherits separately, is given separately or acquired through transactions with separate property. If land use rights existed before marriage, were inherited separately, given separately or purchased with separate property then they are separate property of the person named. If land use rights were formed during marriage, with common funds or cannot be proven to be separate property then they are determined as common property of spouses.

Determination of origin of land use rights is based on documents proving land use rights such as land use right certificates, contracts of transfer, donation, inheritance, documents of payment of land use fees, tax receipts, judgments or decisions of courts, decisions resolving disputes of competent state agencies. In cases without documents, the People’s Committee at commune level has authority to confirm the origin of land use based on actual use, opinions of related parties and cadastral records.

5. Time of formation of common property and effect of division of property

The time of formation of common property is the time land use rights are established during marriage, that is after the date of marriage registration and before the date divorce takes legal effect. If land use rights are granted during marriage, without grounds to prove they are separate property then they are determined as common property. If land use rights are granted before marriage, or inherited separately, given separately, or purchased with separate property then they are separate property of the person named.

Division of common property of spouses during marriage takes effect from the time agreed by husband and wife and recorded in writing; if the writing does not specify the effective time then the effective time is the date of the writing. In cases where property is divided and under law transactions related to such property must comply with a certain form then division of common property of spouses takes effect from the time the agreement complies with the form required by law. In cases where the Court divides common property of spouses then division takes effect from the date the judgment or decision of the Court takes legal effect. Rights and obligations regarding property between husband and wife and third parties arising before the time division of common property takes effect remain legally valid, except where parties have other agreements.

6. Case where land use rights are recorded in the name of one spouse

According to Article 34 of the Law on Marriage and Family 2014, where property is common property of spouses and law requires registration of ownership or use rights then certificates must record names of both spouses, except where husband and wife have other agreements. Where certificates record the name of one spouse only then transactions related to such property are carried out under Article 26 of this Law; if there is dispute over such property then it is resolved under Clause 3 Article 33 of this Law.

In cases of divorce between a Vietnamese and a foreigner, since foreigners are not permitted to have their names on land use right certificates, the certificate records only the Vietnamese spouse. However, if land use rights are formed during marriage, with common funds, then they are still determined as common property of spouses. Upon divorce, the value of land use rights will be divided between both parties according to principles of division of common property, although the foreign spouse is not permitted to have his or her name on the land use right certificate.

7. Principles of division of land use rights upon divorce involving foreign elements

Division of land use rights as common property of spouses upon divorce involving foreign elements is carried out according to principles:

Respect agreements of parties on division of common property. If no agreement then the Court settles according to law.

Common property of spouses is divided equally but taking into account factors: circumstances of family and of husband and wife; contribution of husband and wife in creating, maintaining and developing common property; protection of legitimate interests of each party in production, business and profession so that parties have conditions to continue working to generate income; fault of each party in violating rights and obligations of husband and wife.

For land use rights, foreigners are entitled only to the converted value equivalent to their share of land use rights. They are not permitted to directly have their names on land use right certificates.

In cases where land use rights are common property of spouses with households, upon divorce the portion of land use rights of spouses is separated and divided according to law.

In cases where spouses live with family without common land use rights with the household, upon divorce the rights of the party without land use rights and not continuing to live with the family are settled according to Article 61 of the Law on Marriage and Family 2014.

8. Practical solution when foreigners are not permitted to have their names on land use right certificates

Since Vietnamese law does not permit foreign individuals to have their names on land use right certificates, in cases where husband or wife is a foreigner, the certificate records only the Vietnamese spouse. However, if land use rights are formed during marriage, with common funds, then they are still determined as common property of spouses. Upon divorce, foreigners are not permitted to receive land use rights in kind.

To ensure rights of foreigners, parties may make written agreements confirming origin of property, recognizing rights of foreigners to the value of land use rights. Such writing may be notarized or certified to serve as basis for settlement in case of dispute. Upon divorce, the Court will rely on such agreement, as well as provisions of law on common property, to divide the value of land use rights to foreigners, although they are not permitted to have their names on land use right certificates.

9. Verification of evidence and valuation of land use rights in disputes

Verification of evidence and valuation of land use rights are important steps in settlement of disputes over division of property upon divorce. Evidence proving origin of land includes: land use right certificates, contracts of transfer, donation, inheritance, documents of payment of land use fees, tax receipts, judgments or decisions of courts, decisions resolving disputes of competent state agencies, cadastral maps, cadastral registers, land registers, documents showing current status of land plots, documents on boundaries, landmarks, adjacent plots, documents on land use process (tax receipts, etc.).

Valuation of land use rights is carried out by the Asset Valuation Council according to provisions of civil procedure law. Value of land use rights is determined based on market price at time of settlement, land price tables issued by provincial People’s Committees, or results of valuation by organizations with valuation functions. Valuation must ensure objectivity, publicity, transparency, with participation of related parties. Valuation results are the basis for the Court to divide the value of land use rights to parties when division in kind is not possible.

10. Procedures for transfer of title and payment of value when continuing to use land

When dividing land use rights as common property of spouses and only one party has demand and condition to directly use land, that party continues to use but must pay the other party the value of land use rights to which he or she is entitled. Procedures for transfer of title are carried out according to provisions of land law, including steps:

• Making transfer contract;
• Notarization or certification of contract;
• Submission of application for registration of changes at Land Registration Office;
• Fulfillment of financial obligations (taxes, registration fees, appraisal fees, certificate issuance fees).

Payment of value of land use rights is carried out according to agreement of parties or according to the decision of the Court. If parties cannot agree then the Court will value land use rights and determine the amount payable by the party receiving land use rights to the other party. Payment may be made once or in installments, depending on the financial capacity of parties and their agreement. If the party receiving land use rights fails to fulfill payment obligation then the other party has the right to request enforcement agency to enforce the judgment or decision of the Court.

Conclusion

Division of land use rights as common property of spouses upon divorce between a Vietnamese and a foreigner must strictly comply with provisions of Vietnamese law on marriage and family and land. Foreigners are not permitted to have their names on land use right certificates in Vietnam, but if land use rights are formed during marriage, with common funds, then they are still determined as common property of spouses. Upon divorce, foreigners are not permitted to receive land use rights in kind, but only to receive value of property corresponding to their contribution, except where there is another agreement consistent with Vietnamese law. Determination of origin of property, time of registration of land use rights, name of person on certificate, contribution, fault of each party, transactions with third parties, jurisdiction of dispute settlement, procedures for transfer, valuation of property, as well as precedents and guiding documents must all be comprehensively and objectively considered to ensure rights and legitimate interests of parties. In all cases, settlement of disputes over division of land use rights involving foreign elements must ensure compliance with Vietnamese law, respect agreements of parties, protect rights of vulnerable persons, children, dependents, while ensuring order, security and national sovereignty over land.

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