Factory Sales And Key Considerations For Land Assets

A transferee of Vietnamese assets can avoid assumption of liabilities associated with the assets.

Take, for example, the purchase of a factory. Let's say the transferor doesn't own but only leases the land beneath his factory. The transferor has no right to sell the land, so how to deal with the underlying land? What if the landlord (that has leased the land to the transferor) objects to the transaction and cancels the existing lease?

Consider the following:

• To sell the factory, the transferor must have a certificate of ownership of construction work. Generally, the transferor must obtain a land use rights certificate under its name before it can build the factory. To sell the factory, it must also obtain a certificate of ownership of the factory. Without these certificates, it cannot sell the factory.