Bidding and then abandoning the deposit can result in a ban of up to 5 years.

Illustration photo.

The above proposal was stated by the Ministry of Justice in the draft Resolution on handling difficulties in auctioning land use rights when allocating and leasing land.

The draft has added specific sanctions to deal with the situation of abandoning deposits after winning a land auction. Accordingly, those who abandon deposits must compensate for all damages arising from the organization of the auction, but the results will be canceled. They are also banned from participating in auctions from 2 to 5 years.

Those who win the auction but do not pay in full will also be banned from 6 months to 3 years. The draft also increases the deposit amount for individuals participating in land auctions to a minimum of 20% and a maximum of 50%.

The Ministry of Justice believes that this is a solution to help prevent the situation of taking advantage of auction activities to make profits and then abandoning deposits.

The proposal of the Ministry of Justice was made in the context of land auction activities having many shortcomings in recent times. Typically, the situation of participants paying unusually high prices, showing signs of collusion to manipulate prices and then "abandoning deposits", affecting the healthy development of the real estate market. Meanwhile, current laws do not have enough sanctions to deter such acts.

However, the proposal on sanctions for abandoning land auction deposits also raises concerns such as restricting human rights, basic rights and obligations of citizens. Because the contents of the above group of rights according to the Constitution must be regulated by law, the option of issuing a resolution of the Government does not apply.

Responding to the above comments, the Ministry of Justice said that the Civil Code stipulates that if individuals and legal entities abuse civil rights to commit illegal acts, the Court may not protect part or all of their rights and force them to compensate if they cause damage. Thus, the provision of sanctions prohibiting participation in land auctions if they abandon their deposits "is not considered a restriction of civil rights and human rights".

In addition, property auctions are a method of buying and selling assets, not a business, so this proposal does not restrict the freedom of business as stipulated in the Constitution, according to the drafting agency.

Source: https://vtv.vn/dau-gia-roi-bo-coc-co-the-bi-cam-tham-gia-den-5-nam-100251020085811203.htm