The "bottlenecks" of a project that has been delayed for 20 years in the Capital: Part 2: The project lasted for 20 years and the inspection lasted for 23 months

(LSVN) - After 15 years, the dispute between Van Nien Company and the Investor of the project Lot C/D13 should have ended with the retrial decision of the Supreme People's Court. But the Government Inspectorate got involved and the Investor of the project was forced to negotiate again with the party that had lost the court's decision. With the agreement still not finalized, 23 months of inspection have not yet reached a conclusion of right or wrong?

The confusing thing in the Inspection Decision

On December 21, 2023, the Government Inspectorate issued Decision No. 729/QD-TTCP to inspect the compliance with the law in land use management, construction planning and construction licensing in Hanoi. The Decision stated: “Inspection period: from 2011-2022; if there is any related content during the inspection process, the Inspection Team can consider the related content before and after the above period”.

However, without waiting for the "inspection process", Article 1 of the Decision immediately included the inspection content: "Compliance with the law on auctioning land use rights for lot C/D13 in Cau Giay New Urban Area" of CIRI Company, even though it took place in 2005. What is even more confusing is that at that time, Cau Giay district was newly established and submitted to the Hanoi People's Committee for permission to auction the entire Cau Giay New Urban Area. Many project land lots won the auction at the same time in 2005, also implemented by the Cau Giay District People's Committee, but were not inspected.

Inspection Decision No. 729/QD-TTCP dated December 24, 2023 of the Government Inspectorate, stipulating the inspection period: From 2011 - 2022; Inspection period: 60 working days from the date of announcement of the inspection decision.

Realizing that this confusing development was related to the information about the project acquisition by Van Nien Company, CIRI Company was forced to record the working sessions and exchanges.

In the Report to the Prime Minister, CIRI Company stated: Judgment 253 dated December 21, 2011 of the Supreme People's Court has come into effect, regarding the obligations of the parties have been fulfilled, but up to now the project still cannot be implemented because Van Nien Company has used its relationships, power, and blockade to force CIRI Company to pay more money in addition to the announced judgment. From 2011 to 2019: demanding from 150 to 160 then 285 billion. March 2023: demanding 500 billion. June 26, 2024: demanding 550 billion. July 23, 2024: demanding 585 billion.

“Review the capacity of CIRI Company” and “cancel the auction results”?

“Reviewing the capacity of CIRI Company” and “cancelling the auction results” are the contents of the appeal request in the official dispatch of the Internal Affairs Committee and in the Appeal Decision No. 09 of the Supreme People's Procuracy, which were rejected by the Supreme People's Court's Judicial Council in the Retrial Decision No. 08, dated July 6, 2022.

However, during the inspection process, the above content was made public by Head of the Inspection Team Pham Hung during working sessions and discussions.

At the first working session on April 8, 2024 with representatives of CIRI Company and Cau Giay District People's Committee, Mr. Pham Hung said: "We accept this content as the opinion of the Steering Committee that mentioned capacity. There was a story about winning but not paying money, but agreeing to transfer with Van Nien Company. Our Inspection Team raised the issue with the enterprise whether the enterprise can prove that at that time the results of production and business activities have capacity or not. If there is capacity, we will evaluate the responsibility of the district differently. In case there is no capacity, we agree with the opinion of the Steering Committee. If we can prove it, we will report back to the Steering Committee that the enterprise is completely capable. Implement the transfer between the two parties, and then calculate later."

In the document deposited with CIRI Company, Mr. Pham Hung also stated that the content that must be clarified is "the Company's capacity at the time of winning the auction".

According to Decision No. 729/QD-TTCP, the inspection content is "Compliance with the law on auctioning Land Lot C/D13 Cau Giay". Accordingly, the inspection subject is the People's Committee of Cau Giay District; CIRI Company, the winning bidder, is only a related party.

What is confusing is that at the time of the auction, there was no regulation requiring the auction winner to prove financial capacity. Therefore, the requirement for CIRI Company to prove financial capacity was not included in the inspection content of "Compliance with the law on auctioning land use rights for Lot C/D13". Mr. Pham Hung's statement that the Company needed to prove financial capacity at the time of winning the auction was to "report back to the Steering Committee" is also not included in the provisions of the Inspection Law.

CIRI Company had to confirm in writing: The Company's capacity at the time of participating in the auction met the regulations of the Auction Invitation Document, and paid the full deposit of 2 billion VND.

CIRI Company must continue to transfer the project to Van Nien Company?

Mr. Pham Hung's statement that "the two parties will transfer and then consider" is also not consistent with the current public service. Because Judgment 253 has resolved the commitment to transfer Lot C/D13 between the two parties. CIRI Company has completed the judgment and is determined to implement the project.

However, right at the first working session, CIRI Company realized the pressure to "reconcile" with Van Nien Company when hearing Mr. Pham Hung present 3 options:

“The most difficult option for us but the most beneficial for you is for all parties to sit together, discuss, and cooperate in some way, then get Hanoi to agree, restore and immediately implement the project. That is the easiest option for you but the most difficult for us. With the role of the Inspection Team, approving this is the most difficult. The second option is less difficult but in the middle. That is, according to the Auction Regulations, the land is recovered and returned to each person to their home, this land lot is returned to the City Land Fund Development Center (…) The easiest option for the Inspection Team that we think is correct, there is a story of violations in the auction of this land lot, requesting an appraisal of the land lot to see if the construction price was 65 billion in the past, its actual value is 70, 75, or 60 billion… That is the easiest option for the Inspection Team"; “We are ready to do whatever the Inspection Team can do to support businesses and localities. But if you cannot come up with an effective solution, we will do our duty at the 90th minute.”

Talking to the leader of CIRI Company, Mr. Pham Hung said: “In short, I discussed with the shareholders, we established a separate legal entity to implement this project, established a new joint stock company, we contributed to this land lot. The shareholders establishing the enterprise are Van Nien, Van Nien invested 800 billion. Then we worked together. Once the project started, this joint stock company moved, we withdrew money, the other side pumped money into the project…”.

“Late payment” error

After winning the auction, CIRI Company sent a document requesting an extension of payment for the auctioned land use fee and late payment interest according to regulations.

The Inspection Team believes that the Auction Regulations do not have provisions for late payment and late payment interest, and the People's Committee of Cau Giay District did not cancel the auction results, which is a violation of Article 18 of the Auction Regulations issued by the People's Committee of Cau Giay District.

However, according to the records, after 10 days of receiving the Notice of winning the auction, CIRI Company sent an official dispatch requesting to postpone the deadline for paying the auction winning money because the land did not meet the conditions for handing over the infrastructure. Then, on May 30 and October 10, 2006, the Company sent 2 documents to the Hanoi People's Committee requesting to extend the payment deadline and pay late interest. The Hanoi People's Committee sent Official Dispatch No. 4805/UBND-KT dated October 19, 2006 to the Department of Finance regarding CIRI Company's request. Because many enterprises were late in paying the auction winning money in Hanoi, the Department of Finance issued Official Dispatch No. 5577/STC dated December 21, 2006 announcing the interest rate applied to investors who were late in paying the auction winning money. This instruction is in accordance with Decree 198/2004/ND-CP dated December 3, 2004 of the Government on land use fee collection, in which Article 18 stipulates: "For late payment of land use fee to the State budget, each day of late payment must pay 0.02% of the land use fee amount".

On December 4, 2006, CIRI Company paid the full amount. On March 27, 2007, the Project Management Board issued a Certificate of the Company's completion of the obligation to pay the auction winning amount.

Afterwards, in discussions with the leaders of CIRI Company, Mr. Pham Hung repeatedly affirmed that it was impossible to revoke the project of Lot C/D13. One of those times, he said: “We have not officially concluded. But I will answer you right away, firstly, there is no recovery. Why not recover and what happens if we recover? First, according to the Regulation on auction of late payment, there is already a law on late payment, but there is no law on late payment. Late payment must be calculated with interest. Under the Regulation, there are 2 documents of the Project Management Board guiding and agreeing to late payment and calculating interest. The Regulation is of the district, enterprises only need a document of the state with the seal to implement. Second, at the same time, Hanoi has many other projects that also owe and have paid. If we handle this project, is it fair (…). Those are factors that cannot be recovered. If we recover, CIRI will sue. If we do not recover, Van Nien will sue. I think that there are not enough conditions to recover. There is not enough basis, so I also aim for no recovery.”

Along with saying that there would be no revocation, Mr. Pham Hung urged and persuaded CIRI Company to "reconcile" with Van Nien Company. He assured: "If the two sides sit down to reconcile, the Government Inspectorate will work with Hanoi to agree to put the project into implementation." He presented two options from the other side to the CIRI Company Leader and said: "If you think it's OK, I'll invite the parties. If the parties reconcile, they will agree with each other, then record the application or some kind of minutes. I'll include in the conclusion: Regarding the incident, up to this date, we have agreed with each other, recommending that the Prime Minister direct Hanoi to consider supporting the parties to quickly implement...". Responding to the concern of CIRI Company Leader about submitting to the Prime Minister, he said: "The Prime Minister is just a procedure...".

Despite the Head of the Inspection Team spending a lot of time, the agreement was still not successful. CIRI Company found that it was imposed unreasonably, the content of the agreement was not feasible, and the transfer of the project's land use rights would be illegal. Meanwhile, Van Nien remained silent for a long time when CIRI stated in the Agreement Minutes that it had to calculate the value of the two mortgaged assets for the loan that the bank was managing. Regarding these two assets, CIRI Company sent three official dispatches requesting clarification on the value of the assets and legal documents to handle the loan, but the Bank did not respond.

CIRI Company was forced to submit 5 urgent petitions to the Government Inspectorate to issue a Conclusion or suspend the inspection due to the statutory deadline. While waiting for a response, CIRI Company still does not understand why the Inspection Team is prolonging the issuance of the inspection conclusion when the Head of the Team himself said in a meeting with the Company and the People's Committee of Cau Giay District: "The Inspectorate's findings of right and wrong are only a small part to me, only one-third...".

According to Articles 47, 48, 73, 75, 78 of the 2022 Law on Inspection (effective from July 1, 2023), the maximum time for an inspection conducted by the Government Inspectorate from the date of the Inspection Decision to the date of the inspection conclusion is no more than 9 months. Up to now, after 23 months, the Government Inspectorate has not yet issued a conclusion on the inspection of law enforcement on the auction of Land Lot C/D13 Cau Giay. Why?

PV

Source: https://lsvn.vn/bai-2-du-an-keo-dai-20-nam-va-cuoc-thanh-tra-keo-dai-23-thang-a165706.html