Divorce ends more than the marital relationship — it raises the difficult question: how are houses, companies and shares divided? Many assume “just split 50:50”, but the law is more nuanced: division is equal subject to circumstances, contributions and even each party’s fault.
This article analyzes the principles of property division on divorce under Article 59 of the Law on Marriage and Family 2014, focusing on real estate, businesses and shares.
1. General principle: agreement first, conditional equal division
Article 59 of the Law on Marriage and Family 2014 (No. 52/2014/QH13) provides:
- Agreement takes priority: spouses agree on the division themselves — courts respect and recognize it;
- No agreement: common property is divided equally but taking into account 4 factors:
- (a) The circumstances of the family and of each spouse;
- (b) Each spouse’s contributions to creating, maintaining and developing the common property — household labour counts as income-generating labour;
- (c) Protecting each party’s legitimate interests in production, business and occupation;
- (d) Each party’s fault in breaching spousal rights and obligations.
Under Joint Circular 01/2016, “fault” means breaching personal or property spousal rights and obligations leading to the divorce — e.g. domestic violence, infidelity, dissipation of assets. The at-fault party may receive less, protecting the innocent party and minor children.
2. How are houses and land divided?
- Step 1 — common or separate: real estate acquired during marriage from common income is common property; pre-marital or separately gifted real estate is separate (not divided);
- Step 2 — division: common real estate is divided in kind where possible (e.g. splitting a land plot); where not possible, by value — the party taking the property pays the difference to the other;
- Value is assessed at the time of division, usually requiring valuation where disputed.
3. How are companies, shares and capital contributions divided?
Capital contributions and shares formed during marriage from common property are the spouses’ common property. On divorce:
- Under Article 64, the party continuing to run the business is prioritized to take the capital/shares and pay the corresponding value to the other — so the business is not fragmented;
- The value is determined at the time of division (independent valuation may be needed);
- Transferring the stake must comply with enterprise law (e.g. pre-emptive rights of remaining members/shareholders in some company forms).
4. How are joint debts handled?
Spouses’ joint debts (borrowing for family expenses or joint business) are divided by agreement; the division must protect bona fide third parties — spouses cannot agree to dump all debt on one party to evade creditors.
5. Frequently asked questions
Q: The wife stayed home while the husband earned — does she get less?
A: No. Household labour counts as income-generating labour (point b, Clause 2, Article 59). Caring for the family and raising children counts equally with financial contributions.
Q: Does infidelity reduce a spouse’s share?
A: Possibly. Infidelity is “fault in breaching spousal obligations” (point d, Clause 2, Article 59), which courts consider to protect the innocent party.
Q: Is separate property divided?
A: No — separate property belongs to its owner, except where merged into common property.
Need advice on dividing property involving real estate or businesses? Contact us for support.
This article was prepared by the FLAW AI Legal Council. Content is pending QA Council review before submission for approval; information is for reference only and does not replace legal advice for your specific case.