Revaluing contributed land is the hottest issue whenever a party wants to exit a joint venture: the land use rights contributed years ago may have multiplied in value, and the price basis chosen directly decides how much the exiting partner receives. For foreign-invested joint ventures, mishandling this step triggers not only internal disputes but also unexpected tax liabilities.
Legal basis for revaluation
Under Article 36 of the 2020 Enterprise Law (Law 59/2020/QH14, in force as of 20 October 2026), contributed assets during a company’s operation are valued by agreement between the contributor and the Members’ Council (for limited liability companies), or by a valuation organisation. Where a valuation organisation is used, its figure must be approved by the contributor and the Members’ Council. The key point many parties miss: the law does not impose “market price” as the sole benchmark — party agreement comes first, and independent valuation is the fallback when agreement fails.
In parallel, the contributed land plot must still satisfy Article 45 of the 2024 Land Law (Law 31/2024/QH15): a land certificate, no disputes, no seizure, within the land use term, and no interim emergency measures. If the plot has become disputed or seized by the exit date, the transfer of the capital contribution tied to it can stall — something the buyer must verify before price negotiations.
Which price applies?
Joint ventures in practice use one of three approaches: (1) the book value recorded at contribution, adjusted by agreement; (2) the market price at transfer determined by a valuation organisation; (3) a price freely agreed in the capital transfer contract. The second is most common when trust has broken down, because an independent third party takes professional responsibility for the figure.
One decisive rule: Article 52 of the 2020 Enterprise Law requires a member wishing to transfer capital to first offer it to the remaining members pro rata on the same terms; only if they do not buy, or do not buy in full, within 30 days may it be transferred to an outsider. The offer price is the revalued price — so the exiting partner cannot unilaterally set a high figure and bypass the remaining members’ pre-emptive right.
Who hires the valuer, and who pays?
The law does not designate who must engage the valuer. Best practice: the Members’ Council adopts a resolution to hire a valuer chosen from a list both sides accept, with costs borne by the company or split by agreement. The joint venture charter should hard-wire this mechanism from day one — for example, each side nominates one valuer, and if the two figures differ by more than a threshold (commonly 10%), a third valuer is engaged and the average is taken. Without this clause, valuation disputes easily deadlock.
Tax on exiting with appreciated land
The gap between the land’s value at contribution and its revalued price on exit may constitute taxable income: corporate income tax for organisational transferors, personal income tax for individuals (under Personal Income Tax Law 109/2025/QH15, in force at the time of writing). Transferring the land use rights attached to the deal may trigger further financial obligations. The exiting party should determine its exact tax position with a tax adviser before signing the transfer contract to avoid later reassessment. There is no universal “standard” rate — liability depends on the transferor type and the transaction’s nature.
Frequently asked questions
1. When a partner exits, at what price is contributed land revalued?
Party agreement takes priority (Article 36, 2020 Enterprise Law); failing that, an independent valuer is engaged and the result must be approved by the contributor and the Members’ Council. Market price at transfer is the usual practical benchmark.
2. Who hires the valuer for revaluation on exit?
The law does not specify; best practice is a Members’ Council resolution, selecting from a mutually accepted list, with costs borne by the company or split by agreement. The charter should provide this mechanism from the outset.
3. What if the parties cannot agree on the land’s value?
Renegotiate on the basis of the independent valuation; if still deadlocked, use the charter’s dispute mechanism (mediation, arbitration or court). The exiting member must still observe the 30-day offer procedure under Article 52 of the 2020 Enterprise Law.
4. What tax applies when exiting with appreciated land?
The value gap may trigger corporate income tax (organisational transferor) or personal income tax (individual, under Law 109/2025/QH15). Determine the exact position with a tax adviser before signing; no single rate fits all cases.
Key takeaways for investors
- Revaluation follows party agreement first, independent valuation second (Article 36, 2020 Enterprise Law).
- Exit requires a 30-day offer to remaining members first (Article 52) — the offer price is the revalued price.
- Write the valuer-selection mechanism and cost-sharing into the charter from day one.
- Value appreciation may create tax liability — clarify with a tax adviser before the deal, not after.