HOTEL JOINT VENTURE LICENSING HALTED WHILE VIETNAM CONSIDERS NEW RULES

HOTEL JOINT VENTURE LICENSING HALTED WHILE VIETNAM CONSIDERS NEW RULES

Vietnam has stopped licensing new joint ventures for the construction of hotels and office blocks while it considers new regulations for the industry, government officials said on Tuesday.

They said the rules would require Vietnamese partners, who usually just contribute land, to take a higher percentage than the 30 percent common in most of the dozens of joint ventures signed in recent years, mostly with developers from Hong Kong, Singapore and Thailand.The Vietnam News daily said the new rules, if approved, would require Vietnamese partners to hold at least 40 percent.

Nguyen Thuy Huong of the State Committee for Cooperation and Investment (SCCI) said the government wanted to reduce the duration of joint ventures in the industry to 20 years but the SCCI, the investment licensing authority, favored keeping longer periods of 30 to 45 years.

The duration of hotel construction joint ventures currently depends on the cost of the project and ranges from 20 years for a US$10 million project to 45 years for a $50 million investment.

Ms. Huong said there was a large number of hotel and office block applications in the pipeline and she hoped a decision on the rules would be taken soon.