Headquarters in a condo?

Wednesday, Sep 30, 2015 08:00

According to the Law on Enterprise (2005), corporations are not eligible to be headquartered in condominiums used for a residential purpose. However, in certain cases enterprises may base their head offices in apartment buildings registered for mixed-use purposes.

The Law on Enterprise (2005) stipulates: "The head office of an enterprise is the place for contact and transaction of the enterprise; it must be located within the territory of Vietnam, have a definite address, including house number, street name (or alley) or name of commune, ward, township, district, provincial town, provincial city, province or city under central authority; telephone and facsimile numbers and email address (if any)." Neither does the Enterprise Law nor its guiding documents have regulations prohibiting corporations from having their headquarters in apartment buildings.

Currently, there are many opinions stating that condominiums were designed and built solely for dwelling purposes. Therefore, it is considered inappropriate to the construction purpose and use when enterprises place their headquarters or offices in such buildings. However, PLF suggests examining the Regulation on Management of Condominium Use enacted with Decision No. 08/2008/QD-BXD by the Ministry of Construction on May 28th, 2008. It clearly states that "a multi-storey building with mixed-use purposes", often referred to as a condominium with mixed-use purposes, has areas that can be used for various purposes, aside from residing. In reality, it is quite common to see the ground level or other floors of an apartment building being rented to supermarkets, stores, head offices, an other businesses.

Under the direction of the Ministry of Construction, stated in Official Dispatch No. 2544/BXD-QLN dated November 19th, 2009, owners of residential purpose-built condominiums are not permitted to alter such buildings' designated use by setting up offices, stores, businesses or production facilities. On the other hand, there are two options in regards to multi-storey buildings with mixed-use purposes:

(1) In cases where the areas utilized for offices, stores… are separate from residential areas, they must be arranged and managed as similarly as business and service constructions;

(2) In cases where such areas are inseparable, which leads to failed application of separate management provisions, particularly when the office area does not meet working conditions in compliance with Building Regulations and Standards, corrective measures must be taken in a timely manner. However, Official Dispatch No. 2544/BXD-QLN has yet to provide guidelines on the implementation of such measures.

In summary, corporations seeking to use condominiums to base their head offices in, must consider whether the area they plan for their headquarters are eligible for other uses (such as to build offices, businesses and production facilities, etc.) apart from the residential purpose. Due to the fact that enterprises are not permitted to place their head office in a condominium solely built for residing, it is essential to ask its investor or owner for crucial documents detailing the use of the apartment area planned for the head office. Furthermore, enterprises must note that business registration authorities may decline granting Business Registration Certifications to those whose headquarters are based in apartment buildings.


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