Must Real Estate Transactions Go Through an Exchange? The Rules under the 2023 Law on Real Estate Business

“Must a real estate purchase or sale go through a real estate exchange?” is a question HTIC Law Firm receives regularly from both individual homebuyers and project developers, especially as the market sees no shortage of pitches — often from distribution agents themselves — along the lines of “a transaction is only lawful if it goes through an exchange.” The short answer under current law is: no, it is not mandatory. But behind that answer lies a legislative history that has swung between two extremes, and practical legal consequences that the parties should understand before deciding whether to use exchange services.

This article analyzes the legal status of the real estate exchange under the Law on Real Estate Business No. 29/2023/QH15 (effective from 1 August 2024), the conditions for an exchange to operate, and how buyers and sellers can protect themselves in transactions involving an exchange.

Mục 01From mandatory to encouraged: the history of a controversial institution

The 2006 Law on Real Estate Business once required organizations and individuals engaged in real estate business to sell and lease houses and construction works through an exchange. The rule was expected to create transparency, but practice showed that it merely added a layer of intermediaries whose costs were pushed into the sale price, while the “gatekeeping” quality of many exchanges was not commensurate. The 2014 Law therefore abolished the obligation. During the drafting of the 2023 Law, the option of mandatory exchange transactions was once again vigorously debated, on the argument that exchanges help the State capture transaction data and combat tax losses; the position ultimately adopted by the National Assembly, however, was to respect the parties’ freedom of business and freedom to choose their transaction method.

The result is that Article 7.7 of the 2023 Law on Real Estate Business provides that the State encourages organizations and individuals to conduct the sale, transfer, lease, and hire-purchase of houses, construction works and land use rights through a real estate exchange. “Encourage” is a clear legal category: a transaction concluded without an exchange is fully valid, and no one may refuse notarization, registration of changes, or issuance of a certificate on the ground that the transaction did not go through an exchange. Any advice to the contrary is without legal basis.

Mục 02What conditions must an exchange satisfy to operate lawfully?

That using an exchange is not compulsory does not mean an exchange may operate however it pleases. The 2023 Law devotes an entire section to real estate exchanges: Article 54 requires that an exchange be established and registered for operation, and be run by an enterprise engaged in real estate service business; Article 55 sets out the operating conditions, including that the exchange’s manager must be qualified to manage an enterprise under enterprise law and must have completed a training course on the management and operation of a real estate exchange; the following articles, including Article 57, define the exchange’s rights and obligations, such as the right to require customers to provide files and information on the real estate to be listed, and the obligation to verify that information before admitting it for transaction.

From the service user’s perspective, these rules create a simple test: before signing a service contract with an “exchange,” ask it to produce its enterprise registration certificate with the appropriate business lines, the written notification of exchange operation sent to the regulator, and the operator’s certificate of completion of the training course. In reality, the market is full of outfits calling themselves exchanges that are in substance just groups of freelance brokers; only when a dispute erupts — for example, the exchange takes customers’ “booking” money and the developer never launches the sale — do customers discover that their counterparty has no clear legal standing and that the prospects of recovering the money are slim.

Mục 03Transacting through an exchange: the legal value of its confirmation and what to double-check

Where the parties choose to transact through an exchange, the exchange’s confirmation of the transaction has evidentiary significance, showing that the deal was carried out through a registered intermediary — useful in loan files, in evidencing cash flows and in tax declarations. Its limits, however, must be properly understood: the exchange’s confirmation does not replace notarization or certification of the contract where required by law, is not a basis for establishing ownership, and is no “insurance” for the legal quality of the property. Responsibility for verifying that the property satisfies the conditions for being put into business — eligible for sale, free of disputes, free of unreleased mortgages — rests first and foremost with the seller, and the exchange is liable within the scope of the information it publishes.

An illustrative situation: a customer paid a deposit for an off-plan apartment through an F1 distribution exchange, relying on the exchange’s information board stating that the project was “eligible for sale.” The project was later determined not to have obtained the regulator’s written confirmation of eligibility to sell future-formed housing. In such a case, the customer is entitled to seek a declaration that the arrangement is void and demand a refund, and may also pursue the exchange’s joint liability if it can be shown that the exchange published untrue information. The lesson: even with an exchange involved, buyers should still independently verify the project’s original legal documents — or entrust that verification to a lawyer — rather than relying entirely on marketing materials.

Mục 04Exchange service businesses and the compliance challenge

For enterprises operating or planning to establish an exchange, the 2023 framework demands serious investment in a compliance system: the exchange’s operating regulations, a process for vetting property files before listing, mechanisms for storing and reporting transaction information to the regulator, and standard service contracts with customers that clearly delineate the scope of responsibility. In particular, the boundary between exchange activities and brokerage activities must be clearly designed within the corporate structure, as each activity carries its own conditions and liability regime; brokers working at an exchange must still hold a brokerage practice certificate as required. Sloppy operations lead not only to administrative sanctions but also give customers grounds to claim compensation when a transaction collapses.

In our advisory work, the HTIC real estate lawyers regularly recommend that developers signing distribution contracts with exchanges include control clauses: limits on the information the exchange may publish, a prohibition on collecting any money from customers beyond the authorized scope, and an indemnification mechanism where the exchange’s violations create liability for the developer.

Mục 05Frequently asked questions

Is a sale contract concluded without an exchange void?

No. Current law does not require real estate transactions to go through an exchange, so not using one does not affect the contract’s validity. The validity of the transaction depends on the general conditions of civil law and specific requirements such as notarization or certification applicable to the relevant type of transaction.

Who bears the exchange service fee, and is it capped?

The exchange service fee is a civil agreement between the exchange and the service user; the law imposes no ceiling. What matters is that the fee arrangement be made transparent in writing before the service is performed; buyers should be wary of “price difference fees” or “booking fees” without invoices or supporting documents — this is the grey zone that generates the most disputes and tax risk.

Should the deposit be paid to the exchange or to the developer?

As a matter of prudence, all sums relating to the purchase of project real estate should be paid directly to the developer under a duly signed and sealed contract. If payment is made through an exchange, verify the developer’s written authorization for the exchange to collect money, state the purpose of the payment clearly, and keep full documentation. Money paid to a party without valid authorization is very difficult to recover when things go wrong.

Mục 06Contact HTIC Law Firm

HTIC Law Firm advises on legal due diligence of projects and real estate transactions, reviews distribution contracts between developers and exchanges, and represents clients in deposit and booking disputes. Fixed-fee quotation for each case or project — Hotline +84 379 044 299.