Over 100 angry people crowded into Phu My Hung Company’s office on November 11, demanding that the investor provide them with documents on real estate projects, but they were prevented by guards.

People were prevented by guards from seeing the firm’s officials.

Dispute at HCM City’s model residential area

Residents file official complaint against Phu My Hung

Residents of an upscale South Saigon residential district, Phu My Hung, remain furious that they have been slapped by a huge and unexpected tax bill, and continue to charge duplicity on the part of the neighborhood’s Taiwan-owned development company.

A spokesman for residents, Nguyen Hong Hai, said that they were led to believe that they could meet the Phu My Hung Company’s general director, Truong Quoc Hung, on December 11 to discuss the land use fee, the grant of house ownership certificate and the land use right certificate at projects in the new residential area.

However, on December 11, no Phu My Hung Company representatives showed up, but only guards and some office staff. Clients were prevented from entering the office by guards. A fight was imminent when local police officers arrived to stabilize the situation.

Notable in the group were many new faces, purchasers of apartments belonging to the Phu My Hung Company’s latest Riverpark project. They expressed their disappointment at having signed papers to buy property that’s now subject to dispute.

Nguyen Bich Thu said “my family agreed to buy an apartment of the Riverpark project for over 4.9 billion dong. Now I’ve been told about the towering land use fee but I can’t withdraw my money.”

She said a friend plans to withdraw from the Riverpark project because of disappointment with the investor’s behaviour.

Another Riverpark buyer, Nghia, said he has asked the investor to supply a copy of the land use right certificate for the Riverpark project and has requested to see company officials to ask about other matters related to this project but all requests have been refused.

Residents’ Representative Nguyen Hong Hai said that the local residents remain very upset. They want to meet representatives of the HCM City People’s Council to seek an answer to the question “who will pay the land use fee – the developer or the buyers?”

Timeline

October 9: Hundreds of residents of the upscale Phu My Hung residential area signed a complaint against the Phu My Hung Development Company’s demand that they pay a land use fee of up to a billion dong (over $50,000) per apartment.

October 10: The developer explains that as a foreign company, it is unable to own land; it can only lease it. Therefore, the contracts it signs with residents require them to pay the land use fee. The company had no way of knowing that the fee would rise sharply at the same time that housing prices fell. After this ‘first dialogue’ with the developer, hundreds of residents agreed they would refuse to pay the land use fees.

October 12: HCM City authorities suggested collecting the land use fees from residents in Phu My Hung at the time they sign a contract to buy apartments, instead of 2-3 years later. The city assigned the Department of Natural Resources and Environment to facilitate a quick solution to the dispute.

October 12: Fearing it will not be able to sell the apartments, the Phu My Hung Company asked the HCM City authorities to freeze the land prices in Phu My Hung in 2010 and exempt it from land use fees.

October 31: After two failed dialogues with Phu My Hung residents, the Phu My Hung Company closed its business department and stopped the dialogue. Clients signed a petition to the National Assembly, the Government Inspectorate and related agencies at all levels.

November 6: Nearly 700 people made a group complaint to related agencies about the problem in collecting the land use fee at the Phu My Hung new residential area.

PV