Lam Dong closed the King Palace project, refunding nearly 73 billion VND to the business

On the afternoon of April 25, at the conference to provide press information, Mr. Pham S, Vice Chairman of Lam Dong Provincial People’s Committee, said that he had worked with Hoan Cau Da Lat Joint Stock Company (Hoan Cau Company) on a joint basis. King Palace project (Dinh 1) Da Lat No. 1 Tran Quang Dieu, Ward 10. This project closed on April 26.

According to the Vice Chairman of Lam Dong Provincial People’s Committee, the closure of this project was proposed in 2021, but has only been implemented so far. The locality faces difficulties in recovering the project because it involves many issues, including solutions for businesses.

And Mr. Bui Thang, Head of the Propaganda Department of the Lam Dong Provincial Party Committee, said that the Provincial Party Committee Standing Committee held a meeting on this project and agreed to close King Palace. Relevant units will make a minutes of asset handover between the parties. The People’s Committee of Da Lat City was assigned to continue to preserve and manage the assets within the project and develop a plan to auction land lease rights at Dinh 1.

Lam Dong refunded nearly 73 billion VND to businesses

Regarding this incident, Lam Dong Department of Finance reported issues regarding costs that must be reimbursed to Hoan Cau Company after closing the project. According to the Department of Finance, by December 31, 2023, businesses invested over 112 billion VND and the amount generated up to this point is nearly 29 billion VND. Therefore, the business requested to pay 141 billion VND to return Palace 1 to the province.

However, according to the Lam Dong Department of Finance, it only accepts an amount of 112 billion VND and does not accept additional proposals proposed by businesses. The reason given by the Department of Finance is that the above investment amount is after the time of recovery and termination of investment.

Also according to the Department of Finance, in the total project investment value of more than 112 billion VND, more than 36 billion VND in depreciation and 3 billion VND in rent for Palace 1 have been deducted. Therefore, the actual amount of money that Lam Dong province must repay to Enterprise is nearly 73 billion VND.

This agency proposed that the province deduct nearly 56 billion VND from the State budget to refund Hoan Cau Company. The remaining 17 billion VND will be included in the auction plan to be paid to Hoan Cau company.

In 2015, Lam Dong Provincial People’s Committee assigned Hoan Cau Company an 18-hectare pine hill area, including a number of villas and Palace 1 to implement a tourism project with a 50-year operating period.

By 2020, the Government Inspectorate concluded that Lam Dong province leasing houses and land to Hoan Cau Dalat Company in Dinh 1 was a violation of land and investment laws, so it proposed to terminate the project. In case an enterprise wants to use it, it must re-determine the price and lease the asset according to regulations to avoid loss of budget revenue.

In 2021, this province issued a document terminating operations at the above project with a plan to refund money to the investor. The recall and closure have only been carried out since then.