Thông tư 44/2009/TT-BNNPTNT

CIRCULAR

GUIDING THE FINANCIAL MANAGEMENT OF FOREIGN AID SOURCES MANAGED BY THE MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT

THE MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENT

Pursuant to the Government's Decree No. 01/2008/ND-CP of January 3, 2008, defining the functions, tasks, powers and organization of the Ministry of Agriculture and Rural Development;
Pursuant to the Government's Decree No. 60/ 2003/ND-CP of June 6, 2003, promulgating the Regulation detailing and guiding the implementation of the State Budget Law;
Pursuant to the Government's Decree No. 131/2006/ND-CP of November 9, 2006, promulgating the Regulation on management and use of official development assistance (ODA) sources;
Pursuant to the Prime Minister's Decision No. 64/2001/QD-TTg of April 26, 2001, promulgating the Regulation on management and use of foreign non-governmental aid;
Pursuant to the Ministry of Finance's Circular No. 82/2007/TT-BTC of July 12, 2007, guiding the state financial management regime for foreign non-refundable aid belonging to state budget revenue sources; Circular No. 108/2007/TT-BTC of September 7, 2007, guiding the mechanism for financial management of ODA programs and projects; Circular No. 116/2005/TT-BTC of December 19, 2005, guiding the management and handling of assets of state budget-funded projects upon their completion.
The Ministry of Agriculture and Rural Development guides the financial management of foreign aid sources under its management, as follows:

Chapter I

GENERAL PROVISIONS

Article 1. Objectives and scope of regulation

This Circular aims to raise the effectiveness and efficiency of the financial management of foreign aid sources, including official development assistance (ODA) sources and foreign non-governmental organization (NGO) aid invested through programs or projects, non-project aid for administrative agencies or non-business units. Sector Support Partners Offices. Sector Trust Funds and Project Management Units managed by the Ministry of Agriculture and Rural Development.

Article 2. Subjects of application

Administrative agencies, non-business units. Sector Support Partners' Offices, Sector Trust Funds and Project Management Units under the Ministry, which are tasked under the Ministry's decisions to act as program or project owners or to perform the coordination, to partially (for projects with many mini-projects or components) or fully implement programs or projects and non-project aid (referred collectively to as project owners) shall strictly comply with the provisions and guidance of this Circular.

Article 3. Financial management principles

1. ODA capital sources and NGO investment or supports via programs or projects and non-project (referred collectively to as project) aid are all state budget capital sources, must be fully accounted and reflected through vouchers, books, records, reporting forms, and be managed and used under the State Budget Law as well as its guiding decrees and documents.

2. Except for special cases already approved by the Government or the Prime Minister, contributed domestic capital from the state budget as committed for ODA and/or NGO programs or projects managed by authorities at any level (central or local) shall be allocated, arranged, estimate-assigned, examined and settlement-approved by that level. However, all data must be reflected and synthesized in the financial statements and settlement reports of the entire programs or projects.

3.Project owners are answerable to law and the Minister for the fulfillment of commitments stated in international treaties and project documents; observe state regulations on implementation of programs or projects and on financial management; and observe the regimes of formulation of financial plans, accounting, audit, settlement, management of project assets, and reporting under current state regulations.

4. In case treaties, international pagreements or commitments to which Vietnam has signed or acceded contain provisions different from national regulations, such treaties, agreements or commitments will prevail. If donors or agencies or organizations authorized by donors to directly administer expenditures for programs or projects, the financial management complies with the treaties, agreements, commitments or project documents, memoranda of understanding, which have been signed with the donors.

Article 4. Contents of financial management

1. The contents of financial management of foreign aid managed by the Ministry of Agriculture and Rural Development cover: formulation and synthesis of financial plans (also referred to as estimation of state budget revenues and expenditures); the regime of expenditure control and state budget accounting; the regime of procurement and spending norm setting; the regime of reporting, accounting, audit and final settlement; the regime of management of capital and assets formed from project funds, and tax policies.

2. In addition to the above-mentioned contents, for independent non-refundable aid programs or projects (not accompanied by loan capital projects), aid certification by the Ministry of Finance (the Foreign Debt and Finance Management Department) as provided for in the Ministry of Finance's Circular No. 82/2007/TT-BTC of July 12. 2007. guiding the state financial management of foreign non-refundable aid being a state budget revenue source, and documents amending, supplementing or replacing this Circular, is also required.

Chapter II

FORMULATION AND APPROVAL OF FINANCIAL PLANS

Article 5. Principles of formulation of financial plans

1. Financial plan means an investment capital plan (for capital construction projects) or administrative and non-business capital plan (for administrative and non-business projects), or credit-lending plan (for credit projects). A financial plan covers the following contents: ODA and NGO capital plan (loan capital, non­refundable aid capital, classified according to aid-providing countries or organizations), contributed domestic capital (central budget capital, local budget capital, domestic credit capital, own capital of project owner, contributed capital of project beneficiaries, capital sources from value-added tax refund (if any) and other capital sources prescribed by Vietnamese law).

2. For mixed capital construction and administrative and non-business projects, project owners shall formulate and submit for approval specific financial plans according to each spending item of the projects. For a project with many owners, each project owner shall formulate a financial plan for the project part it implements. If a project has many owners and a common body for coordinating the project implementation, the common coordinating body shall formulate a financial plan for activities it carries out and at the same time synthesize the common plan of the whole project.

3. Annual financial plans of projects must express expenditure details according to each component and principal operation of projects, according to source of aid, contributed domestic capital, own capital of project owners, contributed capital of beneficiaries, credit capital (if any), which must be enclosed with reports clearly explaining grounds and bases for calculation of each spending amount.

4. Annual financial plans of projects already approved or notified by competent bodies will serve as a basis for control of expenditure, withdrawal of contributed domestic capital and foreign capital for projects. After the financial plans are approved. Project Management Units shall send them to the Ministry of Finance (the Foreign Debt and Finance Management Department) and state treasuries with which their transactions are registered.

5. Annual financial plans of projects will be formulated under the guidance in the Ministry of Finance's Circular No. 108/2007/TT-BTC of September 7, 2007, guiding the financial management mechanism for ODA programs and projects.

In order to meet the management requirements and practical conditions, forms for plan formulation and sum-up are guided and detailed in three appendices (not printed herein):

Appendix 1: Annual financial plan sum-up form. This form is synthesized from projects detailed in Appendices 2 and 3.

Appendix 2: Annual financial plan.

Appendix 3: Detailed annual budget expenditure estimates of projects.

Article 6. Formulation and approval of financial plans

1. Annually before July 15, which coincides with the time of making state budget estimates, project owners being grade-II estimating units shall base themselves on current regulations, contents of project documents, master plans and project implementation progress to direct the Project Management Units and their subordinate units to formulate and sum up capital plans for the subsequent year, reach agreement with/obtain no objection of donors (if so requested), which serve as grounds for proposing the Ministry to consider and send them to the Ministry of Finance and the Ministry of Planning and Investment for state budget sum-up and submission to the Government and the National Assembly for approval.

2. For projects of investment nature (referred to as capital construction projects), the project owners shall formulate and send their financial plans to the Department of Planning for consideration, sum-up and reporting to the Minister before sending them to the Ministry of Planning and Investment. For projects of administrative and non-business expenditure nature (referred to as administrative and non­business projects), project owners shall formulate and send their financial plans to the Finance Department for consideration, sum-up and report to the Minister before submission to the Ministry of Finance.

3. In August, according to their assigned functions and tasks, the Finance Department (for administrative and non-business projects) and the Department of Planning (for capital construction projects) shall assume the prime responsibility for. and coordinate with relevant departments and authorities in. finalizing the state budget plan/ estimates of the Ministry for sum-up and submission to the Ministry of Finance and the Ministry of Planning and Investment. In the course of formulating annual state budget plans/ estimates, departments, authorities, other non­business units and authorized bodies shall base on their respective assigned functions and tasks to assume the prime responsibility for, or coordinate with one another in, organizing the appraisal and approval of financial plans/state budget expenditure estimates for projects under their respective management, which must be completed before October 31.

4. Immediately after the assignment of state budget revenue and expenditure estimates by the Prime Minister and the appraisal of capital distribution plans by competent authorities, the Finance Department shall propose the Minister to decide on the assignment of state budget expenditure estimates to administrative and non­business projects; the Department of Planning shall submit to the Minister the notification of capital plans for capital construction projects to grade-II estimating units, which all must be completed before December 31. Grade-II estimating units shall notify capital plans to their attached units within 5 working days after the receipt of the Ministry's decisions/notifications on assignment of plans/estimates.

5. Regarding ODA and NGO projects for which international treaties or agreements were already signed but have not yet taken effect or have taken effect but the procedures for domestic investment have not yet been completed, the agencies assigned to act as project owners shall submit to the Ministry (thrugh the Department of Planning, for capital of capital-construction nature; or the Finance Department, for capital of administrative and non-business nature) for sum-up and report to the Ministry of Planning and Investment and the Ministry of Finance (during the formulation of budget estimates) for inclusion in capital-construction or administrative and non­business expenditure reserves, and submit them to competent authorities for decision (if contributed domestic capital is supplied by the central budget).

Article 7. Adjustment, supplementation of financial plans

For newly arising projects or projects already approved but requiring adjustment or supplementation after the formulation and assignment of budget plans, the Department of Planning (for capital-construction capital) or the Finance Department (for administrative and non­business capital) shall, at the proposal of project owners and depending on capital use. study and submit adjustments to the Minister for approval (in cases where the adjustments will not increase total capital amounts) and make sum-up reports on supplementation plans (for cases requiring capital addition) by the time of supplementation of annual budget plans, or report to the Ministry of Planning and Investment and the Ministry of Finance for handling on a case-by-case basis (in case of necessity or urgency).

Chapter III

ACCOUNT OPENING, CAPITAL DISBURSEMENT AND EXPENDITURE CONTROL

Article 8. Opening and use of accounts

1. Project owners may open accounts at commercial banks or state treasuries in localities where their transactions registration offices are opened in order to facilitate the receipt and disbursement of foreign aid capital as well as contributed domestic capital allocated by the state budget for implementation of programs and projects.

2. If accounts are opened at banks for receipt of foreign capital sources, project owners shall propose the service banks to additionally open separate accounts for monitoring interest money and send monthly statements to the projects for sum-up and monitoring of arising interest amounts.

3. It is strictly forbidden to use personal accounts, to lease or borrow accounts of agencies, units or other organizations and likewise to receive and use foreign aid sources for programs and projects.

Article 9. Certification of aid, report on aid receipt and use

1. The certification of aid money and goods with the Ministry of Finance (the Foreign Debt and Finance Management Department) and report on aid receipt and use will only apply to independent non-refundable aid programs and projects.

The forms and time of aid certification are prescribed in the Ministry of Financed Circular No. 82/2007/TT-BTC of July 12, 2007, including:

1.1. Form C2-HD-XNVT: "Declaration for certification of import aid goods" (Appendix 1a), used in certification of aid being equipment, machinery, supplies, raw materials, utensils and other kinds of goods imported from foreign countries. This declaration shall be made by project owners after the receipt of import dossiers.

1.2. Form C2-HD/XNVT: "Declaration for certification of domestic aid goods and services" (Appendix 1b), used in declaration for certification of aid being equipment, machinery, supplies, raw materials, utensils and other kinds of goods, purchased at home (including service charges) with foreign aid money. This declaration shall be made monthly by project owners, simultaneously with declaration for value-added tax refund.

1.3 Form C3-HD/XNVT: "Declaration for certification of aid money" (Appendix 1c), used in declaration of foreign aid money. This declaration shall be made by project owners immediately after the receipt of money transfer vouchers of donors.

2. Within 15 days after the end of a quarter, project owners shall make reports on aid receipt and use (according to the form guided in Appendix 05. promulgated together with Circular No. 82/2007ATT-BTC of July 12, 2007, of the Ministry of Finance) and send them to the Ministry (the Finance Department) for sum-up reporting to the Ministry of Finance.

3. Preferential ODA loan programs or projects or mixed programs or projects comply with Circular No. 108/2007/TT-BTC of September 7, 2007, guiding the financial management mechanism applicable to ODA programs and projects and do not require aid certification.

Article 10. Spending norms

1.The spending norms in case of using contributed domestic capital and capital borrowed through programs, projects on cooperation with foreign countries comply with the Finance Minister's Decision No. 61/2006/ QD-BTC of November 2, 2006, promulgating a number of spending norms applicable to ODA projects/programs, and documents amending, supplementing or replacing this Decision.

2. The spending norms in case of using foreign non-refundable aid capital comply with the provisions of Treaties, Agreements. Project Documents, Memoranda of Understanding on Foreign Aid, signed with Donors.

3. Except cases of aid by mode of budget support, the cases of using non-refundable aid capital within the framework of programs or projects financed by European Union (EU) member countries or such United Nations (UN) agencies as FAO, UNDP, WHO, UNICEF... comply with criteria and norms prescribed in the updated version of "EU-UN guidelines on local costs in development cooperation with Vietnam," published on the website of the EU Mission in Vietnam: http://www.delvnm.ec.europa.eu/eu_vn_relations/development_coo/publications.htm

4. The econo-technical capital construction norms for peculiar activities of the sectors and activities of investment nature comply with current regulations of the Vietnamese Government (regardless of capital sources).

5. For other cases in which specific norms are not prescribed in aid treaties or agreements or projects involve many ministries/branches (ministries are managing bodies), units, localities and relevant partners but without unified spending norms or with incomplete spending norms which fail to meet practical requirements, at the proposal of project owners and after obtaining the consent of donors' representatives, the Ministry of Agriculture and Rural Development (the Finance Department) shall send documents asking for opinions of the Ministry of Finance before promulgating regulations on spending norms for uniform application to the whole projects.

Article 11. Capital disbursement

1. For foreign capital: Depending on the provisions of aid treaties or agreements and requirements of each payment, the withdrawal and payment of ODA and NGO capital provided by mode of aid to projects shall be carried out in one or several of following forms: direct payment withdrawal/or money transfer, payment withdrawal in form of letter of understanding/or special commitments, payback-capital withdrawal, retrospective withdrawal, payment via special accounts/or advance account's and some other special forms of capital withdrawal under separate agreements with donors.

For preferential ODA loan or mixed ODA programs or projects, under the provisions of Section III, Part II of Circular No. 108/2007/TT-BTC of September 7, 2007, of the Ministry of Finance. Project Management Units shall send valid capital withdrawal dossiers to the Ministry of Finance. Within 5 working days after the receipt of valid dossiers, the Ministry of Finance shall examine and sign/or consent the capital withdrawal applications, requesting donors to consider and approve them and notify the service banks thereof for capital disbursement.

2. For contributed domestic capital: Within 5 working days, based on the expenditure control results certified in payment requests, the state treasuries at different levels shall pay contributed domestic capital allocated by the state budget to projects in conformity with contributed domestic capital plans approved annually by competent authorities.

Article 12. Expenditure control

1. Expenditure control means the examination and certification of spending amounts, dossiers of payment from aid capital and preferential loan capital sources of project owners in accordance with state budget expenditure management, regulations, carried out by state treasuries or re-lending bodies authorized by the Ministry of Finance.

2. Expenditure control applies to all programs and projects funded by preferential ODA loan capital or non-refundable ODA capital in ODA loan capital projects, mixed ODA loan capital sources and independent non-refundable aid projects. Under Point 1, Section I, Part II of Circular No. 108/2007/TT-BTC of September 7, 2007 of the Ministry of Finance, the control for withdrawal of foreign capital of ODA projects is not restricted by annual financial plans of the projects but the withdrawal level must not exceed the common financial plans of the whole projects.

3. For aid in kind, intangible non-refundable aid (intellectual property assets), money amounts spent or paid to beneficiaries being "non­resident" organizations or individuals (money for hire of consulting organizations, foreign experts working for long term in Vietnam); expenses for foreign experts in surveys, appraisal and assessment of projects in Vietnam... from foreign aid sources) by donors or their representatives, under independent non-refundable aid projects, the expenditure control regime does not apply.

4. In case of opening accounts at commercial banks, project owners shall still fully supply legal documents, treaties/memoranda of understanding/agreements with donors on norms, budget estimates, spending plans and relevant dossiers and vouchers for state treasuries for proper expenditure control, without affecting the project progress and commitments with donors.

5. For independent non-refundable aid projects, within 10 working days counting from the beginning of the month, project owners shall compile "the General Statement of expenditures and payments from aid money sources" according to each "declaration for certification of aid money" and send them to state treasuries of their respective transactions for control and certification of the total spending amounts from aid money sources, then send these documents to the Ministry (the Finance Department) for sum-up of these statements to be sent to the Ministry of Finance for budget revenue and expenditure accounting according to expenditure items in the current state budget contents.

6. Apart from the above-mentioned contents, details of expenditure control dossiers, documents and forms, duration and responsibilities of concerned parties in the course of expenditure control will depend on types of projects, concretely:

6.1. For programs or projects funded with preferential ODA loans or non-refundable ODA aid in ODA loan projects, or mixed ODA loan sources, the provisions of Section I, Part II of Circular No. 108/2007/TT-BTC of September 7. 2007 of the Ministry of Finance, guiding the financial management mechanism applicable to ODA programs and projects, will apply.

6.2. For independent non-refundable aid projects, the provisions of Point 2. Section III. Part II of Circular No. 82/2007/TT-BTC of July 12. 2007 of the Ministry of Finance, guiding the financial state management of foreign non­refundable aid belonging to the state budget revenue sources, will apply.

Chapter IV

ACCOUNTING AND AUDIT

Article 13. Accounting apparatus

1. Depending on the size, nature and model of managerial organization of each project, the project owner will take the initiative in proposing the accounting model, organization of the accounting apparatus, appointment of full-time or part-time accountants, or recruit/sign contracts with new accountants meeting the conditions and criteria prescribed in the Law on Accounting and relevant legal documents as well as requirements on qualifications and experience suitable to domains of management, ensuring the fulfillment of the tasks of project accounting.

2. The accounting apparatus and specific positions and the number of accountants shall be clearly stated in task assignment decisions or Project Management Unit establishment decisions by competent authorities or authorized agencies/units. For each position in the accounting apparatus, a job description must be made.

Article 14. Accounting regime

1. The administrative and non-business accounting regime, promulgated together with the Finance Minister's Decision No. 19/2006/ QD-BTC of March 30, 2006, will apply to administrative and non-business programs and projects on technical assistance, capacity building, research, policy renewal and institutional reform.

2. The investors' accounting regime, promulgated together with the Finance Minister's Decision No. 214/2000/QD-BTC of December 28, 2000, will apply to programs and projects funded with capital construction investment capital and permitted to set up their separate Project Management Units.

3. The units' current accounting regime will apply to the performance of accounting jobs if the projects are small, simple with no big accounting work volume and without Project Management Units; however, project owners shall account separately project capital sources, project expenditures and must not incorporate ODA capital sources in the units' capital sources.

Article 15. Accounting work

Administrative agencies and non-business units. Sector Support Partners' Offices, Sector Trust Funds and Project Management Units under the Ministry shall uniformly use a system of accounts, open adequate books and make reports according to the accounting regimes similar to those mentioned above in Article 14 for full, truthful and timely reflection of the receipt, management and use of funds, the conditions of equipment, the procurement and use of project assets.

Article 16. Project audit

The audit of projects largely covers the audit of annual financial statements and the audit of project completion settlement, concretely:

1. The audit of annual financial statements complies with regulations of donors or auditing requirements of Vietnamese functional bodies, aiming: (i) to examine and certify the truthfulness and reasonability of project financial statements in a fiscal year; (ii) to simultaneously certify projects' resources already used in accordance with procedures, regulations, policies, financial and accounting regimes, the application of which within the project framework has been agreed upon by the Government and the donors.

2. The audit of project completion settlement will apply to all important national ODA projects, ODA projects of group A, ODA projects of group B. financed with state capital, upon their completion (before submission to competent authorities for verification and approval of settlement); for remaining projects, the audit of settlement will be carried out at the request of donors and competent authorities.

3. In addition, in a number of specific cases, at donors' requests, performance audit, spending efficiency audit or procurement audit shall also be carried out.

4. Audit contractors selected to provide project audit services must satisfy the following basic requirements: (i) Being audit companies operating lawfully in Vietnam, having their names on the list of companies fully qualified to conduct the audit, which is promulgated annually by the Ministry of Finance (or professional organizations authorized by the Ministry of Finance), unless otherwise provided for in the commitments between the Government and donors: (ii) Abiding by current regulations on audit as well as standards on audit as well as on auditors' professional ethics.

5. Project owners shall formulate and submit to the Ministry (The Finance Department) for consideration and approval, audit plans and bidding dossiers/ reference provisions for annual auditing services or the whole project period-audit (except for cases authorized by the Ministry) before carrying out subsequent procedures under current provisions of law on bidding.

6. Immediately after the receipt of reports on audit of annual financial statements and reports on audit of project completion settlement made by audit contractors, within 10 working days, together with the sending of audit reports at donors" requests, project owners shall also send to the Finance Department one set (including the management letter) for information and recommendations in service of management activities; and also for use as a basis for examination and approval of project settlement.

Chapter V

ANNUAL SETTLEMENT AND PROJECT COMPLETION SETTLEMENT

Article 17. Annual project settlement

1. Annually, project owners being grade-II estimating units shall examine and approve the settlements fully reflecting various capital sources (foreign aid sources and contributed domestic capital...) for grade-Ill units. Project Management Units and their subordinate units, then synthesize them and make annual settlement reports for timely submission to the Ministry (the Finance Department) for approval, consideration, appraisal and notification of annual settlement.

2. For capital construction projects, the annual settlement complies with the Finance Ministry's Circular No. 53/2005/TT-BTC of June 23, 2005. and the Minister of Agriculture and Rural Development's Decision No. 2533/QD-BNN-TC of August 19, 2005. guiding the formulation and examination of reports on settlement of capital construction investment capital belonging to the state budget according to annual budget, and documents amending, supplemen-ting or replacing the said Circular and Decision.

3. For administrative and non-business projects, the annual project settlement complies with the Finance Ministry's Circular No. 01/ 2007/TT-BTC of January 2, 2007, guiding the approval, examination and notification of annual settlement reports for administrative agencies, non-business units and organizations provided with state budget supports, and the Minister of Agriculture and Rural Development's Decision No. 3833/QD-BNN-TC of December 3. 2008. promulgating the Regulations on consideration, approval, examination and notification of annual settlement for administrative agencies, non­business units and organizations assigned to use budget, managed by the Ministry of Agriculture and Rural Development, and documents amending, supplementing or replacing the said Circular and Decision.

Article 18. Settlement of completed projects

1. Upon project completion, project owners shall make reports on settlement of investment capital (for capital construction projects) and reports on settlement of administrative and non­business capital (for administrative and non­business projects), fully reflecting all capital sources of the projects, for submission to the Ministry (the Finance Department) for consideration, examination and approval according to current accounting regulations.

2. Reports on settlement of capital of completed capital construction investment projects comply with the provisions of the Finance Ministry's Circular No. 33/2007/TT-BTC of April 9, 2007 and the Minister of Agriculture and Rural Development's Decision No. 2707//QD-BNN-TC of September 3, 2008, guiding the settlement of investment capital, and documents amending, supplementing or replacing the said Circular and Decision.

3. Reports on settlement of capital of completed administrative and non-business projects comply with the Finance Minister's Decision No. 19/2006/QD-BTC of March 30, 2006, promulgating the administrative and non­business accounting regimes, and documents amending, supplementing or replacing this Decision.

Chapter VI

EQUIPMENT. PROCUREMENT AND MANAGEMENT OF ASSETS

Article 19. Equipment and procurement of assets

1. The furnishment and procurement of assets in service of project management work must comply with the project documents already approved by competent authorities, assigned tasks and requirements as well as State-prescribed standards and norms, ensuring thrift practice and waste combat.

2. In case of procurement and furnishment of new assets, the current provisions of law on the bidding will apply. Project owners shall elaborate general bidding plans and submit them to the Ministry for approval for the entire projects before carrying out procedures for further procurement (except for bidding packages to be executed first).

3. If specific ODA treaties or donation agreements contain provisions different from current Vietnamese regulations on furnishment, procurement and management of assets of Project Management Units, project owners shall report them to the Ministry (the Finance Department) for submission to the Prime Minister for comments before signing or conducting the procurement under the provisions of such treaties.

Article 20. Asset management

1. Assets furnished or procured by projects must be used for proper purposes, monitored in detail through cards and/or books and fully accounted according to regulations. The asset depreciation complies with the Regulations on management and depreciation of fixed assets in state agencies, public non-business units and organizations using the state budget, promulgated together with the Finance Minister's Decision No. 32/2008/QD-BTC of May 29, 2008, and documents amending, supplementing or replacing this Decision

2. All assets procured or received under decisions of competent authorities and assets leased in service of projects' activities must be used for proper purposes, by proper subjects and according to criteria set by the State; it is strictly forbidden: (i) to trade, exchange, transfer, donate, present as gifts. lend the assets without decisions of competent authorities; (ii) to lease or lend them to organizations or individuals; (iii) to use them for personal purposes.

3. Project owners/ Project Management Units assigned to directly manage and use the assets shall promulgate Regulations on asset management and use; provide for oil and gasoline consumption norms for vehicles; annually inventory and report on inventory results to the Ministry (the Finance Department) according to current regulations.

4. Assets procured or received in service of projects' activities shall be maintained and repaired strictly according to state regulations on technical management applicable to each type of assets. Asset maintenance and repair funds will come from annual expenditure estimates of Project Management Units.

Article 21. Handling of assets during the use thereof and after the project completion

1. Project assets upon project completion or being no longer in use in the course of project implementation shall be handled under the Finance Ministry's Circular No. 116/2005/TT-BTC of December 19, 2005, guiding the management and handling of assets of state budget- financed projects upon their completion, and relevant legal documents as well as documents amending, supplementing or replacing the above Circular.

2. An asset-handling dossier submitted to the Ministry (the Finance Department) comprises:

2.1. An official letter proposing the asset handling upon project completion;

2.2. The record on inventory of assets of the completed project (made according to form provided in Appendix 01/TSDA);

2.3. The list of assets proposed for handling (made according to the form in Appendix 02/ TSDA);

2.4. The demanding unit's written application for receipt of transferred assets (for assets handed over to localities, the provincial-level People's Committee's official letter is required);

2.5. The copy of the Aid Treaty/Memorandum of Understanding/Agreement;

2.6. The donor's official letter or agreement on transfer of assets (if any);

2.7. The report on the use of automobiles (in case of application for receipt of transferred automobiles):

2.8. Copies of other documents and papers related to the right to use the assets (for offices, land and houses, constructions attached to land and vehicles).

3. The asset-handling involves the following steps:

3.1. Prior to the project completion time, project owners shall direct their Project Management Units to prepare dossiers and documents, set up asset-inventory councils: within 30 days as form the date the projects terminate or the assets are no longer usable or needed in the course of project implementation, the Project Management Units shall inventory them and make records thereon (according to the form in Appendix 01/TSDA), elaborate schemes for asset handling (according to the form in Appendix 02/TSDA) as provided for in the Finance Ministry's Circular No. 116/2005/TT-BTC of December 19, 2005.

3.2. Project owners shall examine and sum up inventory results of the Project Management Units and submit the dossiers defined in Clause 2. Article 21 of this Circular to the Ministry for decision on asset handling:

3.3. Within 10 working days after the receipt of valid dossiers, the Finance Department shall submit to the Ministry documents for sending to the Finance Ministry for agreement on the asset-handling schemes:

3.4. Within 5 working days after the receipt of the written reply of the Finance Ministry, the Finance Department shall propose the Ministry in writing to issue asset-handling decisions:

3.5. Based on the Ministry's asset-handling decisions, within 10 working days, project owners shall direct the Project Management Units to set up councils for asset hand over (in case of asset transfer) or organize asset liquidation via auction, for assets still of some use value, or destruction, for irreparably or unrestorably damaged assets without use value.

3.6. Project owners shall report on the handling results to the Ministry via the Finance Department within 10 working days after the completion of asset handover and handling in service of supervision and inspection.

4. Project owners shall bear full responsibility before law and the Ministry for their relaxed asset management, causing losses, waste or damage, for delayed handling of assets when projects are completed or for ultra vires transfer of assets.

Chapter VII

TAX POLICIES AND TAX INCENTIVES

Article 22. Taxes

Taxes applicable to projects include export tax, import tax, excise tax, value-added tax, personal income tax. corporate income tax, charges and fees.

Article 23. Tax policies and tax incentives

1. For non-refundable ODA projects, the provisions of Section II of the Finance Ministry's Circular No. 123/2007AT-BTC of October 23, 2007,  guiding the application of tax policies and tax incentives to ODA programs and projects,
and documents amending, supplementing or
replacing that Circular, will apply.

2. For preferential loan or mixed loan ODA projects (referred collectively to as ODA loan), the provisions of Section III of the Finance Ministry's Circular No. 123/2007/TT-BTC of October 23, 2007, guiding the application of tax policies and tax incentives to ODA programs and projects, and documents amending, supplemen­ting or replacing the above Circular, will apply.

Article 24. Fulfillment of lax obligations

1. To fulfill tax obligations, project owners shall register with tax offices in the localities where their transaction offices are located for grant of tax identification number. The procedures for tax registration and grant of tax identification number comply with the guidance in the Finance Ministry's Circular No. 85/2007/ TT-BTC of July 18. 2007. guiding the implementation of the Tax Administration Law, regarding tax registration, and documents amending, supplementing or replacing the above Circular.

2. Particularly for value-added tax. dossiers for tax refund, the declaration time limit, the organization of dossier receipt and tax refund comply with the guidance in the Finance Ministry's Circular No. 60/2007/TT-BTC of June 14, 2007, guiding the implementation of a number of articles of the Tax Administration Law and guiding the implementation of the Government's Decree No. 85/2007/ND-CP of May 25, 2007, detailing and guiding the implementation of a number of articles of the Tax Administration Law, and documents amending, supplementing or replacing the above Circular or Decree.

3. For experts, consultants and officials working for projects, project owners shall deduct at source, register, carry out procedures for declaration and payment of. personal income tax under the Personal Income Tax Law and its guiding documents (except for tax and fee exemption for foreign experts ODA programs or projects as provided for in Circular No. 52/2000/ TT-BKH of June 5, 2000. of the Ministry of Planning and Investment).

4. For foreign organizations or individuals doing business in Vietnam or earning their incomes in Vietnam, when providing services for projects, they shall fulfill their tax obligations under the Finance Ministry's Circular No. 134/ 2008/TT-BTC of December 31. 2008. and documents amending, supplementing or replacing the above Circular.

Chapter VIII

IMPLEMENTATION PROVISIONS

Article 25. Organization of implementation

1. The Director of the Finance Department shall guide, monitor and inspect the implementation of this Circular.

2. Heads of administrative agencies, non­business units. Directors of Sector Support Partners' Offices, Sector Trust Funds and Directors of Project Management Units under the Ministry, who are assigned by the Ministry to act as program or project owners or to coordinate, to perform part or the whole of programs or projects, shall widely disseminate and organize the strict implementation of, the provisions of this Circular.

3. The International Cooperation Department is assigned to elaborate and sum up in the first quarter of every year the reported lists of projects approved in the preceding year and the projected list of projects to be mobilized, negotiated and concluded in the year for submission to relevant competent agencies and concurrently to the Finance Department, the Department of Planning for coordinated monitoring in service of managerial work, and the common report of the Ministry and report to other ministries and branches.

4. The International Cooperation Department is assigned to coordinate with the Finance Department, the Department of Planning and other relevant Departments/Authorities in elaborating annual plans for regular and irregular inspections of the receipt, management and use of foreign aid sources via programs, and projects; detect in time violations and signs of violation and propose handling measures to the Minister.

Article 26. Handling of violations

1. Throughout the course of project implementation or upon project completion, if project owners show signs of violating current state regulations on financial management, failing to make and submit to the Ministry for approval the settlement and failing to propose schemes for handling of assets of completed projects, thus giving rise to improper use of assets, ultra-vires transfer of assets, the Finance Department shall coordinate with the Organization and Personnel Department, the International Cooperation Department and the Ministry's Inspectorate in clarifying their liabilities and proposing the Minister not to assign their units to implement new projects.

2. Apart from the above-said handling measures, all organizations and individuals violating the provisions of this Circular shall, depending on the nature and severity of their violations, be proposed for handling according to law, and at the same time shall make self-criticism before the Minister for their violations.

Article 27. Implementation effect

This Circular takes effect 45 days from the date of its signing. If meeting with difficulties or problems or detecting new matters in the course of implementation, heads of administrative agencies, non-businesses units. Directors of Sector Support Partners' Offices. Sector Trust Funds and Directors of Project Management Units under the Ministry shall promptly report them to the Ministry for consideration, proper amendment and supplementation.-