Circular No. 02/1999/TT-BKH guiding the procedures and formalities for granting investment incentives pursuant to Decree No. 51/1999/NĐ-CP dated July 8, 1999 of the Government detailing the implementation of the Law on Encouraging Domestic Investment (amended) No. 03/1998/QH10.

CIRCULAR

Guidelines for the procedures for granting investment incentives pursuant to Decree No. 51/1999/NĐ-CP dated July 8, 1999 of the Governmentdetailing the implementation of the Law on Encouraging Domestic Investment No. 03/1998/QH10(Amended) Implementing Clause 3, Article 36, Decree No. 51/1999/NĐ-CP dated July 8, 1999 of the Government detailing the implementation of the Law on Encouraging Domestic Investment (amended) No. 03/1998/QH10 (hereinafter referred to as Decree No. 51/1999/NĐ-CP), the Ministry of Planning and Investment provides guidelines for the procedures for granting investment incentives (hereinafter referred to as Investment Incentives) as follows:

I. AUTHORITY TO RECEIVE APPLICATIONS FOR INVESTMENT INCENTIVES

To be granted Investment Incentives, investors belonging to the categories prescribed in Clause 1, Clause 2, Clause 3, Clause 4, Clause 5, Clause 6, Clause 7, Clause 8, Clause 9, Article 2, Decree No. 51/1999/NĐ-CP shall submit applications for Investment Incentives to the authority receiving applications as provided below:

1. The Ministry of Planning and Investment shall receive applications for Investment Incentives from enterprises established by decisions of the Prime Minister, Ministers of Ministries, Heads of central agencies with jurisdiction.

2. The Department of Planning and Investment of provinces and centrally-administered cities (hereinafter referred to as Department of Planning and Investment) where the investor implements the investment project shall receive applications for Investment Incentives from:

- Enterprises established by decisions of the People's Committee Chairmen of provinces and centrally-administered cities (hereinafter collectively referred to as Provincial People's Committee Chairmen);

- Private enterprises, companies (including joint-stock companies approved by the Provincial People's Committee Chairmen for shareholding restructuring plans and decided to convert state-owned enterprises into joint-stock companies);

- Cooperative unions; cooperatives operating industries and trades specified in Clause 1, Article 13, Decree No. 16/CP dated February 21, 1997 of the Government on the conversion, registration of cooperatives and the operation of cooperative unions (hereinafter referred to as Decree No. 16/CP);

- Enterprises, cooperatives, cooperative unions of overseas Vietnamese, foreigners permanently residing in Vietnam investing directly in Vietnam, or Vietnamese citizens jointly establishing with overseas Vietnamese or foreigners permanently residing in Vietnam under the Law on Encouraging Domestic Investment (amended);

- Educational, health, cultural establishments with certificates of business registration.

3. The People's Committees of districts and towns within provinces (hereinafter referred to as District People's Committees) where the investor implements the investment project shall receive applications for Investment Incentives from: Cooperatives not operating industries and trades specified in Clause 1, Article 13, Decree No. 16/CP; individuals and groups engaged in business activities under Decree No. 66/HĐBT dated March 2, 1992 of the Council of Ministers (now the Government).

For projects implemented across multiple localities, investors may register for Investment Incentives at one of those localities.

II. APPLICATION FOR INVESTMENT INCENTIVES

Investors shall submit to the authority receiving applications an Application for Investment Incentives comprising the following three elements:

1. Application for Investment Incentives:

For investors applying for Investment Incentives for the first time, the application shall be filled out according to Model MĐƯĐĐT (attached to this Circular); for supplementary applications for Investment Incentives for projects already granted Investment Incentives as stipulated in Articles 34 and 46, Decree No. 51/1999/NĐ-CP, according to Model MĐƯĐĐTBS (attached to this Circular).

For projects applying for supplementary Investment Incentives, an additional report on the results of implementing the investment project, the level and duration of Investment Incentives already enjoyed (according to Model BC THDA1 attached to this Circular) must be submitted.

For projects currently being implemented but now applying for Investment Incentives, an additional report on the results of implementing the investment project (according to Model BC THDA2 attached to this Circular) must be submitted.

If investors request exemption from import duties on equipment, machinery, and specialized transportation vehicles as stipulated in Article 26, Decree No. 51/1999/NĐ-CP, they must declare this in the Application for Investment Incentives or prepare a list attached to the application (according to Model DM MMTB attached to this Circular) and bear responsibility for the accuracy and truthfulness of the list.

2. Investment Project or Business Plan (hereinafter collectively referred to as Investment Project):

For projects that the Investment Management and Construction Regulation (issued together with Decree No. 52/1999/NĐ-CP dated July 8, 1999 of the Government) requires to be approved by the competent authority, a copy of the valid Investment Decision must be submitted.

The Investment Project must clearly specify: the investor; industry and trade invested in; location; technical and technological plan, equipment and machinery requirements, transportation needs; capital mobilization plan; number of workers employed.

3. Certificate of Business Registration (a valid copy):

For newly-established state-owned enterprises that have not yet completed business registration procedures, a valid copy of the Enterprise Establishment Decision shall be substituted. For individuals and groups engaged in business activities under Decree No. 66/HĐBT dated March 2, 1992 of the Council of Ministers (now the Government), it is a business license or other documents replacing the business license as prescribed by the Government for such entities.

For private educational, training, and cultural institutions; private healthcare facilities; ethnic cultural establishments, it is a certificate of business operation.

For investors registering to establish production and business establishments along with applying for Investment Incentives, a business registration dossier in accordance with current laws shall be substituted.

Overseas Vietnamese and foreigners permanently residing in Vietnam, after presenting documents regarding their origin as stipulated in point e and point f, Clause 1, Article 43, Decree No. 51/1999/NĐ-CP, shall proceed with the procedures as domestic Vietnamese investors.

III. PROCEDURE FOR GRANTING INVESTMENT INCENTIVES

1. For existing production and business establishments:

a) The Ministry of Planning and Investment shall examine Applications for Investment Incentives from enterprises mentioned in point 1, Section I of this Circular, seek written opinions from relevant agencies if deemed necessary, and decide on granting or refusing to grant the Investment Incentive Certificate (Model GCNƯĐĐT-TW), or the Supplementary Investment Incentive Certificate (Model GCNƯĐĐTBS-TW attached to this Circular).

a) The Ministry of Planning and Investment shall examine the registration dossier of the enterprises referred to in Point 1, Section I of this Circular, seek written opinions from relevant agencies if deemed necessary, and decide on issuing or refusing to issue the Certificate of Investment Registration (Form GCNƯĐĐT-TW), or the Supplementary Certificate of Investment Registration (Form GCNƯĐĐTBS-TW attached to this Circular).

b) The Provincial Department of Planning and Investment shall examine the registration dossier for investment incentives of production and business establishments that have been established and fall within the scope defined in Point 2, Section I of this Circular, seek written opinions from relevant provincial departments and agencies if deemed necessary, and submit to the Chairman of the Provincial People's Committee for a decision on issuing or refusing to issue the Certificate of Investment Incentives (Model GCNUDDT-DF) or the Supplemental Certificate of Investment Incentives (Model GCNUDDTBS-DF attached hereto).

c) The Chairman of the District People's Committee shall examine the registration dossier for investment incentives of production and business establishments that have been established and fall within the scope defined in Point 3, Section I of this Circular, seek written opinions from the Provincial Department of Planning and Investment and other relevant provincial departments and agencies if deemed necessary, and submit to the Chairman of the Provincial People's Committee for a decision on issuing or refusing to issue the Certificate of Investment Incentives or the Supplemental Certificate of Investment Incentives.

2. For production and business establishments registering investment incentives together with business registration:

a) For the registration dossier for investment incentives of investment projects linked to the establishment of production and business establishments which, according to the law, must be registered for business at the Provincial Department of Planning and Investment, the Provincial Department of Planning and Investment shall implement according to the current regulations on procedures and formalities for establishment and business registration, seek written opinions from relevant provincial departments and agencies if deemed necessary, before submitting to the Chairman of the Provincial People's Committee for a decision on issuing or refusing to issue the Certificate of Investment Incentives. If the issuance of investment incentives is approved, it shall be carried out simultaneously with the issuance of the Business Registration Certificate.

b) For the registration dossier for investment incentives accompanying the business registration dossier of cooperatives not engaging in industries specified in Clause 1, Article 13, Decree 16/CP, of individuals or groups of businesses operating under Decree No. 66/HĐBT dated March 2, 1992 of the Council of Ministers (now the Government), the District People's Committee shall examine and issue the Business Registration Certificate or Business License according to the current procedures. At the same time, it shall examine the conditions for investment incentives, seek written opinions from the Provincial Department of Planning and Investment and other relevant provincial departments and agencies if deemed necessary, and submit to the Chairman of the Provincial People's Committee for a decision on issuing or refusing to issue the Certificate of Investment Incentives to the investor.

3. For cases of adjustment or supplementation of investment incentives:

For investment projects that have already been granted investment incentives, during the implementation of the project, if the investor registers to supplement incentives due to meeting additional incentive conditions as stipulated in Article 34 of Decree No. 51/1999/NĐ-CP, the agency that received and processed the registration dossier for investment incentives shall examine and submit to the competent authority for a decision on adjusting or supplementing the investment incentives.

If the investor does not meet the conditions to continue enjoying incentives, they shall notify the agency that received the registration dossier for investment incentives in writing so that the agency can examine and submit to the competent authority for a decision on partially adjusting or withdrawing all granted incentives.

In the case of issuing a supplemental Certificate of Investment Incentives, the previously issued Certificate of Investment Incentives shall be revoked.

In the case of withdrawing all incentives, the decision to revoke the Certificate of Investment Incentives shall be sent to relevant agencies involved in implementing the incentive contents.

4. For cases where there is a request for exemption from import duties on equipment, machinery, and specialized transportation means:

Equipment, machinery, and specialized transportation means eligible for exemption from import duties must be consistent with the investment objectives and technical and technological schemes recorded in the investment project, or the investment decision (if any).

b) The agency processing the dossier shall base its examination on the Application for Investment Incentives, the Investment Project, and the Investment Decision (if any), compare with the List of Types of Machinery, Equipment, and Specialized Transportation Means Produced Domestically (Annexed to Decision No. 214/1999/QĐ-BKH dated April 26, 1999 of the Ministry of Planning and Investment) to determine those types of machinery, equipment, and specialized transportation means that are not yet produced domestically and submit to the competent authority for a decision on granting investment incentives.

If the investor imports a complete set of equipment and machinery that is not yet produced domestically but includes types of equipment and machinery that are already produced domestically, the entire set of imported equipment and machinery shall be exempted from import duties.

In addition to the above cases, the agency processing the dossier shall examine the project's objectives and the mayor's requirements regarding the quality of products to be produced to determine those types of machinery, equipment, and specialized transportation means that are already produced domestically but do not meet the quality requirements of the project. If deemed necessary, opinions from relevant management agencies at the same level may be sought before submitting to the competent authority for a decision.

c) The list of machinery, equipment, and specialized transportation means eligible for exemption from import duties shall be recorded in the Certificate of Investment Incentives or the Supplemental Certificate of Investment Incentives; if the list is too long, it shall be recorded as an annex (Model DM HHNKMT-TW for the Ministry of Planning and Investment, or Model DM HHNKMT-ĐP for the Provincial People's Committee).

d) In the case where the investor has a previous project that was granted a Certificate of Investment Incentives including a provision for exemption from import duties but has not yet been decided on the List of Goods Eligible for Import Duty Exemption by the Ministry of Trade, the investor shall send a letter requesting exemption from import duties along with the import contract to the agency that issued the Certificate of Investment Incentives. The letter shall clearly state the name, specifications, or code number, quantity of each type of machinery, equipment, and specialized transportation means requested for exemption from import duties. The agency receiving the registration dossier for investment incentives shall compare with the aforementioned conditions and issue a notification letter to the investor and the customs office at the port of entry to inform and implement the import procedures.

IV. TIME LIMIT FOR ISSUING INVESTMENT INCENTIVES CERTIFICATES

Issuing new Certificates of Investment Incentives or Supplemental Certificates of Investment Incentives shall be completed within twenty working days from the date the agency receiving the dossier receives a complete and valid dossier.

A valid dossier is one that meets all the valid elements prescribed in Section II of this Circular.

If the dossier is invalid, the agency receiving the dossier shall notify the investor in writing within three working days from the date of receipt of the dossier to supplement and complete the dossier.

The date of receipt of the dossier is the date when the agency directly receives the dossier or the date marked by the post office upon receipt if the dossier is sent through the post.

The reduction of part or the withdrawal of the entire investment incentive shall be carried out within no more than five working days from the date of receiving the investor's notification of not meeting the conditions to enjoy incentives.

In case of refusal to issue the Investment Incentive Certificate, the agency receiving the dossier must notify the reasons in writing to the investor.

State management agencies, when consulted on investment incentives, have the responsibility to reply in writing within no more than seven working days from the date of receiving the consultation document; failure to provide a written response beyond this period shall be deemed as agreement.

V. IMPLEMENTATION PROVISIONS

1. This Circular takes effect from the date of issuance, replacing Circular No. 02/1998/TT-BKH dated March 16, 1998 of the Ministry of Planning and Investment guiding the procedures and formalities for issuing investment incentive certificates under Decree No. 07/1998/NĐ-CP dated January 15, 1998 of the Government detailing the implementation of the Law on Encouraging Domestic Investment and Document No. 955 BKH/DN dated February 10, 1999 of the Ministry of Planning and Investment temporarily guiding during the transition to apply the amended Law on Encouraging Domestic Investment No. 03/1998/QH10.

2. Every six months (on June 10 and December 10), the department responsible for handling investment incentive dossiers at the provincial People's Committee shall report on the situation of issuing investment incentives, the implementation of investment assistance and incentives in the locality, and propose issues arising that need to be addressed, to be submitted to the Department of Planning and Investment for consolidation and reporting to the provincial People's Committee and the Ministry of Planning and Investment.

Every six months (on June 20 and December 20), the Department of Planning and Investment shall consolidate the situation of issuing investment incentives, the implementation of investment assistance and incentives in the locality, and propose issues arising that need to be addressed, to be submitted to the Ministry of Planning and Investment for consolidation and reporting to the Government.

During the implementation process, if there are any difficulties, it is requested that agencies and production and business establishments promptly reflect them so that the Ministry of Planning and Investment can study and amend the guidance provided to make it appropriate.