Joint Circular No. 03/2015/TTLT-BGTVT-BTC guiding financial management and allocating plans for providing public services to ensure flight operations

JOINT CIRCULAR

Guidelines for financial management and allocation of plans to supply public services ensuring flight operations

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Pursuant to the Civil Aviation Law of Vietnam dated June 29, 2006;

According to Decree No. 60/2003/NĐ-CP dated June 6, 2003 of the Government detailing and guiding the implementation of the State Budget Law;

Pursuant to the Law on Prices dated June 20, 2012;

Pursuant to the Ordinance on Fees and Charges No. 38/2001/PL-UBTVQH10 dated August 28, 2001;

Based on Decree No. 130/2013/NĐ-CP dated October 16, 2013 of the Government on production and supply of public goods and services;

Pursuant to Decree No. 71/2013/NĐ-CP dated July 11, 2013 of the Government on state capital investment in enterprises and financial management of enterprises wholly owned by the state;

Pursuant to Decree No. 107/2012/NĐ-CP dated December 20, 2012 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Transport;

Pursuant to Decree No. 215/2013/NĐ-CP dated December 23, 2013, promulgated by the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

The Minister of Transport and the Minister of Finance jointly issue this Circular to guide financial management and allocation of plans to supply public services ensuring flight operations.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular guides financial management and allocation of plans to supply public services ensuring flight operations.

Article 2. Applicability

This Circular applies to Vietnam Air Traffic Management Corporation, organizations and individuals related to the organization and provision of public services ensuring flight operations.

Article 3. Explanation of Terms

Flight operation assurance service is a necessary service to ensure safety, regulation, continuity, and efficiency of flight operations, including air traffic control services; information, guidance, surveillance services; meteorological services; aviation news reporting services, and search and rescue services.

Air traffic control services include air traffic control services, flight notification services, air traffic advisory services, and alerting services.

Article 4. Principles of Management

1. Vietnam Air Traffic Management Corporation shall be entrusted with capital, assets, and personnel necessary to perform flight operation assurance tasks according to economic-technical norms prescribed by the Ministry of Transport.

In addition to performing state-assigned public tasks, Vietnam Air Traffic Management Corporation may utilize the entrusted state capital, assets, and resources to organize business activities in accordance with the law without affecting the performance of the assigned public tasks as stipulated in Clause 4, Article 9 of Decree No. 130/2013/NĐ-CP of the Government.

2. Revenue from air traffic control over airspace and flight information regions is a fee as prescribed by the State regarding fees and charges. Vietnam Air Traffic Management Corporation is exempted from value-added tax on such fee revenue.

Chapter II

ALLOCATION OF PLANS TO SUPPLY PUBLIC SERVICES ENSURING FLIGHT OPERATIONS

Article 5. Preparation and Allocation of Budget Estimates for Air Traffic Control Fees Over Airspace and Flight Information Regions

1. Based on actual implementation and forecasted demand for air transport announced by the Civil Aviation Administration of Vietnam, Vietnam Air Traffic Management Corporation prepares budget estimates for air traffic control fees over airspace and flight information regions to submit to the Ministry of Transport before July 15 each year. The Ministry of Transport reviews and incorporates these estimates into its next year's budget revenue and expenditure plan to send to the Ministry of Finance before July 20 each year.

2. After receiving the budget allocation decision from the Ministry of Finance, the Ministry of Transport allocates budget estimates for air traffic control fees over airspace and flight information regions to Vietnam Air Traffic Management Corporation for implementation.

Article 6. Basis and Time for Allocation of Plans to Supply Public Services Ensuring Flight Operations

1. Based on the Ministry of Transport’s decision on budget allocation for air traffic control fees over airspace and flight information regions and Vietnam Air Traffic Management Corporation’s production and business plan, the Ministry of Transport organizes the allocation of plans to supply public services ensuring flight operations to Vietnam Air Traffic Management Corporation after obtaining written comments from the Ministry of Finance.

2. The Ministry of Transport completes the allocation of plans to Vietnam Air Traffic Management Corporation before December 31 of the preceding year.

Article 7. Content of the plan for providing public service to ensure flight operations

1. Plan for providing public services.

a) Name of public service: flight operation assurance service;

b) Volume of public service: number of flights managed and converted operational kilometers;

c) Quality of public service: safety, coordination, and effectiveness of 100% of managed flights;

d) Completion time: end of December of the planning year.

2. Financial plan.

2.1. Revenue from providing public service to ensure flight operations includes:

a) Thirty-five percent of revenue from air traffic control fees collected over airspace and flight information regions;

b) Revenue from air traffic control services for domestic and international flights arriving at and departing from Vietnamese airports;

c) Subsidies and price supports from the State (if any);

d) Revenue from financial activities and other revenues.

The determination of revenue shall be carried out in accordance with current regulations.

2.2. Costs for providing public service to ensure flight operations: including cost items prescribed by law for state-owned limited liability companies and special costs as follows:

a) Safety incentive costs;

b) Flight calibration equipment costs;

c) Satellite communication channel rental costs;

d) Support service costs for ensuring flight operations;

đ) Civil liability insurance costs for air traffic controllers;

e) Search and rescue exercise costs;

g) Anti-terrorism drill costs;

h) Meal allowance costs;

i) Air traffic control navigation service costs;

k) Other information, navigation, and surveillance service costs;

l) Airport concession operation costs.

2.3. Profit.

2.4. Amounts to be remitted to the State budget include:

a) Sixty-five percent of revenue from air traffic control fees collected over airspace and flight information regions;

b) Corporate income tax;

c) Other amounts payable (if any).

Article 8. Provisions on the ratio of retained fees and fees remitted to the State budget

1. The Vietnam Air Traffic Management Corporation is entitled to retain thirty-five percent of revenue from air traffic control fees collected over airspace and flight information regions and record it as revenue of the unit. The remaining revenue from air traffic control fees collected over airspace and flight information regions (sixty-five percent), the Vietnam Air Traffic Management Corporation is responsible for remitting to the State budget. The collection regime shall be implemented in accordance with the current regulations of the Ministry of Finance.

2. In cases where the Vietnam Air Traffic Management Corporation uses up all its own capital and still lacks funds to fulfill the public service mission of ensuring flight operations according to international standards, the Corporation shall develop specific plans, report to the Ministry of Transport and the Ministry of Finance for joint consideration, and issue documents to adjust the retention ratio of air traffic control fee revenue accordingly.

Article 9. Financial management and profit distribution of the Vietnam Air Traffic Management Corporation

1. The management of capital, assets, profit distribution, and other financial provisions, the Vietnam Air Traffic Management Corporation shall implement in accordance with the provisions of the law applicable to state-owned limited liability companies.

2. In cases of exchange rate differences and interest on deposits, the Vietnam Air Traffic Management Corporation shall fulfill the obligation to remit to the State budget the interest arising from exchange rate differences and deposits derived from air traffic control fees collected over airspace and flight information regions, in accordance with the ratio stipulated in Clause 1 of Article 8 of this Circular.

Article 10. Adjustment of the plan for supplying public services to ensure flight operations

1. The plan to implement public service tasks shall be adjusted when permitted by the competent authority in the following cases:

a) The State adjusts economic and technical norms; prices, unit costs constituting reasonable expenses or subsidy levels for public goods and services;

b) The State changes mechanisms and wage policies, prices of raw materials and fuels;

c) Unforeseeable causes as prescribed by law affecting the implementation of public service tasks.

2. The Vietnam Air Traffic Management Corporation shall be responsible for completing the assigned public service targets and reporting to the Ministry of Transport on the implementation of these targets, adjustments to the plan, and shall bear responsibility for the accuracy and honesty of the report.

Chapter III

ORGANIZATION OF INSPECTION AND SETTLEMENT OF PUBLIC SERVICE TASKS TO ENSURE FLIGHT OPERATIONS

Article 11. Inspection and settlement of the implementation of public service tasks to ensure flight operations

1. Quarterly and annually, the Vietnam Air Traffic Management Corporation shall prepare financial reports and settlement reports on the implementation of public service tasks, and submit them to the Ministry of Transport and the Ministry of Finance in accordance with current regulations.

2. Annually, the Vietnam Air Traffic Management Corporation must conduct independent audits of annual financial reports and be subject to inspection, examination, and supervision by financial agencies regarding financial management work as prescribed.

3. Annually, the Ministry of Transport shall take the lead and coordinate with the Ministry of Finance to organize inspections of settlement reports on public service tasks of the Vietnam Air Traffic Management Corporation.

4. The Vietnam Air Traffic Management Corporation and related individuals shall be responsible before the State and the law for the accuracy and honesty of the data in the settlement reports on public service tasks and shall bear responsibility for compensation when settling public service tasks to ensure flight operations do not comply with regulations.

Chapter IV

IMPLEMENTATION

Article 12. Effective Date

1. In addition to the provisions set out in this Circular, the Vietnam Air Traffic Management Corporation shall also comply with other legal provisions applicable to a limited liability company wholly owned by the State.

2. This Circular takes effect from April 12, 2015 and applies from the fiscal year 2015, replacing Circular No. 119/2007/TT-BTC dated October 9, 2007 of the Ministry of Finance guiding financial management and the allocation of plans for supplying public services to ensure flight operations, and Circular No. 72/2013/TT-BTC dated May 27, 2013 of the Ministry of Finance amending and supplementing Circular No. 119/2007/TT-BTC dated October 9, 2007 of the Ministry of Finance guiding financial management and the allocation of plans for supplying public services to ensure flight operations.

Article 13. Implementation Organization

1. The Ministry of Transport shall take the lead and coordinate with the Ministry of Finance to direct and implement in accordance with this Circular.

2. During the implementation process, if there are difficulties, the Vietnam Air Traffic Management Corporation shall have the responsibility to explain and report to the Ministry of Transport and the Ministry of Finance for research and appropriate amendments and supplements./.