Joint Circular No. 04-LB/TT guiding additional regulations on the establishment and dissolution of state-owned enterprises

 

 

JOINT CIRCULAR

GUIDELINES FOR IMPLEMENTATION AND SUPPLEMENTARY PROVISIONS ON THE REGULATIONS FOR ESTABLISHING AND DISSOLVING STATE ENTERPRISES
(Annexed to Decree No. 388-HĐBT dated November 20, 1991 and Decree No. 156-HĐBT amending and supplementing Decree No. 388-HĐBT of the Council of Ministers)
On the basis of Decree No. 156-HĐBT dated May 7, 1992 on amending and supplementing Decree No. 388-HĐBT promulgating regulations on establishing and dissolving state enterprises of the Council of Ministers;

Following Circular No. 01-TT/LB dated February 13, 1992 of the National Planning Commission and Ministry of Finance guiding the implementation of regulations on establishing and dissolving state enterprises;

At the request of relevant sectors and localities, the National Planning Commission and the Ministry of Finance provide supplementary guidance on the following points:

1. Authority for examination and decision-making on the establishment and dissolution of state enterprises

: Implement Article 1 of Decree No. 156-HĐBT amending Article 6 of Decree No. 388-HĐBT.1.1. For state enterprises established by the Chairman of the Council of Ministers signing the decision: The Director of the National Planning Commission shall lead the examination and make recommendations.

1.2. For state enterprises directly under central ministries and sectors: The Director of the National Planning Commission shall lead the examination and propose to the Chairman of the Council of Ministers. The Minister managing the sector shall sign the decision to establish state enterprises directly under their ministry after receiving approval from the Chairman of the Council of Ministers.

1.3. For state enterprises directly under localities (including those directly under provinces, cities, and districts if applicable): The Minister managing the economic and technical sector shall lead the examination and issue a notification of agreement for the Chairman of the People's Committee of the province or centrally-administered city to sign the decision to establish.

1.4. In this context, the economic and technical sector management ministry refers to the vertical sector management ministry. For example, all enterprises under the Construction Department, including machinery production enterprises for construction equipment, should submit their files to the Ministry of Construction. Enterprises under the Industry Department should be submitted to the appropriate heavy or light industry ministry depending on the sector.

2. Written opinions

of the economic and technical sector management ministry or the provincial People's Committee (as per Article 5.5 of Decree No. 388-HĐBT). 2.1. For state enterprises that existed before Decree No. 388-HĐBT and are now being re-established:

a. All files from the provincial People's Committee, which is the founding authority, shall be sent to the vertical sector management ministry. The vertical sector management ministry shall review and provide written comments to the Director of the National Planning Commission for enterprises established by the Chairman of the Council of Ministers, while organizing the examination of enterprises established by the Chairman of the provincial People's Committee.

b. For industries requiring business licenses according to state regulations (such as import-export, construction, wood processing and forest products, printing, publishing, pharmaceuticals...), copies of previously issued licenses from relevant ministries must be provided or new licenses obtained. For other industries, the examining authorities of the ministries shall invite representatives of related ministries to participate in the examination and record their opinions in the examination minutes.

c. For enterprises under the Industry Department engaging in multiple industries, choose the most important industry (or with the highest sales volume, or with longer tradition and stronger potential for development) as the basis for submitting files to the relevant ministry or vertical sector.

Example: An enterprise engaged in weaving, equipment manufacturing, and power generation, if weaving is chosen as the main industry, the file should be submitted to the Ministry of Light Industry; if equipment manufacturing is chosen, the file should be submitted to the Ministry of Heavy Industry...

d. Confirmation opinions of the provincial People's Committee regarding infrastructure and environment for central enterprises: The local agency responsible for implementing Decree No. 388-HĐBT shall organize reviews and directly confirm each case where enterprises have issues with planning and environment when a related agency requests a recheck. Enterprises previously approved by relevant agencies during economic and technical feasibility studies and continue operating normally do not need to obtain new confirmation letters to reduce unnecessary procedures.

2.2. For newly established enterprises after Decree No. 388-HĐBT. Files from the provincial People's Committee or the founding ministry must include written opinions from the vertical sector management ministry (as per point 2.1 above) and opinions from the relevant economic and technical sector management ministry (as per Part B of Appendix 1 of Joint Circular No. 01-TT/LB and supplementary guidance).

3. Number of files required for re-established enterprises

to be submitted to the examining authority: two sets. The examining authority will make additional copies to send to related agencies. The files include the following documents: - Application for establishment (original).

- Articles of association (or rules and regulations) confirmed by the Minister or the Chairman of the provincial People's Committee for application (original).

- Report on the operation process of the enterprise.

- Minutes of capital transfer (for enterprises already allocated capital). Enterprises that have not completed capital transfer must immediately proceed with it. If not possible, a confirmation letter from the financial authority regarding current capital, including state budget capital and self-supplemented capital, is required.

- Declaration of funds ensuring normal operations according to the 1992 business plan, confirmed by the relevant ministry or department (original). - 1992 plan and direction for plans 1993-1995 (attached to Appendix 5 of Joint Circular No. 01-TT/LB).

To ensure uniform archiving of state enterprise files, ministries shall submit one set of files of state enterprises directly under localities they have examined to the National Planning Commission.

4. The date for determining the total business capital

of enterprises in Appendices 2 to 4c (attached to Joint Circular No. 01-TT/LB) is December 31, 1991. 5. Joint venture capital:

5. Joint venture capital:

5. 1. A business participates a portion of its capital in a joint venture with other economic units: Implement according to Decree 388-HĐBT on procedures for establishment and management of capital. The original capital and the capital participating in the joint venture are both capitals that the business is responsible for preserving and developing, therefore they must be reflected in the total capital of the original unit.

5. 2. A business receives joint venture capital from other economic units or foreign investment capital:

- If the joint venture is consolidated in the total capital of the business, it shall apply the Law on Enterprises or the Law on Foreign Investment in Vietnam.

- If the joint venture maintains separate accounting for a part: implement according to Decree 388-HĐBT as in the case of participating a portion of capital in a joint venture outside.

5. 3. Units established from contributions of state-owned enterprises: if they maintain independent accounting, they shall implement according to Decree 388-HĐBT.

6. Statutory capital level: is the existing capital belonging to the budgetary source allocated, considered as the budgetary allocation and self-supplemented sources, including both fixed capital and working capital of state-owned enterprises. The State-Owned Enterprise Establishment Review Board will compare with the provisions set out in Decree 222-HĐBT or the ability of the capital sources to ensure normal operation and development of the enterprise according to the requirements of the 1992 business plan to consider and decide on establishment according to Decree 388-HĐBT.

7. Regarding Appendix 5 of Circular Joint Ministry No. 01-TT/LB:

7. 1. Section 1: Total capital recorded in the minutes of capital transfer: In cases where the business has not yet conducted capital transfer, record according to the approved settlement figures of the corresponding years. In cases where the settlement has not been approved, there should be confirmation from the financial authority. If multiple businesses are merged into a new business, consolidate the capital sources of all units being merged.

7. 2. Section 2: Remaining value of fixed assets (as of December 31) based on the figures on the approved settlement balance sheet of the corresponding years. Among which:

- Budgetary capital, including budgetary capital and capital treated as budgetary capital; calculation method as stipulated in Directive No. 138-CT dated April 25, 1991, of the Chairman of the Council of Ministers on expanding the scope of granting usage rights and responsibility for preserving production and business capital to grassroots state-owned units.

- Bank loans: recorded based on the balance on the approved settlement balance sheet of the corresponding years.

- Other mobilization: clearly record each specific source of mobilization (if any), including: loans from organizations or individuals, both domestic and foreign; and other sources.

7. 3. Section 3: Working capital: recorded according to the figures on the approved settlement balance sheet of the corresponding years.

8. Registration fee for establishing a business.

8. 1. The object paying the registration fee is state-owned enterprises specified in Point 1 of Circular Joint Ministry No. 01-TT/LB, the payment of the registration fee is accounted for as production and business expenses.

8. 2. Businesses directly pay the registration fee along with the application documents to the competent authority for examining the establishment procedures in cash or by bank transfer. The establishment authority retains 50% (fifty percent) and pays 50% (fifty percent) of the collected registration fees simultaneously with the application documents for establishing enterprises to the competent authority of the Review Board responsible for reviewing these documents.

8. 3. The competent authority for examining establishment documents and reviewing levels of responsibility transfer the collected registration fees into the state treasury account under their direct management and withdraw for expenditure according to the approved budget at the state treasury.

8. 4. The registration fee is used for organizing research to confirm documents, review, and store all related documents on the establishment and dissolution of state-owned enterprises.

Strictly follow the current financial regulations regarding collection, use, and settlement of registration fees with financial authorities at various levels. At the end of the year, any remaining registration fees are paid into the state budget (item 30 miscellaneous revenue from taxes of the state budget).

The competent authority for reviewing of Ministries, State Planning Commission reports the settlement to the Ministry of Finance.

The competent authority of the Provincial People's Committee, city reports the settlement to the Department of Finance - Price Control.

8. 5. Management of receipts for registration fees according to the regulations of the Ministry of Finance: Use the unified receipt issued by the General Taxation Department of the Ministry of Finance (obtained from the local tax office) and stamp each receipt before collecting money.

9. Vertical sector division (A) and economic-technical sector (B) in Appendix 1 of Circular Joint Ministry No. 01-TT/LB.

9. 1. In principle: a business may choose to operate in many different industries suitable with the strengths and technology of the business and market demands.

9. 2. Industries and trades specified in Appendix 1 and additional ones in this Circular need opinions from vertical sectors or economic-technical sectors according to the levels guided in Article 2 of this Circular and Circular 01-TT/LB.

Ministries not named in this division or named but lacking some operating industries, if central or local affiliated enterprises have sufficient conditions to register for establishment, still proceed with establishment or dissolution procedures as prescribed in Decree 388-HĐBT according to the common code guidance and send to relevant agencies according to Article 1 and Article 2 of this Circular.

9. 3. Supplement some industries and trades in Appendix 1 of Circular Joint Ministry No. 01-TT/LB (Appendix 1a, attached).

10. Re-processing the establishment procedures for state-owned enterprises according to Decree 388-HĐBT must be carried out on the basis of reorganizing and rearranging production in accordance with the spirit of Decision 315-HĐBT. Businesses currently operating smoothly should prepare early establishment procedures to operate according to new state regulations, businesses currently facing difficulties must be corrected and handled specifically, only those with the potential to maintain and develop should reprocess the establishment procedures, avoiding superficial or formal actions or causing inconvenience to each other.

State-owned enterprises directly under state management agencies established pursuant to Decision 268-HĐBT shall proactively register in accordance with the Company Law or the Law on Private Enterprises if they are deemed appropriate under Decree 388-HĐBT. For business units of state management agencies that operate on a revenue-expenditure basis and business units of associations established pursuant to Decision 268-HĐBT, if they do not comply with the aforementioned three regulations, they shall wait for further guidance. The reprocessing of establishment procedures for holding companies and industrial unions: await specific guidance from the Council of Ministers. The above are some specific guidelines according to current state regulations. It is requested that relevant sectors and localities apply them uniformly and promptly reflect any issues requiring clarification.

The reprocessing of establishment procedures for holding companies and industrial unions: await specific guidance from the Council of Ministers.

The above are some specific guidelines according to current state regulations. It is requested that relevant sectors and localities apply them uniformly and promptly reflect any issues requiring clarification.

 

APPENDIX 1A

LIST OF INDUSTRIES AND TRADES UNDER THE MANAGEMENT OF THE MINISTRY OF ECONOMY AND TECHNOLOGY TO ACCEPT APPLICATIONS FOR REGISTRATION AND PROCESSING

(Supplementing Appendix 1 attached to Joint Circular No. 01-TT/LB issued by
the State Planning Commission and the Ministry of Finance on February 13, 1992)

MODEL ANNOUNCEMENT OF AGREEMENT TO ESTABLISH A STATE ENTERPRISE

NOTICE

ISSUED BY THE MINISTER OF...
AGREES TO ESTABLISH A STATE ENTERPRISE

- Based on Decree 196-HĐBT dated December 11, 1989 of the Council of Ministers on the tasks, powers, and responsibilities of state management of ministries;

- Based on the charter for establishing and dissolving state enterprises issued together with Decree 388-HĐBT dated November 20, 1991 and Decree 156-HĐBT dated May 7, 1992 of the Council of Ministers amending and supplementing Decree 388-HĐBT;

- Based on the minutes of the meeting of the State Enterprise Establishment Review Board at the ministry managing the sector number... dated... month... year... considering the application for establishing a state enterprise number... dated... month... year... submitted by the People's Committee of the province/city,

MINISTER OF...

hereby announces:

1. Agree to establish a state enterprise... belonging to the province/city...

Code number...

The enterprise to be established has:

- Main office located at:...

and branch offices, representative offices at...

- Business capital... million dong

+ Fixed assets "

+ Working capital "

According to the sources of capital:

+ State budget capital "

+ Self-supplemented capital "

+ Borrowed capital "

- Main business activities or main products...

- Organized in the form of...

2. Request the Chairman of the Provincial/City People's Committee to issue a decision to establish the state enterprise in accordance with the contents of this announcement.

MINISTER OF...

(Signature and stamp)

Place of Receipt:

- Provincial/City People's Committee

- State Planning Commission

MODEL DECISION TO ESTABLISH A STATE ENTERPRISE

MINISTER OF...

(OR CHAIRMAN OF THE PROVINCIAL/CITY PEOPLE'S COMMITTEE...)

- Based on the charter for establishing and dissolving state enterprises issued together with Decree 388-HĐBT dated November 20, 1991 and Decree 156-HĐBT dated May 7, 1992 of the Council of Ministers;

- Based on the announcement agreeing to establish the state enterprise... number... dated... month... year... issued by...

Pursuant to …;

Article 1. Establish the state enterprise... belonging to... Code number...

Article 2. The enterprise is permitted:

- To locate its headquarters at:

and branch offices, representative offices at:

- Business capital million dong

Where:

+ Fixed assets million dong

+ Working capital million dong

According to the sources of capital:

+ State budget capital million dong

+ Self-supplemented capital million dong

+ Borrowed capital million dong

- Main business activities or main products...

- To organize the enterprise in the form of:

Article 3. The enterprise shall be responsible for completing all procedures to register for business and operate in accordance with the law.

Article 4. This Decision takes effect from the date of signature.

Place of Receipt:

- State Planning Commission

- Ministry of Finance

- Industry management ministry

- Enterprise established by decision

 

Note: This form replaces forms 2 and 3 "Decision on the establishment of state-owned enterprises by the Head of the State Planning Commission" and "Decision on the establishment of state-owned enterprises by the Minister of the managing ministry" (Annexes 4b, 4c attached to Joint Circular No. 01-TT/LB dated February 13, 1992).