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

CIRCULAR

OF THE JOINT MINISTRY OF PLANNING AND INVESTMENT - MINISTRY OF FINANCE
NUMBER 04-TT/LB DATE JUNE 11, 1992 GUIDING SUPPLEMENTARY IMPLEMENTATION
OF THE REGULATIONS ON ESTABLISHMENT AND DISSOLUTION
STATE ENTERPRISES

(Annexed to Decree 388-HĐBT dated November 20, 1991 and Decree 156-HĐBT amending and supplementing Decree 388-HĐBT of the Council of Ministers)
Pursuant to Decree 156-HĐBT dated May 7, 1992 on amending and supplementing Decree 388-HĐBT promulgating regulations on establishment and dissolution of state-owned enterprises of the Council of Ministers;

Following Circular No. 01-TT/LB dated February 13, 1992 of the Ministry of Planning and Investment and the Ministry of Finance guiding implementation of the regulations on establishment and dissolution of state-owned enterprises;

At the proposal of relevant sectors and localities, the Ministry of Planning and Investment and the Ministry of Finance guide the supplementation of the following points:

1. The authority for examination and decision-making on the establishment and dissolution of state-owned enterprises

: Implement Article 1 of Decree 156-HĐBT amending Article 6 of Decree 388-HĐBT.1.1. Enterprises established by the Chairman of the Council of Ministers signing the decision: The Director of the Ministry of Planning and Investment shall be responsible for examination and recommendation.

1.2. Enterprises directly under central ministries and sectors: The Director of the Ministry of Planning and Investment shall be responsible for examination and proposing to the Chairman of the Council of Ministers. The Minister managing the sector shall sign the decision to establish enterprises directly under the ministry after receiving a written agreement from the Chairman of the Council of Ministers.

1.3. Enterprises directly under localities (including enterprises directly under provinces and cities and districts if any): The Minister managing the economic and technical sector shall be responsible for examination and issuing a written notification of agreement for the Chairman of the People's Committee of the province or centrally-administered city to sign the decision to establish the enterprise.

1.4. In this context, the economic and technical management sector refers to the vertical sectoral management ministry. For example, all enterprises under the Construction Department, including mechanical enterprises producing construction machinery, should submit their files to the Ministry of Construction. Enterprises under the Industry Department should submit their files to the appropriate ministry such as the Ministry of Heavy Industry, the Ministry of Light Industry...

2. Written opinions

of the economic and technical management sector or of the provincial People's Committee (as per Article 5.5 of Decree 388-HĐBT). 2.1. Enterprises that existed before Decree 388-HĐBT and now being re-established:

a. All files from the provincial or municipal People's Committee as the founding body shall be sent to the vertical sectoral management ministry. The vertical sectoral management ministry shall examine and issue written opinions to the Director of the Ministry of Planning and Investment regarding enterprises established by the Chairman of the Council of Ministers, while the vertical sectoral management ministry shall organize examinations of enterprises established by the Chairman of the provincial or municipal 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 submitted 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, the most important industry (or with the highest sales volume, or with longer tradition and greater potential for development) shall serve as the basis for submitting files to the relevant ministry or sectoral management ministry.

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 transferred to the Ministry of Heavy Industry...

d. Confirmation opinions of the provincial or municipal People's Committee on infrastructure and environment for central enterprises: The local agency responsible for implementing Decree 388-HĐBT shall organize reviews and directly confirm each case of enterprises currently facing issues with planning and environment when a related agency requests a recheck. Enterprises previously approved by relevant agencies during the economic and technical feasibility study and continue operating normally do not need to obtain new confirmation opinions to reduce unnecessary procedures.

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

3. Number of files for re-established enterprises

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

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

- Report on the operation process of the enterprise.

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

- Declaration of sources of capital ensuring normal operations according to the 1992 business plan, confirmed by the relevant ministry or department (original).

- 1992 plan and directions for the 1993-1995 plans (with Appendix 5 of Joint Circular No. 01-TT/LB attached).

To ensure uniform archiving of state-owned enterprise files, ministries shall submit one set of files of state-owned enterprises directly under localities they have examined to the Ministry of Planning and Investment.

4. The date for determining the total business capital

of the enterprise 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 contributes part of its capital to joint ventures with other economic units: Implement according to Decree 388-HĐBT on procedures for establishment and management of capital. The original capital and the contributed capital for joint ventures 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 accounted for together within the total capital of the business, it shall be applied according to the Law on Enterprises or the Law on Foreign Investment in Vietnam.

- If the joint venture accounts separately for a portion: implement according to Decree 388-HĐBT as in the case of contributing part of the capital to a joint venture outside.

5.3. Units established from the contributions of state-owned enterprises: if they operate independently, they shall implement according to Decree 388-HĐBT.

6. Statutory Capital Level: is the current capital belonging to the budgetary allocation, considered as budgetary allocation and self-supplemented capital, including both fixed capital and working capital of state-owned enterprises. The State Enterprise Evaluation Council compares with the provisions 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 memorandum of capital transfer: In cases where the business has not yet transferred capital, 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 one new business, consolidate the capital sources of all the 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 them:

- Budgetary capital, including budgetary capital and treated as budgetary capital; calculation methods 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 entity subject to payment of the registration fee is state-owned enterprises specified in Point 1 of Circular Joint Ministry No. 01-TT/LB, the registration fee payment is recorded as production and business expenses.

8.2. Businesses directly pay the registration fee along with the application documents to the competent authority for examination of the establishment procedure in cash or by bank transfer. The establishment authority retains 50% (fifty percent) and pays 50% (fifty percent) of the collected registration fee simultaneously with the application documents for establishing businesses to the competent authority of the State Enterprise Evaluation Council responsible for examining these documents.

8.3. The competent authority for examining establishment application documents and the responsible levels for transferring the collected registration fees into the national treasury account under their direct management and withdraw for expenditure according to the approved budget at the national treasury.

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

Strictly follow the current financial system regulations on collection, use of registration fees, and settlement with financial authorities at various levels. At year-end, any remaining registration fees are paid into the State Budget (item 30 other tax revenues of the State Budget).

The competent authority for evaluation of the Ministry, National 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 revenue receipts for registration fees according to the regulations of the Ministry of Finance: Use the unified receipt issued by the General Tax Administration of the Ministry of Finance (obtained from the local Tax Bureau) 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 engage in multiple different industries suitable for the strengths and technology of the business and market demands.

9.2. Industries specified in Appendix 1 and additional industries in this Circular need opinions from vertical sectors or economic-technical sectors according to the level guided in Article 2 of this Circular and Circular 01-TT/1B.

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 submit to relevant agencies as provided in Articles 1 and 2 of this Circular.

9.3. Supplement some industries 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 the establishment procedures to operate according to the new regulations of the State, businesses facing difficulties must be adjusted and handled specifically, if they have the potential to maintain and develop, then reprocess the establishment procedures, avoid superficial or formal processing or causing inconvenience to each other.

State-owned enterprises 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 dependent accounting basis and whose revenues cover expenditures, and for business units of associations established pursuant to Decision 268-HĐBT, if they do not comply with the aforementioned three regulations, they shall await further guidance.

The procedures for re-establishing general companies and industrial unions shall 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 further clarification.

Appendix 1a

LIST

INDUSTRIES AND TRADES TO BE HANDLED BY THE MINISTRY OF ECONOMY AND TECHNOLOGY

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

MODEL ANNOUNCEMENT OF AGREEMENT TO ISSUE DECISION
TO ESTABLISH A STATE ENTERPRISE

NOTICE

OF THE MINISTER OF...
AGREE TO ESTABLISH A STATE ENTERPRISE

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

- Pursuant to 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;

- Pursuant to 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 establishment of 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 the 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 the 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...)

- Pursuant to 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;

- Pursuant to the announcement agreeing to establish the state enterprise... number... dated... month... year... of...

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...

- Organized in the form of:

Article 3. The enterprise must complete all necessary 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

- The enterprise is established by decision

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