Joint Circular No. 06TT/LB Circular guiding the planning, allocation, management, and settlement of funds for forest fire prevention and extinguishing work.

JOINT CIRCULAR

||| OF THE GOVERNMENT PRICING BOARD AND THE MINISTRY OF CONSTRUCTION NO. 06/TT-LB, DECEMBER 20, 1996 ON THE PRICE MANAGEMENT MECHANISM FOR CEMENT

Pursuant to Article 2, Article 4 of Decision 137/HĐBT dated April 27, 1992 of the Council of Ministers (now the Government) on price management.
Pursuant to Decree No. 02/CP dated January 5, 1995 of the Government stipulating goods subject to conditional business operations.
Pursuant to Decree No. 25/CP dated April 25, 1996 of the Government promulgating the Resale Agency Regulations.
To implement the goal of stabilizing cement prices in the national market and to be consistent with the production and consumption situation of cement in the coming period, the Joint Board of the Government Pricing Board and the Ministry of Construction hereby issues the price management mechanism for cement as follows:

A. THE PRICE MANAGEMENT MECHANISM AND AUTHORITY TO SET CEMENT PRICES

I. REFERENCE RETAIL PRICE FOR BAGGED PC 30 CEMENT IN THE MAIN MARKET:

1. The reference retail price for bagged PC 30 cement according to standard TCVN 2682-1992 (hereinafter referred to as the reference retail price for cement) in the main market shall be set by the Government Pricing Board based on the pricing proposal submitted by Vietnam Cement Corporation and the consensus opinion of the Ministry of Construction. 2. The main market shall be defined by the Joint Board of the Government Pricing Board and the Ministry of Construction in accordance with the requirements of cement price management during each period. For the time being, the main market includes Hanoi, Ho Chi Minh City, Da Nang, and Can Tho.

3. All organizations producing and trading in bagged PC 30 cement according to standard TCVN 2682-1992 (including imported cement) from all economic sectors at central and local levels, including joint ventures, operating in the main market in Vietnam must comply with the control of the reference retail price for cement in the main market.

4. When factors forming the reference retail price for cement increase, or due to significant fluctuations in cement consumption prices in the market leading to supply not meeting demand, resulting in the need to adjust the retail price of cement beyond the issued reference retail price by more than 10%, then Vietnam Cement Corporation will develop a new reference retail price proposal, submit it to the Government Pricing Board and the Ministry of Construction for consideration and decision.

Within ten days from the date of receipt of the complete new reference retail price proposal from Vietnam Cement Corporation, if the Government Pricing Board does not decide on the reference retail price, then Vietnam Cement Corporation has the right to determine the price according to the proposed plan.

II. RETAIL AND WHOLESALE PRICES FOR DIFFERENT TYPES OF CEMENT BY CEMENT TRADING ORGANIZATIONS.

1. Retail prices for different types of cement:

1.1. Retail prices for different types of cement in the main market:

- The retail price for bagged PC 30 cement in the main market shall be determined by Vietnam Cement Corporation or other cement trading companies (outside Vietnam Cement Corporation, including joint ventures) in accordance with seasonal market conditions (rainy season, construction season). This price may be equal to, lower than, or higher than the reference retail price set by the Government Pricing Board but should not exceed 10% above the reference retail price.

- The retail price for other types of cement (excluding bagged PC 30 cement) shall be determined by Vietnam Cement Corporation or other cement trading companies based on the aforementioned reference retail price and in line with quality and consumer preferences.

1.2. Retail prices for different types of cement in other markets:

The retail price for different types of cement in other markets (excluding the main market) shall be determined by Vietnam Cement Corporation or other cement manufacturing and trading companies, but initially during the transition period of the price management mechanism, it is necessary to ensure that cement prices in remote areas, mountainous regions, and ethnic minority areas do not differ significantly from current prices.

1.3. Retail prices for cement must be posted at stores and sold at the posted price.

2. Wholesale prices for cement:

2.1. For cement produced and imported by Vietnam Cement Corporation:

The wholesale price for cement at factories or major delivery points in provinces and cities shall be set by Vietnam Cement Corporation within a price range or specific price level. In cases where a wholesale price range is established, Vietnam Cement Corporation will guide member cement companies to set specific prices.

2.2. For cement not produced or imported by Vietnam Cement Corporation (cement from joint ventures, local cement, and cement from other industries), the wholesale price at factories or ports (for imported cement) shall be set by these cement manufacturing and trading companies.

2.3. The wholesale prices for cement specified in Points II.2.1 and II.2.2 above shall apply uniformly to all customers with signed purchase contracts in accordance with the provisions of the Civil Code regarding economic contracts.

B. TASKS AND MEASURES TO STABILIZE CEMENT PRICES

I. SPECIFIC PROVISIONS ON THE TASKS OF STABILIZING CEMENT PRICES FOR MINISTRIES, SECTORS, AND LOCALITIES.

1. Ministry of Construction:

1.1. Guide and inspect cement companies in implementing the development planning of the industry, ensuring cement quality according to standards, and maximizing the capacity of factories to meet market demand for cement.

1.2. Participate with relevant agencies in forecasting annual cement consumption nationwide and in each region to balance supply and demand and arrange cement production plans for enterprises under their management.

1.3. Direct Vietnam Cement Corporation and other cement production and trading facilities under their management to import clinker, raw cement, or bagged cement only after fully utilizing domestic production capacity.

1.4. Annually, based on the balance of cement supply and demand, and after reaching agreement with the Government Pricing Board and the Ministry of Construction, specify the quantity of cement needed for storage in each period and the financial mechanism for stored cement to be reported to the Government for assignment to Vietnam Cement Corporation to implement.

2. Government Pricing Board:

2.1. Annually, the Government Pricing Board reviews the number of main markets and the retail price floor for cement in these main markets. If necessary, it will coordinate with the Ministry of Construction to adjust the reference retail price and the number of main markets to align with market conditions and state price management requirements.

2.2. Monitor market conditions and cement prices, and propose specific measures to implement the task of stabilizing cement prices in the market.

3. Provincial People's Committees.

3.1. Direct relevant functional sectors of the province/city in managing the cement market locally.

3.2. Bear primary responsibility for balancing supply and demand of cement within their province/city, taking proactive measures to stabilize cement prices within their province/city.

3.3. Create favorable conditions for cement enterprises to expand their business networks under the form of General Agencies and Agents within their province/city.

II. FOR CEMENT PRODUCTION AND BUSINESS UNITS.

1. Vietnam Cement Corporation.

1.1. As the leading state enterprise, it has the duty to invest in production development, ensuring large-scale balance for the state to meet the majority of cement demand on the market and to reserve a certain amount of cement as assigned by the Government.

1.2. Continue to consolidate and expand the cement sales system through the General Agency, Agent, Branch, and Store model under the Corporation, meeting the majority of cement demand on the market. Coordinate with other cement trading units (joint ventures, vertical cement kilns of various industries and localities...) to improve the national cement trading system.

1.3. Issue regulations on cement trading management, inspect and control General Agencies and Agents selling cement under the Corporation in accordance with the provisions of Decree 25/CP dated April 25, 1996 of the Government.

1.4. Direct member companies and the network of General Agencies under the Corporation to implement cement reserves in production and circulation stages according to state regulations. Develop a mechanism for managing and using reserved cement, submit it to the Ministry of Construction for approval and direct its implementation.

1.5. Guide and direct member companies producing and trading cement, General Agencies, Agents, Branches, and Stores under the Corporation to strictly adhere to the cement price management principles stipulated by the Inter-Ministerial Committee.

1.6. Closely monitor the supply-demand situation and price fluctuations of cement on the national market within their authority to handle them promptly. In cases exceeding their authority, report to the Inter-Ministerial Committee and the Government for handling, aiming to stabilize the cement market.

2. Local cement trading companies and those from other industries (including joint ventures).

2.1. Coordinate with Vietnam Cement Corporation and other cement production-trading enterprises to balance cement supply and demand during each period for the industry and locality.

2.2. Import cement according to the quantity, location, and schedule specified in the import permit.

2.3. Expand the cement trading network to sell cement to consumers conveniently and safely.

3. General Agencies and Agents:

3.1. Adhere to the trading rules issued together with Decree No. 25/CP dated April 25, 1996 of the Government.

3.2. Enjoy commission as prescribed currently, consistent with the agency form recorded in the contract.

3.3. General Agencies and Agents must grasp cement market demand, propose to Vietnam Cement Corporation (for affiliated enterprises) or other cement companies (for non-Corporation affiliated enterprises) to timely balance cement to stabilize cement prices on the market.

III. IMPLEMENTATION:

1. The Government Price Management Board, in collaboration with the Ministry of Construction, shall organize regular or spot checks on the implementation of cement price management mechanisms by cement production and trading organizations nationwide as stipulated in this Circular.

2. The Department of Finance and Price Management, Ho Chi Minh City Price Management Board, in collaboration with the Construction Departments and relevant agencies of provinces and cities, shall regularly or spot-check all cement production and trading units within their jurisdiction regarding compliance with local cement price management mechanisms, identify violations, and handle them within their authority or report to competent state authorities for handling.

3. Vietnam Cement Corporation is responsible for checking the cement selling prices of units under its General Agency, Agent, Branch, and Store network in various regions, promptly identifying and handling violations within its authority or reporting to competent state authorities for handling.

4. All organizations and individuals engaged in cement production and trading throughout the territory of Vietnam must strictly comply with the cement price management mechanisms stipulated in this Circular; at the same time, they have the responsibility to provide complete information required for cement selling price inspection and supervision work.

5. Decisions on wholesale cement prices by all central, local, joint venture units, and retail prices in major markets must be reported to the Government Price Management Board and the Ministry of Construction for monitoring and guidance.

This Circular takes effect from the date of signing and replaces Circular No. 08/TTLB dated September 17, 1993.

During the implementation of this Circular, if there are any difficulties, relevant sectors and levels should promptly reflect them to the Inter-Ministerial Committee: Government Price Management Board - Ministry of Construction for review and appropriate supplementation and amendment.