Joint Circular No. 07/2016/TTLT-BTP-BTC guiding financial assurance from the state budget for enforcement proceedings

JOINT CIRCULAR

GUIDELINES FOR SECURING FINANCIAL RESOURCES FROM THE STATE BUDGET TO ENFORCE JUDGMENTS

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Pursuant to the State Budget Law No. 01/2002/QH11 dated December 16, 2002;

Pursuant to the Civil Enforcement Act No. 26/2008/QH12 dated November 14, 2008, amended and supplemented by certain articles pursuant to Law No. 64/2014/QH13 dated November 25, 2014;

Pursuant to Decree No. 22/2013/NĐ-CP dated March 13, 2013, of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Justice;

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;

Pursuant to Decree No. 62/2015/NĐ-CP dated July 18, 2015 of the Government detailing and guiding the implementation of certain provisions of the Civil Enforcement Act;

The Minister of Justice and the Minister of Finance issue this Joint Circular to provide guidelines for securing financial resources from the state budget to enforce judgments.

Article 1. Subjects eligible for financial security for enforcement

1. The subjects eligible for financial security from the state budget for enforcement are stipulated in Article 39 of Decree No. 62/2015/NĐ-CP dated July 18, 2015 of the Government detailing and guiding the implementation of certain provisions of the Civil Enforcement Act.

2. In cases where the subjects eligible for financial security from the state budget for enforcement as provided in Clause 1 of this Article undergo merger, consolidation, division, separation, dissolution, or conversion, they shall proceed as follows:

a) In the case of merger or consolidation, the new organization continues to fulfill the enforcement obligations. If the new organization falls within the scope defined in Clause 1 of this Article, the state budget will secure financial resources to fulfill the enforcement obligations.

b) In the case of division or separation, the authority issuing the decision on division or separation must clearly identify the organization that will continue to fulfill the enforcement obligations according to the division or separation decision. If the division or separation decision does not specify the obligations of the new organizations, then after the division or separation, the new organizations have joint liability to fulfill the enforcement obligations of the organization being divided or separated. If the new organizations fall within the scope defined in Clause 1 of this Article, the state budget will secure financial resources to fulfill the enforcement obligations.

c) In the case of dissolution or conversion, the competent authority issuing the dissolution or conversion decision has the responsibility to clearly identify the organization receiving the enforcement obligations. If the rights and obligations of the organization being dissolved or converted are transferred to another organization, the new organization continues to fulfill the enforcement obligations.

Article 2. Conditions for securing financial resources for enforcement

Organizations required to enforce judgments that are eligible for financial security from the state budget for enforcement shall be secured financial resources from the state budget for enforcement after:

1. Having requested the person at fault to fulfill their obligation but that person lacks the ability to fulfill the obligation or has only partially fulfilled it with the amount paid.

2. The organization has utilized the savings from its self-managed funds as prescribed in Decree No. 130/2005/NĐ-CP dated October 17, 2005 of the Government on the system of self-management and self-responsibility for the use of staffing and administrative management expenses for state agencies and Decree No. 117/2013/NĐ-CP dated October 7, 2013 of the Government amending and supplementing certain articles of Decree No. 130/2005/NĐ-CP dated October 17, 2005 of the Government on the system of self-management and self-responsibility for the use of staffing and administrative management expenses for state agencies or state agencies operating under a special financial mechanism, or public service units have utilized the self-managed financial funds as prescribed by the Government or the savings from the annual operational funds as prescribed in Decree No. 84/2014/NĐ-CP dated September 8, 2014 of the Government detailing certain provisions of the Law on Thrift and Anti-Waste, but still lack the ability to enforce the judgment.

The aforementioned savings are determined at the time the entity prepares the application for financial security for enforcement and can only be used to secure the enforcement obligations. From the date the judgment or decision becomes legally effective until the entity required to enforce the judgment submits the application for financial security, the entity may not allocate funds for rewards, welfare, or additional income.

Article 3. Establishment of the Council to Determine the Person at Fault and the Liability for Repayment Caused by the Person at Fault

1. In cases where there is no document from the competent state agency determining the person at fault, within ten days from the date of receiving the enforcement decision, the head of the agency or organization responsible for enforcement shall be responsible for issuing a decision to establish the Council to Determine the Person at Fault and the Liability for Repayment Caused by the Person at Fault.

2. Composition of the Board includes:

a) The Chairman of the Council is the head of the agency or organization responsible for enforcement. In cases where there is evidence that the person at fault causing damage is the head of the agency or organization responsible for enforcement, the Chairman of the Council is the head of the superior management agency of the agency or organization responsible for enforcement;

b) A representative of the trade union of the agency or organization responsible for enforcement;

c) The person directly responsible for the person at fault causing damage;

d) The Chief Accountant or the person responsible for financial and accounting work of the agency or organization responsible for enforcement;

đ) In case of necessity, experts in related fields may be hired. The cost of hiring experts is borne by the Council from the regular budget allocated for implementation.

In cases where there is evidence that multiple persons at fault from different agencies have caused damage together, representatives of the leadership of these agencies must participate in the Council.

Members participating in the Council shall not be the spouse (or husband), paternal grandfather, paternal grandmother, maternal grandfather, maternal grandmother, biological father, adopted father, biological mother, adopted mother (from either the wife's or husband's side), biological child, adopted child, brother, sister, half-brother, half-sister (from either the wife's or husband's side), grandson, granddaughter of the person at fault causing damage. The maximum number of members participating in the Council shall not exceed seven people.

3. The Council has the following tasks and powers:

a) Reviewing and determining the person at fault and the liability for repayment caused by the person at fault;

b) Determining the economic conditions of the person at fault causing damage;

c) Advising the head of the agency or organization responsible for enforcement on the amount and method of repayment.

4. Working methods of the Council:

a) The Council only operates when at least two-thirds (two-thirds) of the total number of Council members are present;

b) The Council operates based on the principle of collective discussion and majority decision-making. During the discussion and decision-making process, Council members must be objective, democratic, and comply with legal regulations;

c) The proposal regarding the amount and method of repayment by the person at fault causing damage is made through secret ballot and according to the principle of majority among the total number of present Council members. In case of equal votes, the amount and method of repayment will be decided by the Chairman of the Council;

d) The results of the Council meeting must be recorded in writing and signed by the Chairman of the Council.

5. Determination of the Amount of Repayment by the Person at Fault Causing Damage

The determination of the amount of repayment is based on reviewing the degree of fault; the amount of money under the responsibility for enforcement; the economic condition of the person causing damage, and according to the following principles:

a) In cases where the person at fault negligently causes damage

If the amount of state budget funds guaranteed for enforcement is less than thirty million dong, the amount of repayment is determined to be a maximum of no more than one month's salary of that person at the time of the repayment decision;

If the amount of state budget funds guaranteed for enforcement is from thirty million dong to less than one hundred million dong, the amount of repayment is determined to be a minimum of one month's salary and a maximum of no more than two months' salary of that person at the time of the repayment decision;

If the amount of state budget funds guaranteed for enforcement exceeds one hundred million dong, the amount of repayment is determined to be a minimum of one month's salary and a maximum of no more than three months' salary of that person at the time of the repayment decision.

b) In cases where the person at fault intentionally causes damage but does not reach the level of being criminally prosecuted

If the amount of state budget funds guaranteed for enforcement is less than one hundred million dong, the amount of repayment is determined to be a minimum of three months' salary and a maximum of no more than twelve months' salary of that person at the time of the repayment decision;

If the amount of state budget funds guaranteed for enforcement is from one hundred million dong to less than five hundred million dong, the amount of repayment is determined to be a minimum of twelve months' salary and a maximum of no more than twenty-four months' salary of that person at the time of the repayment decision;

If the amount of state budget funds guaranteed for enforcement exceeds five hundred million dong, the amount of repayment is determined to be a minimum of twenty-four months' salary and a maximum of no more than thirty-six months' salary of that person at the time of the repayment decision.

c) In cases where it is determined that the person at fault intentionally caused damage and was criminally prosecuted due to the illegal act causing such damage, the full amount of money that the State guaranteed financially for the agency or organization responsible for enforcement must be repaid.

d) The salary of the person responsible for repayment as stipulated in point a and point b of Clause 5 of this Article includes the salary and other allowances (if any) of that person at the time of the repayment decision.

Article 4. Scope of Financial Guarantee for Enforcement

1. The state budget shall provide financial guarantee for enforcement in the following cases:

a) For monetary obligations determined in judgments and decisions, including cash obligations and obligations converted to money if the judgment or decision has already been converted to monetary value.

b) For obligations determined in judgments and decisions that require the transfer of assets but the assets to be transferred have decreased in value or the assets to be transferred no longer exist after the judgment or decision becomes legally effective.

2. In cases where the obligation for enforcement arises from the actions of public officials and has been resolved through the procedures and processes for state compensation, the execution of judgments and decisions of courts with legal effect shall be carried out in accordance with the provisions of the law on state liability for compensation.

Article 5. Determination of Obligations for Enforcement

The obligation for enforcement serves as the basis for calculating the level of financial guarantee for enforcement and is determined as follows:

1. The amount of money and asset transfer obligations as stipulated in Clause 1 of Article 4 of this Circular.

In cases where the value of the asset decreases or the value of the asset when the asset to be transferred no longer exists, the reduced value or the value of the asset to be transferred is determined as follows:

a) The value stated in the appraisal report issued by an organization with appraisal functions, signed by the civil enforcement agency, if the parties cannot agree on payment in kind for similar items or agree on payment in kind at a higher value than the value stated in the appraisal report.

b) The agreed value between the parties if the agreed value is lower than the value determined in the appraisal report issued by an organization with appraisal functions, signed by the civil enforcement agency.

2. In cases where the agency or organization responsible for enforcement must fulfill enforcement obligations towards multiple beneficiaries under one judgment or decision, or must fulfill multiple enforcement obligations under different judgments or decisions, the obligation for enforcement is the total of all enforcement obligations that the agency or organization responsible for enforcement must fulfill.

Article 6. Level of Financial Guarantee for Enforcement

The level of financial guarantee for enforcement, decided by the authorized person, is determined as follows:

a) The level of financial guarantee for enforcement is the remaining part of the enforcement obligation after the agency or organization responsible for enforcement has applied the financial measures prescribed in Article 2 of this Circular to settle the enforcement obligation.

b) In cases where the agency or organization responsible for enforcement is unable to apply the financial measures prescribed in Article 2 of this Circular to fulfill the enforcement obligation, the level of financial guarantee for enforcement is the entire enforcement obligation.

Article 7. Sources of Budget Funds for Financial Guarantee for Enforcement

Agencies and organizations responsible for enforcement that are units under central management shall be guaranteed financial resources for enforcement from the central budget; agencies and organizations responsible for enforcement that are units under local management shall be guaranteed financial resources for enforcement from the local budget according to the current budget decentralization.

Article 8. Procedures for implementing financial guarantees to enforce judgments

1. Within ten days from the date of receipt of the enforcement decision, the agency or organization responsible for enforcing the judgment shall apply the financial measures prescribed in Article 2 of this Circular to settle the enforcement obligations.

Within five working days from the date when the financial measures prescribed in Article 2 of this Circular have been applied but the obligation cannot be fulfilled or only partially fulfilled, the agency or organization responsible for enforcing the judgment shall complete the application file for financial guarantee to enforce the judgment and submit it to the competent authority.

a) For agencies or organizations responsible for enforcing the judgment that are primary budget units (at all levels), the application file for financial guarantee must be submitted to the Ministry of Finance (if it is a central budget unit) for review and allocation of funds to ensure enforcement; or submitted to the same-level finance authority (if it is a local budget unit) for review and submission to the same-level People's Committee for consideration and decision on allocation of funds to ensure enforcement.

b) For agencies or organizations responsible for enforcing the judgment that are not primary budget units, the application file for financial guarantee must be submitted to the immediate superior authority for examination and consolidation, then forwarded to the competent authority for review and allocation of funds to ensure enforcement.

Within seven working days from the date of receipt of the complete file as prescribed, the superior authority is responsible for examining and forwarding the application file for financial guarantee to the primary budget unit for examination and consolidation, then submitting it to the Ministry of Finance for review and allocation of funds to ensure enforcement (if it is a central budget unit) or submitting it to the same-level finance authority for review and submission to the same-level People's Committee for consideration and decision on allocation of funds to ensure enforcement (if it is a local budget unit).

c) For agencies or organizations responsible for enforcing the judgment that are People's Committees at various levels, the same-level finance authority shall cooperate with relevant specialized authorities under the same-level People's Committee to prepare the financial guarantee file for submission to the same-level People's Committee for consideration and decision on allocation of funds to ensure enforcement.

2. The examination and allocation of funds to ensure enforcement shall be carried out as follows:

a) In cases where the agency or organization responsible for enforcing the judgment is a central budget unit, within fifteen days from the date of receipt of the application file for financial guarantee from the agency or organization responsible for enforcing the judgment, the ministries, ministerial-level agencies, and central agencies of political organizations and political-social organizations shall be responsible for submitting the application file for financial guarantee to the Ministry of Finance for review and allocation of funds to ensure enforcement.

b) In cases where the agency or organization responsible for enforcing the judgment is a local budget unit, within fifteen days from the date of receipt of the application file for financial guarantee from the agency or organization responsible for enforcing the judgment, the same-level finance authority shall be responsible for reviewing and submitting it to the same-level People's Committee for consideration and decision on allocation of funds to ensure enforcement.

c) Within fifteen days from the date of receipt of the application file for financial guarantee to enforce the judgment, the Ministry of Finance or the People's Committees at various levels shall be responsible for examining and deciding on the allocation of funds to ensure enforcement.

3. The application file for financial guarantee to enforce the judgment includes:

a) A request for financial guarantee to enforce the judgment from the agency or organization responsible for enforcing the judgment, sent to the competent state authority;

b) The effective judgment or decision of the competent state authority;

c) The enforcement decision;

d) A recommendation document from the Council as prescribed in point c, Clause 3, Article 3 of this Circular regarding the amount and method of repayment by the person at fault causing damage;

đ) A report on the fulfillment of the enforcement obligation by the person at fault causing damage and by the agency or organization responsible for enforcing the judgment using the saved funds;

e) A record of agreement on payment in cash for the obligation to deliver property between the parties. The record must be in writing, signed, and stamped (if applicable) by the parties and confirmed by the Enforcement Officer responsible for enforcement.

The civil enforcement agency is responsible for signing a valuation contract with a valuation organization with the function of valuation no later than five working days from the date the parties fail to agree on payment in cash or from the date the parties agree on payment in cash for the obligation to deliver property according to the judgment or decision. The enforcement agency is responsible for sending the valuation document to the finance authority for review of the financial guarantee file.

Article 9. Payment for Enforcement

Within three working days from the date of receipt of the enforcement guarantee funds, the agencies and organizations responsible for enforcement must proceed with the procedures to pay the enforcement payment to the person entitled to enforcement through the enforcement agency or transfer the financial guarantee amount into the enforcement agency's deposit account for payment to the person entitled to enforcement.

Within thirty days from the date of receipt of the enforcement financial guarantee funds, the agencies and organizations responsible for enforcement shall be responsible for preparing a written report on the situation of paying the enforcement payment to the person entitled to enforcement, to be submitted to the direct superior management agency, and simultaneously sent to the financial agency that provided the enforcement financial guarantee funds.

Article 10. Appraisal Costs

In cases where the subject of enforcement is property, the enforcement agency shall be responsible for signing a contract with an appraisal organization to appraise the enforcement property. The appraisal costs are a special operational expense of the civil enforcement agency and are allocated in the annual budget estimate of the civil enforcement agency.

Article 11. Procedures for Returning Financial Guarantees for Enforcement to the State Budget

1. Within five working days from the date of completion of the payment of the enforcement payment, the Head of the agency or organization responsible for enforcement shall issue a decision on the amount and time limit for repayment based on the proposal of the Council specified in Article 3 of this Circular to recover the repayment amount from the person causing damage to be paid into the state budget.

The amount recovered from the person at fault causing damage must be deposited into the central government budget for agencies and organizations responsible for enforcement managed by the central government, which are guaranteed financially by the central government budget, or deposited into the local government budget for agencies and organizations responsible for enforcement managed by the local government, which are guaranteed financially by the local government budget.

The settlement, collection, and deposit of the recovered amount into the budget shall be carried out according to the current financial management system.

2. In cases where the person at fault causing damage is also the Head of the agency or organization responsible for enforcement, the Head of the direct superior management agency of the agency or organization responsible for enforcement shall issue a decision on the amount and time limit for repayment into the state budget.

3. The repayment decision must clearly specify the repayment amount, repayment period, the portion already enforced according to Clause 1, Article 2 of this Circular, and the portion still required to be repaid. The repayment decision must be sent to the person at fault causing damage and related parties for implementation. In cases where there is a request for exemption or reduction of the repayment amount, the Head of the agency or organization responsible for enforcement shall be responsible for reviewing and deciding within their authority. The decision on exemption or reduction of the repayment amount must specify the legal basis and reasons for resolution.

4. In cases where the person required to repay does not agree with the repayment amount or refuses to repay, they have the right to appeal or initiate litigation against the repayment decision in accordance with the laws on appeals and complaints and the laws on administrative litigation procedures.

Article 12. Implementation of repayment

1. Repayment may be carried out once or multiple times.

2. In case repayment is carried out once, within ten days from the date on which the Repayment Decision becomes effective, the person responsible for repayment must pay the full amount determined in the Repayment Decision.

3. In case repayment is carried out multiple times, the person responsible for repayment shall make payments according to the amounts and deadlines specified in the Repayment Decision.

4. In cases where repayment is made by gradually deducting from the monthly salary of the person causing damage, the minimum rate shall not be less than 10% and the maximum rate shall not exceed 30% of the monthly income from salary.

Article 13. Responsibilities of agencies and organizations regarding repayment by persons causing damage in certain specific cases

1. In cases where the person responsible for repayment has ceased employment, retired, or transferred to another agency or organization, the agency or organization responsible for enforcement shall coordinate with local authorities and the agency or organization managing the income of that person to recover the repayment amount according to the effective Repayment Decision issued by the agency or organization responsible for enforcement.

2. In cases where the person responsible for repayment dies after the Repayment Decision is issued and that person leaves behind inheritable property and heirs, the heirs must fulfill the repayment obligation according to the provisions of the inheritance law; if the person responsible for repayment dies without leaving any inheritable property, the agency or organization responsible for enforcement shall verify this fact, document it, and obtain confirmation from the local authority where the person resided while alive that the person left no inheritable property. Immediately upon completion of the verification process, the agency or organization responsible for enforcement shall issue a decision exempting the person from the repayment responsibility. Within three working days from the date of issuing the exemption decision, the agency or organization responsible for enforcement shall report in writing and send the exemption decision along with the report to the immediate superior agency and the competent financial authority.

In cases where the person responsible for repayment dies before the Repayment Decision is issued, the agency or organization responsible for enforcement shall not consider the repayment responsibility of that person.

3. In cases where the agency or organization responsible for enforcement has taken necessary measures as prescribed by law but still fails to recover the repayment amount, the agency or organization responsible for enforcement has the right to initiate legal proceedings against the person causing damage to fulfill the repayment obligation according to the civil procedure law at the court.

Article 14. Preparation of budget estimates and final accounts for financial guarantees to enforce judgments

1. Annually, based on the actual financial guarantee situation for enforcing judgments in the previous year, central ministries and sectors; local specialized agencies shall cooperate with the same-level financial agencies to prepare budget estimates for funding to ensure enforcement of judgments to be included in their own budget estimates and the state budget, and submit them to the competent authority for approval according to the state budget law.

2. The state budget estimate for financial guarantees to enforce judgments can only be used when there is a need to allocate funds for payment to enforce judgments, and shall not be allocated to agencies and organizations responsible for enforcing judgments.

3. At the end of the fiscal year, agencies and organizations responsible for enforcement shall be responsible for settling the budget funds guaranteed by the state budget for enforcing judgments according to the state budget law.

Article 15. Effective Date

1. This Circular takes effect from July 25, 2016.

2. This Joint Circular replaces Circular Joint No. 04/2009/TTLT-BTP-BTC dated October 15, 2009, issued by the Ministry of Justice and the Ministry of Finance, guiding financial guarantees from the state budget to enforce judgments.

3. In cases where agencies and organizations responsible for enforcement have prepared financial guarantee files from the state budget to enforce judgments before the effective date of this Circular, they shall continue to apply Circular Joint No. 04/2009/TTLT-BTP-BTC dated October 15, 2009, issued by the Ministry of Justice and the Ministry of Finance.

4. During implementation, if difficulties arise, agencies, organizations, and individuals are requested to promptly reflect these issues to the Ministry of Justice and the Ministry of Finance for joint research and resolution./.