Circular No. 100/2003/TT-BTC guides the management, allocation, payment, and settlement of investment capital from government bonds.

CIRCULAR

Guidelines for managing, allocating, settling, and finalizing investment capital from government bond issuance
from the government bond source
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Pursuant to the State Budget Law No. 01/2002/QH11 dated December 16, 2002;

Pursuant to Decree No. 52/1999/NĐ-CP dated July 8, 1999 of the Government on the issuance of the Investment Management and Construction Regulation, Decree No. 12/2000/NĐ-CP dated May 5, 2000, and Decree No. 07/2003/NĐ-CP dated January 30, 2003 of the Government amending and supplementing certain provisions of the Investment Management and Construction Regulation;

WHEREAS, pursuant to Decision No. 182/2003/QD-TTg dated September 5, 2003 of the Prime Minister on the issuance of government bonds for investment in important transportation and irrigation works of the country;

The Ministry of Finance hereby issues guidelines for managing, allocating, settling, and finalizing investment capital from government bond issuance as follows:

1. All investment projects funded by government bond issuance must be managed in accordance with the Investment Management and Construction Regulation issued together with Decree No. 52/1999/NĐ-CP dated July 8, 1999 of the Government, and amended and supplemented by Decree No. 12/2000/NĐ-CP dated May 5, 2000, and Decree No. 07/2003/NĐ-CP dated January 30, 2003 of the Government; the management, allocation, settlement, and finalization of investment capital shall be carried out in accordance with Circulars No. 44/2003/TT-BTC dated May 15, 2003, and No. 45/2003/TT-BTC dated May 15, 2003 of the Ministry of Finance.

2. Due to the specific nature of the capital source, the Ministry of Finance provides guidance on certain aspects of managing, allocating, settling, and finalizing investment capital from government bond issuance as follows:

2.1 Regarding investment objectives:

Investment capital from government bonds shall only be allocated to investment projects funded by government bond issuance during the period 2003-2010 as specified in Decision No. 182/2003/QĐ-TTg dated September 5, 2003 of the Prime Minister, and shall not be used for projects outside this list decided by the Prime Minister.

2.2 Regarding capital utilization:

- Allocation of investment capital from government bonds to projects shall be based on the ability to raise funds and the progress of project implementation.

- Projects that can exceed their planned capital due to accelerated progress may be advanced with next year's plan capital; if the project does not complete its planned capital by the end of the year, it will continue in the following year until the project is completed.

2.3 Regarding planning and adjusting the investment capital plan:

- Annual capital planning shall be conducted according to regulations on state budget preparation but separately for projects funded by government bonds. Based on the investment progress determined in the investment decision and the actual implementation of projects, ministries and provincial people's committees responsible for managing projects shall prepare annual capital investment plans (divided by quarter) for each project, submit them to the Ministry of Finance and the Ministry of Planning and Investment. (See Form 01/KH-TPCP attached).

- The Ministry of Finance shall review the investment procedures and construction capabilities of each project in the plan, notify the State Treasury Central Office of the payment plan for each project (for centrally-managed projects); or notify the Provincial Department of Finance (for locally-managed projects), the Provincial Department of Finance shall notify the State Treasury of the payment plan for each project; simultaneously send to the Ministry or the provincial people's committee for coordination in management.

- During the annual plan, if the implementation progress and actual capital settlement needs of projects differ from the initial plan, ministries and provincial people's committees need to prepare adjusted and supplementary capital investment plans, submit them to the Ministry of Finance and the Ministry of Planning and Investment for the Ministry of Finance to proactively manage the bond issuance capital and payment plan. The time for adjusting the investment capital plan is in August each year.

2.4 For projects currently being invested with state budget capital now being funded by government bond capital, the government bond capital will be arranged for continued investment, not to settle the previously allocated state budget capital for the project.

2.5 Projects that have been advanced state budget capital shall be allocated government bond capital to repay the advance. The repayment amount will be included in the annual investment capital plan from government bond sources and recovered by deducting directly from the project's capital payment plan.

2.6 Projects currently being invested with state credit capital now switching to government bond capital funding shall continue to disburse state credit capital according to the plan and terminate the credit contract by October 31, 2003. These projects will be allocated government bond capital for continued investment and to repay the state credit capital borrowed (including principal and interest according to the signed credit contract).

The State Treasury shall allocate capital to the project for debt repayment as follows:

- Based on the investor's proposal and debt repayment settlement documents (including the credit contract, promissory note, and loan repayment notice from the lending organization), the State Treasury shall verify and allocate capital to the project while transferring the repayment funds directly to the Development Support Fund.

- The State Treasury shall only verify the legality and validity of the debt repayment settlement documents and the amount of each repayment, without controlling the value of completed construction works, which is the responsibility of the Development Support Fund.

- If the capital source permits, the investor may repay the loan earlier than the repayment deadline stipulated in the credit contract signed with the Development Support Fund.

2.7 Regarding accounting and finalizing capital:

- Based on the capital settlement plan and the progress of projects, the Ministry of Finance shall transfer capital from government bonds to the State Treasury Central Office (for projects managed by central ministries and sectors) or return to the Provincial Department of Finance and Price Control (for projects managed by localities), the Provincial Department of Finance and Price Control shall transfer capital to the State Treasury of provinces and centrally-administered cities for project settlement.

- Project investors shall annually finalize investment capital according to the current system for state budget-funded investment capital but separately for government bond capital.

- Ministries and provincial people's committees responsible for managing and implementing investment projects funded by government bond capital shall consolidate and finalize reports from project investors, separately finalizing government bond investment capital with the Ministry of Finance (not combined with state budget capital).

- The State Treasury organizes accounting and monitoring of the Government bond capital separately, settling accounts annually with the Finance Department in accordance with regulations. For projects managed by localities, the provincial State Treasuries settle accounts with the Provincial Departments of Finance and Prices, which then settle accounts with the Ministry of Finance for this capital source (without settling it into the local budget).

- The settlement of investment capital for completed investment projects shall be carried out in accordance with the current regulations on the settlement system for investment capital for projects funded by state budget capital.

2.8 On reporting, management, and inspection systems:

- Establishing files for monitoring:

+ The project sponsors, ministries, and provinces managing projects shall establish and complete all project files to serve the purpose of monitoring implementation, reporting, inspecting, and settling investment capital for completed projects.

+ Files shall be established separately for each component project, compiled according to clusters or groups of projects, or according to the overall project (in accordance with the list set forth in Decision No. 182/2003/QĐ-TTg dated September 5, 2003 of the Prime Minister). The file contents include all issues related to the project from its commencement and are regularly and fully updated according to the progress of the project.

+ Ministries and provinces managing projects shall submit a complete set of files to the Ministry of Finance and the Ministry of Planning and Investment.

- Regular reporting system:

+ For project sponsors: on the 5th day of each month, sponsors of projects funded by Government bonds shall report on the implementation of the investment plan, the payment plan for the previous month, comments, evaluations, and recommendations to the ministry or provincial People's Committee managing the project, the State Treasury, and the finance department at the same level. (According to Form No. 02/BC-TPCP attached).

+ For ministries and provincial People's Committees managing projects: on the 10th day of the first month of each quarter, ministries and provincial People's Committees shall report on the implementation of the investment plan and the payment plan for the previous quarter for the projects under their management, submitting these reports to the Ministry of Finance and the Ministry of Planning and Investment. Reports for the fourth quarter shall be replaced by annual reports submitted on January 15 of the following year. (According to Form No. 03/BC-TPCP attached).

+ The central State Treasury shall report to the Ministry of Finance in accordance with the regulations on the reporting system for investment capital.

+ The Ministry of Finance and the Ministry of Planning and Investment shall compile and report to the Prime Minister in accordance with regulations.

- Inspection system: Ministries, provincial People's Committees managing projects, the Ministry of Finance, and the Ministry of Planning and Investment shall conduct regular or spot inspections of projects regarding the implementation of investment plans, the use of capital, and compliance with national financial policies and systems for development investment.

- Ministries, provincial People's Committees, and sponsors entrusted with the management and implementation of projects funded by Government bonds shall strengthen management and inspection work on the progress, volume, quality of works, use of capital, and shall not use this capital for tasks or projects outside the approved project list, avoiding overruns in project investment budgets and wastefulness, loss, and corruption.

3. This Circular takes effect fifteen days after its publication in the Official Gazette. Relevant agencies, organizations, sponsors, and related departments are responsible for implementing this Circular./.