Circular No. 101/2006/TT-BTC guides the administrative penalties and compensation for damages in the practice of thrift and waste prevention.

 

CIRCULAR

Guidelines on administrative penalties and compensation for damages

in the implementation of thrift and the prevention of waste

                                      

Pursuant to Decree No. 77/2003/NĐ-CP dated July 1, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 84/2006/NĐ-CP dated August 18, 2006 of the Government stipulating compensation for damages, disciplinary measures, and administrative penalties in the implementation of thrift and the prevention of waste;

The Ministry of Finance hereby provides detailed guidelines on certain aspects of administrative penalties and compensation for damages applicable to subjects subject to administrative penalties in the implementation of thrift and the prevention of waste as follows:

I. GENERAL PROVISIONS

1. Scope of regulation and applicable subjects:

a) Scope of Regulation

This Circular applies to administrative violations in the implementation of thrift and the prevention of waste as prescribed in Decree No. 84/2006/NĐ-CP dated August 18, 2006 stipulating compensation for damages, disciplinary measures, and administrative penalties in the implementation of thrift and the prevention of waste (hereinafter referred to as Decree No. 84/2006/NĐ-CP).

b) Applicability

Organizations, entities, and individuals who intentionally or negligently violate laws on the implementation of thrift and the prevention of waste but not to the extent of criminal prosecution shall be subject to administrative penalties as prescribed in Decree No. 84/2006/NĐ-CP and guided by this Circular.

2. Cases Not Subject to Administrative Penalties in the Implementation of Thrift and the Prevention of Waste:

a) Civil servants, public officials, and employees who violate laws on the implementation of thrift and the prevention of waste while performing their duties causing waste must compensate for damages and be disciplined according to the Circular of the Ministry of Finance guiding compensation for damages and disciplinary measures against civil servants, public officials, and employees who violate laws on the implementation of thrift and the prevention of waste.

Workers employed under contracts in state agencies and organizations who violate laws on the implementation of thrift and the prevention of waste while performing their tasks and responsibilities under the contract causing waste must compensate for damages and be disciplined according to the Labor Contract.

b) The time limit for imposing penalties has expired as prescribed in Clause 1, Article 25 of Decree No. 84/2006/NĐ-CP.

c) Violations have signs indicating the formation of a crime.

d) The act of violation has been penalized according to the provisions of laws on administrative penalties in other fields.

3. Fines collected from administrative penalties in the implementation of thrift and the prevention of waste must be deposited into the State budget through accounts opened at the National Treasury. Management and utilization of fine receipts and payment of fines shall be carried out in accordance with Decree No. 124/2005/NĐ-CP dated October 6, 2005 of the Government on fine receipts and management and utilization of payments for administrative penalties and guiding documents.

II. ADMINISTRATIVE PENALTIES

1. Principles for Determining Authority to Impose Penalties

a) When administrative violations fall within the authority to impose penalties of multiple persons, the person who first takes charge of the case shall impose the penalty.

b) In cases where one of the forms of penalty or measures to remedy consequences does not fall within the authority or exceeds the authority, the person handling the violation case must promptly transfer the case to the person with the authority to impose penalties.

c) If the violation has signs indicating the formation of a crime, the person with the authority to impose administrative penalties shall prepare a file and transfer it to the competent authority for investigation and resolution in accordance with the law.

2. Application of Forms of Penalty

a) The person issuing the penalty decision must base the decision on the nature and degree of the violation, the background of the violator, and mitigating or aggravating circumstances to determine an appropriate form of penalty.

Only one of the two main forms of penalty, warning or fine, may be applied to a single violation.

b) The application of fine amounts, including when applying mitigating or aggravating circumstances, must not be lower than or exceed the prescribed fine range. Specific fine amounts are determined by the authority imposing penalties based on the fine range prescribed in Decree No. 84/2006/NĐ-CP.

3. Authority to Impose Penalties, Procedures for Imposing Penalties, Enforcement, and Compulsory Enforcement of Penalty Decisions

a) The authority to impose penalties is implemented in accordance with Article 33 of Decree No. 84/2006/NĐ-CP. In cases where the violation is penalized according to laws on administrative penalties in other fields, the authority to impose penalties is determined according to the provisions on administrative penalties in those fields.

b) Procedures for imposing administrative penalties and enforcing penalty decisions are implemented in accordance with the Law on Handling Administrative Violations and Decree No. 134/2003/NĐ-CP dated November 14, 2003 of the Government detailing the implementation of certain provisions of the Law on Handling Administrative Violations.

c) Compulsory enforcement procedures and the application of compulsory measures to enforce penalty decisions are implemented in accordance with Article 66 and Article 67 of the Law on Handling Administrative Violations and Decree No. 37/2005/NĐ-CP dated March 18, 2005 of the Government on procedures for applying compulsory measures to enforce administrative penalty decisions.

4. Acts of Violation

Some acts of violation prescribed in Section 2, Chapter III of Decree No. 84/2006/NĐ-CP are specifically guided as follows:

a) Violations concerning the management and use of transportation means, work equipment, and electricity and water usage causing waste as stipulated in Clause 1, Article 28 of Decree No. 84/2006/NĐ-CP include:

- Failure to establish internal regulations on the management and use of transportation means and fuel in accordance with regulations on thrift;

- Failure to establish internal regulations on the management and use of work equipment and electricity and water to implement thrift and prevent waste;

- Failure to assign personnel to manage and use and maintain records for tracking the management of various types of transportation means and work equipment;

- Using transportation means and work equipment for purposes other than intended; using them for personal matters contrary to established regulations;

- Repairing, replacing means of transportation beyond the prescribed norms, standards, regulations; not in accordance with technical standards set by competent authorities;

- Not conducting reviews and transferring means of transportation from surplus to shortage areas as required; not implementing the liquidation of replaced means of transportation;

- Not submitting proceeds from the liquidation of means of transportation and working equipment into the state budget as stipulated;

- Not handling or reporting to competent authorities for the disposal of unused or unusable working equipment;

b) The act of using research and technology development funds that overlap with other sources of funding causing waste as provided in Clause 4, Article 28 is the act of allocating and using funds from the state budget or other sources to implement research and technology development tasks that have already been funded from the state budget or other sources (overlap within the same source or between different sources of funding);

c) The act of violating management regulations in project investment planning and appraisal causing waste as provided in Clause 1, Article 29 of Decree No. 84/2006/NĐ-CP, including:

- Planning projects that do not comply with approved master plans and plans;

- Planning projects that do not meet construction standards and specifications;

- Planning and appraising projects not in accordance with prescribed procedures and formalities;

- Appraising projects that do not meet conditions and not within the prescribed time limit;

d) The act of violating management regulations in surveying and designing construction works causing waste as provided in Clause 2, Article 29 of Decree No. 84/2006/NĐ-CP, including:

- Surveying works not in accordance with regulations and procedures issued by competent state agencies;

- Designing construction works not in accordance with regulations and procedures issued by competent state agencies;

e) The act of violating management regulations in granting, paying, and finalizing capital for investment projects causing waste as provided in Clause 4, Article 29 of Decree No. 84/2006/NĐ-CP, including:

- Delaying the grant and payment of capital affecting the progress of investment projects when there is basic construction work completed, meeting payment conditions, and funds are balanced;

- Paying investment capital not in accordance with the volume of work accepted; lacking necessary procedures for payment;

- Inspecting, supervising the use of capital and auditing final accounts of works not in accordance with regulations;

g) The act of violating management regulations in organizing groundbreaking, commencement, and completion ceremonies of construction works funded by the state budget or derived from the state budget causing waste as provided in Clause 5, Article 29 of Decree No. 84/2006/NĐ-CP, including:

- Organizing groundbreaking, commencement, and completion ceremonies of works without permission from the Prime Minister (for national key projects), Chairman of the Provincial People's Committee (for significant local projects), or the authorized decision-maker (for works funded from the state budget);

- Organizing groundbreaking, commencement, and completion ceremonies of construction works not in accordance with regulations issued by competent state agencies;

h) The act of violating management regulations on office premises of agencies and organizations funded by the state budget causing waste as provided in Clause 1, Article 30 of Decree No. 84/2006/NĐ-CP, including:

- Not establishing management and usage regulations for office premises to promote thrift and prevent waste;

- Not complying with state agency regulations on managing and using office premises;

i) The act of violating regulations on norms, standards, and systems in the use of office premises of agencies and organizations funded by the state budget causing waste as provided in Clause 2, Article 30 of Decree No. 84/2006/NĐ-CP, including:

- Using beyond or incorrectly according to prescribed norms, standards, and systems causing waste;

- Upgrading, renovating, repairing, or renting office premises exceeding norms, standards, and systems established by competent authorities;

k) The act of violating management and usage regulations on capital and funds in state-owned companies causing waste as provided in Clause 1, Article 31 of Decree No. 84/2006/NĐ-CP, including:

- Violating mandatory financial audit and public disclosure regulations;

- Not establishing and implementing measures to promote thrift and prevent waste in managing and using capital and funds of the company;

- Not issuing regulations and setting norms, standards, and systems to effectively manage and utilize resources allocated by the state;

- Establishing and using funds not in accordance with regulations;

III. COMPENSATION FOR DAMAGE TO THE SUBJECTS PUNISHED FOR ADMINISTRATIVE VIOLATIONS IN PROMOTING THRIFT AND PREVENTING WASTE

Compensation for damage as provided in Article 27 and Section 4 of Decree No.         84/2006/NĐ-CP shall be implemented as follows:

1. Regarding the determination of compensation amount:

a) For expenditures that have prescribed norms, standards, systems, or budgets approved by competent authorities, the compensation amount includes the excess or incorrect expenditure compared to the approved norms, standards, systems, and budgets, and the costs to rectify the consequences (if any).

- The excess or incorrect expenditure compared to the approved norms, standards, systems, and budgets is calculated as the difference between the actual expenditure and the approved expenditure.

- Costs to rectify the consequences include expenses arising from addressing the aftermath of wasteful actions causing damage.

b) For other cases, the compensation amount includes the actual expenses caused by wasteful actions and the costs to rectify the consequences (if any).

c) Expenses for determining the compensation amount are included in the costs to rectify the consequences, including hiring economic and technical consultants and reasonable expenses directly related to determining the compensation amount.

d) In case the transaction involves foreign currency, it shall be converted according to the average trading rate on the inter-bank foreign exchange market published by the State Bank of Vietnam at the time of determining the compensation amount.

2. The person causing damage who is an individual may have their liability for compensation reduced if they meet both of the following conditions:

- Causing damage unintentionally.

- The damage is excessively large compared to the immediate and long-term economic capacity of the person causing the damage.

When requesting a reduction in the level of compensation for damage, the person causing damage must provide sufficient documentation and evidence regarding their immediate and long-term economic capacity, which is insufficient to fully or largely compensate for the damage incurred.

3. The Advisory Council on Damage Compensation (referred to as the Council):

The establishment of the Council and its members shall be carried out in accordance with the provisions of Article 38 of Decree No. 84/2006/NĐ-CP.

4. The deadline for issuing a decision on damage compensation for administrative violations related to thrift and anti-waste is 10 working days from the date of receipt of the request for damage compensation in accordance with Clause 2 of Article 38 of Decree No. 84/2006/NĐ-CP.

5. The authority to issue decisions on damage compensation shall be implemented in accordance with Clause 2 of Article 27 of Decree No. 84/2006/NĐ-CP. When issuing a decision on damage compensation, the authorized person must record all contents in accordance with the model Decision on Damage Compensation attached and promulgated together with this Circular.

6. Regarding the management and use of damage compensation funds:

a) The agency of the person authorized to issue the Decision on Damage Compensation is responsible for collecting the full amount of damage compensation and determining the repayment to the agency or organization directly suffering the damage or depositing into the state budget in accordance with the guidance provided in point c of this clause.

b) Damage compensation funds paid by the person obligated to compensate must be collected and tracked in detail for each payment (if made in multiple installments) and managed under the current financial regulations.

c) Damage compensation funds are used to cover the costs of determining the compensation amount, with the remainder being repaid to the agency or organization directly suffering the damage. If there are other sources of funding to offset the damage or if the compensation arises after the budget settlement, the funds shall be deposited into the state budget (the unit directly suffering the damage belongs to which level of management, the funds shall be deposited into that level's budget).

Depositing damage compensation funds into the state budget or repaying them to the agency or organization directly suffering the damage must be accompanied by complete documentation in accordance with current regulations.

IV. IMPLEMENTATION

1. This Circular takes effect 15 days after its publication in the Official Gazette.

2. During implementation, if difficulties or obstacles arise, please promptly report them to the Ministry of Finance for study and resolution./.