Circular No. 101/2017/TT-BTC guiding certain provisions stipulated in Decree No. 06/2017/NĐ-CP dated January 24, 2017 of the Government on horse racing, dog racing, and international football betting businesses

CIRCULAR

GUIDING SOME PROVISIONS OF THE GOVERNMENT DECREE NO. 06/2017/NĐ-CP

ON HORSE RACING, DOG RACING AND INTERNATIONAL FOOTBALL BETTING BUSINESS

Circular guiding some provisions of Government Decree No. 06/2017/NĐ-CP on horse racing, dog racing and international football betting business.

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Pursuant to Government Decree No. 06/2017/NĐ-CP dated January 24, 2017 on horse racing, dog racing and international football betting business;

Pursuant to Decree No. 87/2017/NĐ-CP dated July 26, 2017, issued by the Government, stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

At the proposal of the Director of the Department of Finance of Banks and Financial Institutions;

The Minister of Finance promulgates this Circular guiding some provisions of Government Decree No. 06/2017/NĐ-CP dated January 24, 2017 on horse racing, dog racing and international football betting business.

 

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular guides some provisions of Government Decree No. 06/2017/NĐ-CP dated January 24, 2017 on horse racing, dog racing and international football betting business (hereinafter referred to as Decree No. 06/2017/NĐ-CP).

Article 2. Applicability

1. Businesses engaged in horse racing betting, dog racing betting, and international football betting (hereinafter referred to as betting businesses).

2. Subjects permitted to participate in betting.

3. State management agencies with functions related to issuing permits, managing, supervising, inspecting, auditing, and imposing administrative penalties in the betting business as prescribed by law.

4. Other organizations and individuals related to the betting business.

Article 3. Application for issuance, reissuance, adjustment, extension of the Certificate of Eligibility for Betting Business and the Certificate of Eligibility for Betting Business

1. The application for issuance of the Certificate of Eligibility for Betting Business according to the form prescribed in Appendix No. 01 issued together with this Circular.

2. The application for reissuance, adjustment, and extension of the Certificate of Eligibility for Betting Business according to the form prescribed in Appendix No. 02 issued together with this Circular.

3. The Certificate of Eligibility for Betting Business issued by the Ministry of Finance according to the form prescribed in Appendix No. 03 issued together with this Circular.

Chapter II

RACING SUPERVISION BOARD

Article 4. Establishment of the Racing Supervision Board

1. Before organizing the betting business, the horse racing betting business and dog racing betting business enterprises shall submit a written request to the Department of Finance of the provincial or centrally-administered city (hereinafter referred to as the Department of Finance) where the horse racing or dog racing track is located, requesting the establishment of the Racing Supervision Board with the following contents:

a) Composition of the Racing Supervision Board as prescribed in Clause 2, Article 29 of Decree No. 06/2017/NĐ-CP. The horse racing betting business and dog racing betting business enterprises propose the composition of the Racing Supervision Board suitable for the scale of horse racing betting business and dog racing betting business and the actual conditions at the location where the betting business is organized;

b) Draft Regulation on the operation of the Racing Supervision Board;

c) Principles for determining the remuneration system for participation in the Racing Supervision Board as prescribed in Clause 5, Article 29 of Decree No. 06/2017/NĐ-CP and Clause 2, Article 8 of this Circular.

2. Based on the request of the horse racing betting business and dog racing betting business enterprises, within 15 days from the date of receipt of the request of the horse racing betting business and dog racing betting business enterprises under Clause 1 of this Article, the Department of Finance shall submit to the People's Committee of the province or centrally-administered city (hereinafter referred to as the Provincial People's Committee) where the horse racing or dog racing track is located:

a) Decision on the establishment of the Racing Supervision Board as prescribed in Clause 1 and Clause 2, Article 29 of Decree No. 06/2017/NĐ-CP and Clause 3 of this Article;

b) Approval of the Regulation on the operation of the Racing Supervision Board as prescribed in Clause 4, Article 29 of Decree No. 06/2017/NĐ-CP.

3. The composition of the Racing Supervision Board includes:

a) Chairman of the Racing Supervision Board is a representative of the Department of Finance;

b) Members of the Racing Supervision Board are representatives of the Department of Culture, Sports and Tourism (or Department of Culture and Sports), Department of Justice, provincial public security agency, Department of Agriculture and Rural Development;

c) Secretary and member of the Racing Supervision Board is a representative of the horse racing betting business and dog racing betting business enterprises.

4. When there is a change in members of the Racing Supervision Board, the Department of Finance shall report to the Provincial People's Committee for consideration and decision on changing personnel of the Racing Supervision Board in the following cases:

a) Transfer to another job;

b) Violation of discipline at the workplace;

c) Violation of discipline during the performance of duties of the Racing Supervision Board;

d) Resignation or retirement according to regulations;

đ) Other cases as prescribed by law.

Article 5. Duties and Authorities of the Chairman of the Race Supervisory Council

1. Duties of the Chairman of the Race Supervisory Council:

a) Be responsible for performing the duties and authorities of the Race Supervisory Council as stipulated in Clause 3 and Clause 4, Article 29 of Decree No. 06/2017/ND-CP and the Operational Regulations of the Race Supervisory Council;

b) Assign specific tasks, coordinate, and direct members of the Race Supervisory Council to fulfill their assigned responsibilities effectively;

c) Report periodically and urgently on the activities of the Race Supervisory Council to the People's Committee of the province and implement measures to strengthen the organization and activities of the Race Supervisory Council in compliance with the provisions of the law, this Circular, and the Operational Regulations of the Race Supervisory Council.

2. Authorities of the Chairman of the Race Supervisory Council:

a) Require enterprises engaged in betting and members of the Race Supervisory Council to comply with the provisions of the law, this Circular, the Operational Regulations of the Race Supervisory Council, and the Racing Rules announced;

b) Other authorities as stipulated in this Circular and the Operational Regulations of the Race Supervisory Council.

Article 6. Duties and Authorities of Members of the Race Supervisory Council

1. Duties of Members of the Race Supervisory Council:

a) Adhere to regulations when performing tasks according to the prescribed regime, the Operational Regulations of the Race Supervisory Council, and the assignment of the Chairman of the Race Supervisory Council;

b) Fulfill tasks assigned by the Chairman of the Race Supervisory Council and be responsible for the results of the assigned work;

c) Timely report to the Chairman of the Race Supervisory Council about any violations or suspicious manifestations during the performance of tasks so that the Chairman of the Race Supervisory Council can promptly examine and decide on appropriate measures.

2. Authorities of Members of the Race Supervisory Council: Members of the Race Supervisory Council have the right to reserve personal opinions during the performance of assigned tasks.

Article 7. Duties and Authorities of the Race Supervisory Council

1. Duties of the Race Supervisory Council:

a) Inspect the conditions for organizing horse racing and dog racing as stipulated in Article 24 of Decree No. 06/2017/ND-CP;

b) Directly supervise the process of organizing horse racing and dog racing according to the Racing Rules announced. All information related to each race must be recorded in the Race Monitoring Record immediately after the race ends. The Race Supervisory Council is responsible for signing the Record confirming the monitored results and the race results immediately after the race ends to serve as a basis for enterprises engaged in horse racing betting and dog racing betting to publicly announce to players. The Race Monitoring Record must include the following contents:

- Date and time of the race;

- Number of horses and dogs participating in the race; - Number, names of members of the Arbitration Board;

- Names, number of horse jockey certificates (for horse racing betting);

- Start and end times of the race;

- Results of the race;

- Issues arising during the race.

c) Supervise the compliance with regulations regarding the frequency of organizing betting, start and end times for accepting bets for each race as stipulated in Article 15 of Decree No. 06/2017/ND-CP;

d) Immediately after the end of the acceptance of bets as stipulated in Point a, Clause 2, Article 15 of Decree No. 06/2017/ND-CP, the Race Supervisory Council supervises the enterprise engaged in horse racing betting and dog racing betting to stop selling betting tickets throughout the system to ensure that no new tickets are issued after this time.

2. Authorities of the Race Supervisory Council:

a) Request and designate inspections for any racehorse or race dog participating in the race if deemed necessary or if signs of fraud are detected;

b) Decide to remove from the list of participants in the race any racehorse, race dog, or jockey when there is accurate information confirming that the racehorse, race dog, or jockey does not meet all the conditions stipulated by law and the Racing Rules;

c) Request the suspension of the organization of horse racing and dog racing by the enterprise to report to competent state management agencies for examination and handling according to the law in the following cases:

- Starting devices and cameras determining the finish of racehorses and race dogs are incomplete and do not ensure accuracy and fairness in organizing the race and determining the race results;

- Organizing horse racing and dog racing, including horse racing betting and dog racing betting, is not conducted according to the schedule and location of events already announced;

- Fraud in organizing the race;

- The main system and terminal equipment are continuously out of operation for thirty (30) minutes during the announced ticket sales period;

- Weather or track conditions are unsuitable for organizing horse racing and dog racing;

- The system continues to issue betting tickets before the end of the acceptance of bets as stipulated in Point a, Clause 2, Article 15 of Decree No. 06/2017/ND-CP.

d) Request disciplinary action or propose competent authorities to investigate and handle violations or fraudulent acts in organizing the race according to the provisions of the law;

e) Request enterprises engaged in horse racing betting and dog racing betting to install, supplement, upgrade, repair, remove, and replace starting devices and cameras determining the finish of racehorses and race dogs that do not meet the required conditions to serve the race;

f) Request enterprises engaged in horse racing betting and dog racing betting to regularly inspect and maintain facilities and equipment at the racecourse according to the law to ensure the organization of horse racing and dog racing, including horse racing betting and dog racing betting, in accordance with the law.

Article 8. Remuneration System for Participation in the Race Supervisory Board

1. The Chairman and members of the Race Supervisory Board shall be entitled to remuneration for their participation in the Race Supervisory Board.

2. The remuneration system for participation in the Race Supervisory Board shall be stipulated by the horse racing betting business enterprise or dog racing betting business enterprise based on principles that are appropriate to the nature of the work, time spent supervising, and enhancing the responsibility of Race Supervisory Board members in performing their supervisory duties. The horse racing betting business enterprise or dog racing betting business enterprise shall have the responsibility to issue regulations regarding the remuneration system for the Race Supervisory Board.

3. The horse racing betting business enterprise or dog racing betting business enterprise shall include the remuneration expenses for Race Supervisory Board members in its operating costs.

Chapter III

FINANCIAL MANAGEMENT, ACCOUNTING REGULATIONS, AUDITING AND REPORTING SYSTEMS

Article 9. Principles of Accounting and Management of Revenue and Expenses

1. Betting business enterprises must separately account for revenues, expenses, and profits related to betting activities and must track these items individually in accounting books and financial reports.

2. In cases where revenues and expenses related to betting activities are linked to other business operations of the enterprise, the following procedures shall apply:

a) If the betting business enterprise cannot separately account for revenues from betting activities and revenues from other business activities, the entire revenue that cannot be separated shall be considered as revenue for calculating special consumption tax on betting activities;

b) In cases where expenses are related to both betting activities and other business operations of the enterprise, the betting business enterprise shall allocate these expenses according to the percentage ratio between revenues from betting activities and the total revenue of the enterprise.

3. Betting business enterprises are responsible for accounting for revenues and expenses in accordance with accounting standards and guidelines set forth in this Circular.

4. The determination of revenues and expenses for declaration and payment of taxes on betting activities shall be carried out in accordance with current tax laws.

Article 10. Revenues and Other Income

Revenues and other income of betting business enterprises include:

1. Revenues from betting activities.

2. Revenues from other business activities outside of betting activities as prescribed by law.

3. Financial revenues.

4. Other income (if any).

Article 11. Expenses

Operating expenses for betting activities consist of all expenses serving betting activities as defined by law, including specific expenses for betting activities as follows:

1. Prize payout expenses are the actual amounts paid by the betting business enterprise to winning players participating in bets in accordance with the rules of the betting game and relevant tax laws.

2. Commission expenses for ticket sales agents:

a) The level of commission for ticket sales agents is determined by the betting business enterprise and must be clearly specified in the Ticket Sales Agency Contract signed between the betting business enterprise and the ticket sales agent;

b) The betting business enterprise will only pay commission to the ticket sales agent after confirming the number of tickets sold and verifying that the ticket sales agent has fulfilled all obligations stipulated in the Ticket Sales Agency Contract;

c) The betting business enterprise is responsible for withholding personal income tax payable by individual ticket sales agents before paying them according to tax laws.

3. Remuneration expenses for Race Supervisory Board members as stipulated in Article 8 of this Circular.

4. Entrusted prize payout expenses:

a) Entrusted prize payouts must be reflected in the Agency Contract signed between the betting business enterprise and the ticket sales agent;

b) The maximum fee for entrusted prize payouts to ticket sales agents shall not exceed 0.2% of the total value of prizes paid by the ticket sales agent under the entrustment, as determined by the betting business enterprise.

5. Other expenses as prescribed by law.

Article 12. Accounting, Auditing, and Financial Report Disclosure System

1. Enterprises engaged in betting business shall implement the accounting system in accordance with the Accounting Law and current legal provisions on accounting.

2. The annual financial reports of enterprises engaged in betting business must be audited by an independent auditing organization legally permitted to operate in Vietnam.

3. Within 120 days from the end of the fiscal year, enterprises engaged in betting business must disclose their financial reports in accordance with the law.

4. Enterprises engaged in betting business shall implement the financial report retention system as prescribed in the Accounting Law and guiding documents.

1. For financial reports:

a) At the end of each quarter's accounting period, enterprises engaged in betting business must prepare and submit quarterly financial reports to the local Tax Bureau within thirty days from the end of the quarter's accounting period;

b) Enterprises engaged in betting business are responsible for submitting annual financial reports to the Ministry of Finance, Provincial Department of Finance, and the local Tax Bureau within ninety days from the end of the fiscal year;

c) The legal representative of enterprises engaged in betting business is liable under the law for the accuracy and truthfulness of these reports.

2. For business operation situation reports: Periodically every six months and at the end of the year, enterprises engaged in betting business must prepare and submit business operation situation reports according to the templates specified in Appendix 04 and Appendix 05 issued together with this Circular to the Ministry of Finance and Provincial Department of Finance within thirty days from the end of the accounting period as stipulated by the accounting law. The legal representative of enterprises engaged in betting business is liable under the law for the accuracy and truthfulness of these reports.

3. In case the Ministry of Finance or the People's Committee of the province requests an extraordinary report, enterprises engaged in betting business must prepare and submit the report as required.

Chapter IV

RESPONSIBILITIES OF ORGANIZATIONS

Article 14. Responsibilities of the Provincial Department of Finance

1. To take the lead in advising the People's Committee of the province in managing, supervising, and inspecting betting business activities within its jurisdiction as prescribed in Article 77 of Decree No. 06/2017/ND-CP, this Circular, and relevant legal provisions.

2. To submit to the People's Committee of the province for issuance of legal documents serving as the basis for the operation of the Race Supervision Council, including:

a) Decision on the establishment of the Race Supervision Council;

b) Approval of the Operation Regulations of the Race Supervision Council.

Article 15. Responsibilities of the Local Tax Bureau

1. To coordinate with the Provincial Department of Finance and related agencies in managing, supervising, and inspecting betting business activities within its jurisdiction as prescribed in Decree No. 06/2017/ND-CP, this Circular, and relevant legal provisions.

2. To be responsible for managing, inspecting, and auditing the tax obligations of enterprises engaged in betting business in accordance with the law on taxation.

Article 16. Responsibilities of Enterprises Engaged in Betting Business

1. To comply with legal regulations governing betting business operations as prescribed in Decree No. 06/2017/ND-CP, this Circular, and other relevant legal provisions.

2. To be responsible for establishing and issuing internal management rules and procedures of the enterprise regarding betting to ensure transparency, honesty, and compliance with legal regulations during betting business operations.

3. To establish and issue regulations on remuneration systems for participation in the Race Supervision Council as prescribed in Clause 2, Article 8 of this Circular.

Chapter V

ORGANIZATION AND IMPLEMENTATION

Article 17. Implementation Organization

1. This Circular takes effect from December 1, 2017.

2. During implementation, if encountering difficulties or obstacles, organizations and individuals are advised to report to the Ministry of Finance for consideration and resolution./.