Circular No. 12/2012/TT-BTC guides the criteria for determining public service units that meet the conditions to be recognized by the State for the valuation of assets to be transferred to the unit for management under the mechanism of capital transfer to enterprises.

CIRCULAR

Guidelines for criteria to determine public service units eligible for the State to determine the value of assets to be transferred to the unit for management under the mechanism of capital transfer to enterprises

mechanism for capital transfer to enterprises

--------------------------

Pursuant to the Law on Management and Use of State Assets;

Pursuant to Decree No. 52/2009/NĐ-CP dated June 3, 2009 of the Government detailing and guiding the implementation of certain provisions of the Law on Management and Use of State Property;

Pursuant to Decree No. 43/2006/NĐ-CP dated April 25, 2006 of the Government stipulating the rights of self-management and self-responsibility for the implementation of tasks, organizational structure, staffing, and finance for public service units;

Pursuant to Decree No. 118/2008/NĐ-CP dated November 27, 2008, of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Implementing the guidance of the Prime Minister as set out in Circular No. 4015/VPCP-KTTH dated June 17, 2011 of the Government Office.

The Ministry of Finance issues guidelines for criteria to determine public service units eligible for the State to determine the value of assets to be transferred to the unit for management under the mechanism of capital transfer to enterprises as follows:

Article 1. Scope and Applicability

Article 1. This Circular guides criteria; procedures, formalities, and authorities for determining public service units eligible for the State to determine the value of assets to be transferred to the unit for management under the mechanism of capital transfer to enterprises.

Article 2. The objects subject to this Circular are public service units under Ministries, agencies at the level of ministries, other central agencies (referred to collectively as Ministries and central agencies), People's Committees of provinces and centrally-administered cities (referred to collectively as provincial People's Committees).

Article 3. This Circular does not apply to public service units under the people's armed forces.

Article 2. Public service units eligible for the State to determine the value of assets to be transferred to the unit for management under the mechanism of capital transfer to enterprises include:

Point 1. Public service units that fully cover their regular operating costs from business revenue (including revenue from the State budget for products and services ordered by authorized State agencies).

Point 2. Public service units not falling within the provisions of Clause 1 of this Article but meeting all of the following conditions:

Subpoint a. Covering more than 10% of regular operating expenses;

Subpoint b. Having a proposal for asset utilization consistent with assigned functions and tasks, approved by the Ministry or central agency (for public service units under central management) or by the provincial People's Committee (for public service units under local management);

Subpoint c. Committing to comply with regulations on asset management and use for financially autonomous units as stipulated in Decree No. 52/2009/NĐ-CP dated June 3, 2009 of the Government detailing and guiding the implementation of certain provisions of the Law on Management and Use of State Assets (hereinafter referred to collectively as Decree No. 52/2009/NĐ-CP) and guidelines issued by the Ministry of Finance;

Subpoint d. In cases where the State permits or requires the inclusion of full cost recovery, including depreciation of fixed assets, in product and service costs (including products and services ordered by authorized State agencies), the unit must ensure full coverage of costs;

Subpoint e. The State does not increase funding, except in cases where the State assigns additional tasks or supplements part of the increased salary according to State regulations;

Subpoint g. Not falling within the cases stipulated in Clauses 2, 3, and 4 of Article 3 of this Circular.

Article 3. Public service units not eligible for the State to determine the value of assets to be transferred to the unit for management under the mechanism of capital transfer to enterprises include:

Point 1. Public service units not meeting the conditions specified in Article 2 of this Circular.

Point 2. Public service units operating in remote, mountainous, and economically disadvantaged areas.

Point 3. Public service units providing essential public services such as: preschool education, primary education, secondary education; mental health hospitals, rehabilitation and functional recovery hospitals, tuberculosis hospitals, leprosy hospitals.

Point 4. Public service units managed by district-level (county, town, city under province) authorities.

Article 4. Procedures and formalities for determining public service units eligible to have the value of state assets determined by the State for management under the capital transfer mechanism for enterprises

1. Public service units meeting the conditions stipulated in Article 2 of this Circular shall prepare and submit a dossier to the competent state agency specified in Article 5 of this Circular for consideration and decision on transferring state assets to the unit for management under the capital transfer mechanism for enterprises. The application dossier includes:

a. A request for transferring state assets to the unit for management under the capital transfer mechanism for enterprises;

b. A project on using assets in accordance with assigned functions and tasks and related documents proving compliance with the conditions stipulated in Article 2 of this Circular;

c. Other relevant documents (if any).

2. Based on the provisions of Article 2 of this Circular, the competent state agency specified in Article 5 of this Circular shall consider and decide on transferring state assets to public service units for management under the capital transfer mechanism for enterprises. The procedures for determining the value of state assets to be transferred to public service units for self-financing management shall be implemented in accordance with the provisions of Section 8 of Circular No. 245/2009/TT-BTC dated December 31, 2009 of the Ministry of Finance detailing and guiding the implementation of certain provisions of Decree No. 52/2009/NĐ-CP dated June 3, 2009 of the Government on detailed regulations and guidance for implementing certain articles of the Law on Management and Use of State Assets (hereinafter referred to as Circular No. 245/2009/TT-BTC).

3. Article 5. Competence to determine public service units eligible and to decide on transferring state assets to public service units for self-financing management under the capital transfer mechanism for enterprises

1. Competence to determine public service units eligible to have the value of state assets determined by the State for management under the capital transfer mechanism for enterprises:

a. The Minister, Head of central agencies decides or delegates the decision to recognize public service units under central management as eligible to have the value of state assets determined by the State for management under the capital transfer mechanism for enterprises.

b. The Chairman of the People's Committee of the province decides to recognize public service units under local management as eligible to have the value of state assets determined by the State for management under the capital transfer mechanism for enterprises.

2. Competence to decide on transferring state assets to public service units eligible to have the value of state assets determined by the State for management under the capital transfer mechanism for enterprises:

a. The Minister, Head of central agencies decides or delegates the decision to transfer state assets to public service units under central management.

b. The Chairman of the People's Committee of the province decides to transfer state assets to public service units under local management.

Article 6. Management and use of state assets transferred to public service units for management under the capital transfer mechanism for enterprises

1. The management and use of state assets transferred to public service units for management under the capital transfer mechanism for enterprises shall be carried out in accordance with the provisions of Chapter IV of the Law on Management and Use of State Assets, Chapter III of Decree No. 52/2009/NĐ-CP and the guidance provided in Circular No. 245/2009/TT-BTC. Specifically, the depreciation and provision for depreciation of fixed assets shall be guided as follows:

a. Depreciation of fixed assets shall be provided for the portion of assets used in production, business services, leasing, joint ventures, and joint operations in accordance with the regulations;

b. Depreciation of assets shall be calculated in accordance with the regulations for the portion of assets used to provide services assigned by the State.

In cases where the competent state agency specified in Article 5 of this Circular permits or requires full costs, including depreciation of fixed assets, to be included in the cost of products and services (including products and services ordered by authorized state agencies), the unit must provide for depreciation of fixed assets. The calculation and accounting of depreciation costs of fixed assets shall be carried out in accordance with current regulations.

2. Public service units receiving state assets transferred in accordance with this Circular shall be responsible for registering and reporting the situation of managing and using transferred assets in accordance with the laws on management and use of state assets; and reporting the results of production and business service activities in accordance with current laws.

1. This Circular takes effect from March 22, 2012;

Article 7. Implementation Provisions

2. Ministries, central agencies, provincial People's Committees, and public service units shall be responsible for organizing the implementation of the provisions of this Circular.

During the implementation process, if there are difficulties or obstacles, agencies and units are requested to report to the Ministry of Finance for research and appropriate amendments.

- National Assembly, People's Council, People's Committee, Department of Finance, Department of Home Affairs, State Treasury of provinces and centrally administered cities;