Circular No. 132/2008/TT-BTC guides the management mechanism for loans under the specialized credit program funded by the Japan International Cooperation Agency (JICA).

CIRCULAR

Guidelines for the management mechanism of loan capital for the Specialized Credit Program funded by the Japan International Cooperation Agency (JICA)

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Pursuant to Decree No. 134/2005/NĐ-CP dated November 1, 2005 of the Government promulgating the Borrowing and Repayment Regulations for Foreign Debts and Decree No. 131/2006/NĐ-CP dated November 9, 2006 of the Government promulgating the Management and Utilization Regulations for Official Development Assistance (ODA) sources;

Based on the credit agreements signed between the Government of the Socialist Republic of Vietnam and the Japan Bank for International Cooperation, now known as the Japan International Cooperation Agency (hereinafter referred to as JICA) to finance the Rural Infrastructure Development and Improved Livelihood Program;

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

The Ministry of Finance provides guidelines for the management mechanism of JICA's loan capital for the Rural Infrastructure Development and Improved Livelihood Program as follows: mức sống của cư dân như sau:

Part I

GENERAL PROVISIONS

1. The Rural Infrastructure Development and Improved Livelihood Program (referred to as the Specialized Credit Program) is a program utilizing JICA loan capital to construct infrastructure projects at local levels nationwide, including areas as specified in the Agreements.

2. The loan capital under the Specialized Credit Program is a government loan. This capital is managed according to the State Budget Law and its guiding documents, current expenditure regulations. The Ministry of Finance is responsible for repaying foreign debt when due (including principal and interest). This capital is allocated into the State Budget to fund local infrastructure investment projects through targeted central budget supplements to localities. Areas and projects within the Specialized Credit Program that are determined to have a refinancing mechanism will be implemented according to the Refinancing Regulation issued by Decision No. 181/2007/QĐ-TTg dated November 26, 2007 of the Prime Minister promulgating the Refinancing Regulation from government loan and foreign aid funds.

3. Implementation organizations: The specialized credit program includes many component projects in rural transportation, rural electricity, potable water supply, and irrigation sectors. Local component projects are entrusted to local authorities as project sponsors. The Program Head establishes a Central Program Management Board to oversee and monitor the implementation of the program. Each province with projects establishes a Project Management Board (hereinafter referred to as the Provincial JICA Project Management Board) according to the Program Head's guidance to oversee and monitor the implementation of JICA projects in their locality.

a. The Ministry of Planning and Investment is the Program Head responsible for planning the use of Specialized Credit Program capital for projects. The Ministry of Planning and Investment establishes a Central Program Management Board to oversee and monitor the implementation of the program, guide localities in managing projects and allocating counterpart funds according to regulations.

b. The Vietnam Joint Stock Commercial Bank for Foreign Trade (Vietcombank) is commissioned by the Ministry of Finance to handle foreign exchange transactions and is responsible for signing bank agreements with foreign parties based on the JICA loan agreement.

c. Provincial People's Committees and local state management agencies are responsible for organizing the management of capital usage in accordance with the Program Head's and the Ministry of Finance's guidelines, consistent with current domestic regulations on basic construction investment project management and commitments in signed credit agreements with JICA.

4. This Circular applies to all specialized credit programs funded by JICA. For forestry planting, it shall apply according to Circular No. 104/2002/TT-BTC dated November 15, 2002 of the Ministry of Finance providing guidelines for the management mechanism of JICA loan capital for the forestry planting sector under the Specialized Credit Program.

Part II

SPECIFIC PROVISIONS

1. JICA Loan Capital:

1.1. JICA capital accounts for 75% to 85% of the project value and is used for the following purposes:

a. Hiring foreign consultants;

b. Importing materials, goods, and equipment for projects both domestically and internationally;

c. Paying for construction work volumes and implementing domestic program projects;

d. JICA loan withdrawal fees (at a rate of 0.1% of the withdrawn amount recorded as a loan debt by JICA immediately upon withdrawal);

đ. Payment for retention money pending final settlement after warranty period; advance payment refunds from local budget funds can only be executed within the loan withdrawal period stipulated in the Agreement;

1.2. JICA loan capital cannot be used to pay for land acquisition compensation, project survey design costs, taxes, management expenses, domestic banking service fees, or construction insurance fees.

2. Domestic Counterpart Capital:

2.1. Domestic counterpart capital is self-funded by local budgets and implemented according to the current mechanism for managing counterpart capital for ODA-funded projects: included in annual budget balancing or raised from other sources, ensuring synchronization with the progress of foreign capital utilization during each project plan period. This amount needs to be allocated approximately 15-25% of the project value to cover:

a. Land acquisition compensation costs, project survey design costs, and management fees (during the project construction process);

b. Domestic banking service fees (for payments to contractors);

c. Indirect taxes applicable to goods and services for ODA loan-funded projects allocated to local projects;

d. Domestic import-related costs: agency import fees, import duties, value-added tax (if applicable), receiving, supplying, and transporting goods from ports to projects (for projects requiring imported goods) allocated to projects using imported equipment under the program;

đ. Construction insurance fees;

e. Retention money payment pending final settlement after the warranty period.

g. Advance payment shall be made in cases where payments are made under the reimbursement method;

2.2. Domestic counterpart funds allocated by the Program Owner: The Ministry of Planning and Investment will allocate domestic counterpart funds to cover common costs for the entire program, including:

a. Program management fees;

b. Bank charges related to payments for consulting services;

c. Costs associated with organizing supervision, monitoring, and evaluating the program;

3. Procedures related to economic contracts: The signing, approval, and endorsement of contracts shall be carried out in accordance with the guidelines of the Ministry of Planning and Investment for the specialized credit program and the provisions set forth below:

For consulting service contracts and procurement contracts for imported goods and materials:

a. The central program management board shall lead the organization of bidding and negotiation of consulting service contracts and procurement contracts for goods and materials for the program or project with legitimate suppliers in accordance with the Agreement.

b. Tax clauses in the contracts shall be implemented according to current tax regulations applicable to ODA projects.

c. The central program management board shall select entities (hereinafter referred to as Importers) to delegate transactions, sign import contracts for goods, and handle procedures for receiving and delivering goods to the construction site. The central program management board shall directly sign foreign consulting service contracts for the entire program.

d. After signing the contract, the Importer shall submit the signed contract to the Program Owner for approval. JICA and the Ministry of Finance will process the endorsement of contracts that reach the value threshold specified in the Agreement. For contracts valued lower than the threshold specified in the Agreement, the Importer only sends a copy of the contract to the central program management board for monitoring.

đ. The Ministry of Finance shall notify Vietcombank about the endorsement of contracts to facilitate external payment procedures for suppliers of goods or foreign contractors (if any).

3.2. For contracts for construction work volumes and implementation of programs/projects undertaken by domestic contractors:

a. After being assigned JICA capital allocation plans and receiving notification from the Ministry of Planning and Investment to implement the program, the project sponsors shall conduct bidding in accordance with the current Bidding Law and sign contracts with contractors.

b. In exceptional cases where bidding is not conducted, the managing authority must issue a decision to designate the contractor in accordance with current regulations and assign the sponsor to sign a contract with the contractor.

c. The contract must clearly state the value supported by JICA loan funds.

d. Tax clauses in the contract shall be implemented according to current tax regulations applicable to ODA projects.

đ. Immediately after signing the contract, the Project Sponsor shall send a certified copy of the contract to the JICA provincial project management board.

e. For contracts valued under 0.5 billion Japanese Yen (converted to VND based on the JPY/VND exchange rate published by the Vietnam Commercial Joint Stock Bank at the time of contract signing), the JICA provincial project management board only needs to notify and attach the list of approved contracts to the central program management board and the Ministry of Finance. JICA and the Ministry of Finance will process the endorsement of contracts using JICA funds for contracts valued at 0.5 billion Japanese Yen or more (converted to VND based on the aforementioned exchange rate).

g. The Ministry of Finance will only pay for contract quantities included in the list notified to the Ministry of Finance. Payment from JICA funds will be made in accordance with the project schedule, independent of the annual provincial budget plan.

4. Method of withdrawing funds

a. For consulting service contracts and procurement of foreign equipment: The portion of the contract paid in foreign currency shall be withdrawn through the Letter of Commitment or Special Account (abbreviated as SKDB) for payment. The portion paid in domestic currency (VND) shall be withdrawn through Transfer or Reimbursement for payment.

b. For contracts signed to procure domestic equipment and undertake domestic construction works, the withdrawal of funds through Special Accounts or Reimbursement for payment shall be applied according to the procedures stipulated in Section III below.

c. At the request of the Ministry of Finance, Vietcombank shall open a Special Account in Japanese Yen and an interest account for the Special Account at the Tokyo-Mitsubishi Bank, with the Ministry of Finance as the account holder. Vietcombank shall only conduct transactions from these accounts upon request from the Ministry of Finance.

đ. The Ministry of Finance shall process the initial withdrawal and additional withdrawals into the aforementioned Special Account in accordance with the Agreement. The first withdrawal does not require accompanying documentation.

đ. The Ministry of Finance shall request Vietcombank to open dedicated accounts corresponding to the Special Account and the interest account of the Special Account named after the Ministry of Finance (Department of Foreign Financial Affairs) to monitor and record the amount withdrawn and the interest generated on the Special Account, as well as future repayment.

Part III

PAYMENT PROCESS FOR DOMESTIC CONTRACTORS

1. Payment Recipients

1.1. Projects (hereinafter referred to as projects) eligible for payment from the specialized credit program are those included in the JICA capital utilization plan distributed and announced by the Ministry of Planning and Investment to localities.

1.2. Legitimate contractors are those contractors listed in the winning bid decision for the project or designated to undertake the project in compliance with current regulations (hereinafter referred to as contractors).

2. Payment Request Documentation

2.1. When requesting payment, sponsors must prepare the following payment documentation:

a. All payment requests for JICA funds shall be prepared in accordance with the current domestic basic construction payment procedures.

b. Contract between the Project Sponsor and the Contractor (a certified copy stamped by the sponsor).

c. Payment request form of the Contractor according to this Circular (two original copies) approved by the Project Sponsor.

d. Construction completion payment voucher (abbreviated as XDCB) issued by the State Treasury where the transaction account is opened, specifying the amount requested for payment with JICA funds (two original copies).

đ. Temporary advance guarantee letter (in case of advance payment) according to the model attached to this Circular.

2.2. The payment file submitted to the JICA Project Management Board of the province for processing in accordance with regulations.

3. Payment process and additional capital withdrawal into the special account:

3.1. Advance payment method: The contractor shall be paid advances according to the level specified in the contract. In the payment request file, there must also be a copy of the Advance Payment Guarantee Certificate (issued together with this Circular) (a certified true copy of the Advance Payment Guarantee Certificate issued by a commercial bank or joint venture bank with good reputation, accepted by the Investor). The guarantee period must ensure that the Investor can recover the advance payment. The payment process is similar to Section 3.2 below.

3.2. Method of payment for completed work volume:

a. After the contractor completes the project volume, the investor collects the payment request file and sends it to the State Treasury of the locality for pre-payment control in accordance with the current domestic construction investment capital payment regulations;

b. The total amount requested for payment from JICA funds must equal the appraised value of the completed construction work volume minus the advance payment at the percentage stipulated in the contract and within the amount of JICA funding specified in the contract. In cases where the amount reviewed by the State Treasury of the locality is less than the amount requested for payment, the contractor must resubmit the Payment Request Certificate based on the amount reviewed by the State Treasury of the locality;

c. After receiving the expenditure control results from the State Treasury of the locality, the investor compiles the file (as prescribed in Section 2 above) and submits it to the JICA Project Management Board of the province;

d. Within five working days from the date of receipt of the file, the JICA Project Management Board of the province:

- Collects and reviews the files, compares them with the allocated capital plan and contract list;

- Responds to the investor if the file does not meet the payment conditions;

- Sends the complete payment file to the Ministry of Finance (Department of Foreign Financial Affairs) along with a letter summarizing the list of projects requesting payment. The file sent to the Ministry of Finance includes one original Payment Request Certificate from the contractor, one original Payment Invoice for completed construction work volume, and a summary of all payment requests from the JICA Project Management Board of the province (all originals);

đ. Within five working days after receiving the complete file from the JICA Project Management Board of the province, the Ministry of Finance, based on the balance in the Special Account, requests Vietcombank to transfer money to the contractors within three working days according to the account number designated by the contractor in the Payment Request Certificate. After transferring the money, Vietcombank sends the Ministry of Finance the Transfer Notification Letters along with the bank transfer documents for each contractor to allow the Ministry of Finance to process the additional capital withdrawal into the Special Account. At the same time, Vietcombank sends the Transfer Notification Letters to the JICA Project Management Board of the province for disbursement tracking.

3.3. Repayment Payment Method:

a. The repayment payment method applies to the repayment of JICA capital for amounts previously advanced from local government funds.

b. The repayment payment method may be applied in specific cases as follows:

- In cases where the local budget has sufficient sources to pay the contractor immediately, which will then be repaid using JICA funds. This method can be applied at any time before the end of the six-month drawdown period under the Agreement;

- In cases where the locality does not have sufficient sources to pay the contractor immediately, if the payment falls within the last six-month drawdown period of the Agreement, the locality needs to prepare a budget plan to secure the advance payment source, which will then be repaid from JICA funds;

Due to different expiration dates for drawdown periods under Agreements, the JICA Project Management Board of the province should contact the JICA Central Program Management Board or the Ministry of Finance to know the specific deadlines for each case.

c. The repayment payment process from JICA loan capital is as follows:

- Advance payments made from the local government budget and requests for repayment from JICA funds must fully comply with JICA capital payment conditions;

- The payment request file is similar to the regular JICA capital payment request file, accompanied by a certified true copy of the valid bank transfer document proving the amount advanced from the local government budget to the contractor's account;

- In the Payment Request Certificate, the contractor requests the transfer to the local government budget account. The repayment amount must match the amount advanced;

- The file processing and payment procedures are similar to those outlined in Sections 3.1 and 3.2 above.

3.4. Additional Capital Withdrawal into the Special Account

Based on the request letter from the Central Program Management Board, the Ministry of Finance (Department of Foreign Financial Affairs) processes the additional capital withdrawal into the Special Account in accordance with the Agreement regulations. The Central Program Management Board lists and compiles the documents paid out from the Special Account (including the contractor's Payment Request Certificate and the bank's payment authorization clearly stating the amount transferred from the Special Account to the contractor's account). The drawdown ratio is defined in the Agreement. After completing the final drawdown, if there is a positive difference between the amount withdrawn into the Special Account and the payment documents from the Special Account due to exchange rate differences, the Ministry of Finance requests the Central Program Management Board to allocate JICA funds to repay this difference.

Part IV

TYPES OF CHARGES GENERATED

1. Bank fees and payment:

1.1. Bank fees include

a. Domestic payment service fees: Vietcombank charges according to the Bank Service Fee Schedule issued by the General Director of Vietcombank;

b. International payment service fees: charged based on the actual amount required by the foreign bank;

1.2. The specific payment of fees is carried out as follows:

a. For transfer fees when repaying foreign debt: Vietcombank automatically debits the Government Budget Deposit Account (opened at Vietcombank);

b. For fees related to opening and paying import letters of credit: These fees are collected from the entrusted importer, and subsequently, the entrusted importer allocates and recovers these fees from the corresponding local government funds.

c. For fees related to the opening and payment of service advisory L/Cs: The fee is collected from the account opened by the Ministry of Planning and Investment at Vietcombank, using counterpart funds arranged by the Ministry of Planning and Investment for the credit program's service.

d. For transferring money to domestic contractors: Bank charges are deducted from the payment amount to the contractor. Depending on the contract signed with the Project Owner, the Contractor may bear this charge or request the Project Owner to reimburse it based on the notification of bank charges from Vietcombank from the counterpart fund.

2. Importer's Fees:

The importer selected by the Central Program Management Board is responsible for negotiating and signing purchase contracts with the winning bidder (foreign supplier), carrying out all import procedures under the supervision of the Central Program Management Board, and enjoying agency import fees and supply fees agreed upon with the Central Program Management Board and current state regulations. These fees are collected from receiving units and included in the project's counterpart funds.

Part V

ACCOUNTING INTO THE STATE BUDGET

1. JICA loans used to allocate to local projects must be fully and promptly recorded in the State Budget. The principle of recording through the budget is to record revenue in the Central Budget and record expenditure in the Local Budget (LB) as supplementary targeted expenditure. The recording through the budget is implemented as follows:

1.1 Allocation of common costs: Common costs include withdrawal fees, fees related to direct transactions (of consultancy contracts and equipment import contracts under the Advance Payment and Letter of Guarantee method), management fees of the Central Program Management Board (including organizational implementation costs for monitoring and evaluation work). By December each year, the Central Program Management Board compiles all common costs incurred during the year and officially requests the Ministry of Finance to process the recording of revenue and expenditure in the budget: Recording foreign loan debt, recording allocation to the Central Program Management Board under the Ministry of Planning and Investment.

1.2 For consultancy fees: Thirty days after the end of each Agreement's withdrawal period, the Central Program Management Board compiles actual consultancy fees for the entire program under that Agreement, allocates them officially to local projects according to the capital usage ratio sent to each province, and sends the Ministry of Finance to process the recording of revenue and expenditure in the budget. Based on the allocation notice from the Central Program Management Board, the Ministry of Finance will record foreign loan debt and record supplementary targeted expenditure for the Local Budget.

1.3 For the value of imported goods:

a. After the end of the withdrawal period for each procurement contract, the Program Management Board collaborates with the Importer to allocate the corresponding value of imported goods to each project in the provinces, agrees with the JICA Provincial Project Management Boards, and officially requests the Ministry of Finance to process the recording of revenue and expenditure in the budget.

b. In cases where there is a discrepancy between the planned distribution and the actual receipt of goods (including allowable losses), the provinces work with authorized supply units to confirm these discrepancies and report to the Central Program Management Board for handling according to the principle that the entity responsible for the loss must bear it, specifically as follows:

- Losses exceeding the allowable rate determined during the import process are borne by the Importer;

- Losses exceeding the allowable rate during the supply process are borne by the authorized supply unit;

- Losses exceeding the allowable rate due to provincial delays or delays in receiving goods are borne by the province;

1.4 For construction works, implementing the program/project paying domestic contractors in VND:

a. Annually, based on the notification of funds transfer from the Commercial Bank, the Ministry of Finance compiles and processes the recording of JICA loan revenue and supplementary targeted expenditure of the Central Budget for the Local Budget;

b. Accounting entries for points 1.2, 1.3, and 1.4: Based on the documents sent by the Ministry of Finance, the Provincial Finance Department proceeds to issue orders for local budget revenue collection and fund disbursement to the units using the funds sent to the State Treasury of the province or centrally-administered city; the State Treasury of the province or centrally-administered city disburses funds according to the provisions of the State Budget Law. The basis for recording expenditures is the Disbursement Order of the Budget Department of the Ministry of Finance, accompanied by the Notice of the Foreign Financial Department listing the Agreement number, project name, project owner, payment amount for each project, and applicable exchange rate.

The value recorded for budget revenue and expenditure is the foreign currency (JPY) value multiplied by the exchange rate published by Vietcombank at the time of transfer (for payments to domestic contractors) or the accounting exchange rate prescribed by the Ministry of Finance at the time of accounting (for consultancy fees, withdrawal fees, and imported goods).

Part VI

RESPONSIBILITIES OF THE RELATED AUTHORITIES IN THE PAYMENT PROCESS

1. Central Program Management Board:

1.1. Organize bidding to select Importers and Consultants.

1.2. Take the lead, together with Consultants, Sponsors, and the Ministry of Finance, in planning, monitoring, supervising, evaluating, and auditing the program and projects;

1.3. Support and guide local Planning and Investment Departments and Provincial JICA Project Management Boards on mechanisms and policies related to the Special Credit Program;

1.4. Take the lead, together with the Ministry of Finance, in organizing training for managing and implementing the Special Credit Program;

1.5. Compile progress reports on the implementation of the program to the Government, the Ministry of Finance, and sponsors;

1.6. Collect files and documents to send to the Ministry of Finance to proceed with additional capital withdrawal into the special account;

1.7. Allocate repayment funds to JICA if there is a positive difference between the amount withdrawn into the special account and the payment vouchers from the special account due to exchange rate differences.

2. Provincial JICA Project Management Board:

2.1. Serve as the focal point for managing projects implemented locally, responsible for compiling from the planning stage through execution and reporting. Regularly coordinate and inform the provincial Department of Finance of relevant information about projects in the locality;

2.2. Carry out tasks delegated by the Program Leader in conjunction with the provincial Planning and Investment Department in developing the JICA capital plan (referencing JICA standards) and ensuring adequate counterpart funding for projects at the local level;

2.3. Lead in developing the counterpart funding plan for projects in accordance with the schedule, including both regular counterpart funding and provisional funding from the budget in cases where the repayment method is applied;

2.4. Prepare a list of contracts and contract appendices funded by JICA capital to be submitted to the Program Leader and the Ministry of Finance according to the attached model;

2.5. Guide project sponsors and contractors in preparing vouchers according to the JICA-prescribed models for each type of capital withdrawal;

2.6. Receive and review payment file submissions from project sponsors, compare them with the JICA capital plan and contracts, and within five working days of receiving complete valid files, compile and submit to the Ministry of Finance for payment request. In cases where the submission is not accepted, the Provincial JICA Project Management Board has the responsibility to contact the project sponsor to complete the submission;

2.7. Monitor and update disbursement data for foreign capital and counterpart funding for each project in the province;

2.8. Assist the Central Program Management Board, consultants, sponsors, and the Ministry of Finance in tracking and managing projects in the province.

3. Ministry of Finance:

3.1. Process acceptance for payment after receiving complete files as prescribed. In cases where payment is not accepted, the Ministry of Finance shall immediately notify the Central Program Management Board and the Provincial JICA Project Management Board concerned;

3.2. Promptly process revenue and expenditure entries so that the provincial Department of Finance can record them in the local budget;

3.3. Promptly conduct additional capital withdrawals into the special account;

3.4. Implement interest and principal repayments as stipulated in the Agreement;

3.5. Coordinate with the Central Program Management Board and sponsors in monitoring and evaluating the program;

4. Local State Treasury:

4.1. Control expenditures for completed construction works in accordance with current regulations on investment and construction management, clearly identifying the amount financed by JICA capital as the basis for the Ministry of Finance to pay contractors. The control of JICA capital expenditures is carried out in line with the project schedule, independent of the annual provincial budget plan;

4.2. Coordinate with the provincial Department of Finance in accounting for the special credit program budget;

5. Provincial and City Departments of Finance:

Record revenues and expenditures in the local state budget after receiving accounting vouchers from the Ministry of Finance;

6. Vietnam Joint Stock Commercial Bank for Foreign Trade (Vietcombank):

6.1. Execute payments according to the withdrawal methods specified in the JICA loan agreements at the request of the Ministry of Finance and send appropriate notices for each payment method to the Ministry of Finance, the Central Program Management Board, and contractors;

6.2. Monitor and report to the Ministry of Finance the balance of the special account after each payment and capital withdrawal into the special account;

7. Project Sponsor:

7.1. Prepare feasibility studies, technical designs, etc., in accordance with construction investment procedures and organize the selection of contractors in accordance with current tendering regulations;

7.2. Sign contracts with winning bidders or designated bidders, specifying the amount financed by JICA capital. Responsible for inspecting or entrusting consulting firms to inspect the quality of the work in accordance with technical designs and confirming the contractor's payment application form;

7.3. Report on the withdrawal of physical goods and money from JICA loans to relevant management authorities;

7.4. Timely and appropriately settle counterpart funding in line with the project schedule;

7.5. Monitor project completion progress based on the contractor payment notice from the Ministry of Finance to proceed with final settlement and contract payment with the contractor;

7.6. Finalize project settlements and individual project components in accordance with current construction project settlement regulations;

7.7. Assist in the supervision, monitoring, evaluation, and auditing of the program by the Program Leader, the Ministry of Finance, and sponsors;

8. Contractor:

8.1. Fulfill the contract in terms of quantity, quality, and schedule;

8.2. Fulfill tax obligations, warranties, repayment of advance funds, etc., as stipulated and in accordance with the contract with the Project Sponsor;

8.3. Complete final settlement, acceptance, handover, and warranty for completed projects with the Project Sponsor.

PART VII

MONITORING, REPORTING, AND SETTLEMENT WORK

1. Each year, the People's Committee of provinces and centrally governed cities and the Central Program Management Board shall report to the Ministry of Finance and the Ministry of Planning and Investment on the progress of the Program, as well as any issues arising from the receipt and use of loan funds.

2. The Central Program Management Board shall take the lead in coordinating with the Ministry of Finance to conduct regular and spot checks on the management and use of loan funds by localities. If misuse of loan funds is discovered, the transferred funds will be recovered or the transfer of funds will be temporarily suspended to take appropriate measures.

3. The Project Sponsor shall cooperate with relevant units to inspect and settle the accounts of completed projects.

4. Provinces and centrally governed cities shall consolidate and settle their local budgets and submit them to the Ministry of Finance and the Ministry of Planning and Investment for overall consolidation as prescribed. The Central Program Management Board shall be responsible for settling the program.

5. The Ministry of Planning and Investment shall compile and report to the Prime Minister on the allocation and implementation of projects at localities, and send copies to the Ministry of Finance. The Central Program Management Board shall coordinate with the JICA project evaluation team to review the program's implementation after the completion of the loan agreement disbursement period.

6. The Central Program Management Board shall be primarily responsible for providing information and data to JICA and the Government of Vietnam inspection, audit teams.

7. The Provincial Program Management Board and the Project Sponsor shall be responsible for retaining payment documentation files in accordance with current domestic regulations on the settlement of construction investment capital from the date of the loan agreement's conclusion, in compliance with archival requirements, to present when requested, to serve monitoring, tracking, assessment, and auditing of the program.

PART VIII

IMPLEMENTATION

This Circular takes effect fifteen days after its publication in the Official Gazette and replaces Circular No. 129/1999/TT-BTC dated November 5, 1999, issued by the Ministry of Finance.

In the course of implementation, if there are difficulties, agencies are advised to report to the Ministry of Finance for appropriate resolution measures./.