Circular No. 14-CNR guides the regulations on economic linkage in the forestry sector

CIRCULAR

OF THE MINISTRY OF FORESTRY NO. 14-CNR ON APRIL 17, 1986 GUIDING

PROVISIONS ON ECONOMIC LINKAGES IN THE FORESTRY SECTOR.

Currently, the production requirements for the forest industry sector are very high, but the investment capital and technical facilities of provinces with forests are limited. The Ministry of Forestry has just issued Directive No. 10-LN/KL dated April 12, 1986 on strengthening management in the logging phase.

Below are the guidelines for provisions on economic linkages in the forestry sector.

1. Unit A (including Forest Departments, inter-industry associations of forestry-agriculture-industry, state-owned forest farms in provinces with forests) if lacking business capacity in logging and construction, may enter into economic linkages with Unit B from provinces without forests but possessing the capability to participate in forest logging and construction.

2. Unit B must be organizations within the forestry sector requesting linkage such as Forest Departments or Timber Companies authorized by the Forest Department.

Both Units A and B must negotiate and agree on the annual production linkage plan volume to submit for review by the Ministry of Forestry and the People's Committee of the province with forests. Based on the approved plan, Units A and B must sign a specific economic contract before commencing production.

Unit B must strictly comply with the logging regulations and procedures of the forestry sector (forests must be planned and designed before logging; logging must follow the prescribed procedures...). Unit A is responsible for organizing guidance, inspection, and strict supervision of compliance with logging procedures and ensuring proper forest acceptance and product acceptance.

Unit B must commit to organizing logging forces (labor, equipment, materials, fuel necessary...) from their own locality to participate in logging without hiring labor; purchasing; renting equipment, materials, fuel at the logging site, disrupting local plans.

All products logged by Unit B must be handed over to Unit A. Unit A will value the investment effort of Unit B in producing the product and pay the corresponding value to Unit B in equivalent timber according to the state-prescribed price.

Based on the economic linkage contract between Units A and B, the Forest Inspection Office of the province with forests will issue a permit to Unit B to transport an equivalent amount of timber corresponding to the paid labor value back to the province where the linkage force is located under the supervision of the People's Committee and the Forest Department of that province.

In principle, linked timber harvested in a year must be transported out in the same year. However, due to the current logging pattern often concentrated in the fourth quarter of each year, it is allowed to extend the transportation of linked timber from the previous year until the first quarter of the following year. Beyond this period, any untransported timber will be compulsorily purchased by the state based on actual quantity and quality upon entry into state warehouses.

Local Forest Departments in provinces with forests shall organize monitoring and oversight of the implementation of economic linkages and compile statistics on the volume of timber extracted by the linkage forces, the volume they are permitted to transport, and report these to the People's Committee of the province and the Ministry of Forestry.