Decision No. 142/2003/QĐ-BTC Issuing the Regulation on the Organization of Lottery Lotto Issuance

DECISION OF THE MINISTER OF FINANCE

Issuing the Lottery Organizing and Issuing Regulations

________________________

THE MINISTER OF FINANCE

- Based on Decree No. 86/2002/NĐ-CP dated November 5, 2002 of the Government stipulating the functions, tasks, powers, and organizational structure of Ministries and ministerial-level agencies;

- BASED ON DECREE NO. 77/2003/ND-CP OF July 1, 2003 OF THE GOVERNMENT PROVIDING FOR THE FUNCTIONS, TASKS, POWERS AND ORGANIZATIONAL STRUCTURE OF THE MINISTRY OF FINANCE;

- Pursuant to the proposal of the Director General of the Department of Finance of Banks and Financial Organizations,

DECISION:

Article 1. Attached herewith is the Lottery Organizing and Issuing Regulations to be uniformly applied throughout the country.

Article 2. This Decision takes effect fifteen days from the date of publication in the Official Gazette and replaces Decision No. 37/2000/QĐ-BTC dated March 13, 2000 of the Ministry of Finance on issuing the Lottery Organizing and Issuing Regulations.

The Director General of the Department of Finance of Banks and Financial Organizations, the Head of the Ministry's Office, the Heads of relevant units under the Ministry, the Directors of Provincial Departments of Finance and Prices, and the Directors of Lottery Companies in provinces and cities shall be responsible for implementing this Decision./.

REGULATIONS

LOTTO LOTTERY ORGANIZING AND ISSUING REGULATIONS

(Issued  pursuant to Decision No. 142/2003/QĐ-BTC dated September 9, 2003 of the Ministry of Finance) 

Lotto lottery is a type of state lottery where the buyer has the right to choose their preferred numbers and there is a regular draw for prize distribution. To ensure compliance with national regulations on unified management of lottery issuance, the Ministry of Finance issues the Lotto lottery organizing and issuing regulations for provincial lottery companies to have a basis for implementation.

PART I

 GENERAL PROVISIONS

Article 1. Purpose of issuing Lotto lottery:

Issuing state lotteries generally, and Lotto lottery specifically, is a financial measure of the State to mobilize savings from residents into the State budget for use in programs serving society through a healthy entertainment form with prizes.

Article 2. Requirements in organizing and issuing Lotto lottery:

- The issuance of Lotto lottery must ensure compliance with national regulations on unified management of lottery issuance, current laws, and provisions in these regulations.

- Effective promotional work for Lotto lottery must be organized to explain to the public the purpose, significance, and appropriate measures to combat illegal activities such as playing illegal numbers games.

PART II

 SPECIFIC PROVISIONS

Article 3. Lottery tickets for Lotto lottery must meet the following requirements:

- The ticket must have a stub or retention portion.

- The ticket format should be simple and convenient, reflecting all necessary elements to serve participants buying tickets and meeting management requirements, and must have colors distinguishing denominations of each type of ticket for two-digit, three-digit draws.... to facilitate buyers' selection and control of the ticket when purchasing, and must print the name of the issuing company (for multiple-draw tickets, the number of draws must be clearly stated on the ticket).

In the instructions on the back of the ticket, in addition to general regulations, it must clearly state "any errors or mistakes recorded on the ticket that do not comply with the regulations will not be the responsibility of the lottery company for prize payment."

Article 4. Price of Lotto lottery tickets:

The price of Lotto lottery tickets is established based on ensuring balance and harmony with other types of state lottery tickets issued at various prices ranging from 500 dong to 10,000 dong per draw. For tickets applicable to multiple draws, the total value recorded on each ticket must not exceed 50,000 dong.

Article 5. Prize structure, reserve fund establishment and usage for stabilizing prize payment costs for Lotto lottery: - Establish a prize structure averaging no more than 60% of sales revenue. At the end of the accounting period (December 31 each year), the lottery company must establish and use a reserve fund for stabilizing prize payment costs according to the following provisions:

If the actual prize payment value for the entire year is less than 60% of the actual sales revenue, the lottery company can establish a reserve fund for prize payments. Reserve fund level

60% of sales revenue

Actual prize payment value  =      prize payment     -       for the entire year

      The level of the Lotto lottery prize payment reserve fund, if unused, may be carried over to the next year. The total amount of the reserve fund established cannot exceed 5% of the total lottery sales revenue for the reporting year. The lottery company records prize payment expenses as business expenses equal to 60% of sales revenue.                     If the reserve fund for prize payments has reached its maximum level, then actual prize payment expenses are recorded.             If the reserve fund for prize payments has reached its maximum level, then actual prize payment expenses are recorded.

Principle of using the reserve fund for prize payments: When the actual prize payment value for the entire year exceeds 60% of the actual sales revenue, the lottery company can use the reserve fund to reduce prize payment costs. If the reserve fund is insufficient, the remaining actual prize payment value is recorded as a business expense.

When the lottery company ceases issuing Lotto lottery, the entire unused reserve fund for prize payments must be recorded as a reduction in business expenses.

Promotion and advertising:

- When issuing Lotto lottery, the lottery company must organize effective promotional work to explain to the public the purpose, significance, and differentiate the nature of the state-issued Lotto lottery from illegal gambling and illegal number games.

Article 6. - Promotion and advertising must be conducted in moderation, focusing on essential information about the issuance of Lotto lottery to serve ticket buyers, such as: prize structure, participation rules, recording methods of agents, result comparison methods, prize levels, award collection locations, award collection times, and other information about winners, prize amounts, funds collected into the state budget, and their use for social welfare purposes.

Organization of issuance:

Lotto lottery is issued concurrently with other types of lottery.

Article 7. The quantity of tickets issued in each batch is determined by the lottery company based on market demand and must be consistent with the management capacity of each company.

The market for selling Lotto lottery tickets is limited to the administrative area of the locality.

Sales agents for Lotto lottery tickets:

The lottery company organizes and strictly manages the network of sales agents for Lotto lottery tickets. Sales agents for Lotto lottery tickets

Article 8. must be carefully selected and meet the following requirements:

- Proficient in specialized skills (promotion, recording, selling tickets).  - Adhere strictly to the agent regulations and specific provisions of the lottery company.

- Agents must prepay money to purchase tickets or provide cash collateral or mortgage certificates of value (bonds, bills, treasury bonds...) equivalent to the value of the tickets received (excluding commission for selling tickets).

- Agents must sign an agency contract for selling Lotto lottery tickets with the lottery company, and the agency contract must clearly stipulate the rights, obligations, and material responsibilities between both parties.

Organization of drawing and prize announcement:

- The agent must enter into an agency contract for selling Lotto lottery tickets with the Lottery Company, wherein the agency contract shall clearly stipulate the rights, obligations, and material liabilities between both parties.

Article 9. Number drawing and prize announcement procedures:

- The Lottery Companies may draw numbers separately for each type of Lotto ticket or use the traditional lottery results to announce the winning results for each type of two-digit, three-digit Lotto ticket, and other types that allow multiple result comparisons. Separate number drawings for each type of Lotto ticket must comply with the regulations of the Ministry of Finance on organizing and operating the Lottery Supervisory Council. - Announcements of Lotto lottery results must be clear and accurate, containing all necessary elements such as: date and location of the drawing, winning prizes, winning numbers, corresponding prize money for each prize, and the name of the issuing company to serve participants who purchase Lotto tickets and for the Lottery Company to organize prize payouts.

- Organizing the recovery of ticket stubs or retained portions: ... - The recovery of ticket stubs or retained portions must be strictly organized and managed under the supervision of the Lottery Supervisory Council.

Article 10. - The location for recovering ticket stubs or retained portions and the lottery record sheets must be separated from other work areas. During the recovery process, the Lottery Company must closely monitor and absolutely prevent unauthorized individuals from approaching the recovery area.

- The recovery of ticket stubs or retained portions must be completed thirty minutes before the start of the drawing. The person responsible for recovering the stubs or retained portions must prepare a record sheet, sign it, and bear full responsibility for any errors in the recovery process.

- After completing the recovery of ticket stubs or retained portions and recording the sales volume, the Lottery Company may proceed to withdraw winning ticket stubs or retained portions to ensure objectivity and honesty, preventing negative incidents.

- Upon obtaining the drawing results, the Lottery Company shall withdraw winning ticket stubs or retained portions and compile a record of the total prize money to be paid out. This record must be confirmed with signatures from members of the Lottery Supervisory Council.

- Withdraw winning ticket stubs or retained portions in order by each agent, sealing them separately for each agent, and preparing a detailed record of the quantity of stubs or retained portions for each prize category. - During the performance of their duties, relevant staff must ensure compliance with their respective functions, responsibilities, and authorities as stipulated by the Lottery Company.

- Organizing the storage of recovered ticket stubs or retained portions that did not win.

After verifying and counting the recovered ticket stubs or retained portions that did not win, the recovery staff must individually package the Lotto tickets of each agent according to each issuance period, seal each package, and send it to the ticket warehouse along with a list of each agent. In cases where winning ticket stubs or retained portions are missed during unsealing, the Supervisory Council must prepare a record of the unsealing and withdrawal of winning ticket stubs or retained portions.

- Storing and destroying recovered ticket stubs or retained portions that did not win, as well as winning ticket stubs or retained portions that have exceeded the redemption period without being claimed, must be carried out in accordance with current regulations of the Ministry of Finance regarding the storage and destruction of unsold tickets.

Article 11.  - Prize payments and management of redeemed tickets:

- Prize payments shall be made for tickets that remain intact within their original framework, are not torn, patched, erased, and whose numbers match those on the stub, provided they are within the redemption period announced by the Lottery Company.

Article 12. - Before making prize payments, the prize payment staff must verify the winning ticket presented by the holder to ensure it meets the valid winning ticket criteria as stipulated, and punched holes must be made on the ticket after payment.

- Prior to storing redeemed tickets, the Lottery Company must organize inspections, prepare records confirming compliance with regulations, and compile detailed lists of the number of winning tickets and stubs or retained portions, and the amount of prize money paid.

Article 13. - The storage period for winning tickets must comply with current regulations of the Ministry of Finance.

- Agent commissions:

Agent commissions are set by the Lottery Company but cannot exceed 13% of ticket sales revenue (for plains provinces and cities) and 15% (for mountainous and Central Highlands provinces).

- Prior to storing redeemed tickets, the Lottery Company must organize inspections, prepare minutes confirming that such tickets comply with regulations, and create detailed lists specifying the number of tickets and stubs or winning portions, along with the amount of redemption.

- The retention period for winning tickets shall be carried out in accordance with the current regulations of the Ministry of Finance.

Article 14. Commission for agents:

The agent commission is set by the Lottery Company but shall not exceed 13% of sales revenue (for plains provinces and cities) and shall not exceed 15% (for mountainous provinces and the Central Highlands).

 

Article 15. Ensuring the obligation to pay lottery ticket sales between agents and the Lottery Company:

- The Lotto lottery agent may only receive tickets after completing the legal procedures to guarantee the payment of 100% of the amount due immediately before receiving the tickets from the Lottery Company.

- The use of forms of guarantee for the payment obligation of the lottery savings agent with the Lottery Company shall be carried out in accordance with current regulations.

Article 16. Payment for lottery ticket sales:

The agent must submit the full proceeds from the sale of Lotto lottery tickets to the Lottery Company according to the deadline specified in the contract and in accordance with current state regulations related thereto.

Article 17. Accounting work:

- All activities related to the issuance of Lotto lottery tickets must be recorded and entered into accounting books in accordance with the provisions of the law and the current state accounting system.

- The Lottery Companies must implement reporting and statistical systems, financial reports in accordance with current state regulations.

Article 18. Obligation to pay state budget:

The Lottery Companies must comply with all current legal regulations regarding taxes and other payments.

CHAPTER III

 IMPLEMENTATION

Article 19. Conditions for organizing the issuance of Lotto lottery tickets:

Lottery Companies in provinces and cities that have a need to issue Lotto lottery tickets must develop a proposal report to the Department of Finance - Price Control for the Provincial People's Committee to decide on permission to issue.

The project must include the following main contents:

+ The annual issuance plan must be divided by month and quarter.

+ Place of printing tickets, designing ticket sheets, and measures to ensure the safety of ticket sheets.

+ Organizing a network of agents within the sales area.

+ Organizing promotional and advertising work.

+ Economic and social benefits.

+ Management organization measures.

The decision of the Provincial People's Committee allowing the issuance of Lotto lottery tickets must be sent to the Ministry of Finance for monitoring and management.

Article 20. The organization of the issuance of Lotto lottery tickets must fully follow the following procedures:

- Market research must be organized well to build an issuance plan suitable for consumption capacity; organize well promotional and advertising work, explain to the public the purpose, significance, and fairness of the issuance of Lotto lottery tickets.

- Before issuing, there must be sufficient material conditions to serve the issuance; organize well the network of agents, widely publicize the issuance regulations and rules for participating in prize draws.

 - Initially organize issuance in a limited scope to gain experience; expansion of the sales area must be appropriate to management capacity.

- Monthly and quarterly summaries must be conducted, timely inspections and corrections made to prevent negative developments.

Article 21. Suspension of Lotto lottery ticket issuance.

In cases where the Lottery Companies' issuance of Lotto lottery tickets achieves low effectiveness, incurs losses, and cannot be rectified, unable to maintain this type of lottery issuance, the company must submit a report to the Department of Finance - Price Control, the Provincial People's Committee.  The Ministry of Finance requests suspension of Lotto lottery ticket issuance.

When suspending Lotto lottery ticket issuance, the company must comply with the following regulations:

+ Analyze the reasons leading to losses.

+ Prepare a final settlement of the Lotto lottery operations from the date of issuance to the date of cessation, to be submitted to the Department of Finance - Price Control, Tax Bureau.

+ The Provincial People's Committee is the authority with the power to decide on the suspension of Lotto lottery ticket issuance.

PART IV

 HANDLING VIOLATIONS

Article 22.  Handling violations of the regulations:

For cases violating the provisions of this regulation, depending on the severity of the violation, administrative penalties (including consideration of suspension of Lotto lottery issuance) or referral to competent authorities for criminal responsibility will be imposed.

Article 23. Handling intentional fraudulent acts such as scraping, altering, or printing fake tickets to claim prizes:

For intentional fraudulent acts such as scraping, altering, or printing fake tickets to claim prizes, depending on the severity of the violation, compensation or criminal responsibility will be pursued.

CHAPTER V

 IMPLEMENTING PROVISIONS

Article 24. Effectiveness and responsibility for implementation:

This regulation takes effect 15 days after its publication in the Official Gazette and replaces the Regulation on the Organization of Issuance of Lotto Lottery Tickets in provinces and cities from Ninh Thuận onwards dated March 13, 2000, issued under Decision No. 37/2000/QĐ-BTC dated March 13, 2000, of the Ministry of Finance.

The Lottery Companies are responsible for strictly implementing this regulation and are subject to inspection by the Department of Finance - Price Control, the Provincial People's Committee, the Ministry of Finance, and competent authorities.

During implementation, if difficulties arise, units and individuals should report to the Provincial People's Committee and the Ministry of Finance for prompt resolution./.