Joint Circular No. 19/2010/TTLT-BTP-BTC-TTCP guiding the implementation of the State's liability for compensation in administrative management activities.

JOINT CIRCULAR

Guidelines for Implementing State Liability for Compensation in Administrative Management Activities

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Based on the Law on State Compensation Liability dated June 18, 2009;

Pursuant to Decree No. 16/2010/NĐ-CP dated March 3, 2010 of the Government detailing and guiding the implementation of certain provisions of the Law on State Compensation Liability;

The Ministry of Justice, the Ministry of Finance, and the Government Inspectorate have jointly issued guidelines for implementing state liability for compensation in administrative management activities as follows:

PART I

DETERMINATION OF STATE COMPENSATION LIABILITY

IN ADMINISTRATIVE MANAGEMENT ACTIVITIES

Article 1. Basis for Determining State Liability for Compensation in Administrative Management Activities

1. The State's liability for compensation in administrative management activities shall arise only when the following conditions are met:

a) There is a document from a competent state authority determining that the act of the public servant is contrary to the law;

b) The illegal act of the public servant falls within the scope of compensation liability prescribed in Article 13 of the Law on State Liability (hereinafter referred to as the Law).

c) Actual damage has occurred;

d) There is a causal relationship between the actual damage and the unlawful act of the public servant.

Clause 2. The State shall not compensate for damage that occurs entirely due to the fault of the person suffering damage; in cases where both the public servant and the person suffering damage are at fault, the State shall only compensate for part of the damage corresponding to the degree of fault of the public servant.

Article 2. Official document of the competent state agency determining the illegal act of the public servant

1. Decisions on handling complaints made by persons with authority that have taken legal effect in accordance with the law.

Clause 2. Decision on handling complaints made by the competent authority or person in accordance with the provisions of the law.

3. Judgments and decisions of the Court on resolving administrative cases that have taken legal effect.

Article 3. Determination of the Scope of Compensation Liability

Determination of the scope of compensation liability in certain specific cases shall be carried out as follows:

Clause 1. Applying measures provided for in Clauses 2, 3, and 4 of Article 13 of the Law refers to the situation where the public servant commits an illegal act and causes damage when issuing decisions to handle administrative violations or implementing such measures.

Clause 2. Applying taxes, fees, and charges as stipulated in Clause 6 of Article 13 of the Law refers to the situation where the public servant commits an illegal act and causes damage when performing the following tasks:

Point a) Identifying taxpayers and taxable objects;

Point b) Determining tax bases, fees, and charges;

Point c) Exempting; reducing; refunding; deferring payment; writing off taxes, fees, and charges.

Clause 3. Applying customs procedures as provided for in Clause 7 of Article 13 of the Law refers to the situation where the public servant commits an illegal act and causes damage when performing the following tasks:

Point a) Receiving and registering customs declarations;

Point b) Inspecting declaration forms; inspecting actual goods and transport vehicles;

Point c) Clearing goods and transport vehicles.

Clause 4. Documents having the value of permits as provided for in Clauses 5 and 11 of Article 13 of the Law include: confirmation, approval, and approval documents; professional certificates; certificates of recognition and other types of documents issued by competent state agencies for organizations and individuals to exercise their rights and fulfill their obligations under the law.

Article 4. Actual Damage

Actual damage is real damage that the person suffering damage must bear due to the illegal acts of the public servant. Actual damage includes material damage and damage caused by mental distress.

Clause 1. Material damage within the scope of state liability for compensation in administrative management activities includes: damage caused by the infringement of property as stipulated in Article 45 of the Law; damage caused by the loss or reduction of actual income as stipulated in Article 46 of the Law; material damage caused by the death of the person suffering damage as stipulated in Article 48 of the Law; material damage caused by harm to health as stipulated in Article 49 of the Law.

Clause 2. Damage caused by mental distress within the scope of state liability for compensation in administrative management activities includes: damage caused by mental distress during administrative detention, placement in educational facilities, educational institutions, or medical facilities as stipulated in Clause 1 of Article 47 of the Law; damage caused by mental distress in cases where the person suffering damage dies as stipulated in Clause 3 of Article 47 of the Law; damage caused by mental distress in cases where health is infringed upon as stipulated in Clause 4 of Article 47 of the Law.

Chapter II

DETERMINATION OF COMPENSABLE DAMAGE

Article 5. Damage caused by infringement of property

1. Damage caused by infringement of property shall be determined in accordance with Article 45 of the Law. In cases where the infringed property is land use rights, houses, construction works, and other assets attached to the land, the compensation for damage shall be determined in accordance with the provisions of Article 45 of the Law and relevant laws.

2. The interest calculation period for the amounts specified in Clause 4 of Article 45 of the Law shall be calculated from the date the money is deposited into the state budget; confiscated; enforced; placed as security at the competent authority until the date the decision on compensation settlement is issued by the responsible compensation agency or the court's judgment or decision.

Article 6. Damage caused by actual loss or reduction of income

1. Damage due to actual loss or reduction of income of organizations

Damage caused by actual loss or reduction of income of organizations as stipulated in Article 46 of the Law shall be determined based on the average income of two consecutive years prior to the occurrence of the damage. The income of the organization shall be determined according to the organization's legally valid financial report; in cases where there is no financial report, the organization may prove the actual loss or reduction of income through other legitimate documents and evidence in accordance with relevant laws.

In cases where the organization has been established for less than two years up to the time of damage occurrence, the actual income of the organization shall be determined based on the average income during the actual operating period of the organization.

2. Damage due to actual loss or reduction of income of individuals

a) Actual income of individuals as stipulated in Article 46 of the Law shall be determined as follows:

In cases where the person suffering damage had stable income from salary within the establishment or wages from labor contracts before the occurrence of damage, the amount of actual income shall be determined based on the salary or wage level of the month immediately preceding the occurrence of damage.

In cases where the person suffering damage had employment and monthly income but not stable before the occurrence of damage, the average income of the three months immediately preceding the occurrence of damage shall serve as the basis for determining the amount of actual income.

In cases where the person suffering damage was farmers, fishermen, salt workers, forest growers, hired workers, small traders, artisans, or other workers with income that is seasonal or unstable before the occurrence of damage, the average income of similar workers in the locality shall be taken as the basis; if the average income cannot be determined, the minimum wage prescribed by the State for civil servants working in administrative state agencies at the time of compensation settlement shall be used as the basis for determining the amount of actual income.

b) The person suffering damage (including deceased persons) shall be compensated for the actual income lost or reduced during the period they were administratively detained, sent to a correctional school, educational facility, medical facility, and during treatment due to health infringement. During this period, if the person suffering damage receives full salary or wages from the agency or employer in accordance with labor law and social insurance regulations, they shall not receive corresponding compensation; if the person suffering damage receives partial salary or wages from the agency or employer, the remaining portion shall be considered as the actual income reduction and they shall be compensated for that reduced income.

Example 1:

Mr. A is a freelance newspaper vendor. Due to being illegally admitted to a medical facility, Mr. A did not have any income during this period. Mr. A's income before being admitted to the medical facility was unstable, but his income in the three months prior to the damage was successively 1,200,000 VND, 1,000,000 VND, and 1,100,000 VND. Mr. A's actual income is determined as the average income of the three months immediately preceding the damage: 1,100,000 VND. In this case, Mr. A's actual income was lost, and he is entitled to compensation for the actual income lost during the period of admission to the medical facility each month, which is 1,100,000 VND.

Example 2:

Ms. B works for a legal consulting company. Her income before her health was infringed upon was stable, averaging 3,000,000 VND per month. Due to health infringement, Ms. B had to undergo treatment, and during the treatment period, the company paid her 40% of her salary, which is 1,200,000 VND. In this case, Ms. B's actual income was reduced by 1,800,000 VND per month, so she is entitled to compensation for the actual income reduction during the treatment period.

Example 3:

Mr. C is a civil servant with a stable monthly income of 1,700,000 VND. Due to health infringement, Mr. C had to undergo treatment, and during the treatment period, the agency continued to pay all his income fully. In this case, Mr. C's actual income was not lost, so he is not entitled to compensation for this amount.

Article 7. Damage due to mental distress

1. Damage due to mental distress during administrative detention, placement in a reformatory school, educational facility, or medical facility as stipulated in Clause 1 of Article 47 of the Law shall be determined as follows:

a) One day's minimum wage is determined by dividing the minimum wage set by the State for civil servants working in administrative agencies at the time of compensation by 22, which is the average number of working days per month.

Example: At the time this Circular is issued, the general minimum wage set by the State is 730,000 VND, therefore one day's minimum wage will be: 730,000 VND ÷ 22 = 33,182 VND.

b) The number of days of administrative detention, placement in a reformatory school, educational facility, or medical facility is determined based on the actual number of days during which the person being compensated was administratively detained, placed in a reformatory school, educational facility, or medical facility.

Example: Mr. A was admitted to a medical facility on December 1, 2010, and was released on March 1, 2011. On March 20, 2011, the competent authority determined that Mr. A did not fall under the category of individuals subject to placement in a medical facility. In this case, the damage due to mental distress that Mr. A is entitled to compensation for is determined as follows:

The actual number of days of admission to the medical facility is: 31 days of December 2010 + 31 days of January 2011 + 28 days of February 2011 = 90 days.

The amount of minimum wage days to be compensated is:

90 days × 2 = 180 days.

In this example, the amount of compensation that Mr. A receives from the State is:

180 days × 33,182 VND = 5,972,760 VND.

2. Damage due to mental distress in cases where the person suffering damage dies as stipulated in Clause 3 of Article 47 of the Law shall be determined as follows:

a) If the person suffering damage dies during administrative detention, placement in a reformatory school, educational facility, or medical facility without it being their own fault or due to an unforeseeable event or emergency situation, their relatives are entitled to compensation for damage due to mental distress in the form of a lump sum payment equal to three hundred sixty months' worth of minimum wage as set by the State at the time of compensation.

b) If the person subjected to administrative detention, placement in a reformatory school, educational facility, or medical facility dies during such detention or placement due to their own fault or due to an unforeseeable event or emergency situation, their relatives are not entitled to compensation for damage due to mental distress according to Clause 3, Article 47 of the Law.

c) The compensation for damage due to mental distress is a lump sum payment for the relatives of the person suffering damage (spouse, father, mother, adoptive father, adoptive mother, biological child, adopted child, or person directly raising the person suffering damage). Those entitled to compensation must still be alive at the time the person suffering damage dies.

Article 8. Material damage caused by the death of the person suffering damage

1. Reasonable expenses for the treatment, care, and support of the person suffering damage before their death, as stipulated in Clause 1, Article 48 of the Law, are actual necessary expenses consistent with the nature and extent of the damage, commensurate with the average price in each locality at the time of expenditure, including: fees for transportation to take the person suffering damage to a medical facility for emergency care; costs for medicine and medical equipment; expenses for X-rays, CT scans, ultrasounds, laboratory tests, surgery, and blood transfusions as prescribed by a doctor; hospital fees; nutritional supplements and health recovery expenses for the person suffering damage as prescribed by a doctor; other actual necessary expenses prior to the death of the person suffering damage (if any).

2. Expenses for the burial of the deceased person suffering damage, as stipulated in Clause 2, Article 48 of the Law, are determined based on the funeral allowance as provided by social insurance laws.

3. Only maintenance payments are compensated to those individuals who were receiving maintenance from the person suffering damage as stipulated in Clause 3, Article 48 of the Law, if prior to administrative detention or placement in an educational or medical facility, the person suffering damage was fulfilling maintenance obligations but died during such detention or placement. Individuals receiving maintenance from the person suffering damage are entitled to compensation for those maintenance payments.

Article 9. Material damage due to harm to health

1. Reasonable expenses for medical treatment, care, recovery of health and functions lost or diminished of the person suffering damage as stipulated in Clause 1 of Article 49 of the Law include: the expenses guided in Clause 1 of Article 8 of this Circular and expenses for installing artificial limbs, eyes, wheelchairs, walking aids, and aesthetic restoration, and other expenses to support or replace part of the body functions lost or diminished (if any).

If state agencies have paid all these expenses, the person suffering damage shall not be compensated; in case state agencies have paid part of these expenses, the person suffering damage shall be compensated for the remaining expenses.

2. Compensation for reasonable expenses and actual income loss of caregivers for the victim as stipulated in Clause 3 of Article 49 of the Law.

a) The victim may only be compensated for reasonable expenses and actual income loss of caregivers if such care is necessary or required by a medical facility.

b) Reasonable expenses of the caregiver during the treatment period include travel expenses for transportation and rental fees for accommodation at local average prices (if any).

c) Actual income lost of the caregiver during the treatment period is determined according to Article 46 of the Law and the guidance provided in Clause 2 of Article 6 of this Circular.

3. The person suffering damage who has lost their ability to work and requires constant care is someone unable to perform production, business, or service activities. Reasonable expenses for the constant care of the person suffering damage who has lost their ability to work as stipulated in Clause 4 of Article 49 of the Law are calculated based on the average wage paid for caring for disabled persons in the locality where the person suffering damage resides.

Chapter III

PROCEDURE FOR SETTLING COMPENSATION

Article 10. Determining the illegal act of public officials

1. When organizations or individuals believe they have suffered damage due to administrative decisions or acts of public officials and wish to receive state compensation, they must follow the complaint procedures prescribed by the law on complaints to request the competent authority to determine whether the act of the public official is illegal.

2. The authority responsible for handling complaints has the responsibility to resolve complaints in accordance with the prescribed procedures under the law. In the decision resolving the complaint, it must clearly determine whether the act of the public official is illegal or not illegal.

Article 11. Claim for Compensation Documents

The claim for compensation documents include:

a) A claim form according to Form No. 01a; 01b or 01c issued together with this Circular;

b) A copy of the document from the competent state agency determining the illegal act of the public official;

c) Relevant documents and evidence related to the claim for compensation.

Article 12. Acceptance of Compensation Claim Petitions

1. Within two years from the date of receipt of the document from the competent authority determining the illegal act of the public official, the person claiming compensation must submit the claim for compensation documents to the responsible compensation authority through one of the following methods:

a) Directly submitting the application at the responsible compensation authority;

b) Sending the claim for compensation documents to the responsible compensation authority via the postal communication system.

2. Upon receiving the claim for compensation documents, the responsible compensation authority must check and determine the validity of the claim form and accompanying papers; if the documents are incomplete, the person claiming compensation must be instructed to supplement them.

For documents from the competent state agency determining the illegal act of the public official that the person claiming compensation cannot provide, the responsible compensation authority has the responsibility to collect those documents.

3. Within five working days from the date of receipt of the valid claim form and accompanying papers, if it determines that the claim for compensation falls within its responsibility to resolve, the authority receiving the documents must accept the case and notify the person claiming compensation in writing about the acceptance of the claim; if the authority receiving the claim believes that the matter does not fall within its responsibility to resolve, it must return the documents and guide the person claiming compensation to send the claim to the state management agency on compensation to determine the responsible compensation authority according to Chapter IV of Decree No. 16/2010/NĐ-CP dated March 3, 2010 of the Government detailing and guiding the implementation of certain provisions of the Law on State Compensation Liability (hereinafter referred to as Decree No. 16/2010/NĐ-CP).

Article 13. Organization of the Compensation Settlement Process

Immediately upon accepting the compensation claim petition, the head of the agency responsible for compensation must issue a decision to appoint a representative to carry out the compensation settlement process (hereinafter referred to as the representative) in accordance with Article 7 of Decree No. 16/2010/NĐ-CP.

Article 14. Damage Verification

Within five working days from the date of accepting the compensation claim petition, the representative must organize the verification of damages. The verification of damages shall be carried out based on the documents and evidence provided by the person requesting compensation. In cases where necessary as stipulated in Clause 2 and Clause 3 of Article 18 of the Law, the agency responsible for compensation may request other agencies or organizations to appraise assets, assess property damage, assess health damage, or seek opinions from related agencies regarding the compensation settlement.

The verification period for damages is twenty days, starting from the date of accepting the compensation claim petition; in cases involving many complex circumstances or requiring verification at multiple locations, the verification period may be extended but not exceeding forty days.

Article 15. Negotiation on Compensation

Within three working days from the end of the damage verification process, the representative must initiate negotiations with the damaged party.

The negotiation period is thirty days, starting from the end of the damage verification process; in cases involving many complex circumstances, the negotiation period may be extended but not exceeding forty-five days.

The negotiation participants, negotiation location, and negotiation minutes content shall be conducted in accordance with Clause 2, Clause 3, and Clause 4 of Article 19 of the Law. The negotiation minutes shall be implemented according to Form No. 02 issued together with this Circular.

Article 16. Issuance of Decision on Compensation Resolution

Immediately after completing the negotiation, the representative must finalize the draft decision on compensation settlement to report to the head of the agency responsible for compensation. Based on the results of damage verification, negotiations with the damaged party, and opinions from related agencies (if any), the head of the agency responsible for compensation will review and sign off on the decision on compensation settlement. The decision on compensation settlement shall be implemented according to Form No. 03 issued together with this Circular.

Article 17. Transfer of the Decision on Compensation Settlement

The representative organizes the transfer of the decision on compensation settlement in accordance with the procedures stipulated in Article 10 of Decree No. 16/2010/NĐ-CP.

Article 18. Initiating a Lawsuit to Resolve Compensation

The damaged party has the right to initiate a lawsuit to resolve compensation in the following cases:

1. The damaged party disagrees with the decision on compensation settlement as prescribed in Clause 1 of Article 22 of the Law.

2. Upon expiration of the deadline for issuing the decision on compensation settlement, if the compensation settlement agency does not issue the decision on compensation settlement as prescribed in Clause 1 of Article 22 of the Law.

The deadline for issuing the decision on compensation settlement as stipulated in Article 22 of the Law is determined as the eleventh day from the date when the representative of the compensation settlement agency and the damaged party sign the negotiation minutes.

Article 19. Requesting Compensation During the Administrative Litigation Process

1. During the administrative litigation process, if the plaintiff believes that the unlawful act of a public servant has caused damage, they have the right to request the competent court to resolve the compensation settlement as prescribed in Articles 24 and 25 of the Law.

2. In cases where the agency responsible for compensation does not voluntarily comply with the judgment or decision of the court that has taken legal effect, the damaged party has the right to submit a petition requesting the civil enforcement agency to organize enforcement in accordance with the laws on civil enforcement.

Article 20. Payment of compensation

Based on the effective decision on compensation settlement of the agency responsible for compensation or the judgment or decision that has taken legal effect of the court, the agency responsible for compensation shall implement the payment of compensation to the damaged party in accordance with Chapter VI of the Law.

Chapter IV

IMPLEMENTING PROVISIONS

Article 21. Effectiveness

1. This Circular takes effect 45 days from the date of signature.

2. Repeal Circular No. 49/2008/TT-BTC dated June 12, 2008, of the Ministry of Finance guiding compensation for losses to taxpayers and declarants due to the unlawful acts of tax officials and customs officials while performing their duties.

Article 22. Implementation organization

During the implementation process, if there are difficulties or obstacles, individuals and organizations are requested to reflect them to the Ministry of Justice for coordination with the Ministry of Finance and the Government Inspectorate to study and resolve./.