Circular No. 19/2014/TT-BQP detailing and guiding management of prices in the national defense sector.

CIRCULAR

Detailed regulations and guidance on price management

in the defense sector

                                  _________________                               

||| Based on the Law on Legislative Acts of 2008;

Pursuant to the Law on Fees and Charges 2015;

Pursuant to Decree No. 89/2013/NĐ-CP dated August 6, 2013 of the Government detailing implementation of certain provisions of the Law on Prices regarding price appraisal;

Pursuant to Decree No. 177/2013/NĐ-CP dated November 14, 2013 of the Government detailing and guiding implementation of certain provisions of the Law on Prices;

Pursuant to Decree No. 35/2013/NĐ-CP dated April 22, 2013 of the Government detailing functions, tasks, powers, and organizational structure of the Ministry of National Defense;

Upon examination of the proposal of the Director of the Finance Department of the Ministry of National Defense;

The Minister of National Defense hereby promulgates detailed regulations and guidance on price management in the defense sector.Article 1. This Circular stipulates detailed regulations and guides methods for pricing goods and services priced by the Ministry of National Defense; price management within the Ministry of National Defense.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

Article 2. Matters not covered by the guidance provided in this Circular shall be implemented in accordance with the laws on prices.

This Circular applies to agencies, units, organizations, enterprises, and individuals related to procurement, production, repair, supply of goods and services serving national defense according to orders, plans, and designated tenders (for specific cases) as prescribed by the Ministry of National Defense.

Article 2. Applicability

Clause 1. The comparative method is a pricing method based on the results of analyzing and comparing prices and economic and technical characteristics affecting the prices of goods and services to be priced with similar goods and services on the market.

Article 3. Explanation of Terms

In this Circular, the following terms shall be understood as follows:

Clause 2. Similar goods and services are those of the same type, identical, or similar to the goods and services to be priced in terms of basic characteristics such as: Purpose of use, economic and technical features, shape, size, construction principle, main technical parameters, quality, origin, time of production, production technology.

Clause 3. The cost method is a pricing method based on actual reasonable and legitimate production and business costs, expected profit (if any), consistent with the market price level and state policies affecting the prices of goods and services.

Article 4. Pricing principles

Clause 1. Determining prices must ensure compensation for reasonable production and business costs with profit, consistent with the market price level; state policy orientation and guidelines of the Ministry of National Defense.

Clause 2. Timely adjust prices when factors forming prices change.

Article 5. Bases for pricing

Clause 1. Total cost, quality of goods and services at the time of pricing, expected profit level.

Clause 2. Domestic and international market prices (if applicable) and competitiveness of goods and services at the time of pricing.

Clause 3. The competent authority managing prices shall base its decisions on the provisions of this Circular to:

Point a) Appraise pricing schemes, decide on prices of goods and services priced by the Ministry of National Defense.

Point b) Inspect price-forming factors, inspect compliance with laws on prices.

Clause 4. Units and enterprises in the military engaged in production, business, and supply of goods and services not falling under the scope specified in Article 2 of this Circular have the right to base their decisions on the provisions of this Circular to calculate and decide on prices of goods and services within their pricing authority.

4. Units and enterprises under the military engaged in production and business, supplying goods and services not falling within the scope prescribed in Article 2 of this Circular shall have the right to base themselves on the provisions of this Circular to calculate and determine prices for goods and services within their pricing authority.

Article 6. Valuation methods, selection of valuation methods in the Ministry of National Defense

1. The valuation methods for goods and services stipulated in this Circular include the comparison method and the cost method.

2. Based on the characteristics and utility value of each type of goods and service; specific conditions related to production and business operations, and market conditions to select appropriate valuation methods for goods and services that need to be valued.

Chapter II

"5. The pre-tax weighted average cost of capital i (%) is determined according to the formula below:VALUATION METHODS FOR GOODS AND SERVICES

Section 1

COMPARISON METHOD

Article 7. Comparative factors

1. Factors for analyzing, comparing, and adjusting prices that affect the price of goods and services to be valued include:

a) Market buying and selling transaction prices under normal conditions (without economic crises, natural disasters, enemy attacks, fires, and other force majeure situations) of similar goods and services tied to time, transaction conditions (market conditions, buying and selling conditions, delivery and payment conditions, exchange rates, and other conditions), and state policies affecting the prices of goods and services.

b) Basic characteristics of goods and services such as: economic and technical features, usage status, quality, origin, production time, usage time, legal characteristics, intended use, and other relevant comparative parameters.

2. Transaction prices of similar goods and services on the market collected closest to the valuation date, based on at least one of the following documents:

a) Information sources from authorized agencies, organizations, individuals; pricing decisions by authorized levels; successful transaction prices of organizations and individuals.

b) Import prices according to customs declarations provided by customs authorities; prices listed on sales invoices as prescribed.

c) Auction prices, bidding prices, prices determined by appraisal organizations with valuation functions.

d) Registered prices, declared prices, listed prices.

đ) Prices listed on quotation papers, tender offers from at least three supplying units, budget estimates for implementing production and supply of goods and services approved by authorized levels.

e) Reference prices from legitimate information provided by suppliers in accordance with Vietnamese law obtained through the internet, mass media, trade commissioners of Vietnam, defense attachés of Vietnam in foreign countries.

3. Results of analysis and comparison of similar goods and services for valuation purposes.

Article 8. Conducting valuation using the comparison method

1. Determine general information about the goods and services to be valued (quantity, types, characteristics, usage period, main economic-technical parameters, and other information); key comparative factors affecting the prices of goods and services to be valued.

2. Study the market, collect information on prices and related information of similar goods and services on the market; analyze information sources to select at least three similar goods and services for comparison (if available). In cases where fewer than three similar goods and services are available for comparison, comparisons should be made based on the actual number of items collected.

3. Analyze prices and related information for comparison, key contents affecting the prices of goods and services to be valued.

4. Conclusions and recommendations.

Section 2

COST METHOD

Article 9. Determining the price of goods and services

1. Price of domestically produced and repaired goods and services

a) Calculation Formula:

The price of domestically produced and repaired goods and services = total cost + expected profit (if applicable) + defense and security subsidy, special military subsidy, attraction subsidy for workers in key national defense industrial facilities, special subsidy for key facilities (if applicable) + special consumption tax (if applicable) + value-added tax, other taxes (if applicable).

b) Total cost of goods and services shall be determined in accordance with the provisions of Article 16 of this Circular.

c) Expected profit shall be determined in accordance with the provisions of Article 18 of this Circular.

d) Special consumption tax (if applicable), value-added tax, other taxes (if applicable) shall be determined in accordance with current tax laws.

2. Price of imported goods and services

a) Calculation Formula:

The price of imported goods and services = import cost + selling expenses, financial costs (if applicable), management expenses + expected profit (if applicable) + value-added tax, other taxes (if applicable)

b) Import cost shall be determined according to the following formula:

Import cost = Purchase price at Vietnam's customs port + import tax + special consumption tax (if applicable) + other taxes and fees arising at the import stage (if applicable) + other monetary expenses as prescribed (if applicable)

Where:

- Purchase price at Vietnam's customs port = [(Actual purchase price in the foreign market + costs incurred to bring the goods to Vietnam (including international insurance costs, international freight charges) + other costs to be added as prescribed (if applicable) - costs to be deducted as prescribed (if applicable) from the value of imported goods for calculating import tax as prescribed] x exchange rate for converting foreign currency.

The exchange rate for converting foreign currency shall be calculated based on the actual exchange rate that organizations and individuals have settled with the Bank (where the organization or individual conducts transactions) when borrowing or purchasing foreign currency to buy goods. In cases where organizations and individuals have not yet settled with the Bank, it shall be calculated based on the selling rate of the commercial bank where the organization or individual has borrowed or purchased foreign currency at the time of valuation.

- Import tax, special consumption tax, other taxes and fees arising at the import stage (if applicable) shall be determined in accordance with current tax laws.

c) Selling expenses, financial costs (if applicable), management expenses shall be determined in accordance with Articles 13, 14, and 15 of this Circular.

d) Expected profit shall be determined in accordance with the provisions of Article 18 of this Circular.

đ) Value-added tax, other taxes (if applicable) shall be determined in accordance with current tax laws.

Article 10. Direct material costs of domestically produced and repaired goods and services

1. Direct material costs include costs related to main raw materials (including externally purchased semi-finished products), replacement parts, self-made semi-finished products, auxiliary materials, fuel, energy, power... (hereinafter referred to as material costs) directly used in the production, repair, and supply of goods and services. These costs are determined based on material consumption standards or technical design - general budget estimates (for shipbuilding products, water transport means, products under programs and projects) approved and the purchase price of input materials.

2. Calculation formula:

Material costs = Material price x Material consumption rate

a) For products subject to value-added tax, material costs are determined according to the following formula:

Material costs = Material price (excluding value-added tax) x Material consumption rate

b) For products not subject to value-added tax, material costs are determined according to the following formula:

Material costs = Material price (including value-added tax) x Material consumption rate

3. Material prices are determined as follows:

a) For externally purchased materials, it is the purchase price recorded on the seller's invoice (if the materials are imported in foreign currency, they are converted to Vietnamese Dong based on the actual selling rate of the transaction bank at the time of payment) plus import tax and additional fees (if applicable) plus transportation costs, loading and unloading fees, storage fees, insurance fees, loss fees according to standard rates (if applicable), warehouse rental fees, pre-import processing fees (if applicable), sorting and recycling fees.

b) For self-manufactured or dismantled materials, it is the actual price of materials issued from the warehouse according to regulations, plus actual costs incurred during the manufacturing and restoration process.

c) For outsourced processed materials, it is the actual price of materials issued from the warehouse for processing, plus outsourcing processing fees, transportation costs, loading and unloading fees from the warehouse of the unit or enterprise to the processing location and vice versa.

d) For materials and replacement parts provided free of charge (in kind) by industries to units and enterprises are included in direct material costs, but are listed separately as a cost item to be excluded when determining the payment price of defense products.

For materials priced by the State or the Ministry of Defense, they are priced according to the level set by the State or the Ministry of Defense, plus transportation and loading/unloading costs (if applicable).

4. Material consumption rates are determined based on actual usage, but must not exceed economic and technical standards or technical design - general budget estimates (for shipbuilding products, water transport means, products under programs and projects) approved by competent authorities. If the consumption rate exceeds the standard or total estimate, a report must be submitted to the competent authority for approval of adjustment before being considered for pricing.

Article 11. Direct labor costs for goods and services produced and repaired domestically

1. Direct labor costs include wages, salaries, and allowances with the nature of wages (excluding defense and security allowances, special military allowances, incentives to attract workers in key national defense industrial facilities, and special communication allowances), social insurance, health insurance, unemployment insurance (if applicable), union dues of workers directly involved in production, repair, and supply of products, specifically as follows:

2. Calculation formula:

Direct labor cost = Labor consumption rate x Wage unit price

a) The labor consumption rate is determined based on actual figures but must not exceed economic and technical norms or technical design - total budget estimates (for shipbuilding products, watercraft, and products under programs and projects) approved by competent authorities. If it exceeds the norm or total estimate, a report must be submitted to the competent authority for approval of adjustments before considering the price.

b) Wage unit price

- The daily wage unit price is determined by the wage (the average job grade coefficient multiplied by the basic salary according to regulations), allowance with the nature of wages (excluding defense and security allowances, special military allowances, incentives to attract workers in key national defense industrial facilities, and special communication allowances), divided by 26 days.

- The hourly wage unit price equals the daily wage unit price divided by 8 hours.

c) Social insurance, health insurance, unemployment insurance (if applicable), and union dues of workers directly involved in production are allocated according to current state regulations, Ministry of National Defense, and distributed according to the wages of direct workers for both defense and economic products.

Article 12. Common production costs for goods and services produced and repaired domestically

Common production costs include expenses for management and service of common production that cannot be directly attributed to individual products, but must be allocated to the cost of each product according to appropriate allocation criteria for both defense and economic products, including:

1. Wages and allowances with the nature of wages (excluding defense and security allowances, special military allowances, incentives to attract workers in key national defense industrial facilities, and special communication allowances) of workshop staff and contributions to social insurance, health insurance, unemployment insurance (if applicable), and union dues on the wages of workshop staff according to current state and Ministry of National Defense regulations. Calculation methods as stipulated in Article 11 of this Circular.

2. Meal expenses between shifts for production workers; for workshop management staff according to current regulations.

3. Material costs used for common production needs such as materials for repairing fixed assets, used for management work.

4. Depreciation costs of fixed assets implemented according to the Ministry of National Defense's regulations on depreciation rates for defense products.

5. Costs of production tools and equipment.

6. External service costs, including: electricity, water, telephone, rental for repairs of fixed assets, loading and unloading fees, transportation costs of products, and other related costs.

7. Other monetary costs outside those mentioned above serving the operation of the workshop.

Article 13. Selling expenses for goods and services produced and repaired domestically

1. Wages and allowances with the nature of wages (excluding defense and security allowances, special military allowances, incentives to attract workers in key national defense industrial facilities, special allowances for critical positions) paid to sales staff, packaging staff, transportation staff, product storage staff... and contributions to social insurance, health insurance, unemployment insurance (if applicable), trade union fees according to current State regulations, Ministry of National Defense. The calculation method shall be as prescribed in Article 11 of this Circular.

2. Material costs and packaging materials used for preserving, packaging, and consuming products, and for repairing fixed assets.

3. Tool and equipment costs used in the consumption process of products.

4. Depreciation costs of fixed assets used in the consumption process of products, such as: Loading and unloading equipment, transportation equipment, and other related depreciation costs.

5. Costs for product acceptance, warranty costs, training and education costs.

6. External service costs, including: electricity, water, telephone, rental for repairs of fixed assets, loading and unloading fees, transportation costs of products, and other related costs.

7. Other monetary costs outside those mentioned above serving the consumption process of products.

Article 14. Financial expenses for goods and services produced and repaired domestically

Financial expenses include interest payments on loans (if any) directly related to the production and business of products and exchange rate differences (if any) during the purchase and sale of materials and goods, allocated to each unit of product or service.

Article 15. Administrative expenses of enterprises for goods and services produced and repaired domestically

Administrative expenses include indirect costs serving general management and production and business activities of the enterprise that do not directly participate in the production and consumption processes of products; these costs are allocated appropriately to both defense products and economic products, including:

1. Wages, allowances with the nature of wages (excluding defense and security allowances, special military allowances, incentives to attract workers in key national defense industrial facilities, special allowances for critical positions) and contributions to social insurance, health insurance, unemployment insurance (if applicable), trade union fees of enterprise management personnel according to current State regulations, Ministry of National Defense. The calculation method shall be as prescribed in Article 11 of this Circular.

2. Wages for time off and contributions to social insurance, health insurance, unemployment insurance (if applicable), trade union fees of personnel during holidays, Tet, leave, meeting days, political and military training days according to regulations of the Ministry of National Defense.

3. Management material costs used for enterprise management needs such as materials for repairing fixed assets and management work.

4. Office tool, equipment, and office supply costs.

5. Depreciation costs of common fixed assets for the enterprise such as: Office buildings of departments, warehouses, structures, communication equipment, management machines and equipment used in offices, and other related depreciation costs of common fixed assets in offices.

6. Scientific research and technology development costs (excluding budget-supported funds), training and education costs according to regulations, internal medical costs.

7. Severance pay, demobilization pay, retirement waiting pay according to regulations (excluding budget-supported funds).

8. Costs for female employees according to regulations.

9. Labor protection and uniform costs according to regulations.

10. Travel expenses, transportation allowances for vacation of enterprise officials and employees.

11. Party and mass organization work costs at the enterprise (costs outside the budgets of these organizations as stipulated).

12. External service costs, including: Tools, equipment, electricity, water, telephone, repair service fees for fixed assets, loading and unloading fees, freight charges for goods and products; insurance premiums for assets and project management products (if any) and other external service costs serving management work.

13. Other monetary costs: Reasonable and legitimate costs outside those mentioned above, used for the common needs of the management department.

Article 16. Total cost of goods and services produced and repaired domestically

Total cost = Direct material costs + Direct labor costs + Common production costs + Selling expenses + Financial costs (if applicable) + Business management costs.

Article 17. Contents of costs not included in the payment price for defense products

1. Expenses that are not deductible when determining taxable income for corporate income tax and expenses that are not included in production costs and product cost according to relevant legal documents.

2. Expenses already covered by the State budget.

Article 18. Anticipated profit

1. Enterprises supplying goods and services for national defense shall calculate anticipated profit appropriately for each group of products.

2. The rate of anticipated profit included in the payment price for products for each group of products shall be implemented according to the provisions set out in Appendix III attached to this Circular.

3. Anticipated profit shall be implemented as follows:

a) Profit of products produced and repaired is determined by multiplying the anticipated profit rate specified for each group of products by the total cost of the product.

b) For semi-finished products provided by enterprises before production to enterprises after production, the anticipated profit rate of the latter enterprise shall only be calculated on the actual value realized (excluding the value of semi-finished products and test firing costs).

c) Products ordered for production, repair, and supply (outside regular tasks) at factories and production facilities of the military that have not been economically accounted for, research institutions, academies, and public service units shall be calculated at 50% of the anticipated profit rate specified for each group of products.

Article 19. Allowances

Defense and security allowances, special military allowances, allowances for attracting workers in key defense industry establishments, special allowances for confidential positions (if any): Based on state regulations, the Ministry of National Defense shall allocate these allowances according to the percentage (%) of rank-based salary for personnel on establishment strength to the products based on the direct worker's salary.

Article 20. Value Added Tax, other taxes

For products subject to VAT and other taxes (if applicable), the calculation shall be made according to current tax laws.

Chapter III

PRICE MANAGEMENT

Section 1

PRICE OF PURCHASED GOODS AND SERVICES

Article 21. Price of purchased goods and services for national defense

1. All types of goods and services (except for tender prices under investment and construction projects) must be appraised according to the legal provisions on price management before being authorized by competent authorities to purchase.

2. Methods for determining the price of purchased goods and services are stipulated in Article 6 of this Circular and other appraisal methods according to the Vietnamese Appraisal Standards System issued by the Ministry of Finance.

3. Purchased goods and services must fall within the budget allocated by the Ministry; if exceeding the budget, a report must be submitted to the Ministry of National Defense for review and decision prior to purchasing.

Article 22. Tender package price for centralized procurement

For tender packages for centralized procurement authorized by the Ministry of National Defense to subordinate agencies and units to approve contractor selection plans, there must be a written opinion from the Department of Finance/MoND regarding the tender package price.

Article 23. Price of National Reserve Procurement Packages

For the prices of procurement packages assigned to units under the Ministry of Defense for national reserve goods procurement plans, the Financial Department of the Ministry of Defense shall review the package price, and the Investment Planning Department of the Ministry of Defense shall compile and submit for approval by the head of the Ministry of Defense in accordance with regulations.

Article 24. Documentation for Pricing Plans of Procurement Packages

The documentation for pricing plans of procurement packages shall be carried out in accordance with the provisions of the law on bidding.

Section 2

PRICES OF ORDERED GOODS AND SERVICES UNDER PLANNED PROCUREMENTS AND DIRECT ASSIGNMENTS

Article 25. Payment Prices for Goods and Services

1. All types of goods and services (excluding those related to investment and construction projects) must be priced by authorized bodies in accordance with the legal provisions on price management.

2. The method for determining the prices of goods and services is stipulated in Article 6 of this Circular.

3. Prior to preparing and submitting the documentation for pricing plans, goods and services must be approved by authorized bodies for economic and technical norms or technical design - total estimates (for ship products, watercraft, and products under programs and projects) as the basis for determining prices.

4. Determining payment prices:

Payment price = Direct material costs + Direct labor costs + Common production costs + Sales costs + Financial costs (if applicable) + Management costs + Anticipated profit + National defense security allowance, special military allowance, personnel attraction allowance in key defense industries, special communication allowance (if applicable) + Value-added tax, other taxes (if applicable) - Amounts covered by the state budget.

Article 26. Documentation for Pricing Plans

1. Documentation for pricing plans includes:

a) A letter requesting the competent authority to set or adjust prices.

b) A calculation of the prices of goods and services, production, repair, and supply according to Appendix I and Appendix II issued together with this Circular.

c) A document summarizing the opinions of relevant agencies (including copies of agency opinions if available).

d) A document reviewing the pricing plan by agencies with the function of review according to regulations (including detailed appendices explaining the details).

đ) Decision approving economic-technical norms, technical design-total estimates (including detailed appendices explaining the details).

e) Other related documents.

2. Explanation of the Pricing Plan

a) The necessity to set or adjust prices for goods and services (production and business situation; domestic, regional, and global market price trends).

b) Basis for setting or adjusting prices for goods and services (relevant legal normative documents).

Section 3

PRICES OF POLICY HOUSING AND RENTAL HOUSING FOR PUBLIC USE

Article 27. Policy Housing Prices

1. All types of policy housing sold to military officers must be priced by authorized bodies in accordance with legal provisions on prices.

2. The selling price of policy housing shall cover all costs to recover investment capital, including land use fees and interest (if applicable), management and operation costs during usage, maintenance costs, anticipated profits of the project developer (if applicable), value-added tax (if applicable), and other legitimate costs.

3. For projects that have not yet met the conditions to determine official selling prices but where the project developer and eligible buyers agree on an official selling price, the Ministry of Defense will consider and decide if the following conditions are met: Detailed explanation of the plan to handle price differences compared to the official selling price; ensuring recovery of all investment capital costs, including land use fees and interest (if applicable).

Article 28. Rent price for official housing

The rent price for official housing shall be implemented in accordance with the provisions of the law on the management of rent prices for official housing.

Section 4

PRICES OF OTHER GOODS AND SERVICES

Article 29. Prices of other goods and services

The prices of other goods and services include:

1. Freight rates for transporting construction materials and goods to islands.

2. Medicine prices.

3. Prices of other goods and services not specified in Articles 21, 22, 23, 27, and 28 of this Circular.

Article 30. Methods for determining prices of other goods and services

The prices of other goods and services shall be determined in accordance with the provisions of the law on price management.

Chapter IV

AUTHORITY TO SET PRICES, PROCEDURES FOR PRICE REVIEW

Article 31. Authority to set prices

1. The Minister of National Defense decides

a) The maximum limit price and specific price levels for various types of goods and services ordered, planned, and tendered by the Ministry of National Defense (for certain specific cases) for units and enterprises under the Ministry of National Defense to produce, repair, supply, and be paid from the state budget.

b) The prices of defense goods and services ordered by the Ministry of National Defense at enterprises according to the Government's plan, paid from the state budget.

c) The price of national defense reserve goods for the planning year, after receiving written comments from the Ministry of Finance.

d) The prices of family housing policies for military officers and official housing for projects directly directed and implemented by the Ministry of National Defense.

đ) Pricing of products listed in Appendix IV issued together with this Circular; Delegating authority to commanding officers of subordinate agencies and units of the Ministry of National Defense to approve prices in certain specific cases.

2. Commanding officers of subordinate agencies and units of the Ministry of National Defense decide

a) The prices of various types of goods and services serving national defense, authorized by the Minister of National Defense, and report the pricing decisions to the Financial Department of the Ministry of National Defense for monitoring, management, and reporting as prescribed.

b) The prices of goods and services purchased to serve national defense, based on the分级处理后继续翻译剩余部分：

The prices of family housing policies for military officers and official housing for projects delegated by the Ministry of National Defense to units for implementation.

Article 32. Procedures and formalities for price review

1. Financial agencies at all levels, as stipulated in Articles 36 and 37 of this Circular, shall be responsible for leading the coordination with relevant agencies to review the prices of goods and services, and report to the competent authority to decide on prices as stipulated in Article 31 of this Circular.

2. For assets where, after the price review report from the price review agency, the approving authority deems it necessary to have additional reviews, a Price Review Board shall be established to conduct the price review.

The Price Review Board must have at least one member who has been trained or educated in specialized valuation practices as prescribed by the Ministry of Finance or holds a college, university, or postgraduate degree in valuation or appraisal.

The Price Review Board shall be chaired by the head of the unit owning the asset requiring price review, with other members comprising representatives from specialized management or financial management units of the asset-owning unit, and other members appointed by the Chairman based on the nature of the asset. The Price Review Board shall dissolve itself upon completion of its tasks.

The procedures and formalities for price review, rights and obligations of the Price Review Board, and costs of price review shall be carried out in accordance with the provisions of the law on prices.

Article 33. Submitting Pricing Proposals

1. Goods and services within the pricing authority of the Minister of National Defense shall be submitted for pricing proposals by units under the Ministry of National Defense.

2. Goods and services within the pricing authority of commanders of units under the Ministry of National Defense shall be submitted for pricing proposals by the purchasing agency directly responsible for procurement and ordering.

3. Enterprises and production units shall establish pricing proposals to submit to the Ministry of National Defense (through the Finance Department of the Ministry of National Defense), the ordering unit, and the superior management agency for review.

4. When submitting a pricing proposal, the unit or enterprise must attach the pricing proposal file.

Article 34. Time Limit for Reviewing Pricing Proposals and Deciding Prices

1. The maximum time limit for reviewing pricing proposals is not more than 10 working days from the date of receipt of complete pricing proposal files as prescribed.

2. From the date of receiving the pricing proposal with comments from the pricing review agency, the maximum time limit for deciding prices at all levels is not more than 10 working days.

3. In cases where it is necessary to extend the time for reviewing pricing proposals and deciding prices, the agency or unit with the authority to review pricing proposals or decide prices must notify in writing and clearly state the reasons for the extension to the agency submitting the pricing proposal; the extended period shall not exceed 15 working days.

Chapter V

RESPONSIBILITIES OF THE AUTHORITIES AND UNITS

Article 35. Responsibilities of Commanders of Agencies and Units Under the Ministry of National Defense

1. Commanders of agencies and units responsible for procurement and ordering

a) Before December 31 each year, report the plan for reviewing and approving prices for the following year to the Ministry of National Defense (through the Finance Department of the Ministry of National Defense).

b) Review pricing proposals for procurement, production, repair, and supply of goods and services serving national defense according to orders, plans, and designated tenders (for specific cases) of the Ministry of National Defense, and report to the Ministry of National Defense (through the Finance Department of the Ministry of National Defense).

2. Commanders of superior agencies of enterprises

a) Review and approve economic-technical norms for products produced and repaired by units and enterprises under their jurisdiction. For economic-technical norms for repair products in the missile, special equipment, weapons, armored vehicle, and tank industries, approval is made by the Chief of the General Technical Department.

b) Review pricing proposals for payment of products produced by units and enterprises under their jurisdiction for various types of guns, artillery, bombs, mines, grenades, ammunition, optical equipment, explosive tubes, explosives, detonators, propellants, explosives, and firearm parts; shipbuilding and watercraft construction; and report to the Ministry of National Defense (through the Finance Department of the Ministry of National Defense).

Article 36. Responsibilities of the Finance Department

1. Review and submit to the Ministry of National Defense pricing proposals within the price decision-making authority of the Minister of National Defense.

2. Advise and propose to the Minister of National Defense to consider and decide on delegating the authority to approve prices to commanders of agencies and units under the Ministry of National Defense in certain specific cases (outside the list of prices decided by the Ministry of National Defense as set out in Appendix IV issued together with this Circular).

3. Review prices of national defense strategic reserves, report to the Ministry of National Defense to seek written comments from the Ministry of Finance before submitting to the Minister of National Defense for price decisions.

4. Review prices of tender packages approved by the Ministry of National Defense for the selection of contractors as stipulated in Article 21 of this Circular; participate in opinions on prices of tender packages delegated by the Ministry to commanders of agencies and units under the Ministry of National Defense to approve plans for selecting contractors as stipulated in Article 22 of this Circular.

5. Participate in opinions on pricing proposals for production, repair, and supply of goods and services serving national defense according to orders, plans, and designated tenders of the Ministry of National Defense delegated by the Minister of National Defense to commanders of agencies and units under the Ministry of National Defense to decide prices.

6. Inspect and audit the implementation of regulations in this Circular, report to the Minister of National Defense to handle violations of laws on price management according to the provisions of the law.

Article 37. Responsibilities of Financial Authorities of Agencies and Units under the Ministry of National Defense

1. Take the lead and coordinate with functional agencies to assist the command of agencies and units in appraising the pricing plans for assets, goods, and services decided on prices by the Minister of National Defense for reporting to the Ministry of National Defense (through the Finance Department of the Ministry of National Defense).

2. Take the lead and coordinate with functional agencies in appraising the pricing plans for assets, goods, and services submitted to the command of agencies and units for price decisions in accordance with regulations of the Ministry of National Defense.

Chapter VI

IMPLEMENTING PROVISIONS

Article 38. Effective Date

1. This Circular takes effect from February 15, 2015, and replaces Circular No. 20/2009/TT-BQP dated May 14, 2009, of the Ministry of National Defense on guiding the preparation, submission, appraisal of pricing plans, and decision-making on prices for various types of goods and services serving national defense.

2. The provisions of this Circular shall be applied from January 1, 2015.

Article 39. Responsibility for Implementation

1. Chiefs of the General Staff, Political Bureau; Directors of Departments, Commanders of agencies and units are responsible for implementing this Circular.

2. Director of the Finance Department is responsible for organizing the implementation of this Circular.

3. When there are changes in state financial policies and prices that affect cost factors in the settlement prices of national defense products, the Ministry of National Defense will review and guide principles for adjusting settlement prices accordingly./.