Circular No. 199/2014/TT-BQP detailing and guiding price management work in the national defense sector.

CIRCULAR

Detailed regulations and guidance on price managementin the defense sector

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||| 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 stipulating the 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 the 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 between various price levels and economic and technical characteristics affecting the price 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, and 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 policies and directives 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 itself on the provisions of this Circular to:

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

b) Check price-forming factors, 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 defined in Article 2 of this Circular have the right to base themselves 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, business, supply of goods and services that do not fall within the objects specified 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 regarding production and business operations, market conditions to select appropriate valuation methods for goods and services that need to be valued.

Chapter II

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, purpose of 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 the appropriate functions.

d) Registered prices, declared prices, listed prices.

e) Prices recorded on quotation papers, bids from at least three supply units, budget estimates for implementing production and supplying goods and services approved by authorized levels.

f) 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, key economic-technical parameters, and other information); main comparative factors affecting the prices of goods and services to be valued.

2. Study the market, collect information on prices and related information about 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 there are fewer than three similar goods and services 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:

Price of domestically produced and repaired goods and services = total cost price + expected profit (if applicable) + defense and security subsidy, military-specific subsidy, subsidy for attracting labor 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 price 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:

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

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

Import cost price = 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 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 collectively as material costs) directly used in the production, repair, supply of goods and services. These costs are determined based on material consumption quotas 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 quota

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 quota

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 quota

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 quotas (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 costs, 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, these are included in direct material costs but are listed separately as a cost item to be excluded when determining the settlement price of defense products.

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

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

Article 11. Direct labor costs for domestically produced goods and services, repair work

1. Direct labor costs include wages, salaries, and allowances with wage characteristics (excluding defense and security allowances, military-specific allowances, defense industry core facility worker attraction allowances, and special allowances for key facilities), social insurance, health insurance, unemployment insurance (if applicable), union dues of workers directly involved in production, repair, and product supply, 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 pricing.

b) Wage unit price

- The daily wage unit price is determined by multiplying the average wage level (the wage coefficient of the job grade multiplied by the basic wage level as prescribed) with wage allowances (excluding defense and security allowances, military-specific allowances, defense industry core facility worker attraction allowances, and special allowances for key facilities) and dividing 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 direct worker's wages for both defense and economic products.

Article 12. Common production costs for domestically produced goods and services, repair work

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

1. Wages, allowances with wage characteristics (excluding defense and security allowances, military-specific allowances, defense industry core facility worker attraction allowances, and special allowances for key facilities) of workshop staff and contributions to social insurance, health insurance, unemployment insurance (if applicable), and union dues based on the staff's wages according to current state and Ministry of National Defense regulations. Calculation methods follow the provisions of 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 and for management tasks.

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

5. Tool and equipment costs.

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

7. Other monetary costs outside those mentioned above serving workshop operations.

Article 13. Selling expenses for domestically produced goods and services

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

2. Material and packaging costs 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. Product acceptance costs, warranty costs, and training and education costs.

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

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

Article 14. Financial expenses for domestically produced goods and services

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 domestically produced goods and services

Administrative expenses include indirect costs serving general management and administrative 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 wage nature (excluding defense and security allowances, special military allowances, incentives to attract workers in key national defense industrial facilities, and special allowances for critical positions) and contributions to social insurance, health insurance, unemployment insurance (if applicable), trade union fees of enterprise management staff according to current state regulations and the 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 staff during holidays, Tet, leave, political and military training days according to the 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 tools, equipment, and supplies.

5. Depreciation costs of common fixed assets for the enterprise such as: Office buildings of departments, warehouses, structures, communication devices, 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 the prescribed system, internal medical costs.

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

8. Costs for female employees according to the system.

9. Labor protection and uniform costs according to regulations.

10. Travel expenses, train and bus allowances for holiday travel for enterprise cadres, workers, and staff.

11. Party and mass organization work costs at the enterprise (the portion of costs outside the funding of these organizations as prescribed).

12. Outsourced service costs, including: Tools, equipment, electricity, water, telephone, repair and maintenance of fixed assets, loading and unloading fees, transportation costs of goods and products; insurance costs for assets and managed projects (if any) and other outsourced services 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 raw material costs + Direct labor costs + Common production costs + Sales expenses + Financial costs (if any) + 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 to calculate corporate income tax and expenses that are not included in production costs and product costs as prescribed by 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 in accordance with each group of products.

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

3. Anticipated profit shall be implemented as follows:

a) The 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 the regulations of the State and the Ministry of National Defense for each beneficiary, these allowances are allocated to products based on a percentage (%) of the salary grade of the assigned personnel directly involved.

Article 20. Value Added Tax, Other Taxes

For products subject to VAT and other taxes (if applicable), they shall be calculated according to the 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 tender packages under investment and construction projects) must be appraised in terms of price according to the legal regulations 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 estimate assigned by the Ministry; if exceeding the budget estimate, a report must be submitted to the Ministry of National Defense for review and decision prior to purchasing.

Article 22. Price of Centralized Tender Packages

For centralized tender packages 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 of the Ministry of National Defense regarding the 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 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 Proposal of Procurement Packages

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

Section 2

PRICE OF ORDERED GOODS AND SERVICESPROCUREMENT PLAN, DIRECT ASSIGNMENT

Article 25. Payment Price for Goods and Services

1. All types of goods and services (excluding those within investment and construction projects) must be decided on their price by the competent authority in accordance with the legal provisions on price management.

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

3. Prior to preparing and submitting the documentation for pricing proposals, goods and services must be approved by the competent authority for economic and technical norms or technical design - total estimate (for ship products, watercraft, products under programs and projects) as the basis for determining the price.

4. Determining the payment price:

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 industrial facilities, special administrative allowance (if applicable) + Value-added tax, other taxes (if applicable) - Amounts guaranteed by the budget.

Article 26. Documentation for Pricing Proposals

1. Documentation for pricing proposals includes:

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

b) The valuation document for goods, services, produced and repaired products, and supplied products in accordance with 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 proposal by the competent authority with detailed explanations.

đ) Decision approving economic-technical norms, technical design-total estimate (with detailed explanatory appendix).

e) Other related documents.

2. Explanation of the Pricing Proposal

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

b) Basis for setting or adjusting the price of goods and services (relevant legal documents).

Section 3

POLICY HOUSING PRICE, OFFICIAL HOUSING RENTAL PRICE

Article 27. Policy Housing Price

1. All types of policy housing sold to military officers must be approved by the competent authority on the selling price in accordance with the legal provisions on price.

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

3. For projects that have not yet met the conditions to determine the official selling price according to regulations, but the project investor and the buyers agree on the official selling price, the Ministry of Defense will consider and decide if the following conditions are met: Detailed explanation document about the handling plan for price differences compared to the official selling price; ensuring recovery of all costs for construction investment, 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 managing the rent price 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 charges 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 the 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 AND FORMALITIES FOR PRICE APPRAISAL

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 by the Ministry of National Defense, assigned plans, and designated tendering (for certain specific cases) to units and enterprises under the Ministry of National Defense for production, repair, supply, and payment 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 for by the state budget.

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

d) The price of policy housing for military families and official housing for projects directly directed and implemented by the Ministry of National Defense.

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

2. The heads of agencies and units under the Ministry of National Defense decide

a) The prices of various types of goods and services serving national defense that have been authorized by the Minister of National Defense and reported 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 for national defense purposes based on the classification level of the Ministry of National Defense, in compliance with the provisions of Articles 21, 22, and 23 of this Circular.

c) The price of policy housing for military families and official housing for projects authorized by the Ministry of National Defense for units to implement.

Article 32. Procedures and formalities for price appraisal

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

2. For assets where, after the appraisal report from the price appraisal agency, the approving authority deems it necessary to obtain additional appraisals, a Price Appraisal Board shall be established to conduct the price appraisal.

The Price Appraisal Board must have at least one member who has received specialized training in price appraisal as prescribed by the Ministry of Finance or holds a college, university, or postgraduate degree in pricing or price appraisal. The Price Appraisal Board shall be chaired by the head of the unit owning the asset to be appraised, with members including representatives from relevant departments within the unit responsible for financial management, and other members appointed by the Chairman based on the nature of the asset. The Price Appraisal Board will dissolve itself upon completion of its tasks.

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

Article 33. Submitting Pricing Plans

1. Goods and services within the pricing authority of the Minister of National Defense shall be submitted for pricing plans 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 plans by procurement agencies directly purchasing or ordering such goods and services.

3. Enterprises and production units shall establish pricing plans 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 plan, the unit or enterprise must attach the pricing plan dossier file.

Article 34. Time Limit for Reviewing Pricing Plans and Determining Prices

1. The maximum time limit for reviewing pricing plans is ten working days from the date of receipt of complete pricing plan dossiers as prescribed.

2. From the date of receiving the pricing plan with comments from the pricing review agency, the maximum time limit for determining prices at all levels is ten working days.

3. In cases where it is necessary to extend the time for reviewing pricing plans or determining prices, the agency or unit authorized to review pricing plans or determine prices must notify in writing and clearly state the reasons for the extension to the agency submitting the pricing plan; the extended period shall not exceed fifteen 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 Procurement Agencies and Ordering Units

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 plans 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 Units of Enterprises

a) Review and approve economic-technical norms for products produced and repaired by units and enterprises under their jurisdiction. Economic-technical norms for repair products in the missile, special equipment, weapons, armored vehicles, and tracked vehicle industries are approved by the Chief of the General Technical Department.

b) Review pricing plans for payment of products produced by units and enterprises under their jurisdiction including various types of guns, artillery, bombs, mines, grenades, ammunition, optical equipment, explosive tubes, explosives, slow-burning fuses, detonators, propellants, and gun and artillery spare 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 plans within the price determination 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 units under the Ministry of National Defense in certain specific cases (outside the list of prices determined by the Ministry of National Defense as set out in Appendix IV issued together with this Circular).

3. Review prices of national defense reserve goods, 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 determination.

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

5. Participate in opinions on pricing plans 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 units under the Ministry of National Defense for price determination.

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 the Financial Authority of Departments and Units under the Ministry of National Defense

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

Chapter VI

3. Amend Clause 3 Article 2 as follows:ARTICLE IMPLEMENTATION

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 guidelines for preparing, submitting, appraising pricing plans, and deciding 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. Heads of the General Staff, Political Bureau; Chiefs of the Departments, Commanders of the units are responsible for implementing this Circular.

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

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