Joint Circular No. 210/2013/TTLT-BTC-BXD-BTTTT guiding the mechanism, principles for price control and methods to determine rental prices for shared technical infrastructure works.

JOINT CIRCULAR

Guidelines for the mechanism, principles of price control, and methods for determining rental prices for shared technical infrastructure works

 determination of rental prices for shared technical infrastructure works

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Pursuant to Decree No. 72/2012/NĐ-CP dated September 24, 2012 of the Government on management and common use of shared technical infrastructure works;

Pursuant to Decree No. 25/2011/NĐ-CP dated April 6, 2011 of the Government detailing and guiding the implementation of certain provisions of the Law on Telecommunications;

Pursuant to Decree No. 149/2016/NĐ-CP dated November 11, 2016 of the Government amending and supplementing certain provisions of Decree No. 177/2013/NĐ-CP dated November 14, 2013 of the Government detailing and guiding the implementation of certain provisions of the Law on Prices;

Pursuant to Decree No. 118/2008/NĐ-CP dated November 27, 2008, of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

Pursuant to Decree No. 62/2013/NĐ-CP dated June 25, 2013 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Construction;

Based on Decree No. 132/2013/ND-CP dated October 16, 2013 of the Government on the functions, tasks, powers, and organizational structure of the Ministry of Information and Communications;

The Minister of Finance, the Minister of Construction, and the Minister of Information and Communications issue this joint Circular guiding the mechanism, principles of price control, and methods for determining rental prices for shared technical infrastructure works.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation and Applicability

Article 1. This Circular guides the mechanism, principles of price control, and methods for determining rental prices for shared technical infrastructure works in urban areas and public technical infrastructure works; it also stipulates exemptions and reductions in prices for activities serving national defense and security.

For shared technical infrastructure works outside urban areas, organizations and individuals are encouraged to apply the mechanism, principles of price control, and methods for determining rental prices as prescribed in this Circular, similar to those for shared technical infrastructure works within urban areas.

Article 2. Scope of application: owners as defined in Article 10 of Decree No. 72/2012/NĐ-CP dated September 24, 2012 of the Government on management and common use of shared technical infrastructure works, and agencies, units, organizations, and individuals involved in investment, management, and signing contracts for the use of shared technical infrastructure works.

Article 3. Provisions on shared technical infrastructure works

Point 1. Common use of shared technical infrastructure works refers to the arrangement and installation of telecommunications cables, power lines, and public lighting cables (collectively referred to as cables); water supply pipes, drainage pipes, and energy supply pipes (collectively referred to as pipes) into shared technical infrastructure works.

Point 2. Shared technical infrastructure works are technical infrastructure works constructed for the arrangement and installation of cables and pipes, including: antenna towers; cable suspension poles (wires); cable conduits; trenches and technical ducts; urban roads, road tunnels; railway tunnels; underground culverts; road bridges and railway bridges.

Point 3. Regulations on the use of shared technical infrastructure works shall be implemented in accordance with Decree No. 25/2011/NĐ-CP dated April 6, 2011 of the Government detailing and guiding the implementation of certain provisions of the Telecommunications Law and Decree No. 72/2012/NĐ-CP dated September 24, 2012 of the Government on management and common use of shared technical infrastructure works.

Article 4. Principles and bases for determining rental prices for shared technical infrastructure works

Clause 1. Principles for determining rental prices

Subpoint a) Rental prices for shared technical infrastructure works must accurately cover all construction investment costs; management operation, maintenance, and repair costs; other costs as prescribed by law, linked to service quality, consistent with policies, economic-technical norms, and cost standards issued by competent authorities.

Subpoint b) In cases where organizations or individuals invest in constructing shared technical infrastructure works for business purposes through leasing, rental prices shall be determined based on costs as prescribed and reasonable profit.

Clause 2. Bases for determining rental prices

Subpoint a) Production and service supply costs commensurate with service quality.

Subpoint b) Supply and demand relationships, market prices.

Subpoint c) Changes and fluctuations in prices and state policies; approved rental price adjustment schedules (if any).

Subpoint d) Local socio-economic development conditions affecting rental prices.

Chapter II

SPECIFIC PROVISIONS

Section 1

MECHANISM, PRINCIPLES OF PRICE CONTROL FOR RENTAL PRICES OF SHARED TECHNICAL INFRASTRUCTURE WORKS

Article 4. Mechanism and Principles for Controlling Rental Prices of Shared Technical Infrastructure Projects

1. The State implements price management under a market mechanism with state regulation; respecting the right to self-determine prices and competitive pricing among organizations and individuals investing in shared technical infrastructure projects in accordance with the provisions of the law.

2. The State carries out rental price control for shared technical infrastructure projects to protect the rights and legitimate interests of both the lessee and lessor parties and the common interests of society in accordance with the provisions of the law and this Joint Circular.

3. The control of rental prices for shared technical infrastructure projects (hereinafter referred to as rental prices) is carried out through the methods of rental price control and the methods of determining rental prices stipulated in this Joint Circular.

Article 5. Methods of Controlling Rental Prices

1. Notification of Registration of Rental Prices.

2. Price Negotiation.

3. Public Display of Rental Prices.

4. Inspection of Factors Forming Rental Prices.

Article 6. Notification of Registration of Rental Prices for Shared Technical Infrastructure Projects

1. Organizations and individuals base on the provisions of Article 3 and the method of determining rental prices stipulated in this Joint Circular to determine the rental price of shared technical infrastructure projects they have invested in (outside state budget sources) and negotiate with organizations and individuals who have a need to use them; simultaneously registering the rental price with the competent authority specified in Clause 4, Article 14 of this Joint Circular in the form of notification of registration of rental prices. In cases where the parties cannot agree on the rental price, the competent authority shall organize price negotiation in accordance with the provisions of Article 7 of this Joint Circular.

2. The notification of registration of rental prices includes the following contents:

a) The rental price level calculated according to the provisions of Article 3 and the method of determining rental prices stipulated in this Joint Circular, linked to quality and key economic and technical parameters;

b) Information about factors forming rental prices; comparison with rental prices of similar projects in the area (if available);

c) Regulations on application conditions serving as a basis for negotiating specific rental price levels with customers such as: situations where preferential policies, discounts, and price reductions apply to large customer groups; payment conditions such as advance payment...; specific discount rates or amounts;

d) Duration of application of rental prices;

e) A sample of the notification of registration of rental prices attached as an appendix to this Joint Circular.

3. Organizations and individuals are responsible for directly sending; or by postal service; or by email (with electronic signature) one (01) notification of registration of rental prices to the competent authority specified in Clause 4, Article 14 of this Joint Circular.

4. When there are changes or fluctuations in factors forming rental prices and state policies affecting rental prices, if organizations and individuals adjust the rental prices, they must re-register the adjusted rental prices according to the contents stipulated in Clause 2 of this Article.

Article 7. Price Negotiation for Shared Technical Infrastructure Projects

1. Price negotiation is implemented for rental prices of shared technical infrastructure projects within the price decision-making authority of organizations and individuals.

2. The content and procedures for price negotiation are carried out in accordance with current laws on price management.

Article 8. Public Display of Rental Prices for Shared Technical Infrastructure Projects

1. Organizations and individuals must publicly display rental prices for shared technical infrastructure projects in Vietnamese currency at transaction locations to facilitate customer observation and recognition, as well as that of competent state authorities; the public display of rental prices must be clear and not cause confusion for customers.

2. For shared technical infrastructure projects whose rental prices are set by the State, the rental prices determined by competent state authorities based on quality, key economic-technical parameters, and implementation of the publicly displayed prices shall be posted.

In addition to public display at transaction locations, organizations and individuals may choose additional forms such as press conferences, publication on mass media, or other suitable methods.

3. For shared technical infrastructure projects whose rental prices are set by organizations or individuals, the rental prices announced and registered with competent authorities based on quality, key economic-technical parameters, application conditions, and not renting at a higher price than the publicly displayed price shall be posted.

Article 9. Inspection of Factors Forming Rental Prices for Shared Technical Infrastructure Projects

1. The inspection of factors forming rental prices shall be conducted in the following cases:

a) When state authorities with competent authority set rental prices for shared technical infrastructure projects funded from the state budget;

b) When rental prices fluctuate abnormally and upon request of the Prime Minister; Ministers, Heads of ministerial-level agencies, Chairpersons of provincial People's Committees directly under the central government (hereinafter referred to collectively as provincial People's Committees).

2. If requested by the Prime Minister, Ministers, and Heads of ministerial-level agencies shall organize inspections of factors forming rental prices for shared technical infrastructure projects.

3. Provincial People's Committees shall organize inspections of factors forming rental prices for shared technical infrastructure projects within their pricing authority.

4. The content and procedures for inspecting factors forming rental prices shall be carried out in accordance with current laws governing price management.

Article 10. Provisions on Exemption and Reduction of Rental Prices for Public Welfare Activities Related to National Defense and Security

1. Public welfare activities serving national defense and security tasks shall be exempted or reduced from rental prices for shared technical infrastructure projects according to the provisions of the law.

2. Cases of exemption and reduction of rental prices; specific exemption and reduction plans for each recipient as stipulated by the competent authority.

3. Financial mechanism for exemption and reduction of rental prices for public welfare activities related to national defense and security: implemented in accordance with current laws regarding the production and supply of public welfare products and services.

Section 2

METHODS FOR DETERMINING RENTAL PRICES FOR SHARED TECHNICAL INFRASTRUCTURE PROJECTS

Article 11. Methods for Determining Rental Prices

1. The methods for determining rental prices for shared technical infrastructure projects specified in this Circular include cost-based and comparative methods.

2. Based on the unique characteristics of shared technical infrastructure projects and market conditions, organizations and individuals shall select appropriate methods for determining rental prices for the projects they need to price.

Article 12. Cost Method

1. Factors forming the rental price for shared technical infrastructure projects:

a) Construction investment costs;

b) Management and operation costs (if applicable);

c) Maintenance and repair costs;

d) Other costs as prescribed by law (if applicable);

e) Anticipated profit.

2. Formula for determining the rental price

: The minimum value in monetary terms paid to the state budget_{organize credit institutions, foreign bank branches are responsible for organizing the implementation of this Circular.}: is the construction investment cost for shared technical infrastructure projects (VND/year) determined by dividing the total construction investment cost by the number of years for depreciation of the project.

- Total construction investment cost: includes all reasonable and lawful costs incurred for the implementation of the construction project and its commissioning for use according to current regulations on construction project cost management and approved by the competent authority at the time of handover for use. If the project must be put into use before the investment capital settlement is approved by the competent authority, then the total temporary construction investment cost will be calculated based on the investor's final settlement report; after the investment capital settlement is approved, adjust the construction investment cost according to the settled amount._đt- Number of years for depreciation: calculated according to the Ministry of Finance's regulations on the management, use, and depreciation of fixed assets.

For shared technical infrastructure projects that only track depreciation in accounting records, CP

 is the annual cost of installation and assembly related to shared technical infrastructure projects (VND/year).

b) CP-_đt: is the annual management and operation cost (VND/year), including:

- Wages and allowances, social insurance, health insurance, and other deductions from the wage fund for the staff of the entity managing the project. Wages are determined based on the staffing level, salary rates, allowances, and other deductions from the wage fund according to current state regulations;_btbd- Electricity and water costs for office operations of the entity managing the project; other costs related to management and operation;

- Depreciation costs of fixed assets of the entity managing the project. The management and use of depreciation costs of fixed assets are carried out according to the regulations of the Ministry of Finance.

- Office supplies, office furniture, tools, and inexpensive consumables of the official housing management unit;

In cases where organizations or individuals investing in shared technical infrastructure projects directly manage and operate them without establishing a separate management body, the management and operation costs are determined based on actual reasonable costs serving the management and operation of shared technical infrastructure projects.

c) CP-btbd

: is the average annual maintenance and repair cost for the project (VND/year), including: all costs for regular maintenance, periodic repairs, and emergency repairs according to economic and technical norms and legal provisions on maintenance and repair to ensure normal and safe operation of the project.

d) CP_{: is other actual reasonable costs as prescribed by law if applicable (VND/year) directly related to the rental price but not specified in points a, b, and c of Clause 2 of this Article.}e) LN

: is the anticipated reasonable profit included in the rental price (VND/year) determined to be a maximum of 10% of the total costs from point a to point d of Clause 2 of this Article._kf) SL

: is the quantity for pricing determined based on the design capacity of the project and the actual usage capacity consistent with market conditions. The unit of measurement for the quantity for rental pricing is: wire, cable; or pipeline; or pole; or length of the project; or area rented for the project or other suitable units of measurement according to the characteristics of each project such as: wire, cable or pipeline per unit length of shared infrastructure,..._{a) CP}3. Where the costs forming the rental price under Clause 2 of this Article relate to multiple products and services, these costs must be allocated to other products and services according to appropriate criteria.

4. Costs already allocated by the state budget, depreciation recorded in the accounting books of the entity, and benefits such as land use fees, land lease fees, and tax benefits as prescribed by laws on tax administration, and costs already structured into the cost of production and sales prices of other products and services of enterprises shall not be included in the rental price for shared technical infrastructure projects._g: is the revenue-based quantity determined based on the design capacity of the facility and the actual usage capacity in line with market conditions. The unit of measurement for the revenue-based rental quantity is: strand, cable; or pipeline; or pole; or length of the facility; or area rented out of the facility; or other pricing units suitable to the characteristics of each facility such as: strands, cables, or pipelines per unit length of shared facilities,...

3. In cases where the costs forming the rental price under Clause 2 of this Article relate to multiple products and services, such costs must be allocated to other products and services according to appropriate criteria.

4. The rental price of shared technical infrastructure facilities shall not include costs already allocated from the state budget; depreciation of assets recorded in the asset accounting books of the entity; preferential amounts such as land use fees, land rental fees, and tax preferences as stipulated by laws on tax administration; and costs already incorporated into the cost structure or selling prices of other products and services of the enterprise.

Article 13. Comparison Method

1. Concept

The comparison method is a method to determine the rental price without conducting analysis or comparing the rental prices associated with the economic and technical characteristics of similar construction projects traded on the local market (if available) or in other regions within the country.

2. Construction projects of the same type as the project for which the rental price needs to be determined have similarities in the following aspects:

a) Economic and technical features of the construction project (such as constituent materials, main economic-technical parameters, function, purpose of use, service life, physical-chemical properties, and other related criteria);

b) Specifications and quality of the construction project;

c) Location of the construction project.

3. Construction projects similar to the project for which the rental price needs to be determined have basic similarities including:

a) Having the same function and purpose of use; having similar economic and technical features (such as being made from equivalent raw materials and materials); having similar main economic-technical parameters;

b) Equivalent specifications and quality;

c) Similar locations.

4. When using the comparison method, it must be based on factors that significantly affect the value of the project for which the rental price needs to be determined, including:

a) Current rental prices associated with the quality of the construction project;

b) Rental conditions (time, payment form, and other related criteria);

c) Basic features of the construction project such as asset characteristics, main technical parameters, and input cost factors;

d) Location, quality, and usage time of the construction project;

đ) Other related criteria.

Chapter III

IMPLEMENTATION AND EFFECTIVE PROVISIONS

Article 14. Responsibilities of Agencies, Organizations, and Individuals

1. The Ministry of Finance

a) Coordinate with the Ministry of Construction, the Ministry of Information and Communications, and relevant ministries and agencies, and provincial People's Committees to guide, monitor, and inspect the implementation of the provisions of this Circular and related legal documents.

b) Take the lead in organizing price negotiations according to current laws.

2. Ministry of Construction, Ministry of Information and Communications

a) Within their functions and responsibilities, they are responsible for taking the lead and coordinating with the Ministry of Finance and relevant agencies and provincial People's Committees to guide, monitor, and inspect the implementation of the provisions of this Circular and related legal documents.

b) Coordinate with the agency leading the organization of price negotiations according to the law.

3. Ministries and agencies at the level of ministries within their tasks and authorities are responsible for coordinating in guiding, monitoring, and inspecting the implementation of the provisions of this Circular and related legal documents.

4. Provincial People's Committees and specialized agencies under provincial People's Committees

a) The provincial People's Committee assigns specific specialized agencies of the province to implement the provisions of this Circular and related legal documents.

b) The Department of Finance takes the lead in receiving registration notices for rental prices submitted by organizations and individuals investing in common infrastructure construction projects in urban areas within its jurisdiction; takes the lead and coordinates with relevant departments to examine and check the legality and reasonableness of the registration notice for rental prices. Thereafter, the Department of Finance has the responsibility to send one copy (photocopy) of the registration notice for rental prices to the Ministry of Finance (Price Management Department), the Ministry of Construction (Infrastructure Technology Department, Construction Economy Department), and the Ministry of Information and Communications (Telecommunications Department).

c) The Departments of Finance, Information and Communications, and Construction take the lead or coordinate with relevant agencies to organize price negotiations within their authority; inspect the implementation of management regulations on pricing set out in this Circular and related legal documents.

5. Organizations and individuals

a) Comply with the management regulations on rental prices for common infrastructure construction projects stipulated in this Circular, the law on price management, and related legal documents.

b) Provide complete and timely information and documents related to rental prices when requested by state agencies to report; bear legal responsibility for the accuracy, reasonableness, and legality of reported data and documents.

Article 15. Effective Date

1. This Circular takes effect from March 1, 2014.

2. During the implementation process, if there are difficulties, agencies, organizations, and individuals are advised to promptly reflect them to the Ministry of Finance, the Ministry of Construction, and the Ministry of Information and Communications for consideration and resolution./.