Decision No. 210/A-TC-VP stipulates the land, water, and sea surface rental fees for foreign-invested enterprises in Vietnam.

Pursuant to …;

OF THE MINISTER OF FINANCE

Regulations on land, water, and sea surface rental fees for foreign-invested enterprises in Vietnam

Regulations on land, water, and sea surface rental fees for foreign-invested enterprises in Vietnam

THE MINISTER OF FINANCE

Pursuant to the Law on Foreign Investment in Vietnam dated December 29, 1987, and the laws amending and supplementing certain articles of the Law on Foreign Investment in Vietnam dated June 30, 1990 and December 23, 1993;

Pursuant to the Land Law dated December 23, 1993;

Pursuant to Decree 178/CP of the Government dated October 28, 1994 stipulating the tasks, powers, and organizational structure of the Ministry of Finance.

DECISION:

Article 1. The regulations on land, water, and sea surface rental fees applicable to forms of foreign investment in Vietnam are hereby promulgated together with this Decision.

Article 2. All previous regulations of sectors and People's Committees of localities that conflict with the contents of the attached regulations under this Decision are hereby abolished.

Article 3. This Decision shall take effect from the date of signing.

REGULATIONS

REGARDING RENT FOR LAND, WATER SURFACE, AND SEABED
APPLICABLE TO FOREIGN INVESTMENT FORMS IN VIETNAM
(Announced together with Decision No. 210A-TC/VP dated April 1, 1990
Port Authority Name

Article 1. Joint ventures, wholly foreign-owned enterprises, and parties participating in business cooperation contracts (hereinafter referred to as foreign-invested enterprises) granted by the Socialist Republic of Vietnam to lease land, water, and sea surfaces for use must pay rental fees for land, water, and sea surfaces according to these regulations.

Article 2. Rental fees for land, water, and sea surfaces are calculated annually based on a unit area and the entire leased area as specified in the lease agreement.

Article 3. The rates of rental fees for leasing land, water, and sea surfaces per unit area are stipulated as follows:

The specific rates are determined for each contract depending on the characteristics of the industry, geographical conditions, location, and ease or difficulty of using the leased land, water, and sea surfaces. Based on the proposals of the People's Committees of provinces, cities, and centrally governed municipalities, the State Committee on Cooperation and Investment decides the specific rates to be applied during a maximum period of five years, which will be reviewed and decided again upon expiration.

Article 4. During the exploration, survey, construction period, foreign-invested enterprises only have to pay up to a maximum of 50% of the stipulated rental fee, and when production and business operations commence, they must pay the full 100% of the stipulated rental fee. Based on the characteristics and duration required for exploration, survey, and construction of each entity, the State Committee on Cooperation and Investment examines and decides the specific payment amounts.

Article 5. Rental fees for land, water, and sea surfaces may be reduced in the following cases:

- For foreign-invested enterprises operating in particularly difficult regions or in certain special fields requiring encouragement of investment attraction, the maximum reduction is 50% of the rental fee payable.

- A reduction of 5% to 10% for foreign-invested enterprises paying the rental fee in one lump sum for a usage period of three to five years.

- Cases where losses are caused by natural disasters (earthquakes, typhoons, floods, etc.) requiring significant costs to mitigate.

The reduction amount is proposed by foreign-invested enterprises and decided by the State Committee on Cooperation and Investment.

Article 6. Rental fees for land, water, and sea surfaces are calculated annually from the date the foreign-invested enterprise is granted permission to use them. The rental fees are paid in two installments, each being 50% of the annual amount due. The latest payment deadlines are July 5th and December 31st of each year.

For the first and last years, if the usage period exceeds seven months, the full annual rental fee must be paid; if it is less than seven months, only half of the annual rental fee is required.

Article 7. Foreign-invested enterprises must submit declarations regarding the area of land, water, and sea surfaces used to the tax collection agency within one month from the start of their permission to use. Any changes during the usage period must be re-declared.

Based on the declaration, the collection agency must verify, calculate the rental fee, and notify the enterprise of the annual rental fee due.

Foreign-invested enterprises are responsible for paying the rental fees for land, water, and sea surfaces into the Treasury or bank designated by the collection agency.

Article 8. Rental fees for land, water, and sea surfaces can be paid in US dollars or Vietnamese dong. If paid in Vietnamese dong, the exchange rate at the time of payment shall be based on the buying rate published by the State Bank.

Article 9. In cases where the Vietnamese party contributes to the capital of a foreign-invested enterprise through rental fees for land, water, and sea surfaces, the value of the contribution is agreed upon by both parties, and the enterprise does not need to pay the rental fees stipulated herein for the amount contributed by the Vietnamese party according to the signed contract. However, the Vietnamese party is responsible for recording the contributed capital in the state budget.

Article 10. In cases where the business cooperation contract divides products according to Article 80 of Decree No. 139-HĐBT dated September 5, 1988 of the Council of Ministers, and the rental fees for land, water, and sea surfaces are included in the portion allocated to the Vietnamese party, the joint venture enterprise does not need to pay the rental fees stipulated herein. When the Vietnamese party sells the allocated products, they are responsible for paying the rental fees into the state budget.

Article 11. Violations concerning land lease payments, water surface lease payments, or sea surface lease payments as stipulated herein shall be subject to penalties as follows:

1. Failure to declare within the prescribed time results in a fine of 10 USD per day of delay.

2. Incorrect declaration to reduce the amount payable results in a fine of up to three times the amount understated.

3. Failure to pay the rental fees or fines on time results in a daily fine of 0.5% of the overdue amount.

Article 12. Rental fees for land, water, and sea surfaces are deposited into the state budget under item 23 of chapter 97 of the current budget classification.

- In cases where payments are made in US dollars, they should be deposited into the central government's foreign currency account - account number: 37-120-001 at the Central Foreign Trade Bank.

Article 13. The Ministry of Finance assigns the state-owned collection sector the task of organizing the management and collection of rental fees for land, water, and sea surfaces according to these regulations.