Joint Circular No. 36/2005/TTLT/BTC-BCN guides the management and use of economic public expenditure funds for promoting rural industry activities.

CIRCULAR

Joint Circular No. 36/2005/TTLT-BTC-BCN of the Ministry of Finance and the Ministry of Industry dated May 16, 2005 "Guidelines on the management and use of public funds for economic activities to promote industry"

ngày 16 tháng 5 năm 2005 “Hướng dẫn việc quản lý và sử dụng kinh phí sự nghiệp kinh tế đối với hoạt động khuyến công”

kinh phí sự nghiệp kinh tế đối với hoạt động khuyến công

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Pursuant to Decree No. 60/2003/NĐ-CP of the Government dated June 6, 2003 detailing and guiding the implementation of the Law on State Budget;

Pursuant to Decree No. 134/2004/NĐ-CP of the Government dated June 9, 2004 on encouraging the development of rural industry.
To unify the management and use of public funds for economic activities to promote industry, the Joint Circular of the Ministry of Finance and the Ministry of Industry provides guidance as follows:

Part I

GENERAL PROVISIONS

Article 1. This Circular guides the management and use of public funds allocated annually from the state budget to implement activities promoting, guiding, and creating conditions for organizations and individuals to participate in developing rural industry (hereinafter referred to as promoting industry activities).

Article 2. Promoting industry activities implemented by the Ministry of Industry shall be funded by the central government budget; promoting industry activities implemented by localities shall be funded by the local government budget.

Article 3. Organizations and individuals using promoting industry funds must use them for their intended purposes, in accordance with regulations, and be subject to inspection and supervision by competent authorities; they must settle accounts for the funds used at the end of each quarter and year according to current regulations.

Part II

SPECIFIC PROVISIONS

Article 1. Subjects eligible for state support in promoting industry funds:

Clause 1.1. Organizations and individuals directly investing in and producing industry in districts, towns, urban areas, and communes (hereinafter referred to as rural industrial production units) include:

- Small and medium enterprises established and operating under the Law on State-Owned Enterprises;

- Small and medium enterprises established and operating under the Enterprise Law;

||| - Cooperatives established and operating under the Law on Cooperatives;

- Individual households engaged in business operations under Decree No. 02/2000/NĐ-CP of the Government dated February 3, 2000 on Business Registration (now replaced by Decree No. 109/2004/NĐ-CP of the Government dated April 2, 2004 on Business Registration).

Clause 1.2. Organizations and individuals from all forms of economy engaged in promoting industry services (including advisory, training, technology transfer, information provision, trade promotion, and other related activities supporting investment and production in rural industry).

Article 2. Industries eligible for promoting industry policies:

Organizations and individuals directly investing in and producing industry in districts, towns, urban areas, and communes are eligible for state promoting industry policies for the following industries:

- Processing industry of agriculture, forestry, and fisheries;

- Production of products using local raw materials (using local raw materials means using primary raw materials within the province where the organization or individual invests in production facilities), employing many workers (production facilities employing 50 workers or more);

- Production of new products (new products are those that have not been produced by organizations or individuals investing in production facilities in the district, town, or commune where the facilities are located), substitute imported goods, export goods primarily using domestic raw materials (using domestic raw materials means using primary raw materials from domestic sources accounting for 70% or more);

- Production of agricultural machinery parts, assembly, and repair services;

- Construction of small hydropower plants, power generation using new or renewable energy sources with installed capacity below 10,000 kW to supply electricity to rural and remote areas;

- Production, processing, and service provision for complete product manufacturing facilities;

- Investment in infrastructure construction for industrial clusters, small-scale industrial zones, and craft villages.

Article 3. Contents of expenditures for promoting industry activities include:

Clause 3.1. Expenditures for activities guiding organizations and individuals to establish businesses, develop rural industry projects, find production sites, recruit and train workers, raise capital, apply for investment incentives, and other administrative procedures in accordance with laws, consistent with regional and local industrial development plans.

Clause 3.2. Expenditures for activities guiding rural industrial production units to improve management capabilities, rationalize production, and reduce product costs.

Clause 3.3. Expenditures for activities guiding and advising rural industrial production units to invest in building new production lines, expanding production scale, innovating and applying scientific and technological advancements, enhancing production capacity, managing product quality, and protecting the environment.

Clause 3.4. Support for expenditures providing market information, prices, products, and technologies both domestically and internationally; marketing, seeking markets and business partners, and organizing exhibitions and fairs to introduce products.

Clause 3.5. Support for expenditures organizing vocational training, skill transmission, and occupational development.

Clause 3.6. Support for expenditures enabling rural industrial production units to rent space to participate in domestic exhibitions and fairs to showcase products.

Clause 3.7. Support for expenditures organizing experience exchange activities, domestic tours, and surveys; supporting and facilitating rural industrial production units to form joint ventures, partnerships, economic cooperation, and participation in industry associations.

Clause 3.8. Support for expenditures constructing pilot models demonstrating techniques, transferring technology, and implementing scientific and technological consulting services to assist organizations and individuals investing in rural industry.

Article 4. Allocation of tasks for promoting industry expenditures:

Clause 4.1. Tasks of national promoting industry expenditures:

Point a. National promoting industry funds managed and implemented by the Ministry of Industry include:

- National promoting industry funds ensuring expenditures for promoting industry activities specified in Article 3, Part II of this Circular, managed and organized by the Ministry of Industry for products with national or regional significance, consistent with the strategy, planning, and program for promoting industry approved by the Prime Minister.

- Expenditures for compiling textbooks and model materials to guide, train, and advise on promoting industry to provincial levels.

- Expenditures for nationwide publicity of promoting industry through mass media.

- Expenditures for supporting the development of national, regional, and annual promoting industry programs and plans.

- Expenses for inspecting, evaluating, and supervising the promotion of small-scale industry activities at localities and establishments.

- Expenses for purchasing equipment to serve the promotion of small-scale industry work.

- Expenses for rewards as prescribed by the competent authority.

- Other expenses (if any).

b. Expenses for supporting the promotion of small-scale industry activities of the Provincial People's Committee according to programs, plans, and projects approved.

4.2. Tasks of expenses for local small-scale industry promotion:

- Funds for local small-scale industry promotion to be used for small-scale industry promotion activities carried out by the locality as stipulated in Point 3, Part II of this Circular for products produced with significance in the province or region consistent with the provincial strategy and planning for rural industrial development.

- Expenses for promoting the work of small-scale industry promotion within the locality.

- Expenses for supporting the development of small-scale industry promotion programs and plans at each stage and annually in the locality.

- Expenses for inspecting, supervising, and evaluating small-scale industry promotion activities at establishments.

- Expenses for purchasing equipment to serve the promotion of small-scale industry work.

- Expenses for rewards as prescribed by the competent authority.

- Other expenses (if any).

5. Specific levels of expenses:

Agencies, units, organizations, individuals, and establishments using state funds for small-scale industry promotion activities must comply with the current financial expenditure standards set by the competent state authorities. This Circular provides detailed guidance on additional expense items as follows:

5.1. Regarding the construction of pilot models for technology demonstrations to disseminate advanced production technologies:

- For production facilities of organizations and individuals currently operating effectively that need to be promoted and publicized for others to learn from: After selecting production facilities that meet the requirements for demonstration and dissemination, the Ministry of Industry or the Department of Industry of provinces and centrally-administered cities should complete technical process documentation and production processes serving the technology demonstration and allocate necessary funds based on the financial expenditure standards for implementing the demonstration.

- For production facilities currently operating but requiring technological improvements to meet the requirements for technology demonstration, the Ministry of Industry or the Department of Industry will coordinate with the production facility to invest in improving technology and production processes. The investment in improving technology and production processes shall be self-funded by the production facility, with the state providing partial support for related costs of the demonstration model. The maximum level of support shall not exceed 50 million VND per model.

- For new products and new production processes that require the establishment of a demonstration model, the Ministry of Industry and the Department of Industry will select organizations and individuals capable of establishing production facilities as demonstration models on the principle that these organizations and individuals self-fund the investment according to the requirements linked to the demonstration model. Based on the costs for implementing the demonstration model, the state budget will provide partial funding, with the maximum level of support not exceeding 150 million VND per model.

The level of support for each production facility shall be decided by the Minister of Industry and the Chairman of the Provincial People's Committee (referred to collectively as the provincial level) for each specific case, taking into account the scale of investment, nature of the industry, technology, product... of the project, but not exceeding the maximum level specified in this Circular.

5.2. Regarding support for rural industrial production facilities renting space to participate in domestic trade fairs, exhibitions, and product introductions:

Rural industrial production facilities shall be supported by the state with 50% of the rental fees for booth space at domestic trade fairs and exhibitions; specifically, for trade fairs organized in mountainous regions, Central Highlands, and highlands, the support can reach up to 80%. The level of support for each facility shall be decided by the Minister of Industry and the Chairman of the Provincial People's Committee.

5.3. Regarding support for organizations and individuals engaged in small-scale industry promotion services:

Organizations and individuals with the necessary conditions and capabilities to implement small-scale industry promotion services shall be considered for state funding support.

The consideration for supporting the implementation of small-scale industry promotion services shall follow the principle that such services align with the content of the small-scale industry promotion program during each period. The amount of support shall be determined based on the volume of work to be performed, the duration of implementation, the number and target beneficiaries of the small-scale industry promotion services, and the current financial expenditure standards after deducting the contributions of the organizations and individuals benefiting from the services. The specific level of support shall be decided by the Minister of Industry and the Chairman of the Provincial People's Committee.

6. Conditions for receiving small-scale industry promotion funding support:

6.1. Support for constructing demonstration models and transferring technology must meet the following conditions:

- Organizations and individuals have production facilities suitable for the requirements for demonstrating technology as stipulated in Point 5.1, Part II of this Circular, with investment plans compatible with the investment targets and industries specified in Points 1.1 and 2 of Part II of this Circular, approved by the Minister of Industry (for models implemented by the Ministry of Industry) or the Chairman of the Provincial People's Committee (for models implemented by localities).

- Approval decision for the project by the competent authority as prescribed in Decree No. 52/1999/ND-CP dated July 8, 1999, of the Government on the issuance of regulations on investment management and construction.

- Organizations and individuals have genuinely invested capital to improve and perfect technology in accordance with the requirements of the small-scale industry promotion agency.

- Not having received support from any other source of state funds.

6.2. Support for participating in domestic trade fairs and exhibitions must meet the following conditions:

- Being a rural industrial production facility.

- Having a contract for renting exhibition booth space.

- Receipts for payment of booth rental fees issued by the fair and exhibition organizing body.

- Decision on support issued by the competent authority.

- Not having received support from any other source of state funds.

6.3. For support for organizations and individuals implementing small-scale industry promotion services:

- Organizations and individuals have the necessary conditions and capabilities to implement small-scale industry promotion services.

The Ministry of Industry shall specify the criteria for organizations and individuals qualified to implement small-scale industry promotion services.

- There must be an accompanying project proposal with a budget estimate for implementing industrial promotion services approved by the Minister of Industry or the Chairman of the Provincial People's Committee.

The project proposal for implementing industrial promotion services must clearly specify which type of industrial promotion service will be implemented, the target and number of beneficiaries, the time and location of implementation, the capability and level of the implementing force... A detailed budget estimate of necessary funds, the ability to contribute from organizations and individuals receiving the service... the amount of funding requested from the state.

7. Establishing, implementing, and settling the state budget:

The preparation of the budget estimate, allocation, and settlement of funds for industrial promotion tasks shall be carried out in accordance with the provisions of the State Budget Law and current guiding documents of the Ministry of Finance. This Circular provides specific guidance on the following matters:

7.1. On preparing the budget estimate:

Annually, based on the Prime Minister's Directive, the Circular guiding the preparation of the state budget issued by the Ministry of Finance, the implementation situation of the previous year's budget estimate, the content and volume of industrial promotion work to be carried out in the planned year, economic-technical norms, current financial expenditure regulations, and some specified expense levels in this Circular:

- For national industrial promotion funds:

Based on the program, plan, and project proposal for implementing national industrial promotion that have been approved at each period, taking into account local government budgets, provincial-level People's Committees establish the budget estimate for the portion of funds requesting central government support for implementing national industrial promotion work, to be sent to the Ministry of Industry and the Ministry of Finance.

The Ministry of Industry prepares the budget estimate for implementing national industrial promotion work (including national industrial promotion funds directly implemented by the Ministry of Industry and funds supporting local industrial promotion activities according to the program, plan, and project proposal for implementing national industrial promotion that have been approved) together with the annual budget estimate preparation time, to be sent to the Ministry of Finance.

Based on the central government budget capacity, the Ministry of Finance collaborates with the Ministry of Industry to review the budget estimate for implementing national industrial promotion work, including the additional support level for local government budgets to implement national industrial promotion work; consolidate and prepare the state budget revenue and expenditure estimate, the central government budget allocation plan to be submitted to the Government for submission to the National Assembly for consideration and decision.

- For local industrial promotion funds:

Local Departments of Industry prepare the budget estimate for implementing local industrial promotion work together with the annual budget estimate preparation time, to be sent to the Department of Finance for consolidation and submission to the Provincial People's Committee for submission to the Provincial People's Council for consideration and decision.

7.2. On implementing the budget estimate:

The allocation and reduction of the budget estimate for implementing industrial promotion work shall be carried out in accordance with the current provisions of the State Budget Law and guiding documents of the Ministry of Finance.

The State Treasury controls the disbursement of industrial promotion funds according to current norms, regulations, and provisions in this Circular.

Funds for implementing industrial promotion tasks as stipulated in this Circular shall be reflected and settled under Item 04, Sub-item 56 "Industrial Promotion Activities", corresponding to the chapters of relevant ministries, sectors, and localities, and detailed according to the state budget classification.

Industrial promotion funds remaining unused or unspent by December 31st shall be reported by the Ministry of Industry and Local Departments of Industry to the respective financial authorities for resolution in accordance with current regulations.

7.3. On finalizing accounts:

Agencies, units, and individuals using industrial promotion funds must finalize their accounts for the funds used with the Ministry of Industry (for central government economic industrial promotion funds) and with the Department of Industry (for local industrial promotion funds and supplementary targeted support funds for industrial promotion from the central government budget to local budgets) at the end of each quarter and year. Annual finalization reports from the Ministry of Industry and Local Departments of Industry are to be submitted to the respective financial authorities for verification. Procedures for preparing, forms, deadlines for submitting, and reviewing finalization reports are carried out in accordance with current regulations.

8. Inspection and supervision:

The Ministry of Industry and Local Departments of Industry are responsible for coordinating with the respective financial authorities to periodically and urgently inspect the implementation of industrial promotion tasks, ensuring the management and use of industrial promotion funds for their intended purposes and effectively.

Part III

IMPLEMENTATION

This Circular shall take effect fifteen days after its publication in the Official Gazette.

During the implementation process, if there are any difficulties, units are advised to report them to the Ministry of Finance and the Ministry of Industry for appropriate amendments.