Decision No. 38/2002/QĐ-TTg On the management of production, assembly, and import of two-wheeled motorbike components

DECISION

On the management of production, assembly, and import of two-wheeled motorbike parts

vụ kiện xe máy hai bánh

PRIME MINISTER

Pursuant to the Law on Organization of the Government dated December 25, 2001;

To regulate the production, assembly, and import of two-wheeled motorbike parts to meet the legitimate travel needs of the people and the current capacity for investment in transportation infrastructure development; at the same time, to mobilize domestic resources to rapidly develop Vietnam's motorcycle industry and prepare proactively for the process of international economic integration;

Based on the recommendations of relevant ministries and agencies at meetings held on January 10 and January 14, 2002, at the Government Office regarding the management of two-wheeled motorbike part production, assembly, and import in 2001 and measures for management in the future;

At the proposal of the Minister and Head of the Government Office,

DECISION:

Article 1. The following measures for managing the production and assembly of two-wheeled motorbikes are hereby stipulated:

1. The Minister of Industry shall issue specific regulations on the standards of a business entity engaged in the production and assembly of two-wheeled motorbikes as a basis for organizing and developing Vietnam's motorcycle industry. These standards must include: scale of investment; level of technical equipment and production and quality inspection facilities; level of expertise of technical workers and organizational management; product quality and environmental cleaning systems.

2. Conditions for a business entity to be permitted to assemble two-wheeled motorbikes:

a) It must be a business entity established and operating in accordance with the law;

b) It must meet all the standards prescribed in Clause 1 of this Article;

c) Products and two-wheeled motorbike parts produced and assembled by the business entity must ensure quality and safety standards; comply with laws on industrial property rights;

d) Invest in self-production of parts to achieve a minimum localization rate of 20% by 2002 (as stipulated in Circular Joint No. 92/TTLT-BTC-BCN-TCHQ dated November 20, 2001 issued by the Ministry of Finance, Ministry of Industry, and General Department of Customs, and additional points provided in Point 1 of Article 2 of this Decision).

3. The Ministry of Industry shall review all existing businesses engaged in the assembly of two-wheeled motorbikes; if a business meets the conditions prescribed in Clause 2 of this Article, it will be allowed to continue assembling; for new businesses, they must report to the Prime Minister before issuing a decision allowing assembly.

4. Based on the results of tax policy implementation checks according to the localization rate in 2001, reports from police, customs, market management, vehicle inspection agencies, and media and public revelations about violations by motorcycle production and assembly businesses in 2001, the Ministry of Industry shall consider appropriate measures, including revoking permission to assemble and halting the importation of two-wheeled motorbike parts, for serious violators who must be prosecuted under the law.

5. The Ministry of Transport shall issue Technical Standards and Quality Standards for domestically produced two-wheeled motorbikes, frames, and engines; regulatory documents and inspections of businesses' compliance with laws on product quality and safety. The Ministry of Science, Technology, and Environment shall issue regulations and inspections of businesses' compliance with laws on intellectual property rights. These provisions must be issued immediately in the first quarter of 2002 to facilitate business operations, particularly the production of Vietnamese-branded motorcycles that are of good quality and reasonable price.

Article 2. The following measures for managing the export and import of two-wheeled motorbike parts are hereby stipulated:

1. The Ministry of Finance, the Ministry of Industry, and the General Department of Customs shall supplement Circular Joint No. 92/TTLT-BTC-BCN-TCHQ dated November 20, 2001, guiding the implementation of preferential tax policies for the production of two-wheeled motorbikes and engines with the following contents:

a) Investment conditions for producing detailed parts and accessories of two-wheeled motorbikes achieving a minimum localization rate of 20% by 2002 must be tied to the production of certain key components such as engines, frames, and transmission systems.

For businesses assembling engines, they must invest in producing parts accounting for at least 20% of the total engine.

b) Clearly define and establish strict mechanisms for joint venture production of parts and accessories of two-wheeled motorbikes to prevent abuse and fraud;

c) Bank payment transactions must clearly specify the opening of Letters of Credit but not allow cancellation.

2. Businesses permitted to assemble two-wheeled motorbikes as stipulated in Article 1 of this Decision may import parts within the range of types registered and confirmed by the Ministry of Finance (as stipulated in Circular Joint No. 92/TTLT-BTC-BCN-TCHQ dated November 20, 2001, and related supplementary documents of the Ministry of Finance, Ministry of Industry, and General Department of Customs) and within the combined capacity limit specified in Clause 3 of this Article.

Businesses are not allowed to buy and resell imported parts in any form.

Businesses that do not meet the conditions stipulated herein shall not be permitted to import two-wheeled motorbike parts.

3. The Ministry of Finance shall stipulate principles and methods for calculating combined capacity through a scoring system, emphasizing technological advancement and investment scale; simultaneously directing the Inter-Ministerial Working Group (established pursuant to Point 5b, Section I of Circular No. 938/CP-KTTH dated October 18, 2001 of the Government) to conduct inspections and calculate specific scores achieved by businesses to determine their combined capacity. This capacity is the maximum capacity that a business is allowed to assemble and import two-wheeled motorbike parts in a year.

The provisions of this clause apply to foreign-invested businesses producing and assembling two-wheeled motorbikes that do not fully and properly fulfill their responsibilities and obligations as stipulated in their Investment License.

4. After determining the total capacity as prescribed in Clause 3 of this Article, the Ministry of Finance shall notify the enterprise in writing to be informed for implementation; at the same time, notify the General Department of Customs for monitoring the management of the importation of two-wheeled motorbike parts within this capacity, and inform the Vietnam Vehicle Inspection Center for managing the issuance of chassis numbers and engine numbers for products put on the market within this capacity.

5. Enterprises producing and assembling two-wheeled motorbikes for export are not subject to the quantity control prescribed in Clause 3 of this Article for the assembly parts intended for export.

6. For enterprises producing and assembling engines for two-wheeled motorbikes, apart from the quantity of engines retained for domestic assembly as prescribed in Clause 3 of this Article, they may export without quantity restrictions or sell to other domestic enterprises permitted to assemble under contractual agreements. The inspection agency shall issue certificates of conformity for these engines based on the purchase and sale contracts of the enterprises according to current regulations.

7. The Ministry of Finance, the Ministry of Industry, and the General Department of Customs shall base their actions on the actual production situation in the country to promptly supplement the List of commonly used spare parts and components for two-wheeled motorbikes domestically produced as stipulated in Appendix No. 8 of the Joint Circular No. 92/TTLT-BTC-BCN-TCHQ dated November 20, 2001, and related supplementary documents issued by the aforementioned ministries and department.

8. The Ministry of Trade shall direct market management agencies to closely cooperate with police forces, customs authorities, and other relevant forces to intensify efforts against smuggling, commercial fraud, and counterfeiting in the production, importation, and circulation of spare parts and components for two-wheeled motorbikes; strictly handle violations of legal provisions.

Article 3. Enterprises producing two-wheeled motorbikes and vehicle spare parts for export are eligible to borrow funds from the Export Credit Support Fund and receive export incentives as currently provided by the state. Enterprises investing capital to acquire production licenses for engines are entitled to preferential loans from the Development Support Fund at an annual interest rate of 3%.

Article 4. This Decision takes effect fifteen days after the date of signature.

Article 5. Ministers, heads of ministerial-level agencies, heads of government agencies, and Chairpersons of Provincial People's Committees and Municipal People's Committees directly under the Central Government shall be responsible for enforcing this Decision.