Ordinance No. 40/2002/PL-UBTVQH10 on Prices

ORDINANCE

Price

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To contribute to the development of a socialist-oriented market economy, stabilize prices, protect the legitimate rights and interests of organizations and individuals engaged in production and business activities, consumers, and the interests of the State;

Pursuant to the Constitution of the Socialist Republic of Vietnam in 1992, amended and supplemented by Resolution No. 51/2001/NQ-QH10 dated December 25, 2001 of the 10th National Assembly, 10th session;

Pursuant to Resolution No. 52/2001/NQ-QH10 dated December 25, 2001 of the 10th National Assembly, 10th session on the legislative program for 2002;

This Ordinance regulates prices.

Chapter 1:

GENERAL PROVISIONS

Article 1. Scope of Regulation and Applicability

1. This Ordinance stipulates state management over prices and price-related activities of organizations and individuals engaged in production and business.

2. This Ordinance applies to organizations and individuals both within and outside the country engaged in production and business activities in Vietnam.

3. In cases where international treaties signed or acceded to by the Socialist Republic of Vietnam provide for prices differently from this Ordinance, the provisions of such international treaties shall apply.

Article 2. Principles of Price Management

1. The State respects the right of organizations and individuals engaged in production and business to set their own prices and compete according to the law.

2. The State uses necessary measures to stabilize prices, protect the legitimate rights and interests of organizations and individuals engaged in production and business, consumers, and the interests of the State.

Article 3. Supervision of the Implementation of Laws on Prices

1. National Assembly agencies, National Assembly deputies, People's Councils at all levels supervise the implementation of laws on prices within their respective functions, tasks, and authorities.

2. The Vietnam Fatherland Front and its member organizations mobilize the people to comply with the provisions of laws on prices and supervise the implementation of laws on prices.

Article 4. Definitions

In this Ordinance, the following terms shall be understood as follows:

1. Price includes state-determined prices, prices determined by organizations and individuals engaged in production and business, and market prices.

2. Price appraisal is the evaluation or re-evaluation of the value of assets in accordance with market conditions at a specific location and time according to Vietnamese standards or international practices.

3. Dumping is the act of selling goods or services at an excessively low price compared to the usual market price in Vietnam to dominate the market, restrict lawful competition, causing damage to the legitimate interests of other organizations and individuals engaged in production and business and the interests of the State.

4. Price monopoly agreement is an agreement between organizations and individuals engaged in production and business to fix a price level to dominate the market, causing damage to the legitimate interests of other organizations and individuals engaged in production and business, consumers, and the interests of the State.

5. Monopoly price is the price of goods or services sold or purchased exclusively by one organization or individual in the market or the price of goods or services of organizations and individuals involved in a price monopoly agreement that hold a significant market share and have the power to influence market prices.

6. Abnormal price fluctuation refers to price increases or decreases during economic crises, natural disasters, enemy attacks, or other extraordinary circumstances.

Chapter 2:

STATE PRICE REGULATION

Section 1: STABILIZATION OF MARKET PRICES

Article 5. Objectives of Stabilizing Market Prices

The State implements necessary policies and measures to impact supply and demand relationships to stabilize market prices for important and essential goods and services, control inflation, maintain economic and social stability, protect the legitimate rights and interests of organizations and individuals engaged in production and business, consumers, and the interests of the State, and encourage investment and development.

Article 6. Price Stabilization Measures

1. In cases where the market price of important and essential goods and services fluctuates abnormally, the State shall use the following measures to stabilize prices:

a) Adjusting supply and demand of domestically produced goods and exported/imported goods; goods between regions and localities within the country;

b) Buying or selling reserve goods;

c) Monitoring inventory goods;

d) Setting maximum prices, minimum prices, and price ranges;

đ) Controlling price-forming factors;

e) Subsidizing agricultural products when market prices fall too low, causing losses to producers; subsidizing other important and essential goods and services.

2. The authority, procedures, deadlines, and types of goods and services subject to the measures prescribed in Clause 1 of this Article shall be stipulated by the Government.

3. Organizations and individuals producing and trading in important and essential goods and services shall have the responsibility to implement relevant measures prescribed in Clause 1 of this Article to contribute to stabilizing prices.

Section 2: PRICING AND PRICE NEGOTIATION

Article 7. Assets, Goods, and Services Priced by the State

1. Types of assets, goods, and services priced by the State include:

a) Land, water surfaces, and important resources;

b) State-owned assets for sale or lease;

c) Monopoly goods and services;

d) Important goods and services for national economy and people's livelihood.

2. The State shall price the assets, goods, and services specified in Clause 1 of this Article through the following forms:

a) Specific prices;

b) Benchmark prices;

c) Price ranges;

d) Maximum and minimum price limits.

3. The Government shall specify the list of assets, goods, and services priced by the State as stipulated in Clause 1 of this Article and the application of pricing forms specified in Clause 2 of this Article during each period.

Article 8. Basis for Pricing

The State shall price the assets, goods, and services specified in Article 7 of this Ordinance based on production and circulation costs; supply and demand relations; purchasing power of the Vietnamese currency; domestic and international market prices; and economic and social development policies during each period.

Article 9. Pricing Authority

1. Pricing authority is stipulated as follows:

a) The Government decides on the prices of particularly important assets, goods, and services that affect the national economic and social development;

b) The Prime Minister decides on the prices of important assets, goods, and services that affect the development of many sectors;

c) Ministers and heads of ministerial-level agencies decide on the prices of assets, goods, and services that significantly impact the economic development of their respective sectors;

d) Provincial People's Committees and municipal People's Committees under central government jurisdiction decide on the prices of assets, goods, and services that significantly impact local economic and social development.

2. The Government shall specify in detail the pricing authority stipulated in Clause 1 of this Article.

Article 10. Adjustment of Prices Set by the State

1. The competent state agency with pricing authority must promptly adjust the prices of assets, goods, and services within the State pricing list when domestic and international price-forming factors fluctuate, affecting production and living conditions.

2. Organizations and individuals have the right to request the competent state agency with pricing authority to adjust prices according to the provisions of the law.

Article 11. Price Negotiation

The competent state management agency for prices shall organize price negotiations between buyers and sellers for important goods and services with monopoly buying and selling characteristics not included in the State pricing scope specified in Article 7 of this Ordinance upon the request of buyers and sellers or at the request of the Prime Minister, Ministers, heads of ministerial-level agencies, and Chairpersons of provincial and municipal People's Committees under central government jurisdiction.

Article 12. Results of price negotiation

1. The results of price negotiation agreed upon by the parties shall be issued by the competent state agency managing prices for implementation.

2. In cases where the parties have organized price negotiations but have not yet reached an agreement on the price level, the competent state agency managing prices shall decide on a temporary price for the parties to implement until the parties reach an agreement on the price level to promptly serve production and business activities.

Section 3: PRICE APPRAISAL REVIEW

Article 13. State assets subject to price appraisal review

1. State assets subject to valuation include:

a) Assets purchased entirely or partially from state budget sources;

b) State assets leased, transferred, sold, contributed capital, and other forms of transferring rights;

c) Assets of state-owned enterprises that are leased, transferred, sold, contributed as capital, privatized, dissolved, and other forms of conversion;

d) Other state assets as prescribed by law that must be valued.

The Government shall stipulate the value threshold of state assets under this paragraph that must undergo price appraisal review.

2. State assets subject to price appraisal review as prescribed in Clause 1 of this Article, which have been through bidding or valuation by a Valuation Committee, need not necessarily undergo price appraisal review.

Article 14. Price Appraisal Enterprises

1. Price appraisal enterprises include state-owned enterprises and enterprises belonging to other economic sectors. The Government shall stipulate the organizational form and conditions for establishing price appraisal enterprises.

2. Organizations and individuals meeting the conditions prescribed by the Government may establish price appraisal enterprises.

Article 15. Activities of price appraisal enterprises

1. Price appraisal enterprises shall conduct price appraisals of assets in the cases prescribed in Article 13 of this Ordinance and other assets at the request of state agencies, organizations, and individuals.

2. The price appraisal activities of enterprises shall be carried out pursuant to contracts with state agencies, organizations, and individuals requiring price appraisals.

Article 16. Standards for Price Appraisal Officers

1. Individuals recognized as Valuation Experts must meet the following criteria:

a) Be a Vietnamese citizen;

b) Hold a bachelor's degree in a relevant field related to price appraisal operations;

c) Possess a certificate of specialized vocational training in price appraisal issued by a competent authority;

d) Have at least three consecutive years of work experience in the trained specialty.

2. Individuals meeting the conditions prescribed in Clause 1 of this Article shall be considered by the central state management agency for prices for issuance of a Price Appraisal Officer card.

Article 17. Results of price appraisal

The results of price appraisal by price appraisal enterprises shall be documented in writing and can only be used for the purposes specified in the contract. The results of price appraisal may be used as one of the bases for reviewing and approving budget expenditures, calculating taxes, determining asset values for bank loans, purchasing insurance, leasing, transferring, selling, contributing capital, privatizing, dissolving enterprises, and other purposes specified in the price appraisal contract.

Article 18. Rights and obligations of price appraisal enterprises

Price appraisal enterprises have the following rights and obligations:

1. Request state agencies, organizations, and individuals requiring price appraisals to provide relevant materials and data for the price appraisal;

2. Charge service fees for price appraisals according to the agreement in the contract;

3. Bear responsibility under the law for the results of their own price appraisals. In case the results of the price appraisal are incorrect, causing losses to the state, organizations, or individuals, they must compensate according to the provisions of the law;

4. Other rights and obligations as prescribed by law.

Mục 4: CONTROL OF MONOPOLISTIC PRICES

Article 19. State control over monopolistic prices

In cases where necessary, the competent state agency managing prices shall conduct cost control for production, circulation, and goods and service prices of organizations and individuals when there are signs of price monopoly agreements or when it is necessary to examine the formation of monopolistic prices.

Article 20. Responsibilities of organizations and individuals producing and trading upon receiving requests for price control of monopolistic prices

Organizations and individuals engaged in production and trading, upon receiving requests for control of monopolistic prices, have the responsibility to report fully, accurately, and promptly data and documents related to production costs, circulation, and monopolistic goods and service prices according to the requirements of the competent state agency managing prices.

Article 21. Powers and responsibilities of the competent state agency managing prices

In the process of controlling monopolistic prices, the competent state agency managing prices has the following powers and responsibilities:

1. Suspend the implementation of prices for goods and services decided by organizations and individuals involved in price monopoly agreements;

2. Require organizations and individuals involved in price monopoly agreements to buy and sell at the correct purchase and sale prices before entering into a price monopoly agreement. If it is necessary to adjust the sale and purchase prices, organizations and individuals must prepare pricing plans to be submitted to the competent state agency managing prices for review and decision;

3. Decide on the correct price within the prescribed time limit based on the pricing plan presented by organizations and individuals engaged in production and trading or proposed to the competent state authority to adjust prices appropriately;

4. Handle violations of price laws in accordance with the provisions of the law.

Mục 5: COMBATING DUMPING PRICES

Article 22. Prohibition of Dumping Prices

Strictly prohibit organizations and individuals engaged in production and trading from engaging in dumping price behavior.

Article 23. Behaviors Not Considered as Dumping Price Behavior

1. The following behaviors are not considered as dumping price behavior:

a) Lowering the selling price of fresh products;

b) Lowering the selling price of inventory goods due to reduced quality, outdated appearance, and unsuitability with consumer preferences;

c) Lowering the selling price of seasonal goods;

d) Lowering the selling price of goods for promotional activities in accordance with the law;

đ) Lowering the selling price of goods in cases of bankruptcy, dissolution, cessation of production and trading activities, relocation, or change in production and trading direction.

2. The lowering of prices specified in Clause 1 of this Article must be publicly posted clearly at stores or transaction locations regarding the old price, new price, and duration of the price reduction.

Article 24. Complaints and Reports on Dumping Price Behavior

Organizations and individuals have the right to file complaints and reports in accordance with the law against dumping price behaviors.

Article 25. Investigation and Handling of Dumping Price Behavior

1. Upon receipt of complaints and reports about dumping price behavior or upon discovering such behavior, the competent state agency managing prices must organize an investigation into the dumping price behavior.

2. Contents of the investigation into dumping price behavior:

a) Verify the dumping price behavior;

b) Determine the damage caused by the dumping price behavior to the legitimate interests of other organizations and individuals engaged in production and trading and the interests of the State.

3. Based on the results of the investigation, the competent state agency managing prices has the right to handle or recommend the competent authority to handle the dumping price behavior in accordance with the law.

Article 26. Measures to address dumping behavior

1. Determining a minimum selling price that does not restrict lawful competition, causing damage to the legitimate interests of consumers and the State's interests.

2. Administrative violation handling.

3. Compelling organizations and individuals engaging in dumping to compensate for losses suffered by other organizations and individuals due to the dumping behavior.

4. If the person committing dumping behavior shows signs of criminal offense, they shall be held criminally responsible according to the provisions of the law.

Chapter 3:

ACTIVITIES REGARDING PRICES OF PRODUCERS AND TRADERS

Article 27. Pricing by producers and traders

Producers and traders set prices for their goods and services in accordance with this Ordinance and other relevant legal documents.

Article 28. Prohibited acts

Producers and traders are prohibited from conducting the following acts:

1. Colluding with other producers and traders to form monopolies on pricing, causing damage to the legitimate interests of other producers and traders, consumers, and the State's interests;

2. Selling at dumped prices;

3. Fabricating and spreading unfounded information about price increases or decreases that cause damage to the legitimate interests of other producers and traders, consumers, and the State's interests;

4. Setting false prices to deceive consumers or organizations and individuals collaborating in production and trade;

5. Falsely increasing or decreasing prices by changing quantities, quality, or delivery locations of goods and services;

6. Exploiting natural disasters, enemy actions, and other abnormal situations to speculate and increase prices or force prices down;

7. Other acts prescribed by law.

Article 29. Price Display

1. Producers and traders must display prices of goods and services at stores and transaction locations; the price display must be clear and not misleading to customers.

2. For goods and services priced by the State, producers and traders must display the correct price determined by the competent state authority and sell at the displayed price.

For goods and services not included in the list of State-priced items, the display should be based on the price decided by the producer or trader.

Article 30. Rights and Obligations of Producers and Traders in the Field of Prices

1. Producers and traders have the following rights:

a) To determine purchase and sale prices of goods and services, except those listed in the State-priced items;

b) To determine prices within the range and limits set by the competent state authority;

c) To appeal decisions on prices made by the competent state authority that cause damage to their legitimate interests;

d) To report and denounce violations of laws on prices;

đ) To request compensation for damages according to the law from organizations and individuals;

e) Other rights as prescribed by law.

2. Producers and traders have the following obligations:

a) To prepare pricing plans for goods and services listed in the State-priced items, submit them to the competent state authority for decision, and comply strictly with the approved prices;

b) To provide price information and decisions on pricing of goods and services determined by producers and traders upon request of the competent state management authority;

c) To comply with state measures to stabilize market prices as stipulated in this Ordinance;

d) To compensate for damages caused by violations of laws on prices according to the law;

đ) Other obligations as prescribed by law.

Chapter 4:

STATE MANAGEMENT ON PRICES

Section 1: CONTENT AND ADMINISTRATIVE AUTHORITY FOR STATE MANAGEMENT OF PRICES

Article 31. Content of State Management of Prices

1. Studying, building, and organizing the implementation of price policies and measures that are suitable for economic and social development requirements at each period.

2. Issuing legal documents on prices.

3. Determining prices for important goods and services with monopoly characteristics.

4. Specifying standards for Price Appraisers; organizing training for management staff and appraisal skills; issuing and revoking Price Appraiser cards.

5. Monitoring monopoly prices and combating predatory pricing.

6. Collecting, analyzing, and reporting information, forecasting domestic and international market prices.

7. Organizing and managing scientific research, international cooperation, training, and capacity building for staff in the field of prices.

8. Inspecting, investigating, resolving complaints and denunciations, and handling violations of laws on prices.

Article 32. Administrative Authority for State Management of Prices

1. The Government uniformly manages state administration of prices throughout the country.

2. State administrative agencies responsible for prices shall be accountable to the Government for implementing state administration of prices.

3. Ministries and ministerial-level agencies within their respective tasks and powers shall be responsible for coordinating with the state administrative agency responsible for prices in performing their functions of state administration of prices in their sectors according to the price management delegation by the Government.

4. Provincial People's Committees and municipal people's committees directly under the central government within their respective tasks and powers shall be responsible for performing their functions of state administration of prices at the local level according to the price management delegation by the Government.

Article 33. Organization of State Administrative Agencies Responsible for Prices

The organizational structure, functions, tasks, and powers of state administrative agencies responsible for prices shall be stipulated by the Government.

Section 2: INSPECTION AND AUDIT OF PRICES

Article 34. Specialized Inspection of Prices

1. State administrative agencies responsible for prices shall perform specialized inspection functions of prices.

2. Specialized inspection of prices shall carry out inspections and audits of organizations and individuals in compliance with legal provisions on prices and other related legal provisions.

Article 35. Rights and Responsibilities of Specialized Inspection of Prices

1. Specialized inspection of prices has the right:

a) To request organizations and individuals engaged in production and business to report promptly, accurately, and truthfully all relevant data and documents concerning the inspection and audit of prices in accordance with the law;

b) To request relevant agencies to assign personnel to participate and provide relevant data and documents directly related to the inspection and audit of prices;

c) To handle violations of laws on prices according to the provisions of the law.

2. Specialized inspection of prices has the responsibility:

a) Not to use collected data, documents, and information for purposes other than state administration of prices;

b) Not to disclose secrets related to the production and business activities of organizations and individuals engaged in production and business;

c) To be accountable under the law for their inspection and audit of prices.

Article 36. Rights and Obligations of Organizations and Individuals Subject to Inspection and Audit of Prices

1. Organizations and individuals receiving requests from authorized agencies for inspection and audit of prices must report promptly, accurately, and truthfully all relevant data and documents concerning the inspection and audit of prices.

2. Organizations and individuals must strictly comply with decisions on handling issued by state administrative agencies responsible for prices; if they disagree with such decisions, they have the right to lodge complaints according to the law; during the complaint process, they still must comply with such decisions.

3. Organizations and individuals have the right to refuse inspection and audit of prices that do not conform to legal regulations.

Section 3: REWARD AND HANDLING OF VIOLATIONS

Article 37. Awards

Organizations and individuals with achievements in implementing laws on prices shall be rewarded according to the State's regulations.

Article 38. Handling of violations of laws on prices

1. Organizations and individuals who commit acts violating laws on prices shall be subject to administrative penalties or criminal prosecution depending on the nature and severity of the violation; if damage is caused, compensation must be provided in accordance with the law.

2. Any person who abuses their position or authority to violate price regulations; accepts bribes, shields violators of laws on prices; lacks a sense of responsibility, intentionally contravenes the State’s regulations in state management of prices, or commits other acts violating laws on prices shall be subject to disciplinary action or criminal prosecution depending on the nature and severity of the violation; if damage is caused, compensation must be provided in accordance with the law.

Chapter 5:

IMPLEMENTING PROVISIONS

Article 39. Effective date

This Ordinance takes effect from July 1, 2002.

Previous regulations contrary to this Ordinance are abolished.

Article 40. Guidance for Implementation

The Government shall provide detailed regulations and guidance for the implementation of this Ordinance.