Circular No. 48/2017/TT-BTC on financial regulations in auction activities of assets

CIRCULAR

REGULATIONS ON FINANCIAL REGIME IN AUCTION ACTIVITIES

Pursuant to the Auction Law dated November 17, 2016;

Pursuant to the Law on Management and Use of State Property dated June 3, 2008;

The Government issues this Decree on management and development of industrial clusters.

Pursuant to Decree No. 215/2013/NĐ-CP dated December 23, 2013, promulgated by the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

At the proposal of the Director of the State Asset Management Agency,

The Minister of Finance issues this Circular to regulate the financial regime in auction activities.

PART I

GENERAL PROVISIONS

Article 1. Scope of Regulation

This Circular regulates the financial regime in auction activities concerning land use rights according to the laws on land and other assets as stipulated in Clause 1, Article 4 of the Auction Law.

Article 2. Applicability

1. Auction service centers, asset auction enterprises (hereinafter collectively referred to as auction organizations) and Auction Committees as prescribed by law.

2. Agencies, organizations, units having assets for auction or entrusted with handling auction matters.

3. Other organizations and individuals related to the implementation of the financial regime in asset auctions.

Chapter II

FINANCIAL REGIME IN AUCTION ACTIVITIES OF LAND USE RIGHTS AS PROVIDED FOR BY THE LAWS ON LAND

Article 3. Sources of funds ensuring auction activities of land use rights

1. Budget estimates allocated to agencies entrusted with determining initial prices or entrusted with handling land use rights auctions.

2. Fees charged for auction documents provided to participants in land use rights auctions:

a) In cases where land use rights auctions are conducted to allocate residential land to households or individuals:

b) In cases where land use rights auctions do not fall within the scope specified in point a, Clause 2, Article 3 of this Circular:

c) The collection amounts specified in points a and b, Clause 2, Article 3 of this Circular are maximum amounts. Specific collection amounts are determined by agencies entrusted with handling land use rights auctions; in cases of land use rights auctions through committees, such amounts are decided by the Auction Committees.

d) In cases where auctions cannot be organized, organizations and individuals who have registered to participate in the auctions shall be refunded the document fees they have paid within two working days from the date of the planned auction sale. Document fees will not be refunded to organizations and individuals who violate auction regulations during the auction period.

3. Deposit money of participants in auctions shall not be refunded as stipulated in Clause 6, Article 39 of the Auction Law.

4. Other legitimate sources of funds as prescribed by law.

Article 4. Management and utilization of funds ensuring auction activities of land use rights

1. In cases where auctions are carried out by auction organizations:

a) Auction organizations are responsible for collecting document purchase fees as stipulated in Clause 2, Article 3 of this Circular;

b) The amount collected as specified in point a of this clause shall be deducted from the service fee for the auction. Any remaining amount (if any) shall be transferred to the agency entrusted with handling land use rights auctions to settle the remaining expenses as stipulated in Clause 1 and Clause 2, Article 5 of this Circular; if there is any surplus, it shall be deposited into the state budget in accordance with the State Budget Law. If the amount at point a of this clause is insufficient to cover the service fee for the auction, the shortfall shall be covered from the deposit money as stipulated in Clause 3, Article 3 of this Circular and the budget estimate of the agency entrusted with handling land use rights auctions as stipulated in Clause 1, Article 3 of this Circular.

2. In cases where auctions are carried out by Land Use Rights Auction Committees:

a) Land Use Rights Auction Committees are responsible for collecting document purchase fees as stipulated in Clause 2, Article 3 of this Circular;

b) The amount collected as specified in point a of this clause shall be used to pay for the expenses as stipulated in Clause 3, Article 5 of this Circular. Any remaining amount (if any) shall be transferred to the agency entrusted with handling land use rights auctions to settle the remaining expenses as stipulated in Clause 1 and Clause 2, Article 5 of this Circular; if there is any surplus, it shall be deposited into the state budget in accordance with the State Budget Law. If the amount at point a of this clause is insufficient to cover the expenses as stipulated in Clause 3, Article 5 of this Circular, the shortfall shall be covered from the deposit money as stipulated in Clause 3, Article 3 of this Circular and the budget estimate of the agency entrusted with handling land use rights auctions as stipulated in Clause 1, Article 3 of this Circular.

Article 5. Contents of expenses for land use right auction activities

1. Contents of expenses of the agency assigned the task of determining the initial price for land use right auction:

a) Expenses for hiring organizations with advisory functions to determine land prices to determine the initial price;

b) Expenses for appraising land prices to determine the initial price;

c) Other legitimate expenses related thereto.

2. Contents of expenses of the agency assigned the task of handling land use right auction:

a) Expenses for surveying, dividing plots, and determining boundary markers;

b) Expenses for preparing the auction plan for land use rights;

c) Expenses for preparing the cadastral file to put land use rights up for auction;

d) Expenses for selecting the auction organization;

đ) Expenses for implementing procedures to transfer land and related files and papers to the successful bidder for registration of land use right certificate;

e) Payment of service fees for the auction organization according to the service auction contract and the expense level prescribed in Clause 1, Article 6 of this Circular;

g) Other legitimate expenses related thereto.

3. Contents of expenses of the Auction Committee for land use rights:

a) Expenses for preparing the auction file for land use rights (including expenses for establishing the Auction Regulation);

b) Expenses for publicly posting and announcing the auction of assets;

c) Expenses for selling and receiving files from participants in the auction;

d) Expenses for organizing for participants in the auction to view the assets;

đ) Expenses for organizing the auction (including expenses for renting locations to organize the asset auction when the agency assigned to handle the auction cannot arrange an auction sale location; expenses for renting online auction information websites of the asset auction organization to organize the auction in case the auction is conducted through an online auction method; expenses paid to the auction organization for it to dispatch auctioneers to manage the auction sale according to Clause 3, Article 60 of the Auction Law);

e) Other expenses directly related to the organization and implementation of the asset auction.

Article 6. Levels of expenses for land use right auction activities

1. For expenses that have standards, norms, and unit prices prescribed by competent state agencies, the levels of expenses shall be implemented according to the regulations. Among them, the service fee for land use right auctions paid to the asset auction organization shall be carried out according to the regulations of the Ministry of Finance on the framework of service fees for asset auctions.

In cases where the land use right auction does not succeed, the auction organization shall not be paid the service fee for the auction but only be reimbursed for actual reasonable expenses incurred for the land use right auction; the maximum payment amount shall not exceed the service fee for a successful auction according to the regulations of the Ministry of Finance on the framework of service fees for asset auctions.

In cases where a Service Auction Contract for land use rights includes multiple plots of land and part of the auction does not succeed, the ratio (%) of successful auction and the ratio (%) of unsuccessful auction must be determined based on the initial price to determine the service fee for the auction to be paid to the auction organization.

The amount of service fee for the auction, asset auction expenses paid to the auction organization must be clearly recorded in the Settlement Agreement of the Service Auction Contract for land use rights.

2. For expenses without prescribed standards, norms, and unit prices by competent state agencies, the following shall apply:

a) The level of expenses for hiring organizations with advisory functions to determine land prices to determine the initial price shall be carried out according to the contract between the agency assigned the task of determining the initial price and the selected land price determination advisory organization in accordance with the law;

b) The head of the agency assigned the task of determining the initial price for land use right auction, the head of the agency assigned the task of handling land use right auction shall specifically decide the level of expenses for other expenses without prescribed standards, norms, and unit prices to ensure compliance with the current financial management system of the State and bear responsibility for their decisions.

Article 7. Preparation of budget estimates, utilization, and settlement of expenses for auctioning land use rights

1. Based on the source of funds, revenue levels, content of expenditures, expenditure limits stipulated in Articles 3, 4, 5, and 6 of this Circular, and the anticipated workload, the agency assigned to determine the initial price and the agency assigned to handle the auction of land use rights shall prepare a budget estimate for the assigned tasks, submit it for approval by the Chairman of the People's Committee with competent authority before implementation.

In cases where the approved budget estimate is insufficient for actual expenditures, the agency assigned to determine the initial price and the agency assigned to handle the auction of land use rights shall prepare a supplementary budget estimate, submit it for supplementary approval by the Chairman of the People's Committee with competent authority. The use and accounting of this supplementary fund shall be carried out in accordance with the laws on state budget management and utilization.

2. The agency assigned to determine the initial price and the agency assigned to handle the auction of land use rights shall be responsible for managing and utilizing the budget estimate and reporting the final settlement of auction expenses according to the laws on the state budget.

Article 8. Management and Utilization of Advance Payment by Participants in Auctions of Land Use Rights

1. The asset auction organization and the Land Use Right Auction Council shall be responsible for safely managing the advance payment of participants in the auction. The collection of advance payment from participants in the auction of land use rights shall only be conducted within a maximum period of three working days prior to the date of the auction opening, except in cases where there is a written agreement between the participant and the asset auction organization or the Land Use Right Auction Council prior to the auction opening date.

If, prior to the auction opening date, there is a change (in the initial price or other information compared to the information previously posted or publicly announced), and the participant refuses to continue participating in the auction, the asset auction organization and the Land Use Right Auction Council must refund the advance payment and interest (if any) within two working days from the receipt of the refusal notice from the participant.

2. The asset auction organization and the Land Use Right Auction Council must refund the advance payment and interest (if any) to those who did not win the auction, except in cases where the participant is not entitled to receive the advance payment as stipulated in Clause 6, Article 39 of the Auction Law. The refund of the advance payment shall be completed within three working days from the end of the land use right auction or within another agreed period by the parties.

Within two working days from the end of the land use right auction, the asset auction organization and the Land Use Right Auction Council must deposit into the state budget the advance payment and interest accrued up to the date of deposit of the winning bidder. This amount shall be deducted from the payment obligation of the winning bidder.

4. The asset auction organization and the Land Use Right Auction Council shall not use the advance payment of participants for any purpose other than that prescribed by the law on auctions; in cases where the advance payment that the participant is not entitled to receive as stipulated in Clause 6, Article 39 of the Auction Law shall be managed and utilized in accordance with Point b, Clause 1 and Point b, Clause 2 of Article 4 of this Circular.

Article 9. Submission of Proceeds from Auctioning Land Use Rights

Organizations and individuals winning the auction for land use rights to transfer land with payment or lease land shall be responsible for submitting the auction proceeds into the state budget in accordance with the provisions of laws on land use fees and land lease fees.

Chapter III

FINANCIAL REGIME IN AUCTIONING OTHER ASSETS

Article 10. Sources of funds ensuring auction activities of assets

1. Proceeds from the auction of assets.

2. Fees for selling bidding documents to participants in asset auctions:

a) The fee for selling bidding documents for participating in asset auctions is set corresponding to the starting price of the auctioned assets as follows:

b) The amount specified in point a of this Clause 2 is the maximum level. The specific amount is decided by the agency, organization, or unit owning the auctioned asset or the agency entrusted to handle the auction of the asset; in cases where the auction is conducted through a council, it is decided by the Asset Auction Council.

c) In cases where the auction cannot be organized, organizations and individuals participating in the asset auction shall be refunded the bidding document fees within two working days from the date of the planned auction sale. Bidding document fees will not be refunded to organizations and individuals who violate the auction regulations during the auction period.

3. Deposit money of participants in auctions shall not be refunded as stipulated in Clause 6, Article 39 of the Auction Law.

4. Other legitimate sources of funds as prescribed by law.

Article 11. Management and utilization of sources of funds ensuring auction activities of assets

1. In cases where auctions are carried out by auction organizations:

a) The organization conducting the asset auction shall be responsible for collecting the bidding document purchase fees as stipulated in Clause 2 of this Article 10 of this Circular;

b) The amount collected as stipulated in point a of this paragraph shall be deducted from the service fee for the auction. The remaining amount (if any) shall be transferred to the agency, organization, or unit owning the auctioned asset or the agency entrusted to handle the auction of the asset to settle the remaining expenditure items as stipulated in Clause 1 of Article 12 of this Circular; if there is any surplus, it shall be managed and utilized according to relevant laws. If the amount at point a of this paragraph is insufficient to cover the service fee for the auction, the shortfall shall be covered from the deposit stipulated in Clause 3 of Article 10 of this Circular and the proceeds from the sale stipulated in Clause 1 of Article 10 of this Circular to settle the expenses.

2. In cases where the auction is carried out by the Asset Auction Council:

a) The Asset Auction Council shall be responsible for collecting the bidding document purchase fees as stipulated in Clause 2 of Article 10 of this Circular;

b) The amount collected as stipulated in point a of this paragraph shall be used to cover the expenses stipulated in Clause 2 of Article 12 of this Circular. The remaining amount (if any) shall be transferred to the agency, organization, or unit owning the auctioned asset or the agency entrusted to handle the auction of the asset to settle the remaining expenditure items as stipulated in Clause 1 of Article 12 of this Circular; if there is any surplus, it shall be managed and utilized according to relevant laws. If the amount at point a of this paragraph is insufficient to cover the expenses stipulated in Clause 2 of Article 12 of this Circular, the shortfall shall be covered from the deposit stipulated in Clause 3 of Article 10 of this Circular and the proceeds from the sale stipulated in Clause 1 of Article 10 of this Circular to settle the expenses.

Article 12. Contents and levels of expenditure for asset auction activities

1. Contents of expenditure of agencies, organizations, units owning assets to be auctioned or agencies entrusted with handling asset auctions:

a) Costs for inventorying assets;

b) Surveying costs for houses and land in cases of auctioning assets attached to land, or transferring land use rights;

c) Relocation costs as prescribed by law in cases of auctioning assets attached to land, or transferring land use rights;

d) Costs for valuation and price appraisal of assets;

đ) Costs for organizing the selection of auction organizations;

e) Payment of remuneration for auction services to the auction organization according to the service contract;

g) Other legitimate related expenses.

2. Contents of expenditure of the Auction Asset Council:

a) Transportation, delivery, and storage costs of assets from the date of the competent authority's decision on asset disposal until the completion of the auction sale and handover of assets to the buyer;

b) Repair costs for assets to be sold if they need repair before being sold (if applicable); costs to rectify asset losses due to objective reasons during the auction process (if applicable);

c) Expenses as stipulated in Clause 3, Article 5 of this Circular.

3. The levels of expenditure specified in Clause 1 and Clause 2 of this Article shall be implemented in accordance with the provisions of Article 6 of this Circular.

Article 13. Preparation, utilization, and settlement of budget funds

1. Agencies, organizations, units owning assets to be auctioned or agencies entrusted with handling asset auctions shall be responsible for managing, utilizing, and settling the auction budget funds in accordance with relevant laws.

2. The Auction Asset Council bases on the source of funds, revenue level, contents and levels of expenditure as stipulated in Articles 10, 11, and 12 of this Circular and the expected workload to prepare the budget for organizing each auction, submitting it to the agency issuing the decision to establish the Auction Asset Council for approval.

In cases where immediate work must be carried out to auction assets before the budget is approved by the competent authority, the Auction Asset Council is permitted to temporarily advance funds from the unit, organization, or agency owning the assets to be auctioned or the agency entrusted with handling the asset auction to cover necessary expenditures. The maximum advance amount shall not exceed five percent of the value of the assets to be auctioned (based on the starting price). The Auction Asset Council is responsible for repaying the advanced amount to the unit owning the assets or the agency entrusted with handling the asset auction before reporting the final settlement of the budget for organizing the asset auction.

a) After the budget for organizing the asset auction is approved, the Auction Asset Council shall transfer one (01) copy to the agency, organization, unit owning the assets to be auctioned or the agency entrusted with handling the asset auction for coordination in implementation.

b) The Auction Asset Council is responsible for managing and utilizing the budget for organizing the asset auction strictly in accordance with the contents and levels of expenditure in the approved budget.

If the approved budget is insufficient for actual expenditures, the Auction Asset Council shall prepare a supplementary budget, submit it to the agency issuing the decision to establish the Auction Asset Council for supplementary approval; simultaneously, notify the agency, organization, unit owning the assets to be auctioned or the agency entrusted with handling the asset auction for coordination in implementation. The use and accounting of this supplementary fund shall be carried out in accordance with relevant laws.

c) At the latest within thirty working days from the end of the auction, the Auction Asset Council shall report the final settlement of the budget for organizing the asset auction to the agency issuing the decision to establish the Council for approval in accordance with relevant laws.

Agencies, organizations, units owning assets to be auctioned or agencies entrusted with handling the asset auction shall be responsible for managing the settlement file including: The approved settlement report and related documents for the report on the budget settlement for implementing the asset auction.

Article 14. Management of advance payment by participants in asset auction

The management of advance payment by participants in asset auction shall be carried out in accordance with the provisions of Article 8 of this Circular.

Chapter IV

IMPLEMENTING PROVISIONS

Article 15. Effective Date

1. This Circular takes effect from July 1, 2017.

2. This Circular abolishes the following documents:

a) Circular No. 48/2012/TT-BTC dated March 16, 2012 of the Ministry of Finance guiding the determination of initial price and financial regime in the activity of auctioning land use rights for transfer of land with payment of land use fee or lease of land;

b) Circular No. 02/2015/TT-BTC dated January 5, 2015 of the Ministry of Finance amending and supplementing Circular No. 48/2012/TT-BTC dated March 16, 2012 of the Ministry of Finance guiding the determination of initial price and financial regime in the activity of auctioning land use rights for transfer of land with payment of land use fee or lease of land;

c) Chapter III of Circular No. 137/2010/TT-BTC dated September 15, 2010 of the Ministry of Finance stipulating the determination of initial price of state-owned assets to be auctioned and the financial regime of the Asset Auction Council;

d) Circular No. 335/2016/TT-BTC dated December 27, 2016 of the Ministry of Finance stipulating the level of auction fees, the collection, payment, management, and use of asset auction fees and participation fees in asset auctions.

3. During implementation, if any difficulties arise, relevant agencies, organizations, units, and individuals are requested to promptly report to the Ministry of Finance for research and coordinated resolution./.