Circular No. 49/TC-NSNN guiding the financial management of profits distributed from the Vietsovpetro joint venture oil and gas enterprise

CIRCULAR

Circular No. 49/1997/TC-NSNN dated July 30, 1997 of the Ministry of Finance guiding financial management regarding the distribution of profits from the Vietsovpetro Joint Venture Oil Enterprise.

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Based on the Prime Minister's Official Letter No. 1938/KTTH dated April 22, 1997 concerning the management and utilization of profits distributed from the Vietsovpetro Joint Venture Oil Enterprise.

The Ministry of Finance guides the use of the profit share from the joint venture oil enterprise as follows:

I. GENERAL PROVISIONS

Clause 1. The profit share (after tax payment) distributed from the Vietsovpetro Joint Venture Oil Enterprise shall be retained by Vietnam National Oil Corporation at the ratio determined by the Prime Minister for investment in the development of the Oil and Gas Industry. This portion of the profit can only be used for investment in projects approved by competent authorities.

Clause 2. Investment construction projects funded from the aforementioned source must comply with the current State regulations stipulated in the Investment Management and Construction Regulations. Other development investment projects shall follow the relevant current State regulations.

Clause 3. The Ministry of Finance, based on the actual profit retained by Vietnam National Oil Corporation, will process the recording of revenue and expenditure in the State budget.

Clause 4. Vietnam National Oil Corporation is responsible for managing and using the profit share retained from the Vietsovpetro Joint Venture Oil Enterprise according to the State regulations, for the intended purpose, and effectively for the development of the Oil and Gas Industry.

II. SPECIFIC PROVISIONS

Clause 1. Annually, Vietnam National Oil Corporation bases its plans on exploitation capacity, consumption forecasts, and the expected profit retained according to the ratio decided by the Prime Minister, allocates capital specifically for each project, submits it to the competent authority for decision-making, and registers with the Ministry of Planning and Investment and the Ministry of Finance. On this basis, it prepares the annual budget revenue and expenditure report to be submitted to relevant state agencies as required.

Clause 2. Investment projects are budgeted based on the permitted capital sources including: the profit retained from the Vietsovpetro Joint Venture Oil Enterprise at the ratio decided by the Government and other capital sources according to the prescribed regulations.

Clause 3. The entire profit retained must be transferred into a separate account at the State Treasury where Vietnam National Oil Corporation is the main account holder.

Clause 4. Vietnam National Oil Corporation is responsible for sending the approved budget of each project to the Ministry of Finance for tracking and checking the implementation status of basic construction projects.

Clause 5. Within four working days from receiving payment for each oil lot, Vietnam National Oil Corporation is responsible for paying the State budget the profit share due (according to the ratio to be paid) along with other taxes payable to the State budget; and transferring the retained profit share (according to the ratio retained) into the separate account opened at the State Treasury as mentioned above.

Clause 6. On the first five days of each month, based on the transfer vouchers for the profit retained for investment development of approved projects deposited into the separate account of Vietnam National Oil Corporation at the State Treasury, the corporation is responsible for preparing the documentation confirmed by the Treasury agency, reporting to the Ministry of Finance to process the recording of revenue and expenditure in the State budget for the previous month's retained profit.

Clause 7. The State Treasury agency is responsible for checking expenditures from the Vietnam National Oil Corporation's account at the Treasury to ensure they are allocated to approved projects and constructions. Development investment agencies are responsible for checking the implementation status of basic construction projects according to current regulations.

Clause 8. Vietnam National Oil Corporation reports periodically monthly on the implementation status, organizes accounting work, and settles accounts with the Ministry of Finance regarding the profit retained for investment from the Vietsovpetro Joint Venture Oil Enterprise according to current regulations.

III. IMPLEMENTATION PROVISIONS

This Circular takes effect from the 1997 Budget Year.

During implementation, any difficulties should be reported to the Ministry of Finance for timely supplementation to ensure compliance.