Decision No. 50/2002/QD-BCN on the issuance of regulations for managing investment in construction of independent power projects

Pursuant to …;

Regarding the issuance of regulations on managing investment in construction of independent power projects

___________________________

THE MINISTER OF INDUSTRY

Pursuant to the Government Decree No. 74/CP dated November 1, 1995 on the functions, tasks, powers, and organizational structure of the Ministry of Industry;
Pursuant to Decree No. 52/1999/NĐ-CP dated July 8, 1999 promulgating the Investment Management and Construction Regulation and Decree No. 12/2000/NĐ-CP dated May 5, 2000 of the Government amending and supplementing certain articles of Decree No. 52/1999/NĐ-CP;
Pursuant to Decree No. 62/1998/NĐ-CP dated August 15, 1998 of the Government promulgating the Investment Regulation for Build-Operate-Transfer (BOT), Build-Transfer-Operate (BTO), and Build-Transfer (BT) Contracts applicable to foreign investment in Vietnam; Decree No. 02/1999/NĐ-CP dated January 27, 1999 of the Government amending and supplementing certain articles of Decree No. 62/1998/NĐ-CP dated August 15, 1998 of the Government;
Pursuant to Decree No. 77/CP of the Government dated June 18, 1997 promulgating the Investment Construction Regulation for Build-Operate-Transfer (BOT) Contracts within the country;
Pursuant to Decree No. 45/2001/NĐ-CP dated August 2, 2001 of the Government on electricity activities and electricity usage;
To strengthen state management over independent power projects;
At the proposal of the Director of the Planning and Investment Department and the Director of the Legal Department.

Pursuant to …;

Article 1. Issued herewith are the Regulations on Managing Investment in Construction of Independent Power Projects.

Article 2. THIS DECISION SHALL TAKE EFFECT 15 DAYS FROM THE DATE OF SIGNATURE.

Provincial People's Committees, Chairmen of Management Boards, General Directors of Vietnam Electricity Corporation, Heads of agencies and units, and individuals concerned shall be responsible for implementing this Decision.

REGULATIONS

ON THE MANAGEMENT OF INVESTMENT IN CONSTRUCTION OF INDEPENDENT POWER PROJECTS
(Issued together with Decision No. 50/2002/QĐ-BCN dated November 25, 2002 of the Minister of Industry)

__________________________

Chapter 1:

GENERAL PROVISIONS

Article 1.

1. An independent power project is a project where the Investor is an organization or individual, domestic or foreign, investing in constructing power sources and distribution networks to operate and sell electricity to Vietnam Electricity Corporation or other customers.

2. Independent power projects may be invested through Build-Operate-Transfer (BOT), Build-Transfer-Operate (BTO), Build-Transfer (BT), Build-Own-Operate (BOO) forms, or other forms as prescribed by law.

3. The competent State agency for independent power projects under these Regulations shall be understood as follows:

a) The Prime Minister for projects in Group A according to the Investment and Construction Management Charter;

b) The Ministry of Industry for projects in Group B or Group A pursuant to the delegation of the Prime Minister;

c) Provincial People's Committee (hereinafter referred to as the province) for projects in Group C.

Article 2.

These Regulations apply to organizations and individuals, both domestic and foreign, investing in independent power projects.

Projects where Vietnam Electricity Corporation is the sole investor (without joint venture) are not subject to these Regulations.

Article 3.

1. Based on the Socio-Economic Development Strategy, the Vietnam Power Industry Development Strategy; National Power Development Plan and Provincial Power Development Plan at each period, the Ministry of Industry announces the list of projects in Groups A and B, while the Provincial People's Committee announces the list of projects in Group C to attract investment under the independent power project form.

2. After completing the procedures stipulated in Articles 4, 5, and 6 of these Regulations and obtaining permission from the competent State agency, the Investor of an independent power project may proceed with investment preparation work.

Chapter 2:

REGISTRATION FOR INVESTMENT IN PROJECTS

Article 4.

1. Organizations and individuals registering to invest in independent power projects must submit to the competent State agency the registration dossier for investment in the project.

2. The contents of the dossier submitted include the following documents:

a) The Investor's letter of request;

b) Basic information about the Investor: Documents on legal status, business registration, organizational structure diagram, key personnel, experience and capability in implementing projects, financial and technical capacity, including a list of projects implemented in the last five years (including industrial and power projects) and the company's final audit report for the last three years;

c) Preliminary information about the registered project: Location of construction; project objectives; main parameters regarding scale, capacity, investment capital, operation date, electricity consumers; related content concerning industry and local planning.

d) Expected sources of funding for the implementation of the project.

c) Project implementation schedule, investment management, operation, business, and transfer methods (if applicable).

3. Within thirty days for projects in Group A, twenty days for projects in Group B, and ten days for projects in Group C from the date of receipt of a valid dossier, the Ministry of Industry or the Provincial People's Committee will respond in writing to the submitted dossier.

Chapter 3:

SELECTION OF INVESTORS

Article 5.

1. To ensure the efficiency and sustainability of the project, the selection of Investors for independent power projects is conducted through bidding.

2. Based on the list of independent power projects called for investment and the registration to invest by organizations and individuals, both domestic and foreign, the competent State agency organizes bidding to select investors to develop the project and decides on the investment form of the project.

3. In special cases such as small and medium-sized projects; projects aimed at supplying electricity to remote, difficult areas; projects with only one investor registering to participate or for other special reasons, the Ministry of Industry considers appointing the project investor in Group B or proposes the Prime Minister to appoint the project investor in Group A; the Provincial People's Committee appoints the project investor in Group C.

Article 6.

1. In the case of organizing a bidding process to select investors:

a) The Ministry of Industry publishes the Tender Document and conducts bidding for projects in Groups A and B;

b) The Provincial People's Committee publishes the Tender Document and conducts bidding for projects in Group C.

2. The bidding procedure and tendering process shall be carried out in accordance with the Tendering Regulation issued together with Decree No. 88/1999/NĐ-CP dated September 1, 1999 of the Government and other relevant legal documents.

Chapter 4:

PREPARATION OF PROJECTS

Article 7.

1. After the Investor is selected and the investment method is decided by the competent State agency and permission to prepare for investment is granted, the Investor proceeds with investment preparation and prepares the project dossier.

2. The contents of the project dossier shall be carried out in accordance with the current regulations on investment management and construction.

Chapter 5:

APPROVAL OF PROJECTS

Article 8.

1. Scale, classification of projects (into groups A/B/C) and the authority to approve independent power projects shall be implemented in accordance with the Investment Management Regulations for Construction issued together with Decree No. 52/1999/ND-CP dated July 8, 1999 (Decree 52/CP) and Decree No. 12/2000/ND-CP dated May 5, 2000 (Decree 12/CP) of the Government; Investment Regulations under Build-Operate-Transfer (BOT), Build-Transfer-Operate (BTO), and Build-Transfer (BT) contracts applicable to foreign investment in Vietnam issued together with Decree No. 62/1998/ND-CP dated August 15, 1998 of the Government (Decree 62/CP) and Domestic Investment Construction Regulations under Build-Operate-Transfer (BOT) Contracts issued together with Decree No. 77/CP dated June 18, 1997 of the Government (Decree 77/CP).

2. Investment Decision

a) Authority to Approve Projects: In accordance with the current regulations on investment and construction management:

- The investor shall submit to the Prime Minister for approval of investment decisions for projects belonging to Group A.

- For projects belonging to Group B, the investor shall submit the dossier to the Ministry of Industry in accordance with Article 7 of this Regulation for the Ministry of Industry to decide on investment for projects invested in accordance with Decree 62/CP and Decree 77/CP, or provide comments for the competent authority to approve other projects invested in accordance with Decree 52/CP and Decree 12/CP.

Within thirty days from the date of receipt of complete and valid files, the Ministry of Industry will reply in writing regarding the project dossier.

- Projects belonging to Group C shall be approved by the People's Committee of the province or the Board of Directors of State-owned Corporations. If the project is not included in the approved provincial power development plan, it must have the agreement of the Ministry of Industry.

Within fifteen days from the date of receipt of complete and valid files, the Ministry of Industry will provide comments in writing on the investor's proposal.

b) Authority to Approve Technical Design and General Budget Estimate.

- The investor shall submit to the Ministry of Industry for approval of technical design and general budget estimate for projects belonging to Group A.

- For projects belonging to Group B, the investor shall submit to the Ministry of Industry for approval of technical design and general budget estimate for projects invested in accordance with Decree 62/CP and Decree 77/CP, or provide comments for other projects.

Within forty-five days for Group A projects and thirty days for Group B projects from the date of receipt of complete and valid files, the Ministry of Industry will organize approval or provide comments on technical design and general budget estimate of the project.

- Projects belonging to Group C shall be approved by the People's Committee of the province or the Board of Directors of State-owned Corporations based on the agreement of the Ministry of Industry on key technical solutions, standards applied, and industry norms.

The Ministry of Industry will reply in writing to the investor within twenty days from the date of receipt of complete and valid files.

Chapter 6:

IMPLEMENTATION OF PROJECTS

Article 9.

1. After the project is approved, the investor shall send a complete set of project files to the Ministry of Industry for monitoring. Based on the approved project files, the investor shall implement construction, inspection, and put the project into operation in accordance with regulations.

2. During implementation, the investor must take appropriate measures to ensure the project schedule as agreed, be responsible for construction safety, and organize construction to ensure project quality.

3. Quarterly, the investor must regularly report to the competent state authority on the progress of the project.

Article 10.

1. One year after the project is permitted to prepare for investment for Group A and B projects and six months for Group C projects, if the investor does not complete the Preliminary Feasibility Study Report and Feasibility Study Report without agreement, the competent state authority may issue a document terminating the project to call for another investor to implement the project.

2. One year after the technical design of the project is approved, if the investor does not commence construction without the agreement of the competent authority, the Ministry of Industry may issue a document terminating the project or recommend the Prime Minister to issue a document terminating the project to call for another investor to implement the project.

3. Before putting the project into operation, the investor must register for power operation permit in accordance with Decree No. 45/2001/ND-CP dated August 2, 2001 of the Government on power activities and electricity usage and the guidance of the Ministry of Industry.

Article 11.

Responsibilities of the Ministry of Industry and the Provincial People's Committee:

1. Monitor the implementation of the project by the investor.

2. Examine and resolve according to their authority the investor's proposals related to project implementation.

3. Inspect and audit in accordance with the provisions of the law.

Chapter 7:

IMPLEMENTING PROVISIONS

Article 12.

1. This regulation shall be uniformly applied throughout the country.

2. During implementation, if there are difficulties, the investor shall report to the Ministry of Industry for research and supplementation or amendment.