Circular No. 55/2006/TT-BTC guiding the implementation of certain provisions of Government Decree No. 26/2005/NĐ-CP dated March 2, 2005 on the Appraisal Board for Assets in Criminal Proceedings

CIRCULAR

Guidelines for Implementing Certain Provisions of Decree No. 26/2005/NĐ-CP dated March 2, 2005 of the Government on the Asset Valuation Council in Criminal Proceedings

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Pursuant to Decree No. 26/2005/NĐ-CP dated March 2, 2005 of the Government on the Asset Valuation Council in Criminal Proceedings;

Pursuant to Decree No. 77/2003/NĐ-CP dated July 1, 2003 of the Government stipulating the functions, tasks, powers, and organizational structure of the Ministry of Finance;

After receiving opinions from the Ministry of Justice in Circular No. 864/BTP-BTTP dated April 4, 2006, the Ministry of Public Security in Circular No. 571/BCA-V19 dated April 10, 2006, the Supreme People's Procuracy in Circular No. 1468/VKSTC-V8 dated May 15, 2006, and the Supreme People's Court in Circular No. 84/KHXX dated June 5, 2006, the Ministry of Finance issues guidelines for implementing certain provisions of Decree No. 26/2005/NĐ-CP dated March 2, 2005 of the Government on the Asset Valuation Council in Criminal Proceedings (hereinafter referred to as Decree No. 26/2005/NĐ-CP) as follows:

I. SCOPE OF APPLICATION

This Circular guides principles and bases for asset valuation; price survey of assets; rights and obligations of the Asset Valuation Council; rights and obligations of members of the Asset Valuation Council; costs for asset valuation in criminal proceedings, other contents shall be implemented in accordance with the provisions of Decree No. 26/2005/NĐ-CP.

II. SPECIFIC PROVISIONS

1. Principles of asset valuation:

Asset valuation in criminal proceedings must be consistent with market prices at the time and place where the asset was infringed upon; it must ensure honesty, objectivity, transparency, and timeliness, specifically as follows:

a) The market price of an asset is the purchase, sale, or transaction price agreed upon for assets of the same type or equivalent on the market under normal trading conditions at the time and place where the asset was infringed upon.

For assets that were infringed upon and are state-priced assets, the price to be determined is the price prescribed by the State at the time and place where the asset was infringed upon.

For assets not commonly traded on the market (specialized assets, single items), the price to be determined must cover the cost of recreating the asset or importing the asset at the time and place where the asset was infringed upon.

b) The level of asset price determined as the basis for valuation is the average price of the month. The period for collecting information on the price of the infringed asset is one month (30 days) before and one month (30 days) after the date of infringement; if sufficient information cannot be collected within this period to serve as a basis for valuation, the collection period may be extended by one month before and one month after the date of infringement.

When conducting investigations to collect information on the price of the infringed asset, it must be linked to supply and demand factors, market preferences, and purchasing power under normal trading conditions.

Normal trading conditions refer to transactions conducted when supply, demand, prices, and purchasing power do not experience sudden changes due to natural disasters, enemy attacks, etc., and the information on supply, demand, and prices of the infringed asset is publicly displayed on the market.

c) The price of the asset used as a basis for valuation must be collected at the location where the asset was infringed upon.

The location for price surveys is commercial centers, organizations, and individuals producing assets of the same type or equivalent to the infringed asset within the administrative unit of district, town, city directly under province (hereinafter collectively referred to as district level).

Assets of the same type as the infringed asset are those with the same shape, characteristics, usage features, and measurable units. Assets of the same quality can replace each other.

e) Assets equivalent to the infringed asset are those possessing all basic characteristics similar to the infringed asset, including:

- Having the same physical characteristics as the asset;

- Having similar technical specifications;

- Having the same functional purpose;

- Being interchangeable in use;

- Having equivalent quality.

2. Bases for asset valuation: Asset valuation must be based on the following grounds:

a) Market price of the asset at the time and place where the asset was infringed upon. The market price is the purchase, sale price agreed upon for assets of the same type or equivalent and is the most frequently occurring price on the market during the time and place of the infringement.

b) Price prescribed by competent state agencies applied in the locality where the asset was infringed upon and at the time of the infringement.

c) Price of the asset to be valued as determined in legitimate documentation about the type of asset owned by the asset owner (if available).

d) Actual value of the asset to be valued:

- For new assets: The Asset Valuation Council determines the asset price according to assets of the same type or equivalent and in perfect condition.

- For used assets: The Asset Valuation Council must assess the remaining quality of the asset after accounting for depreciation due to use to determine its residual value.

e) Other bases for determining the value of the asset to be valued include market value determinants such as technical and legal information about the asset; actual transfer prices on the market that can be compared; the highest possible value and efficiency of the asset's best use; supply and demand relationships for the asset...

3. Price Survey:

a) Depending on the nature, characteristics, and circulation conditions of each type of infringed asset on the market, the Asset Valuation Council conducts a price survey of the infringed asset according to one of the two types: wholesale price or retail price for assets of the same type or equivalent.

To provide a comprehensive assessment, the price survey for each type mentioned above must be carried out in three areas: on the market, in documentation, and at the competent authority that has already valued the type of asset.

Members of the Asset Valuation Council conducting the price survey implement the direct investigation method (Form 01-KSG, Form 02-KKTS attached to this Circular).

b) Steps for price survey:

Step 1: Develop a survey plan.

Step 2: Identify the location where the property was infringed upon: commune (ward) and administrative unit at the district level.

Step 3: Determine the condition of the property that needs to be surveyed for price:

- For property that no longer exists, the Appraisal Council must take statements and file documents (if available) from the victim, witnesses, civil plaintiffs, civil defendants, parties with rights and obligations related to the case, and those who have infringed on the property to determine what type of property it is (species, model, brand, quality...).

- If necessary, the Appraisal Council may request witnesses to identify the infringed property before proceeding with the determination of its value.

- For property that has been used (or has undergone changes in its basic structure), the Appraisal Council must conduct inspections and evaluate the quality of the property or goods to be appraised after accounting for depreciation due to usage to determine the remaining value of the property.

- For property that needs to be appraised which is precious metals, gems, or objects with artistic or historical elements, the Appraisal Council must base their assessment on the results of the appraisal by the competent authority in that field.

Evaluating the event: Determine the time when the property was infringed upon and decide the specific date, month, and year to conduct the price survey.

Step 5: Coordinate with relevant local authorities at the location where the property was infringed upon to conduct the price survey.

Step 6: Select survey partners: Choose specific partners to collect data such as individuals, production enterprises, organizations or individuals knowledgeable about the type of infringed property or similar property, dealers, stores, shopping centers, plaintiffs and defendants, parties with rights and obligations related to the case.

Step 7: Collect prices of the infringed property:

- The collection of market prices for the property must comply with Clause a, Point 2, Section II, of this Circular.

- Collect prices (from the market, as prescribed by authorized state agencies, attached to the property's documentation) must conform to the form provided in this Circular.

- Price collection must be conducted through at least three investigation forms for each valuation request.

Step 8: Compile collected data into a detailed report to present to the Appraisal Council.

4. Rights and Obligations of the Appraisal Council:

a) The rights of the Appraisal Council are implemented according to Clause 1, Article 8, Decree No. 26/2005/NĐ-CP; the Council has the right to request prosecution agencies, organizations, and individuals related to provide written materials and information about the property to be appraised within the necessary timeframe to ensure timely valuation.

b) The obligations of the Appraisal Council are carried out according to Clause 2, Article 8, Decree No. 26/2005/NĐ-CP and the following provisions:

- Organize the implementation of price surveys of infringed property in accordance with the steps stipulated in this Circular.

- Conduct valuation within the required timeframe; if additional time is needed to complete the valuation, the Council must promptly notify the requesting agency in writing no later than three days (03 days) from the receipt of the valuation request, and in this case, the valuation deadline will be as proposed by the Appraisal Council.

- The Appraisal Council must promptly notify members of the Council in writing about the content, composition, time, and place of meetings and related matters.

5. Rights and Obligations of Members of the Appraisal Council:

a) The rights of members of the Appraisal Council are implemented according to Clause 1, Article 9, Decree No. 26/2005/NĐ-CP and the following provisions:

- Have the right to refuse participation in the valuation of property if the provided documents and information are incomplete or for other valid reasons.

- Be entitled to material compensation as stipulated in this Circular.

b) The obligations of members of the Appraisal Council are carried out according to Clause 2, Article 9, Decree No. 26/2005/NĐ-CP; members of the Council must directly perform activities serving the valuation process such as viewing the property and conducting price surveys.

6. Revaluation of Property:

The revaluation of property is carried out according to the provisions of Article 21, Decree No. 26/2005/NĐ-CP, specifically as follows:

- Revaluation of property when requested by the competent prosecution agency due to suspicion regarding the results of the initial valuation, which occurs when the prosecution agency has sufficient grounds and basis for suspicion in an objective and convincing manner.

- Revaluation in cases of conflict between the initial valuation conclusion and the revaluation conclusion (second revaluation), which is implemented when the revaluation conclusion differs from the initial valuation conclusion.

- Revaluation is conducted by the higher-level Appraisal Council: The Appraisal Council at the provincial level revalues property initially appraised by the Appraisal Council at the district level; the Appraisal Council at the central level revalues property initially appraised by the Appraisal Council at the provincial level.

7. Costs of Valuing Property:

- The costs of valuing property are allocated in the annual budget estimate of the competent prosecution agency. The prosecution agency is responsible for preparing the budget estimate, managing, using, and settling the valuation expenses according to the State Budget Law, guiding documents, and provisions in this Circular.

- Travel expenses and costs for organizing meetings of the Appraisal Council: in accordance with the levels set by the Minister, head of a ministry equivalent to a ministry, or head of a government agency, and the Chairman of the People's Committee of provinces and centrally-administered cities, specifically implementing the provisions of Circular No. 118/2004/TT-BTC dated December 8, 2004, issued by the Ministry of Finance, concerning travel expense regulations and meeting cost regulations for administrative agencies and public service units nationwide.

- Expenses for overtime work related to the asset valuation council's tasks: implemented in accordance with the joint Circular No. 08/2005/TTLT-BNV-BTC dated January 5, 2005, issued by the Ministry of Home Affairs and the Ministry of Finance, guiding the wage system for night and overtime work for civil servants and public officials.

- Expenses for conducting price survey work: in accordance with the expenditure levels prescribed in Circular No. 114/2000/TT-BTC dated November 27, 2000, issued by the Ministry of Finance, guiding the management of funds for surveys funded from state budget sources.

- Expenses for office supplies, document printing, storage costs, and information organization on prices serving asset valuation tasks... shall be settled based on valid invoices and receipts.

III. IMPLEMENTATION

1. This Circular takes effect fifteen days after its publication in the Official Gazette.

2. Minister, Head of equivalent Ministries, agencies under the Government, Chairman of Provincial People's Committees, municipal-level cities directly under the Central Government, Directors of Departments of Finance, and relevant organizations and individuals are responsible for implementing this Circular.

Any difficulties encountered during implementation should be reported to the Ministry of Finance for appropriate amendments and supplements./.