Decree No. 67/2014/NĐ-CP On Certain Policies for Developing Fisheries

 DECREE

On certain policies for developing fisheries

Pursuant to the Law on Organization of the Government dated December 25, 2001;

Pursuant to the Law on State Budget dated December 16, 2002;

Based on the Fisheries Law dated November 26, 2003;

Pursuant to the Law on the State Bank dated June 16, 2010;

Pursuant to the Law on Credit Institutions dated June 16, 2010;

Pursuant to the Law on Insurance Business dated December 9, 2000 and the Law Amending and Supplementing Certain Provisions of the Law on Insurance Business dated November 24, 2010;

Pursuant to the Law on Corporate Income Tax and the Law Amending and Supplementing Certain Provisions of the Law on Corporate Income Tax 2013; the Law on Value Added Tax and the Law Amending and Supplementing Certain Provisions of the Law on Value Added Tax 2013; the Law on Personal Income Tax and the Law Amending and Supplementing Certain Provisions of the Law on Personal Income Tax 2013; the Law on Tax Administration and the Law Amending and Supplementing Certain Provisions of the Law on Tax Administration 2013; the Law on Resource Tax 2009; the Ordinance on Fees and Charges 2001;

At the proposal of the Minister of Finance, the Minister of Agriculture and Rural Development, and the Governor of the State Bank of Vietnam,

The Government promulgates this Decree on certain policies for developing fisheries.

PART I
GENERAL PROVISIONS

Article 1. Scope of Regulation

This Decree stipulates policies on investment, credit, insurance; tax incentives and other policies aimed at developing fisheries.

Article 2. Applicability

This Decree applies to:

1. Organizations and individuals of Vietnam engaged in fisheries activities.

3. Organizations and individuals implementing projects to invest in infrastructure serving fisheries activities.

Chapter II
CERTAIN POLICIES FOR DEVELOPING FISHERIES

Article 3. Investment Policies

1. For essential infrastructure components of fish ports and anchorage areas for typhoon shelters (including wharves; revetments, breakwaters, wave barriers; dredging of channels leading to and from the port, anchorage areas; mooring facilities; buoy systems, signaling devices, signal lights; specialized communication systems):

a) The central budget will finance 100% of the construction costs for Class I fish ports and regional-level anchorage areas for typhoon shelters.

b) The central budget will support investment for Class II fish ports and provincial-level anchorage areas for typhoon shelters up to a maximum of 90% for localities that have not yet achieved fiscal balance and the province of Quang Ngai, and up to a maximum of 50% for localities that remit revenue shares to the central budget for such projects.

2. The central budget will finance 100% of the total investment cost (including land acquisition, essential infrastructure components, and other components) for island routes, including fish port projects (Class I and II ports) and anchorage areas for typhoon shelters within island routes.

3. For essential infrastructure components of aquaculture zones; centralized breeding production areas including: primary water supply and drainage systems (ponds, reservoirs, culverts, canals, pipelines, pumping stations); embankments, revetments, roads, power systems, common wastewater treatment facilities; upgrading of infrastructure at National Aquatic Breeding Centers, Regional Aquatic Breeding Centers, Provincial Aquatic Breeding Centers; Centralized Environmental Monitoring and Early Warning Centers for Aquaculture, Centralized Testing and Certification Centers for Aquaculture at the central and regional levels:

a) The central budget will finance 100% of the construction costs for projects managed by central ministries and sectors;

b) The central budget will support investment up to a maximum of 90% for localities that have not yet achieved fiscal balance and the province of Quang Ngai, and up to a maximum of 50% for localities that remit revenue shares to the central budget for projects managed by localities.

4. The central budget will finance 100% of the construction costs for centralized offshore aquaculture zone infrastructure including buoy systems, boundary marker lights for aquaculture zones, mooring systems for floating cages.

5. For land acquisition and compensation costs for the investment projects mentioned in Clause 1, Clause 3, Clause 4, and Clause 5 of this Article, these costs shall be covered by the local budget, including projects managed by the central government in localities.

6. The state budget will prioritize annual funding allocation according to the plan approved by the competent authority from 2015 to 2020, with an average annual investment increase of at least twice the average annual investment allocated during the period 2011-2014, to ensure rapid completion and finalization of projects and works as prescribed. Priority will be given to constructing and upgrading facilities on islands such as Ly Son, Phu Quy, Con Dao, Phu Quoc, Bai Long Vi, Co To, Cu Lao Re, and some coastal provinces in South Central Vietnam; allocating funds for building large fishing centers linked to key fishing grounds in cities like Hai Phong, Da Nang, provinces like Khanh Hoa, Ba Ria-Vung Tau, Kien Giang according to approved plans.

Article 4. Credit Policy

1. The credit policy for building new vessels and upgrading vessels includes:

b) Borrowing conditions: Those who are currently engaged in profitable fishing activities, have financial capability, and have specific production plans approved by the People's Committees of provinces and centrally-administered cities;

- For new construction of service vessels for distant-water fishing, including engines, maritime equipment; equipment for preserving marine products; preserving goods; cargo handling:

+ In the case of building new steel-hulled vessels: Ship owners can borrow up to 95% of the total investment value for building new vessels from commercial banks at an annual interest rate of 7%, of which ship owners pay 1% per year and the state budget subsidizes 6% per year.

+ In the case of new construction of wooden-hulled vessels: Ship owners are entitled to borrow from commercial banks up to 70% of the total investment value for new construction at an annual interest rate of 7%, of which the ship owner pays 3% per year, and the state budget subsidizes 4% per year.

- For new construction of distant-water fishing vessels, including engines, maritime equipment; equipment for fishing operations; fishing gear; equipment for preserving marine products:

+ In the case of building new steel-hulled or new material-hulled vessels with main engine power capacity from 400HP to less than 800HP: Ship owners can borrow up to 90% of the total investment value for building new vessels from banks at an annual interest rate of 7%, of which ship owners pay 2% per year and the state budget subsidizes 5% per year.

+ In the case of building new steel-hulled or new material-hulled vessels with main engine power capacity of 800HP or more: Ship owners can borrow up to 95% of the total investment value for building new vessels from commercial banks at an annual interest rate of 7%, of which ship owners pay 1% per year and the state budget subsidizes 6% per year.

+ In the case of new construction of wooden-hulled vessels: Ship owners are entitled to borrow from commercial banks up to 70% of the total investment value for new construction at an annual interest rate of 7%, of which the ship owner pays 3% per year, and the state budget subsidizes 4% per year.

+ In the case of building new wooden-hulled vessels while reinforcing with steel or new material hulls: Ship owners can borrow up to 70% of the total investment value for building new vessels from commercial banks at an annual interest rate of 7%, of which ship owners pay 3% per year and the state budget subsidizes 4% per year.

- For upgrading wooden-hulled vessels with main engine power capacity under 400HP to have main engine power capacity of 400HP or more and upgrading the power capacity of vessels with main engine power capacity of 400HP or more (the additional or replacement engines must be brand new 100%): Ship owners can borrow up to 70% of the total upgrade cost of the vessel, including costs for reinforcing the hull, purchasing new equipment and fishing gear, from commercial banks at an annual interest rate of 7%, of which ship owners pay 3% per year and the state budget subsidizes 4% per year.

đ) Collateral assets: Ship owners can use the value of assets formed from borrowed funds as collateral to secure the loan.

e) The annual interest rate that ship owners must pay shall be stabilized according to the provisions of this Decree. The 7% annual interest rate specified in this Article shall be implemented starting from the date when the borrower signs the loan agreement with the commercial bank. When the general lending interest rate decreases, the State Bank of Vietnam will report to the Prime Minister to adjust accordingly based on actual circumstances. If the general lending interest rate increases, it will be handled according to the provisions of Point d Clause 4 Article 9 of this Decree.

2. Risk management mechanism:

In cases where loans for building new vessels and upgrading vessels as stipulated in Clause 1 of this Article face risks due to objective and force majeure factors, they will be handled according to the following principles depending on the extent of damage:

a) For ship owners

- In cases where there is damage but the vessel can still be repaired to operate, ship owners can restructure the repayment period of the loan during the repair period from commercial banks. The insurance company will cover all repair costs.

- In cases where the damage renders the vessel unusable for operation, risk handling by the lending commercial bank will be carried out according to the provisions of Point b Clause 2 of this Article.

b) For commercial banks providing loans.

- In cases where there is damage but the vessel can still be repaired to operate, commercial banks will restructure the repayment period for customers during the repair period.

- In cases where the damage renders the vessel unusable for continued operation, commercial banks will handle the debt in the following order:

+ If the asset has been insured, it will be handled according to the insurance contract.

+ Using the provision fund established for the main vessel's loan balance to offset costs as prescribed by law.

+ If the above measures still fail to recover the full principal, the commercial bank will report to the State Bank of Vietnam to request the Prime Minister to direct the handling of each specific case.

3. Loan policy for working capital

a) Borrowers: Ship owners engaged in fishing and providing fishing support services.

b) Borrowing conditions: They are those currently engaged in profitable fishing activities, have financial capability, and have specific business plans.

c) Loan limits:

- Up to 70% of the value of provided fishing support services for service vessels.

- Up to 70% of the cost for a single voyage for fishing vessels.

d) The borrowing interest rate is 7% per year in the first year from the date the borrower signs the loan agreement with the commercial bank, and the State Bank of Vietnam will report to the Prime Minister based on actual circumstances to adjust the interest rate to ensure it does not exceed the lowest lending rate in the agricultural and rural areas.

The state budget will support the cost of purchasing insurance for offshore fishing vessels and offshore fishing support service vessels that are members of fishing teams or cooperatives and have main engine power capacity of 90HP or more:

1. Annually support 100% of the cost of purchasing crew accident insurance for each crew member working on the vessel.

2. Annually support the cost of purchasing hull, equipment, and fishing gear insurance (all-risk insurance) on each vessel at the following levels:

a) 70% of the cost of purchasing insurance for vessels with main engine power from 90CV to less than 400CV.

b) 90% of the cost of purchasing insurance for vessels with main engine power capacity of 400HP or more.

Article 6. Tax Incentive Policy

1. Exemption from resource tax for natural marine products harvested.

2. No registration fee for vessels engaged in fishing and aquaculture activities.

3. Exemption from business license tax for organizations, households, and individuals involved in breeding, harvesting aquatic and marine products, and fishery support services.

4. Exemption from land and water surface rental fees for organizations, households, and individuals using such resources for aquaculture and marine product activities.

5. The following cases are exempt from value-added tax:

a) Aquatic products produced and sold by organizations and individuals engaged in breeding and harvesting.

b) Insurance for vessels, equipment, and other necessary tools directly serving marine product harvesting.

6. Ship owners engaged in marine product harvesting are entitled to a refund of value-added tax on vessels used for marine product harvesting if the vessel is newly built or upgraded with a total main engine power of 400HP or more.

7. Exemption from personal income tax for households and individuals directly engaged in marine product harvesting.

8. Exemption from corporate income tax on income derived from marine product harvesting activities, income from direct fishery support services, and income from building or upgrading fishing vessels with a total main engine power of 400HP or more for marine product harvesting purposes.

9. Exemption from import tax on machinery, equipment, raw materials, and spare parts imported domestically that cannot be produced, for building or upgrading vessels with a total main engine power of 400HP or more.

1. Support 100% of costs for training crew members to operate steel-hulled vessels and new material vessels; technical guidance on harvesting and preserving products according to new technology for vessels with a total main engine power of 400HP or more.

2. Support costs for transporting goods from the mainland to distant-sea fishing vessels and transporting distant-sea harvested marine products back to the mainland for fishery support service vessels with a total main engine power of 400HP or more.

a) Support level of VND 40 million/trip for vessels with a total main engine power from 400HP to 800HP; VND 60 million/trip for vessels with a total main engine power of 800HP or more; maximum support of 10 trips/year.

b) Conditions for support:

- Fishery support service vessels for distant-sea fishing must be members of fishing teams, cooperatives, or enterprises engaged in fishing.

- Registering fishery support service vessels regularly operating in distant-sea fishing support services with local fisheries management authorities where registered or residing.

- Confirmation of vessel operation in distant-sea fishing support services by military units stationed near fishing grounds or confirmation of vessel position through satellite positioning system (GPS) by competent authorities.

- Confirmation by distant-sea fishing vessel owners (vessel number, buyer's name, quantity of each type of goods purchased).

- Recording and submitting voyage logs of fishery support vessels to local fisheries management authorities where registered or residing.

4. Support 100% of regular maintenance and repair costs but not exceeding 1% of the new construction cost of steel-hulled vessels with a total main engine power of 400HP or more, based on economic and technical standards for regular maintenance and repair set by the Ministry of Agriculture and Rural Development.

Article 8. Sources of capital and mechanisms for implementing policies

1. The central budget shall provide interest rate subsidies to commercial banks for loans to build new and upgrade fishing vessels and service vessels for distant-water fisheries; ensure funding for designing prototype vessels; support 100% of training costs for crew members operating steel-hulled and new-material-hulled vessels, guiding technical operations and preservation according to new technologies for localities with main engine power of 400HP or more.

2. For maintenance and periodic repair costs; transportation costs of goods from land to distant-water fishing vessels and transportation costs of distant-water fishing products back to land for service vessels for distant-water fisheries with main engine power of 400HP or more and insurance policy: The central budget will support 100% of costs for localities that cannot balance their budgets and Quang Ngai Province; the central budget will support 50% of costs for localities with a redistribution ratio of revenue to the central budget below 50%; remaining localities will use their local budgets to implement these measures.

Chapter III
IMPLEMENTATION

1. The Ministry of Agriculture and Rural Development:

a) Study, investigate fishery resources, forecast fishing grounds, and plan the development of fishing vessels in conjunction with fishery resources, groups of occupations, and fishing grounds, while announcing the plans for localities to implement;

c) Take responsibility for leading and coordinating with the Ministry of Finance, the Ministry of Planning and Investment, relevant ministries, sectors, and localities to inspect and supervise the implementation of regulations stipulated in this Decree, propose solutions to address difficulties and obstacles arising during implementation, and report to the Prime Minister on issues exceeding their authority;

d) Lead and coordinate with the Ministries of Planning and Investment and Finance to determine priority investment projects within the annual plan under the Ministry of Agriculture and Rural Development's responsibilities;

đ) Lead the implementation of this Decree in conjunction with restructuring production in the fisheries sector to achieve sustainable and effective development;

e) Direct and guide localities in implementation, conduct periodic reviews; lead and coordinate with relevant ministries, provincial and municipal people's committees under the central government to conclude the implementation of this Decree in the fourth quarter of 2016 and report to the Government;

2. The Ministry of Planning and Investment:

Lead and coordinate with the Ministries of Finance and Agriculture and Rural Development to aggregate demand, balance, and allocate investment capital for development over five-year and annual plans to implement investment programs and projects, ensuring the completion of each project.

3. Ministry of Finance:

a) Allocate the budget to implement policies stipulated in this Decree;

b) Guide the mechanism for providing interest rate subsidies to implement credit policies stipulated in Article 4 of this Decree;

c) Guide the organization to implement insurance policies as prescribed in Article 5 of this Decree.

4. The State Bank of Vietnam:

a) Direct state-owned commercial banks holding controlling shares to allocate capital and provide loans to serve the development of fisheries as prescribed in this Decree;

b) Lead and coordinate with the Ministries of Finance and Agriculture and Rural Development to provide detailed guidance on implementing credit policies as stipulated in Article 4 of this Decree, ensuring simple procedures, quick processing, and safe borrowing from the State;

c) Serve as the focal point to coordinate with relevant ministries, sectors, and localities to inspect and supervise the implementation of credit policies, propose solutions to address difficulties and obstacles arising during the implementation of this Decree;

d) In cases where commercial banks face difficulties in allocating capital for loans to implement policies stipulated in Clause 1, Article 4 of this Decree or when loan interest rates increase, the State Bank will refinance commercial banks according to the Prime Minister's Decision.

5. Other relevant ministries and sectors shall direct and guide the implementation of development policies for fisheries as stipulated in this Decree within their functions and responsibilities.

1. Implement the policies stipulated in this Decree at the local level.

2. Delegate the People's Committee of communes to confirm borrowers according to Point b, Clause 1 and Point b, Clause 3, Article 4; beneficiaries of insurance support according to Article 5; beneficiaries of support according to Article 7 of this Decree, send them to the People's Committee of districts for review, and report to the People's Committee of provinces for approval as the basis for implementation.

3. Guide the selling price (fuel; gasoline, ice for preserving seafood; small repair materials, fishing gear, fresh water, essential foodstuffs) of service vessels for distant-water fisheries to distant-water fishing vessels based on retail prices on land.

4. Allocate local budget funds to support fishermen and invest in infrastructure to serve the development of fisheries as stipulated in this Decree.

5. Based on the requirements and actual capabilities of the locality, allocate funds and issue supplementary and increased support levels for policies to develop aquaculture production and business beyond those specified in this Decree.

6. Depending on the conditions of the locality, establish a Steering Committee to implement the development policies for fisheries stipulated in this Decree appropriately; select pilot subjects to implement policies stipulated in this Decree and expand them throughout the area.

Article 11. Responsibilities of Fisheries Associations

1. Coordinate with local authorities to organize the implementation of support policies for fishermen in accordance with the prescribed beneficiaries and policies as stipulated in this Decree.

2. Guide and encourage members to comply with legal regulations on the implementation of policies for developing fisheries.

Article 12. Rights and Responsibilities of Vessel Owners

1. Enjoy preferential policies of the State as provided for in this Decree.

2. Independently decide on borrowing capital, selecting vessel models, machinery and equipment, fishing gear, shipbuilding facilities for investment in building new and upgrading fishing vessels and offshore fishing service support vessels.

3. Repay borrowed capital and interest for building new fishing vessels and offshore fishing service support vessels in accordance with legal provisions.

4. Determine lower loan amounts and periods than those specified in Article 4 of this Decree and have the right to repay loans ahead of schedule.

Chapter IV
IMPLEMENTING PROVISIONS

Article 13. Effective Date

This Decree takes effect from August 25, 2014.

In cases where there are multiple support policies for a single content, organizations and individuals benefiting from such policies may choose the highest level of support policy.

Where contents related to previous regulations conflict with this Decree or where state preferential levels are lower than those stipulated in this Decree, implementation shall be carried out according to this Decree.

The implementation period for policies stipulated in Articles 4, 5, 7, and 8 of this Decree ends in 2016, and a summary of experiences in implementing these policies will be conducted for future phases.

Article 14. Responsibilities for Guidance and Enforcement

Ministers, Heads of ministerial-level agencies, Heads of government-affiliated agencies, Chairpersons of provincial People's Committees under central cities, and Chairpersons of Fisheries Industry Associations within their respective functions and duties are responsible for guiding and enforcing this Decree./.