Circular No. 67 TC/DTPT guides the management and use of investment capital for primary education projects.

CIRCULAR

MINISTRY OF FINANCE DECREE NO. 67/TC-ĐTPT OF SEPTEMBER 12, 1995 GUIDING THE MANAGEMENT AND USE OF CAPITAL FOR THE PRIMARY EDUCATION PROJECT

- BASED ON THE LOAN AGREEMENT BETWEEN THE GOVERNMENT OF VIETNAM AND THE INTERNATIONAL DEVELOPMENT ASSOCIATION SIGNED ON NOVEMBER 1, 1993.

- BASED ON GOVERNMENT DECREE NO. 58/CP OF AUGUST 30, 1993 ISSUING REGULATIONS ON FOREIGN LOAN MANAGEMENT AND REPAYMENT AND ATTACHED GUIDING CIRCULARS.

- BASED ON GOVERNMENT DECREE NO. 177/CP OF OCTOBER 20, 1994 ON THE ISSUE OF INVESTMENT AND CONSTRUCTION MANAGEMENT REGULATIONS.

- AFTER CONSULTATION WITH THE NATIONAL PLANNING COMMITTEE, THE MINISTRY OF EDUCATION AND TRAINING, THE STATE BANK OF VIETNAM, AND THE AGRICULTURAL BANK OF VIETNAM.

THE MINISTRY OF FINANCE GUIDES THE MANAGEMENT AND USE OF CAPITAL FOR THE PRIMARY EDUCATION PROJECT AS FOLLOWS:

I. GENERAL PROVISIONS:

1. THE WORLD BANK LOAN TO IMPLEMENT THE PRIMARY EDUCATION PROJECT UNDER THE MINISTRY OF EDUCATION AND TRAINING IS A FOREIGN GOVERNMENT LOAN, THEREFORE PROCEDURES FOR WITHDRAWAL, USE, AND REPAYMENT OF THE LOAN SHALL BE CONDUCTED IN ACCORDANCE WITH GOVERNMENT DECREE NO. 58/CP OF AUGUST 30, 1993 AND ATTACHED GUIDING CIRCULARS; THE TERMS AND CONDITIONS OF THE LOAN AGREEMENT BETWEEN THE GOVERNMENT OF VIETNAM AND THE INTERNATIONAL DEVELOPMENT ASSOCIATION SIGNED ON NOVEMBER 1, 1993, AND ANY AMENDMENTS TO THIS AGREEMENT. THE LOAN WILL BE BALANCED AGAINST THE NATIONAL BUDGET, AND THE MINISTRY OF FINANCE WILL ALLOCATE ANNUAL BUDGETS TO REPAY THE LOAN WHEN DUE.

2. THE MINISTRY OF FINANCE AND THE STATE BANK OF VIETNAM AUTHORIZE THE AGRICULTURAL BANK OF VIETNAM TO SERVE AS THE BANK FOR THE PROJECT, TO HANDLE WITHDRAWAL PROCEDURES (INCLUDING DIRECT PAYMENT METHODS, REIMBURSEMENT PROCEDURES, AND COMMITMENT PROCEDURES), AND TO PAY THE PROJECT OWNER UPON APPROVAL BY THE MINISTRY OF FINANCE.

DURING THE PROCESS OF WITHDRAWING FUNDS FROM THE WORLD BANK ACCORDING TO THE ABOVE METHODS, THE AGRICULTURAL BANK OF VIETNAM SHALL RECEIVE SERVICE FEES FOR EACH WITHDRAWAL (INCLUDING FEES FOR OPENING LETTERS OF CREDIT, DOCUMENT HANDLING FEES, TELEGRAMS, FAXES, ETC.), BUT THE AMOUNT OF FEES SHALL NOT EXCEED THE LEVEL SET BY DECISION NO. 162/QĐ-NH2 OF AUGUST 19, 1993 OF THE GOVERNOR OF THE STATE BANK REGARDING CHARGES FOR PAYMENT SERVICES THROUGH BANKS. THESE SERVICE FEES SHALL BE INCLUDED IN THE TOTAL PROJECT INVESTMENT COST.

3. FIVE DAYS BEFORE THE DUE DATE FOR PRINCIPAL AND INTEREST REPAYMENT, THE STATE BANK OF VIETNAM SHALL NOTIFY THE MINISTRY OF FINANCE OF THE AMOUNT OF PRINCIPAL AND INTEREST TO BE PAID TO THE WORLD BANK SO THAT THE BUDGET CAN BE ARRANGED FOR TIMELY REPAYMENT.

4. THE PROVISION OF DOMESTIC AND FOREIGN CAPITAL FOR THE PRIMARY EDUCATION PROJECT SHALL BE ACCORDING TO THE INVESTMENT AND CONSTRUCTION MANAGEMENT REGULATIONS ISSUED ACCOMPANYING GOVERNMENT DECREE NO. 177/CP OF OCTOBER 20, 1994 AND ATTACHED GUIDING CIRCULARS, WORLD BANK REQUIREMENTS FOR THE LOAN, AND THE REGULATIONS SET OUT IN THIS CIRCULAR.

5. THE MINISTRY OF EDUCATION AND TRAINING AND THE PROJECT OWNER ARE RESPONSIBLE FOR PREPARING AND SUBMITTING ANNUAL CAPITAL INVESTMENT PLANS (INCLUDING BOTH DOMESTIC MATCHING FUNDS AND WORLD BANK LOANS) IN ACCORDANCE WITH ESTABLISHED REGULATIONS.

6. THE PROJECT OWNER (AS PER DECISION NO. 2847/QĐ-TCCB OF DECEMBER 15, 1993 OF THE MINISTRY OF EDUCATION AND TRAINING) IS RESPONSIBLE FOR USING FUNDS FOR THEIR INTENDED PURPOSES IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT.

7. THE PRINTING AND TRANSPORTATION OF TEXTBOOKS BY THE EDUCATION PUBLISHING HOUSE MUST BE CONDUCTED ON A FULL COST RECOVERY BASIS FOR THE STATE BUDGET AND WILL BE SPECIFIED IN SEPARATE DOCUMENTS.

8. THIS CIRCULAR APPLIES TO PROJECT COMPONENTS INCLUDING SCHOOL IMPROVEMENT AND CONSTRUCTION, SCHOOL EQUIPMENT, PURCHASE OF OTHER GOODS, AND TEXTBOOK PRINTING AND TRANSPORTATION.

SEPARATELY, THE ADVISORY SERVICES CATEGORY (TRAINING AND EXPERTS) FUNDED FROM OPERATIONAL FUNDS WILL BE HANDLED AS FOLLOWS:

II. SPECIFIC PROVISIONS:

1. THE ANNUAL INVESTMENT AND CONSTRUCTION CAPITAL PLAN (ALLOCATED BY QUARTER) OF THE PROJECT MUST INCLUDE ALL SOURCES OF FUNDS AND WITHDRAWAL SCHEDULES, INCLUDING:

a. WORLD BANK LOAN FUNDS:

- FUNDS TO BE PAID THROUGH DIRECT PAYMENT METHODS, REIMBURSEMENT PROCEDURES, AND COMMITMENT PROCEDURES

- FUNDS TO BE TRANSFERRED TO A SPECIAL ACCOUNT, WHEREIN IT IS NECESSARY TO CLEARLY ANALYZE:

+ FUNDS TO BE PAID IN FOREIGN CURRENCY

+ FUNDS TO BE PAID IN VIETNAMESE DONG

b. DOMESTIC MATCHING FUNDS ANNUALLY FOR INVESTMENT AND CONSTRUCTION SHALL BE ARRANGED IN THE INVESTMENT PLAN.

THE CAPITAL PLAN (a, b) SHALL BE DIVIDED MONTHLY AND QUARTERLY AND DETAILLED BY EACH WORK CATEGORY:

+ CONSTRUCTION

+ SCHOOL EQUIPMENT

+ GOODS

+ TEXTBOOK PUBLICATION AND TRANSPORTATION

2. OPENING ACCOUNTS AND DISTRIBUTING FUNDS FOR THE PROJECT

- THE PROJECT COORDINATION BOARDS AT PROVINCES AND CITIES SHALL OPEN ACCOUNTS AT THE INVESTMENT COUNCIL TO RECEIVE DOMESTIC MATCHING FUNDS AND OPEN ACCOUNTS AT THE AGRICULTURAL BANK TO RECEIVE WORLD BANK LOANS.

- DOMESTIC MATCHING FUNDS: THE MINISTRY OF FINANCE (GENERAL INVESTMENT COUNCIL) SHALL MANAGE AND DISTRIBUTE ACCORDING TO CURRENT REGULATIONS.

- WORLD BANK LOANS: THE AGRICULTURAL BANK OF VIETNAM SHALL MAKE PAYMENTS TO THE PROJECT OWNER UPON APPROVAL BY THE MINISTRY OF FINANCE FOR THE PROJECT OWNER TO WITHDRAW FUNDS.

3. TO BE ELIGIBLE FOR FUNDS FOR PRIMARY SCHOOL CONSTRUCTION;

THE LOCAL GOVERNMENT WHERE THE PRIMARY SCHOOL IS TO BE BUILT MUST DEPOSIT A PERFORMANCE GUARANTEE OF 10% OF THE PROJECT VALUE AT A DOMESTIC BANK. WHEN THE COMPLETED WORK REACHES 10% OR MORE OF THE PROJECT BUDGET, FUNDS FROM THE WORLD BANK CAN BE USED FOR PAYMENT, AND THE PERFORMANCE GUARANTEE WILL BE RETURNED TO THE LOCAL GOVERNMENT UPON FINAL SETTLEMENT OF THE CONSTRUCTION COSTS.

4. WITHDRAWING LOAN FUNDS:

a. WITHDRAWING FUNDS THROUGH A SPECIAL ACCOUNT:

* WITHDRAWING FUNDS FROM THE WORLD BANK TO SUPPLEMENT THE SPECIAL ACCOUNT: WHEN IT IS NECESSARY TO WITHDRAW FUNDS FROM THE WORLD BANK CREDIT ACCOUNT TO SUPPLEMENT THE SPECIAL ACCOUNT OPENED AT THE AGRICULTURAL BANK OF VIETNAM, THE PROJECT OWNER MUST SUBMIT TO THE MINISTRY OF FINANCE (DEPARTMENT OF FINANCE AND DEVELOPMENT) AND THE STATE BANK (BRANCH) THE FOLLOWING DOCUMENTS:

+ REQUEST FOR FUNDS WITHDRAWAL

+ Request for capital withdrawal

+ COPIES OF CONTRACTS FOR EQUIPMENT PURCHASE, TEXTBOOK PRINTING...

+ ITEMIZED EXPENSES

+ BANK BALANCE SHEET WITH THE AGRICULTURAL BANK OF VIETNAM

WITHIN FIVE BUSINESS DAYS, THE MINISTRY OF FINANCE WILL NOTIFY THE STATE BANK TO WITHDRAW FUNDS FROM THE WORLD BANK AND TRANSFER THEM INTO THE SPECIAL ACCOUNT IN THE NAME OF THE PRIMARY EDUCATION PROJECT OWNER AT THE AGRICULTURAL BANK OF VIETNAM.

* WITHDRAWING FUNDS FROM THE SPECIAL ACCOUNT FOR PAYMENT:

- TO WITHDRAW FUNDS FROM THE SPECIAL ACCOUNT, THE PROJECT OWNER MUST SUBMIT THE FOLLOWING DOCUMENTS TO THE MINISTRY OF FINANCE (GENERAL INVESTMENT COUNCIL):

+ REQUEST FOR FUNDS WITHDRAWAL

+ COPIES OF CONTRACTS FOR EQUIPMENT PURCHASE, TEXTBOOK PRINTING...

+ CONFIRMATION OF THE VALUE OF COMPLETED WORK ISSUED BY THE INVESTMENT COUNCIL WHERE THE PROJECT COORDINATION BOARD HAS OPENED AN ACCOUNT (IF PAYMENT IS FOR COMPLETED WORK)

+ A copy of the provincial, municipal guarantee certificate (In the case of the first capital payment for construction works).

+ A copy of the bill of lading (In the case of subsequent payments for equipment and goods value).

+ A reconciliation statement with the Vietnam Agricultural Bank regarding the withdrawal process from the special account.

Within seven working days after receiving all necessary documents mentioned above, the Ministry of Finance (General Department of Investment Planning) will notify the amount to be paid so that the Vietnam Agricultural Bank can pay it to the relevant units.

The circulation of documents and the relationship between units during the payment process for construction work quantities and domestic equipment procurement are illustrated in diagram 1.

After paying to the units or refunding the purchase price of equipment and goods to suppliers, the Vietnam Agricultural Bank prepares a detailed list (indicating the purpose of expenditure, date of payment, foreign currency recipient unit, exchange rate applied, and converted amount in Vietnamese Dong) and sends it to the Ministry of Finance (General Department of Investment Planning) to record the loan repayment to the State Budget and record the transfer of construction investment capital for the project at the buying rate announced by the Foreign Trade Bank at the time of recording income and expenditure.

b. Withdrawal of funds from the World Bank for direct payment and commitment procedures.

Based on the supplier's payment request, the project owner needs to prepare a fund withdrawal application from the loan account and necessary documents to send to the Ministry of Finance (Department of Financial Management), the State Bank (Trading Office). The fund withdrawal payment file includes:

+ Request for capital withdrawal

+ COPIES OF CONTRACTS FOR EQUIPMENT PURCHASE, TEXTBOOK PRINTING...

+ A copy of the bill of lading (In the case of direct payment for equipment and goods value).

+ A copy of the supplier's invoice.

+ Proof of payment made (for the refund procedure).

+ A copy of the letter of credit that the Vietnam Agricultural Bank intends to issue (in the case of the commitment procedure).

Within five working days from the date of receipt of the complete withdrawal file, the Ministry of Finance (Department of Financial Management) will provide comments and notify, if approved, the primary education project owner and the Vietnam Agricultural Bank will sign the withdrawal application to the World Bank for payment to the beneficiary.

Upon receipt of the notification from the World Bank confirming the payment to the seller, the project owner is responsible for sending one copy of the notification to the Ministry of Finance (Department of Financial Management) for tracking and one copy to the General Department of Investment Planning to record the loan repayment from the World Bank into the State Budget and record the transfer of construction investment capital for the project at the buying rate announced by the Foreign Trade Bank at the time of recording income and expenditure.

In both cases above (4a, 4b), based on the payment order, the General Department of Investment Planning records the receipt of State Budget capital and issues a notice of capital receipt for the Investment Planning Departments where the project owner has opened accounts for accounting purposes.

5. The special account is subject to periodic audits. Expenditures from the special account must be strictly monitored. Annually, the special account, books, and accounting files of the project must be audited by an independent auditing agency in accordance with state regulations and the loan agreement. Audit documents are one of the bases for considering additional withdrawals to the special account or withdrawing funds from the special account for payment.

6. While the loan amount in the special account remains unused, interest accrues. On the fifth day of each month, the Vietnam Agricultural Bank must deposit the entire accrued interest from the special account into the State Budget (the national foreign currency reserve account at the State Bank Trading Office, account number 331.213.020.1).

7. Monthly, quarterly, and annually, the project owner is responsible for reporting to the Ministry of Finance (General Department of Investment Planning), the Ministry of Education and Training, the National Science Council, and the State Bank of Vietnam on the implementation of the project, including clearly showing the withdrawal of funds and the use of loans (domestic and foreign).

8. The Vietnam Agricultural Bank is responsible for notifying the Ministry of Finance (General Department of Investment Planning), the State Bank (Trading Office) about the results of fund withdrawal, fund usage, and the balance of the special account monthly. Monthly, the Vietnam Agricultural Bank sends a statement of special account expenditures to the Ministry of Finance (one copy for the General Department of Investment Planning and one copy for the Department of Financial Management). In the special account statement, the monthly accrued interest and the date of transferring this interest to the Ministry of Finance are clearly stated.

III. SETTLEMENT AUDIT WORK:

- The "Primary Education" project owner must settle accounts when the construction works and sub-works are completed.

- Periodically and unexpectedly, the Ministry of Finance, the Ministry of Education and Training, and the National Science Council will inspect the project implementation, the use of funds (domestic and foreign); If the project owner uses funds improperly without effectiveness, the Ministry of Finance will suspend capital transfers to address violations.

IV. IMPLEMENTATION PROVISIONS:

This Circular takes effect from the date of signature. During implementation, if there are difficulties, the project owner, the Ministry of Education and Training, and the Vietnam Agricultural Bank need to promptly reflect them to the Ministry of Finance for research and supplementation amendments.