Bản dịch văn bản 27/2007/TT-BTC
Circular 27/2007/TT-BTC
Cơ quan ban hành: Bộ Tài chính
Ngày ban hành: 2007-04-03

CIRCULAR Guiding the management and payment of investment capital and non-business capital of investment nature belonging to the state budget capital source Pursuant to the State Budget Law No. 01/2002/QH11 of December 16, 2002; Pursuant to the November 26, 2003 Construction Law and the Government's Decree No. 16/2005/ND-CP of February 7, 2005, on the management of investment projects on the construction of works, and Decree No. 112/2006/ND-CP of September 29, 2006, amending and supplementing a number of articles of Decree No. 16/2005/ND-CP of February 7, 2005; Pursuant to the Government's Decree No. 52/1999/ND-CP of July 8, 1999, promulgating the Regulation on construction and investment management, Decree No. 12/2000/ND-CP of May 5, 2000, and Decree No. 07/2003/ND-CP of January 30, 2003, amending and supplementing a number of articles of the Regulation on construction and investment management, issued together with the Government's Decree No. 52/1999/ND-CP of July 8, 1999; Pursuant to the Government's Decree No. 71/2005/ND-CP of June 6, 2005, on the management of investment in the construction of peculiar works; The Finance Ministry guides the management and payment of investment capital and non-business capital of investment nature belonging to the state budget capital source as follows: Part I GENERAL PROVISIONS 1. This Circular applies to investment projects funded with development investment capital or non-business capital of investment nature belonging to the state budget capital source (hereinafter collectively referred to as projects) managed by ministries, ministerial-level agencies, government-attached agencies, political organizations, socio-political organizations, social organizations, socio-professional organizations, economic groups and state corporations (hereinafter collectively referred to as ministries), provinces, centrally run cities (hereinafter collectively referred to as provinces) and districts, towns and provincial cities (hereinafter collectively referred to as districts). This Circular does not apply to projects funded with commune budgets, investment projects of Vietnamese representative missions in foreign countries, and projects on the purchase of copyright. 2. State budget capital (including domestic capital of different state budget levels, foreign loans of the Government and foreign aid capital for the Government, administrations at various levels and state agencies) shall be paid only for investment projects eligible for using state budget capital under the State Budget Law. 3. Investment projects funded with development investment capital or non-business capital in state budget estimates, investment projects funded with capital of different sources in which the state budget capital invested in items or works can be separated or investment projects funded with capital of different sources in which the state budget capital accounts for the biggest proportion in the projects' total investment capital amounts but cannot be separated must complete all investment and construction procedures, be incorporated into the State’s annual investment plans or non-business expenditure plans and eligible for capital payment under the provisions of this Circular. 4. Finance agencies at various levels shall perform the financial management of investment capital and non-business capital of investment nature belonging to the state budget capital. State treasuries and units tasked to control investment capital payment shall control and pay capital in a prompt, adequate and lawful manner for projects meeting all conditions for capital payment. Commercial banks acting as service banks for projects funded with official development assistance (ODA) capital shall, depending on their assigned functions and tasks, comply with the Finance Ministry's regulations on financial management of ODA projects. Part II SPECIFIC PROVISIONS A. ELABORATION OF INVESTMENT CAPITAL PLANS, ALLOCATION OF INVESTMENT CAPITAL AND VERIFICATION OF INVESTMENT CAPITAL ALLOCATION I. Projects may be incorporated into the State's annual investment capital plans only if they satisfy the following requirements: 1. For planning projects: They have planning outlines or tasks and cost estimates for planning work which have been duly approved. 2. For investment preparation projects: They are in line with approved branch or territorial development plannings and have cost estimates for investment preparation work which have been duly approved. 3. For investment execution projects: They have investment decisions which are issued prior to October 31 of the year preceding the plan year and have designs, cost estimates and total cost estimates which have been approved according to regulations. For important national projects and group-A projects of which the total cost estimates have not yet been approved, they have designs and cost estimates for construction works or construction items to be built in the plan year which have been approved and have total cost estimates which must be approved no later than the time when at least 30% of the construction value stated in the total estimates has been realized; if important national projects and group-A projects consist of sub-projects or component projects, each sub-project or component project shall be managed as an independent project. The duration for arrangement of capital for execution of group-B projects in plans must not exceed four years, or two years for group-C projects. II. Elaboration of annual investment capital plans, allocation of investment capital and verification of investment capital allocation: 1. Elaboration of plans: - According to the provisions of the State Budget Law regarding elaboration of annual state budget estimates, investors shall elaborate investment capital plans of their projects on the basis of the project execution progress and purposes and send them to superior management agencies. - Ministries shall synthesize, consider and elaborate investment capital plans and send them to the Planning and Investment Ministry and the Finance Ministry. Provincial-level People's Committees shall estimate local budget amounts for investment capital plans and submit them to the Standing Boards of provincial-level People's Councils for comments before sending them to the Planning and Investment Ministry and the Finance Ministry. - The Planning and Investment Ministry and the Finance Ministry shall synthesize and report investment capital plans to the Prime Minister for submission to the National Assembly for decision and assignment of investment capital plans to ministries and localities. - The time limits for elaboration, submission, approval and assignment of investment capital plans comply with the State Budget Law. 2. Capital allocation: 2.1. For centrally managed investment capital: Ministries shall allocate investment capital as planned to each of eligible projects under their management, ensuring compatibility with the assigned total investment level, domestic and foreign capital structure and economic structure and capital levels of the State's important projects and compliance with the National Assembly's resolutions and the Government's directions on the implementation of annual socio-economic development plans and state budget estimates. 2.2. For locally managed investment capital: People's Committees at various levels shall elaborate investment capital allocation plans and submit them to People's Councils of the same level for decision. Under resolutions of People's Councils, People's Committees shall allocate investment capital and assign investment capital plans to each of eligible projects under their management, ensuring compatibility with the assigned total investment levels, structure of domestic and foreign capital, economic structure and capital levels of the State's important projects and compliance with the National Assembly's resolutions and the Government's directions on implementation of annual socio-economic development plans and state budget estimates. Provincial-level Finance Services shall, together with provincial-level Planning and Investment Services, propose the allocation of investment capital to each project under provincial management to provincial-level People's Committees for decision. District-level Finance Sections shall, together with functional agencies, advise district-level People's Committees on allocating investment capital to each project under their management. Particularly for projects to be invested with capital amounts permitted to be retained under the National Assembly's resolutions and the Prime Minister's decisions and capital amounts allocated from the central budget to local budgets for specified purposes, they shall also comply with regulations on investment objects and use purposes of each source of investment capital. 2.3. Principles on allocation of capital to projects included in annual plans: - Assurance of conditions for projects to be included in investment capital plans as specified in Item I, Part A, Section II of Circular. - Compliance with the provisions of Points 2.1 and 2.2 above. - Allocation of sufficient capital for payment for projects which have been put into use and have the approved investment capital settlements but are still in shortage of capital; and allocation of capital to cover expenses for audit, verification and approval of capital settlements of projects which have been completed but not yet paid because their settlements have not yet been approved. - When capital for a project is incorporated into the investment execution plan but only for project execution preparation, such must be noted in the capital allocation document. 3. After allocating investment capital, ministries and provincial-level People's Committees shall send investment capital plans to the Finance Ministry; and districts shall send investment capital plans to provincial-level Finance Services. 4. Assignment of capital plans to investors: After the capital allocation is verified and approved by finance agencies, ministries and provincial-level and district-level People's Committees shall assign capital plans to investors for implementation and, concurrently send them to the state treasuries where projects' accounts are opened for monitoring and use as a basis for capital control and payment. 5. Verification and notification of lists of projects and their investment capital: 5.1. For projects managed by ministries: - The Finance Ministry shall verify plans on allocation of investment capital according to Point 2.3 above and notify the list of investment projects which have completed all investment procedures and satisfied all conditions for capital allocation and their capital levels to each ministry and, concurrently to the state treasuries for use as a basis for control of capital payment. - When the capital allocation is incompliant with regulations, the Finance Ministry shall issue documents to request ministries to make readjustment. 5.2. For projects managed by provinces or districts: - Based on the investment capital plans decided by People's Committees, provincial-level Finance Services or district-level Finance and Planning Sections shall examine construction investment procedures required for the projects and send notices thereon to various provincial- or district-level branches as well as state treasuries for use as a basis for control of capital payment. - When construction investment procedures have not yet been completed or when the capital allocation is incompliant with regulations, provincial-level Finance Services or district-level Finance and Planning Sections shall make written reports to the People's Committees of the same level for the latter to direct the completion of procedures as prescribed. 5.3. Investors shall send to finance agencies at various levels basic documents of projects already incorporated into the plans for verification and notification of the list of capital payments for investment projects (these documents need to be sent only once until the projects' investment activities are completed, except where supplementation and/or revision are required), including: - For planning projects: the document approving the outline or tasks of the planning project and the cost estimate for planning work. - For investment preparation projects: the document approving the cost estimate for investment preparation work. - For investment execution projects: the document on the investment project on the construction of works (or the techno-economic report, for projects for which only the techno-economic report is required), enclosed with the investment decision of a competent authority and decisions on readjustment to the project (if any), the decision approving the technical design (for projects subject to three-step design) or the decision approving the construction drawing design (for projects subject to one-step or two-step design) and the decision approving the total cost estimate. III. Readjustment of annual investment capital plans 1. Principles: - Ministries and localities shall periodically review the execution progress and investment purposes of projects in the year so as to readjust investment capital plans according to their competence or submit them to the Prime Minister for readjustment, transfer capital of projects which cannot be executed to projects executed ahead of schedule with uncompleted volumes or to projects likely to be implemented ahead of plan in the year. - Before sending plans on readjustment of investment capital of projects to finance agencies, ministries and localities shall work with state treasuries to identify the amounts of capital under the annual plans already paid for the projects and the amounts unused due to non-implementation in order to ensure that the projects' planned capital amounts, after the adjustment, are not lower than the capital amounts already paid by the state treasuries. - Surplus capital after the readjustment of assigned plans shall be transferred to other units under decisions of competent authorities. 2. Finance agencies at various levels shall scrutinize and notify the list of projects with readjusted capital levels according to above regulations. 3. The deadline for readjusting annual investment capital plans is December 31 of the plan year. B. PAYMENT OF INVESTMENT CAPITAL I. Opening of accounts: 1. For domestic capital: Investors may open accounts at state treasuries convenient for payment control and their transactions. 2. For foreign capital: Investors may open accounts at service banks under the guidance of the Finance Ministry and the banks. II. Basic documents of projects In order to serve the management and control of investment capital payment, investors shall send to the state treasuries where they open accounts basic documents of their projects (these documents must be originals or true copies, which need to be sent only once till the projects' investment activities are completed, except where supplementation and/or revision are required), including: 1. For planning projects: - The competent authority's document approving the outline or tasks of the planning project; - The approved cost estimate for planning work; - The document on the selection of the contractor in accordance with the Bidding Law; - The contract between the investor and the contractor. 2. For investment preparation projects: - The approved cost estimate for investment preparation work; - The document on the selection of the contractor in accordance with the Bidding Law; - The contract between the investor and the contractor. 3. For investment execution projects: 3.1. For projects funded with domestic capital: - The investment project on the construction of works (or the techno-economic report, for projects for which only the techno-economic report is required), enclosed with the investment decision of a competent authority and decisions on readjustment to the project (if any); - The decision approving the technical design (for projects subject to three-step design) or the decision approving construction drawing design (for projects subject to one-step or two-step design) and the decision approving the total cost estimate, enclosed with the total cost estimate; - The decision on the selection of the contractor according to the Bidding Law (including bidding, designation of contractors, direct procurement, competitive offers, self-implementation, and selection of contractors in special cases); - The contract between the investor and the contractor (including documents enclosed with the contract: the prospectus of the bidding dossier; the prospectus of the bid price, enclosed with the contractor's detailed price list and conditions for price changes (if any), general and specific terms of the contract). - Approved detailed cost estimates of each job and work item, for bidding packages carried out by a designated contractor or by the investor itself. 3.2. For ODA projects: Apart from the above documents, the following documents are required: + The Vietnamese versions of the credit agreement and the disbursement manual (if any), which are signed and sealed by the investor. Particularly, the contract between the investor and the contractor must be in Vietnamese or translated into Vietnamese and signed and sealed by the investor; + The advance capital guarantee (if any) as specified in the contract (including projects funded with domestic capital but executed by foreign contractors). 4. For investment preparation work for which capital is arranged in the investment execution plan, the approved cost estimate for investment preparation work is required. 5. For project execution preparation work for which capital is arranged in the investment execution plan: - The investment project on the construction of works (or the techno-economic report, for projects for which only the techno-economic report is required), enclosed with the investment decision of a competent authority; - The approved cost estimate for project preparation work. Particularly for ground clearance, the ground clearance plan approved by a competent authority is required; - The document on the selection of the contractor in accordance with the Bidding Law; - The contract between the investor and the contractor. III. Advance payment and recovery of advance capital 1. Objects eligible for advance payment and levels of advance capital: 1.1. For bidding packages for the construction of works: - For bidding packages valued at under VND 10 billion, the advance capital level is equal to 20% of the contract value. - For bidding packages valued at between VND 10 billion and under 50 billion, the advance capital level is equal to 15% of the contract value. - For bidding packages valued at VND 50 billion or more, the advance capital level is equal to 10% of the contract value. 1.2. For bidding packages for procurement of equipment (including imported equipment and domestically procured equipment): The advance capital level shall be agreed upon by the investor and the contractor on the basis of the payment schedule specified in the contract but must not be lower than 10% of the value of the bidding package. Capital shall be advanced according to the schedule of payment by the investor to the contractor as specified in the contract up to the time equipment is put into the investor's warehouses (for equipment requiring no installation) or is completely installed and tested before takeover (for equipment requiring installation). 1.3. For bidding packages or projects executed under EPC contracts: - Capital for the procurement of equipment shall be advanced according to the equipment supply schedule specified in the contract (similar to advance capital for equipment procurement). - For other jobs, the advance capital level is equal to 15% of the contract value. 1.4. For consultancy and planning contracts: The advance capital level shall be agreed upon in the contract between the investor and the contractor but must be at least 25% of the contract value. 1.5. For compensation and ground clearance work: Capital shall be advanced at a level dependent on the execution progress but must not exceed the capital plan already approved for the whole year. The advance of capital for the construction of resettlement quarters or new residential quarters in service of compensation is in accordance with regulations applicable to projects or bidding packages on the construction of works. 1.6. For urgent projects such as dyke building and consolidation, flood control and drainage works, seedling projects, projects for immediately overcoming flood or natural disaster consequences, the advance capital level is equal to 50% of the capital plan decided by a competent authority. 1.7. For some structures and semi-finished products used in construction which are of great value and need to be manufactured beforehand in order to ensure construction schedule and some special supplies and supplies which need to be reserved on a seasonal basis, if it is necessary to advance capital at a level higher than the above-said level, the advance capital level may be based on the manufacture, import and reserve of these supplies but must not exceed the annual capital plan. 1.8. The advance capital levels specified in Section 1 above must not exceed the annual capital plans already approved for bidding packages. When advance capital does not reach the prescribed level because the arranged capital is lower than the advance capital level, advance capital may be further allocated to the project under the subsequent year's plan up to the prescribed level. 2. Recovery of advance capital: 2.1. For bidding packages for the construction of works: Advance capital shall be gradually recovered upon payment for completed volumes according to the following regulations: - The recovery starts: + When 30% of the contract value is paid, for bidding packages valued at under VND 10 billion. + When 25% of the contract value is paid, for bidding packages valued at between VND 10 billion and under 50 billion. + When 20% of the contract value is paid, for bidding packages valued at VND 50 billion or more. - Advance capital shall be fully recovered when 80% of the contract value is paid for the completed volume under the bidding package. - If advance capital is not fully recovered because the bidding package has not yet been received payment up to the above said percentage but the project is not further incorporated into the subsequent plan or is suspended, the investor shall explain to the state treasury on the use of the advance capital amount not yet recovered and concurrently report thereon to competent authorities for handling. - If capital has been advanced but construction under the bidding package cannot be executed according to the schedule specified in the contract, the investor shall explain such to the state treasury and repay the advance capital amount. 2.2. For bidding packages for equipment procurement: Advance capital is recovered upon each payment for competed equipment volumes. - For equipment requiring no installation, after equipment is tested and put into the investor's warehouse, the investor shall send relevant vouchers to the state treasury for the latter to carry out procedures for payment for the completed equipment volume and fully recover the advance capital amount. - For equipment requiring installation, after equipment is completely installed, the investor shall send relevant vouchers to the state treasury for the latter to carry out procedures for payment for the completed equipment volume and fully recover the advance capital amount. When capital has been advanced but, past the time limit specified in the contract, equipment has not been received, the investor shall explain such to the state treasury and repay the advance capital amount. 2.3. For bidding packages or projects executed under EPC contracts: Advance capital for each job is recovered according to regulations on the recovery of advance capital for corresponding work. 2.4. For consultancy and planning contracts: Advance capital is recovered upon each payment for completed consultancy or planning volume on the following principles: - Recovery starts upon payment for completed volume. - The recovered capital amount is equal to the paid capital amount multiplied by (x) the advance capital rate. 2.5. For ground clearance and compensation work, advance capital is recovered upon payment for the completed work volume. 2.6. For urgent projects such as dyke building and consolidation, flood control and drainage works, seedling projects and projects for immediately overcoming flood or natural disaster consequences, advance capital is recovered when the paid capital reaches 30% of the annual plan and fully recovered when the paid capital reaches 80% of the annual plan. 2.7. For some structures and semi-finished products used in construction which are of great value and need to be manufactured beforehand in order to ensure the construction schedule and some special supplies and supplies which need to be reserved on a seasonal basis, advance capital is recovered upon payment for the completed volume and fully recovered when the paid capital reach 80% of the contract value. 2.8. The recovery levels of advance capital for contracts may be higher than those prescribed above if investors and contractors so agree. 2.9. When advance capital for some works (such as compensation for ground clearance) is, for some force majeure reasons, not yet paid to beneficiaries, the investor shall deposit such amount in a state treasury or credit institution. The total interest amount, if any, shall be fully remitted into the state budget. 2.10. If the plan year has expired but advance capital has not yet been fully recovered because the bidding package has not yet received payment up to the prescribed percentage, the remainder shall be further recovered in the subsequent year's plan and not be deducted from the subsequent year's investment capital plan. 3. Documents on advance payment: Apart from basic documents specified in Section II above, the investor shall send to the state treasury a written request for advance payment of investment capital and the investment capital withdrawal voucher. For some structures and semi-finished products used in construction which are of great value and need to be manufactured beforehand in order to ensure the construction schedule and some special supplies and supplies which need to be reserved on a seasonal basis, the following documents are also required: the contract between the contractor and the unit that processes, manufactures or imports structures or supplies or the record between the investor and the contractor certifying the structures, semi-finished products, special supplies and supplies to be reserved on a seasonal basis which have been transported to construction sites. 4. The advance payment of capital shall be made within the payment time limit under the capital plan one or several times, depending on the demand for advance capital, with the advance capital amounts not exceeding the levels prescribed above. IV. Payment for completed volumes 1. Payment for completed construction volumes: 1.1. The completed volume of construction works performed by a designated contractor or by the investor itself which is eligible for payment is the value of the work volume which has been executed and passed the takeover test under the signed contract and satisfies the following conditions: - The volume is compatible with the construction drawing design already approved and included in the assigned annual investment plan; - Its detailed cost estimate has been approved in accordance with the State's current regulations on unit price limits. 1.2. The completed volume of construction works performed in the form of bidding or under EPC contracts which is eligible for payment is the work volume which has been executed and passed the takeover test according to schedule and included in the signed contract and the assigned annual investment plan. Based on the implementation duration and nature of the contract, the payment shall be made by the following modes: - Payment based on package prices (package payment): The investor shall make payment to the contractor according to the package price specified in the contract when the contractor fulfills his/her/its contractual obligations. - Payment based on fixed unit prices: The investor shall make payment to the contractor for completed works according to the unit prices already set in the contract. - Payment based on adjusted prices: To be applied to bidding packages of which the quantity and volume of works cannot be determined at the time of signing contracts or which see large price fluctuations made by the State and are performed under contracts of over 12 months. If there is any arising volume which is either larger or smaller than the contractual volume but within the scope of the bidding dossier and not through the fault of the contractor, the increased or decreased volume must meet specific conditions defined in the contract, be approved in writing and calculated according to contractual unit prices. The adjusted contract value must not exceed the cost estimate, total cost estimate or price of the bidding package stated in the approved bidding plan, unless so agreed by competent persons. For volumes arising beyond or outside the contract and outside the scope of the bidding dossier, a written approval (if the arising volume is put up for bidding) or the additional cost estimate (if the arising volume is performed by a designated contractor) approved by a competent authority in terms of volume and unit price is required. On the basis of the volume which has been tested before takeover, the investor and the contractor shall determine the contract performance progress of the contract and make requests for payment therefor. 1.3. After the completed volume is tested before takeover, the investor shall make and send a payment request dossier to the state treasury, comprising: - The record on the takeover test of the completed part of the construction work or the construction stage or the record on the takeover test of the completed construction item or work before use, enclosed with the statement on the calculation of the value of the volume taken over; - The written request for investment capital payment; - The written request for advance payment of investment capital (if any); - The investment capital withdrawal voucher. For completed volumes of construction works performed through bidding, the state treasury shall make payment based on the execution progress determined by the investor and the contractor in their contract and the volume taken over. 2. Payment for completed equipment volume: 2.1. The completed equipment volume eligible for payment is the equipment volume satisfying the following conditions: - The list of equipment is compliant with the investment decision and included in the assigned investment plan; - It is included in the contract between the investor and the contractor; - It has been warehoused by the investor (for equipment requiring no installation) or completely installed and tested before takeover (for equipment requiring installation). 2.2. After the completed equipment volume is tested before takeover, the investor shall compile and send a payment request dossier to the state treasury, comprising: - The record on the takeover test according to regulations. For equipment requiring no installation, the record on the takeover test between the investor and contractor under the contract is required; - Invoices (for domestically purchased equipment) in case of contractor designation (true copy signed and sealed by the investor); - Transport, insurance, tax and warehousing charge vouchers (if these charges are not yet included in the equipment prices); - The written request for payment of investment capital; - The written request for advance payment of investment capital (if any); - The investment capital withdrawal voucher. 3. Payment for completed consultancy volumes: 3.1. The completed consultancy volume eligible for payment is the performed volume already tested before takeover, which is included in the contract and the assigned investment plan. 3.2. After the completed volume is tested before takeover, the investor shall compile and send a payment request dossier to the state treasury, comprising: - The record on the take test or delivery of the completed consultancy volume or the report on performance results. For contracts with time-based payment, a list of expenses made by the investor is required. - The written request for payment of investment capital; - The written request for advance payment of investment capital (if any). - The investment capital withdrawal voucher. 4. Payment for other completed volumes: Apart from jobs for which consultants have been hired, other jobs are eligible for payment when they acquire all the following grounds to prove that they have been completed: - For construction land allocation fees and land use right transfer tax: lawful invoices and receipts issued by collecting agencies are required. - For compensation and ground clearance expenses: the written certification of the performed compensation volume; contracts and records on the handover of houses (for cases of purchasing houses in service of relocation for ground clearance) are required. Particularly for expenses for organization of compensation and ground clearance, the approved cost estimate is required. For compensation and ground clearance work involving the construction of works (including the building of houses for relocation in service of ground clearance): the advance payment and payment shall be made as in the case of projects or bidding packages on the construction of works. - For expenses for construction commencement, takeover, trial operation and inauguration, a written permit of a competent authority (except for trial operation), the approved cost estimate and a list of expenses made by the investors are required. - For expenses for specialists, training of technicians and production managers: the contracts, the approved cost estimates and a list of expenses made by the investor are required. - For construction insurance premiums: The insurance policy is required. - For project management expenses: + Expenses must comply with the prescribed payment percentage (%). + Contractual expenses (including cases of hiring consultants for project management) shall be paid according to the terms of the contracts. + Expenses subject to elaboration of cost estimates shall be paid according to the approved cost estimates. - For expenses for planning, investment preparation and project execution preparation, the approved cost estimate, the contract and the record of the takeover test of the completed work volume or the report on performance results are required. - For expenses for verification and approval of final settlement: In case of hiring audit professionals, the hiring contract is required; if the verification is conducted by a professional agency, the approved cost estimate is required. 5. Time limits and forms of payment: - Basing themselves on the investors' payment request dossiers, within seven working days after receiving valid and complete dossiers, state treasuries shall examine dossiers, allocate capital to investors and concurrently make payment on behalf of investors directly to contractors, and recover the advance capital amounts according to regulations. - For annual capital plans already assigned to projects, payments shall be made only in the plan year according to the State Budget Law. Past that time limit, work volumes which have been completed but not yet paid shall be incorporated into the subsequent year's plan for payment. 6. For projects funded with foreign capital or bidding packages subject to international bidding under credit agreements between the Vietnamese Government and the donors, which contain provisions on advance payment of capital (objects eligible for advance payment, conditions for and levels of advance payment, recovery of advance capital) and payment of capital different from the above provisions, these agreements will be applied. 7. Investors shall arrange enough capital in the annual plans for the purchase of insurance for construction works. The State does not make payment for damage and risk expenses which fall under the insurance scope if the investors fail to purchase insurance for construction works according to current regulations. 8. The capital amounts paid for each job, construction item and work must not exceed the cost estimates or winning bid prices; the total capital amounts paid for the projects must not exceed the approved total investment levels. The capital amount paid in the year for the projects (including advance capital and capital paid for completed volumes) must not exceed the annual capital amount already planned for the project. 9. For some special important projects which need a mechanism for advance payment and payment of capital different from the above regulations, the Finance Ministry shall issue separate guiding documents after obtaining opinions of competent authorities. 10. The management, payment, recovery and settlement of advance capital amounts allocated under the subsequent year's cost estimates for projects shall be effected as follows: 10.1. For projects managed by ministries: - The advance payment of capital must comply with the provisions of Clause 3, Article 57 of the December 16, 2002 State Budget Law and Article 61 of the Government's Decree No. 60/2003/ND-CP of June 6, 2003, detailing and guiding the implementation of the State Budget Law. - After the advance payment of capital for the projects is permitted by competent authorities, the Finance Ministry shall notify the managing ministries of the total advance capital level, source of advance capital and time limit for advance payment and recovery and concurrently notify such information to state treasuries for payment. - Payment time limit: The time limit for payment of advance capital under a year's plan coincides with the time limit for payment of investment capital under such year's plan. Past the payment time limit, state treasuries shall carry out procedures to cancel advance capital amounts that remain unused. - Recovery: Ministries shall incorporate the projects' capital plans into the subsequent year's budget estimates for repayment of advance capital. When publicizing the list of projects and their annual investment capital plans, the Finance Ministry shall concurrently notify the recovery of capital amounts which are exactly equal to the advance capital amounts. When ministries fail to arrange or fully arrange the to-be-recovered amounts, the Finance Ministry shall recover advance capital amounts by deducting them from the assigned investment expenditure estimates of ministries and issue written notices to ministries for coordination. - Capital settlement: Advance capital under a year's plan shall be settled with that year's budget but not with the budget of the year when the advance payment is made. When advance capital for a project is recovered once every several years, the recovered capital amount of one year's plan shall be settled with that year's budget, the capital amounts already paid but not yet arranged for recovery shall be forwarded to the subsequent year for settlement in accordance with the capital recovery plan. 10.2. For projects managed by localities: - The advance of capital from the budget estimates of local administrations shall be decided by provincial-level People's Committee presidents according to their competence in accordance with State Budget Law No. 01/2002/QH11 of December 16, 2002, the Government's Decree No. 60/2003/ND-CP of June 6, 2003, detailing and guiding the implementation of the State Budget Law, and the Finance Ministry's Circular No. 59/2003/TT-BTC of June 23, 2003, guiding the implementation of Decree No. 60/2003/ND-CP of June 6, 2003. - The management, payment, recovery and settlement of advance capital shall be effected under the provisions of Point 10.1 above. C. MANAGEMENT AND PAYMENT OF INVESTMENT CAPITAL FOR PECULIAR WORKS 1. Works of state secret: 1. Works of state secret are those defined in Article 2 of the Government's Decree No. 71/2005/ND-CP of June 6, 2005, on management of investment in the construction of peculiar works. The management of investment in the construction of works of state secret shall be performed under the Government's Decree No. 71/2005/ND-CP of June 6, 2005, on management of investment in the construction of peculiar works. The elaboration of plans, allocation and notification of investment capital; control, payment and settlement of investment capital for works of state secret shall be made according to regulations applicable to investment capital from the state budget. Particularly for projects of state secret managed by the Public Security Ministry or the Defense Ministry, the Finance Ministry shall transfer capital directly to the Public Security Ministry or the Defense Ministry for management, allocation, payment and settlement for projects. 2. Elaboration of investment capital plans, allocation and notification of investment capital: - The elaboration of investment capital plans, and allocation and notification of investment capital shall be made according to regulations applicable to investment capital from the state budget, in which the list of works of state secret and their capital levels shall be clearly determined. - For projects of state secret managed by the Public Security Ministry or the Defense Ministry, the Finance Ministry shall verify the allocation of capital and notify the list of eligible projects and their capital levels to the Public Security Ministry or the Defense Ministry for management, control and payment of capital for projects. 3. Capital transfer, allocation and payment: - The transfer, allocation and payment of investment capital shall be made according to regulations applicable to investment capital from the state budget. For works of state secret managed by the Public Security Ministry or the Defense Ministry, the Public Security Ministry or the Defense Ministry shall open deposit accounts at transaction bureaus of state treasuries to receive capital transferred from the Finance Ministry. - Based on the annual capital plans and the execution progress of the projects, the Finance Ministry shall transfer capital to the Public Security Ministry and the Defense Ministry in the form of money order. The amount of capital to be transferred each time shall be based on the reports on the execution progress of the projects and the written request for capital transfer of the Public Security Ministry or the Defense Ministry. After January 31 of the subsequent year, the credit balance on the deposit accounts shall be remitted to the state budget. - The Public Security Ministry and the Defense Ministry shall control and pay capital to works of state secret in accordance with regulations on control and payment of investment capital. - For works of state secret managed by other ministries, branches and localities, state treasuries shall only receive capital withdrawal vouchers and transfer money at the request of investors without controlling payment contents. Investors shall take full responsibility for controlling payment contents. - At the end of the plan year, the Public Security Ministry and the Defense Ministry shall report on the implementation of capital plans, the receipt and use of capital; certify the capital amounts paid in the year and the total capital paid to each project from construction commencement till the end of the state budget year; and give comments on the implementation of investment plans and the observance of financial regimes and policies. II. Works built on urgent orders 1. Works built on urgent orders are those defined in Article 2 of the Government's Decree No. 71/2005/ND-CP of June 6, 2005, on management of investment in the construction of peculiar works. The management of investment in the construction of works under urgent orders shall be performed under the Government's Decree No. 71/2005/ND-CP of June 6, 2005, on management of investment in the construction of peculiar works. 2. Advance payment and payment of capital: 2.1. Advance payment of capital: - A dossier for advance payment of capital comprises: + The decision on the building of an urgent work, issued by a competent person; + The written request for payment of investment capital; + The investment withdrawal voucher. - Advance capital level and recovery of advance capital: + The level of advance capital is equal to 50% of the assigned investment capital plan. + The advance capital shall be gradually recovered upon payment for completed volumes and fully recovered upon completion of works. 2.2. Payment for completed volumes The control and payment of capital shall be based on current norms and unit prices. A payment dossier comprises: - The approved cost estimate. - The record of the takeover test of the completed construction stage, construction part, item or work, enclosed with the statement on the calculation of the value of the volume taken over. - The written request for payment of investment capital; - The written request for advance payment of investment capital (if any); - The investment capital withdrawal voucher. State treasuries shall make each payment at the request of the person assigned to manage the construction of the urgent work, which, however, must not exceed the value of the completed volume taken over and the assigned capital plan. III. Makeshift works 1. Makeshift works are those defined in Article 2 of the Government's Decree No. 71/2005/ND-CP of June 6, 2005, on management of investment in the construction of peculiar works. 2. Management, advance payment and payment of capital: The management, advance payment and payment of capital for makeshift works shall be performed under the provisions of Part B of this Circular and the following additional provisions: - For cases of package payment specified in the Construction Ministry's Circular No. 04/2005/TT-BXD of April 1, 2005, capital for makeshift works may be accounted as payment for the completed volume of the project: Apart from the project's documents, the payment dossier also comprises a written request for payment of investment capital and the investment capital withdrawal voucher. - For large-scale and complicated works with cost estimates formulated for the building of makeshift houses at construction sites for accommodation and construction administration, the payment shall be controlled based on the approved cost estimates: Apart from the project's documents, the payment dossier also comprises the decision approving the cost estimate, enclosed with the approved cost estimate, the record of the takeover test, enclosed with the statement on the calculation of the value of the completed volume, a written request for payment of investment capital, the written request for advance payment of investment capital (if any) and the investment capital withdrawal voucher. D. MANAGEMENT AND PAYMENT OF NON-BUSINESS CAPITAL OF INVESTMENT NATURE 1. Capital use: Non-business capital of investment nature in the state budget estimates of administrative and non-business agencies and units shall be used only for investment in the upgrading and extension of existing material foundations (including construction of work items in existing material foundations of administrative and non-business agencies and units). Non-business capital may not be allocated for new investment projects. 2. Elaboration of plans, allocation and notification of capital: The elaboration of plans and allocation and notification of capital shall be performed under the provisions of the State Budget Law and the Finance Ministry's guidance regarding non-business capital. 3. Advance payment and payment of capital: 3.1. Basic documents: - For projects capitalized at VND 1 billion or more, basic documents are similar to those of investment projects funded with development investment capital sources. - For projects capitalized at under VND 1 billion, basic documents comprise: + The cost estimate and the decision approving the cost estimate and design; + The document on the selection of the contractor according to the Bidding Law; + The contract between the investor and the contractor. 3.2. Advance payment of capital: - For projects capitalized at VND 1 billion or more, the level of advance capital and recovery of advance capital comply with regulations applicable to investment projects funded with investment development capital sources. - For projects capitalized at under VND 1 billion, the advance capital is equal to 30% of the assigned annual plan. Advance capital shall be gradually recovered upon each payment for completed volumes and fully recovered in the plan year. The capital amount to be recovered each time is equal to the paid capital amount multiplied (x) by the advance payment rate. - A dossier of advance payment of capital comprises a written request for advance payment of investment capital and the investment capital withdrawal voucher. 3.3. Capital payment: - Non-business capital of investment nature shall be transferred from the state budget to state treasuries for payment according to regulations on management and allocation of non-business capital. - For projects capitalized at VND 1 billion or more, payments for completed volumes shall be made according to the regime of payment for investment capital belonging to the state budget capital source. - For projects capitalized at under VND 1 billion, after the completed volume is tested before takeover, the investor shall compile and send a payment request dossier to the state treasury, comprising: + The record of the takeover test of the completed volume, enclosed with the statement on the calculation of the value of the volume; + The written request for payment of investment capital; + The written request for advance payment of investment capital (if any); + The investment capital withdrawal voucher. E. REPORTING, SETTLEMENT AND INSPECTION REGIMES I. Reporting: 1. For investors: - Periodically on the 5th of the first month every quarter, the investor shall make a report on the situation of investment execution and capital payment of the project and send it to the investment-deciding authority, state treasury and finance agency of the same level (for projects managed by localities). Particularly for important national projects and group-A projects, the investor shall send the report on the 20th every month to the managing ministry or provincial-level People's Committee, the Planning and Investment Ministry and the Finance Ministry for sum-up and reporting to the Prime Minister. - At the end of the plan year, the investor shall make a report on the execution of investment capital in the year and send it to the investment-deciding authority, state treasury and finance agency of the same level (for projects managed by localities) on the 10th of February of the subsequent year. Reports on the execution of investment capital in the year must analyze and assess the situation of plan execution and investment results in the year, point out existing problems and propose solutions thereto. - At the end of the plan year, the investor shall draw up a table of comparison of data on payment of investment capital to each project regarding the amounts paid in the year and the total amounts paid from the construction commencement to the end of the state budget year, then send it to the state treasury for certification. 2. For ministries and provincial-level People's Committees: - On the 15th of the first month every quarter, ministries and provincial-level People's Committees shall review the execution of investment plans and payment of investment capital to projects under their management and send review report to the Finance Ministry, the Planning and Investment Ministry and the Construction Ministry according to regulations. - At the end of the plan year, ministries and provincial-level People's Committees shall review the execution of investment capital in the year and send review reports to the Finance Ministry, the Planning and Investment Ministry and the Construction Ministry on the 20th of February of the subsequent year. Reports on the execution of investment capital in the year must analyze and assess the execution of plans and investment results in the year (material indicators), point out existing problems and propose solutions thereto. 3. For state treasuries: - To comply with the information and reporting regime according to separate regulations of the Finance Ministry. - At the end of the plan year, state treasuries shall settle the used investment capital with finance agencies of the same level in accordance with regulations on settlement of state budget. - At the end of the plan year, state treasuries shall certify the amounts paid in the year and the total amounts paid from the construction commencement to the end of the state budget year to each project formulated by investors. II. Settlement of investment capital: The annual investment capital settlement and the settlement of paid investment capital shall be made under the Finance Ministry's guidance on the regime of investment capital settlement. If a settlement statement is approved but the settled capital amount is lower than the capital amount already paid for the project, the investor shall recover the overpaid amount from the contractor for repayment to the State; if the settled capital amount is higher than the capital amount already paid, the investor shall make further payment or apportion the surplus amount in the subsequent year's plan for payment to the contractor. III. Inspection: Ministries, provincial-level People's Committees, finance agencies and state treasuries shall conduct regular and irregular inspections of investors and contractors participating in the projects regarding their use of advance capital and capital paid for completed volumes and their observance of the State's development investment financial policies and regimes. Finance agencies at all levels shall conduct regular and irregular inspections of state treasuries regarding the implementation of the investment capital payment regime. F. RESPONSIBILITIES AND POWERS OF CONCERNED AGENCIES I. Investors: - To perform their assigned functions and tasks according to regulations. To receive and use capital for proper purposes and proper objects in an economical and efficient manner. To abide by the provisions of law on the development investment financial management regime. - To be answerable for the quality of works, the accuracy and lawfulness of the projects' volumes or progress upon payment; to assure the accuracy, truthfulness and validity of data and documents in dossiers supplied to state treasuries and state functional agencies. - When the construction volume satisfies the contractual conditions, to promptly conduct a takeover test, compile a complete payment dossier and file a request for payment to the contractor within the prescribed time limit. - To send reports in time and fully as prescribed to investment-deciding agencies and concerned state agencies; to supply full dossiers, documents and facts according to regulations to state treasuries and finance agencies in service of capital management and payment; to submit to the inspection by finance agencies and investment-deciding agencies regarding the use of investment capital and observance of the development investment financial policies and regimes of the State. - To practice accounting as required; to settle investment capital according to current regulations. - To request capital payment when all conditions are met and request state treasuries to reply and explain on matters they find unsatisfactory in capital payment. II. Ministries and provincial- and district-level People's Committees: - To guide, inspect and urge investors under their management to execute investment plans, receive and use investment capital for proper purposes in accordance with the state regulations. - Within the scope of their assigned competence, to be responsible to the Government and law for their decisions. III. Finance agencies at all levels: - To report on the execution of investment plans according to regulations. - To ensure sufficient capital sources according to the Finance Ministry's regulations for state treasuries to make payment for projects. - To carry out the settlement of investment capital under the provisions of the State Budget Law. - To coordinate with functional agencies in guiding and inspecting investors, state treasuries and contractors participating in project execution regarding their observance of development investment financial regimes and policies, the management and use of investment capital and the settlement of investment capital so as to work out measures to handle violations, issue decisions to recover amounts spent in contravention of state regulations. - To request state treasuries and investors to supply necessary documents and information in service of the state management of development investment finance, including documents in service of the appraisal of investment projects and allocation of annual investment capital plans, reports on the execution of plans and investment capital according to the information and reporting regime, and documents in service of the verification of investment capital settlement according to regulations. IV. State treasuries: - To promulgate the process for investment capital payment for uniform application nationwide. - To guide investors to open accounts for advance payment and payment of capital. - To control and pay capital in time and fully for projects which satisfy all conditions. - To clearly explain in writing to investors the reduced or rejected payment amounts, to reply to investors' inquiries about capital payment. - When detecting that decisions of competent authorities are contrary to current regulations, to make written proposals for re-consideration and put forward their recommendations. If past the prescribed time limit, no reply is made, to settle the cases according to their recommendations; if a given reply is unsatisfactory, to settle the case according to competent authorities' opinions and, at the same time, to report such to the authorities of higher competence and finance agencies for consideration and handling. - To urge investors to pay debts after the projects have been settled and their accounts liquidated. - To comply with the information and reporting regime and settle investment capital and non-business capital of investment nature belonging to the state budget capital source according to the State Budget Law and the guidance of the Finance Ministry. - To request investors to supply dossiers, documents and information according to regulations in service of capital payment control. When necessary, to inspect the practical situation at construction sites. - To conduct regular and irregular inspections of investors regarding the execution of projects, the observance of development investment financial regimes and policies; and the management and use of investment capital. To suspend capital payment or recover capital amounts used by investors for improper purposes, improper objects or in contravention of the State's financial management regime and, at the same time, report such to the Finance Ministry for handling. - Not to participate in takeover test councils in works and projects. - To organize the control and payment of capital according to uniform professional processes, to simplify administrative procedures while ensuring strict capital management and timely, adequate and convenient payment to investors. - At the end of the plan year, to certify the amounts paid in the year and the total amounts paid from the construction commencement to the end of the state budget year for each project, give comments on the observance of management regimes, unit price limits and policies and regimes as prescribed. - To be responsible to the Minister of Finance and law for the receipt and use of state budget capital and payment in construction investment. Part III IMPLEMENTATION PROVISIONS 1. This Circular takes effect 15 days after its publication in "CONG BAO" and replaces the Finance Ministry's Circular No. 44/2003/TT-BTC of May 15, 2003, guiding the management and payment of investment capital and non-business capital of investment and construction nature belonging to the state budget capital source, Circular No. 45/2004/TT-BTC of May 21, 2004, amending and supplementing a number of points of Circular No. 44/2003/TT-BTC of May 15, 2003, and Circular No. 96/2004/TTY-BTC of October 13, 2004, guiding the management, payment, recovery and settlement of advance capital from subsequent year's budget estimates for capital construction investment projects. 2. For other development investment expenditures of the state budget (state reserve expenditures, expenditures in support of enterprises' working capital, expenditures for contribution to joint ventures, expenditures for loans to foreign counties and foreign aid, expenditures for development assistance funds), they shall be governed by separate guiding documents on each kind of expenditure. 3. Investment projects funded with other capital sources of the State must also abide by the payment principles prescribed in this Circular.