DECISION

PROMULGATING THE REGULATION ON MANAGEMENT, COLLECTION, REMITTANCE AND USE OF STATE ENTERPRISE RESTRUCTURE AND EQUITIZATION SUPPORT FUNDS

THE MINISTER OF FINANCE

Pursuant to the Government’s Decree No.178/CP of October 28, 1994 on the tasks, powers and organizational structure of the Finance Ministry;
Pursuant to the Government’s Decree No.44/1998/ND-CP of June 29, 1998 on the transformation of State enterprises into joint-stock companies;
Pursuant to the Government’s Decree No.103/1999/ND-CP of September 10, 1999 on assigning, selling, business contracting and leasing State enterprises;
Pursuant to the Prime Minister’s Decision No.177/1999/QD-TTg of August 30, 1999 on organization and operation of the State enterprise restructure and equitization support funds;
With the Prime Minister’s consent mentioned in the Government Office’s Official Dispatch No.32/VPCP-DMDN of May 19, 2000;
At the proposals of the head of the Enterprise Finance Department and the general director of the State Treasury,

DECIDES:

Article 1.- To issue together with this Decision the Regulation on the management, collection, remittance and use of the State enterprise restructure and equitization support funds.

Article 2.- This Decision takes effect from the effective date of the Prime Minister’s Decision No.177/1999/QD-TTg of August 30, 1999 and replaces the Finance Minister’s Decision No.01/1998/QD-BTC of January 2, 1998 promulgating the Regulation on the management and use of proceeds from the State’s equities sale and dividends.

The ministries, ministerial-level agencies, agencies attached to the Government and People’s Committees of the provinces and centrally-run cities shall have to coordinate with the Finance Ministry in implementing this Decision.

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FOR THE FINANCE MINISTER
VICE MINISTER




Tran Van Ta

REGULATION

ON MANAGEMENT AND USE OF STATE ENTERPRISE RESTRUCTURE AND EQUITIZATION SUPPORT FUNDS
(Issued together with the Finance Minister’s Decision No.95/2000/QD-BTC of June 9, 2000)

Chapter I

SETTING UP OF FUNDS AND SOURCES OF CAPITAL THEREFOR

Article 1.- The State enterprise restructure and equitization support funds aim to settle regimes for laborers, create conditions and provide financial support for State enterprises in the process of restructure, ownership transformation and alteration of the management mode, concretely for those enterprises which are subject to division, splitting, merger, equitization, assignment, business contracting, sale or lease under the Government’s Decree No.44/1998/ND-CP of June 29, 1998 and Decree No.103/1999/ND-CP of September 10, 1999 as well as the Prime Minister’s Decision No.177/1999/QD-TTg of August 30, 1999.

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1. The central enterprise restructure fund:

Sources of capital for this fund shall be created from revenues generated during the restructure and ownership transformation of State enterprises attached to the ministries and branches; financial supports provided by domestic and foreign organizations and/or individuals for the Government as well as ministries and branches to restructure and equitize State enterprises; and central budget allocations made according to the annual plan (if any).

2. The local enterprise restructure fund:

Sources of capital for this fund shall be created from revenues generated during the restructure and ownership transformation of the locally-run State enterprises; financial supports provided by domestic and foreign organizations and/or individuals for localities to restructure and equitize State enterprises, and local budget allocations made according to the annual plan (if any).

3. The enterprise restructure fund at a corporation 91:

Sources of capital for this fund shall be created from revenues generated during the restructure and ownership transformation of State enterprises being members of a corporation 91; financial supports provided by domestic and foreign organizations and/or individuals for the corporation to restructure and equitize State enterprises.

Article 3.- Concrete revenue sources from enterprises to enterprise restructure funds at the above-mentioned 3 levels include:

1. The actual proceeds from the sale of State capital at State enterprises upon their equitization (including the proceeds from the deferred-payment sale of equities to laborers).

2. The proceeds from the sale, business contracting or lease of State enterprises (which shall be resold to the lessees) after subtracting the expenses therefor; payment of wage debts, social insurance debts and other secured debts as well as other expenses prescribed by law.

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4. The money gained from the recovery of bad debts, which had already been handled, the sale of assets no longer needed for use or left in stock and liquidated assets which had already been excluded from the value of enterprises upon the ownership transformation after subtracting the expenses for asset sale and liquidation as well as debt recovery activities.

5. The proceeds from the sale of assets of dissolved State enterprises after subtracting the expenses for dissolution activities and debt payment as prescribed in the Finance Ministry’s Circular No.25/TC/TCDN of May 15, 1997 guiding the order, procedures and principles for the financial handling upon the dissolution of State enterprises.

6. The dividends and incomes gained from the State’s contributed capital at the joint-stock companies and limited liability companies, which are established on the basis of the ownership transformation of State enterprises, or State capital contributed by such enterprises.

Article 4.- With regard to the proceeds from the sale of State capital at the already equitized State enterprises, which are deposited in the account "deposits from State enterprise equitization", the State Treasury shall, depending on the levels which manage such enterprises, transfer money into the account of the corresponding enterprise restructure fund.

For corporations 90 (with Managing Boards) attached to the branch-managing ministries and the People’s Committees of the provinces and centrally-run cities, whose member enterprises undertake the ownership transformation, the fund-managing body shall, on the case-by-case basis, consider to permit the corporations to retain proceeds from the sale of State capital at the concerned member enterprises in order to meet the investment development requirements according to the use plan already approved by the competent authority.

Article 5.- The ministries, the People’s Committees of the provinces and centrally-run cities and corporations 91 shall direct their functional departments and sections:

1. To coordinate with the enterprise finance agencies of the same level in examining the expenses for ownership transformation in enterprises under their respective management and determining the amounts to be paid by such enterprises to the funds.

2. To urge the dependent enterprises that undertake the ownership transformation, the asset liquidation boards and enterprise dissolution councils (managed by the ministries, localities and corporations) to immediately remit to the funds the money gained from the sale, assignment and equitization of enterprises as well as from the liquidation and sale of assets of enterprises upon their dissolution or recovered assets and/or debts which had not been included in the enterprises’ value before the ownership transformation (after subtracting expenses according to the prescribed regime).

3. The representatives of the State’s contributed capital at joint-stock companies and limited liability companies shall have to inspect and urge the distribution and timely transfer of the dividends (corresponding to the State’s contributed capital at these enterprises) into the enterprise restructure funds at all levels.

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USE OF FUNDS

I. TO IMPLEMENT ENTITLEMENT POLICIES AND PROVIDE SUPPORT FOR LABORERS IN ENTERPRISES UNDERTAKING THE RESTRUCTURE AND OWNERSHIP TRANSFORMATION

Article 6.- Before the restructure or ownership transformation of State enterprises, the Managing Boards or directors (for enterprises without Managing Boards) and the enterprise renewal boards shall have to coordinate with the enterprise trade unions in:

1. Listing of and classifying the existing number of laborers in enterprises being under the restructure and ownership transformation according to the following subjects:

a/ Laborers who will be trained, re-trained for transfer to new jobs.

b/ Laborers who will lose their jobs.

c/ Laborers who voluntarily discontinue their jobs.

d/ Laborers who have their labor contracts expire.

2. Elaborating plans on the implementation of entitlement policies toward these laborers under the guidance of the Ministry of Labor, War Invalids and Social Affairs. The plans on the implementation of entitlement policies toward laborers of enterprises must clearly determine:

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b/ The enterprises’ self-financing capacity from the job severance funds.

c/ The deficit proposed to be offset by the support funds.

3. The lists and plans on the implementation of entitlement policies toward laborers who will be retrained for transfer to new jobs, laborers who have their labor contracts expire or voluntarily discontinue their jobs and laborers who will not be employed, must be publicized at enterprises and sent together with the enterprise restructure or ownership transformation plans to the competent levels for consideration and approval as well as to the enterprise restructure fund-managing bodies for monitoring and coordination.

Article 7.- The funds’ support levels for the training and retraining of laborers for their continued employment at enterprises after the restructure and ownership transformation according to the plans mentioned in Article 6 shall be determined as follows:

1. For laborers to be trained and retrained at State enterprises after division, splitting or merger: The funds’ support level shall be equal to 50% of the spending norm prescribed by the State for one-year training and/or retraining; the training fund deficit shall be accounted and included into the enterprises’ production and business costs.

2. For laborers to be trained and retrained at State enterprises after equitization, assignment, sale, business contracting or lease: The support shall be given according to the actual expenses but shall not exceed the spending norm prescribed by the State for one-year training and/or retraining; the training fund deficit shall be accounted and included into the enterprises’ production and business costs.

3. The spending norm for training and retraining shall be properly adjusted in each period; in the immediate future, the training spending norm provided for by the Finance Ministry and applied since 1998 shall apply.

Article 8.- The funds’ support levels for the payment of allowances to laborers who lose or discontinue their jobs (upon the expiry of their contracts or at their own will) in enterprises subject to the restructure and ownership transformation according to the plans mentioned in Article 6 shall be determined as follows:

The support level from the enterprise restructure fund

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The expense for payment of allowances to laborers who lose or discontinue their jobs

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The balance of the enterprise’s job severance fund

- The expenses for payment of job discontinuation and loss allowances shall comply with the regimes prescribed in the Labor Code, the Government’s Decree No.198/CP of December 31, 1994 and Decree No.72/CP of October 31, 1995 as well as the guiding documents of the Ministry of Labor, War Invalids and Social Affairs.

Article 9.- Basing themselves on the funds’ support plans and levels already approved by the competent authorities, enterprises shall proceed with:

- The compilation of dossiers, requesting the fund-managing bodies to transfer support money.

- The reception of support amounts from the funds.

- Organization of payments to beneficiaries.

- Account settlement and final settlement with the enterprise restructure funds.

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- The plan on support for the implementation of entitlement policies toward laborers in enterprises, which has been approved by the competent level (attached with the list of laborers entitled to allowances and the allowance levels).

- The copy of the enterprise’s financial statement at the time before the restructure and ownership transformation.

- The training contract between the enterprise and a training establishment (in case the enterprise has no training establishment).

Article 11.- Settlement of funding account:

1. For job severance or discontinuation allowances: within 30 days after receiving the financial supports from the funds, the enterprises or organizations that receive and use them shall report the account settlement thereof to the fund-managing bodies.

2. For supports for training and retraining: within 30 days after completing the training and retraining programs, enterprises shall have to report the account settlement of the support funding to the fund-managing bodies.

3. Where the funding is not used up, enterprises shall have to clearly report the reasons therefor and the handling measures to the fund-managing agencies as well as the support plan approving agencies for decision.

4. Within 30 days after receiving the enterprises’ reports on funding account settlement, the fund-managing bodies shall have to examine such reports directly with the recipient enterprises or organizations.

II. CAPITAL SUPPORT AND INVESTMENT FOR ENTERPRISES

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1. To supplement capital to State enterprises which need priority for consolidation.

2. To supplement capital to enterprises where the State capital is not enough for the implementation of preferential policies on the prices of equities sold to laborers under the plans already approved by the competent authorities as prescribed in Article 14 of the Government’s Decree No.44/1998/ND-CP of June 29, 1998.

3. To supplement capital to enterprises where the State capital is not enough to ensure the dominant proportion of the State capital.

For enterprises of this category, the funds’ support levels shall be determined on the basis of the State capital proportion which needs to be maintained in the charter capital structure of enterprises according to the ownership transformation plans already approved by the competent authorities as well as the State capital amount actually available in such enterprises.

4. To supplement capital to enterprises where the proportion of the State capital to business capital is low, so as to create conditions for such enterprises to handle their overdue debts and restructure the debts, thus raising the production and business efficiency before the transformation.

For enterprises of this category, the funds’ support levels shall be determined on the basis of the enterprises’ plans for debt restructure before ownership transformation, which have been approved by the competent authorities; the enterprises’ total overdue debts and actual paying capacity at the time of issuing decisions on ownership transformation.

Article 13.- Capital investment for equitized enterprises

1. Form of support: buying back shares issued by the above-mentioned enterprises in order to implement investment projects.

2. Funds’ support levels and scope:

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Article 14.- Debt- payment support for State enterprises to be assigned, sold or leased:

1. For enterprises to be assigned to collectives of laborers: The enterprise restructure funds shall provide support for social insurance debt payment by enterprises which become insolvent at the time of issuing decisions on enterprise assignment due to their production and business losses.

2. For State enterprises to be sold or leased (then resold to the lessees): The enterprise restructure funds shall provide support for payment of social insurance debts, bank loans and other payable debts only in cases where none of the purchasers agrees to inherit debts and revenues from the lease or sale of enterprises and to recover outstanding debts and the capital balance in cash at the time of sale is not enough for the payment. The above-mentioned support for payment shall only be effected on the basis of the Finance Minister’s decision.

Article 15.- If enterprises eligible for capital support and supplement by enterprise restructure funds as mentioned in Articles 12, 13 and 14 above have demand therefor, they shall have to elaborate plans, asking for the funds’ support, which shall be sent together with the relevant documents (the plans on equitization, assignment, sale or lease of enterprises, already approved or certified by the competent authorities; the decisions ratifying the investment projects, the share-issuing plans, the plans on debt restructure before ownership transformation, which have been approved by the competent authorities; and the enterprises’ financial statements...) to the competent agencies for consideration and approval of the support plans; and concurrently to the fund-managing bodies for comments and coordination in implementation.

After the support plans are approved, enterprises shall send them to the fund-managing bodies for support provision.

Article 16.- Enterprises which receive capital supports and/or supplements from the funds shall have to manage and use the support capital sources in strict accordance with the plans already approved by the competent authorities and submit to the inspection and supervision by the fund-managing bodies as well as the enterprise finance agencies. If detecting any acts of using the funds support capital sources for the wrong purposes and violating the prescribed regime, the fund-managing bodies and the enterprise finance agencies shall have to report them to the Finance Minister or the presidents of the People’s Committees of the provinces or centrally-run cities or the Managing Boards of corporations 91 for decisions to withdraw capital and handle violations according to the current law provisions.

Chapter III

FUND MANAGEMENT

I. DIVISION OF RESPONSIBILITY FOR FUND MANAGEMENT

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1. The central enterprise restructure fund shall be managed by the Finance Minister and used to provide financial supports for State enterprises attached to the ministries and centrally-run branches in the process of restructure and ownership transformation; and for the implementation of entitlement policies toward laborers in such enterprises. The Finance Ministry shall effect the allocation on the basis of the plans on the use of revenues from the ownership transformation of State enterprises, which have been approved by the branch-managing ministries as well as the funds’ capital-balancing capacity.

2. The local enterprise restructure funds shall be managed by the presidents of the People’s Committees of the provinces and centrally-run cities, who shall also decide and approve plans on financial supports for the locally-run State enterprises in the process of restructure and ownership transformation; and for the implementation of entitlement policies towards laborers in such enterprises.

3. The enterprise restructure funds at corporations 91 shall be managed by the corporations’ Managing Boards, which shall also decide and approve plans on financial supports for member enterprises of the corporations in the process of restructure and ownership transformation; and for the implementation of entitlement policies towards laborers in such enterprises.

Article 18.- Agencies assisting the Finance Minister, presidents of the People’s Committees of the provinces and centrally-run cities and Managing Boards of corporations 91 in managing the funds:

1. The Enterprise Finance Department is the body to assist the Finance Minister in performing the function of State management over the operations of the enterprise restructure fund system; appraising plans on support for enterprises of the ministries and branches; organizing the inspection and supervision of the use of the enterprise restructure funds’ capital at the centrally-run enterprises; examining the annual final account settlement reports of the enterprise restructure funds at all levels, and directly managing the central enterprise restructure fund.

2. The provincial/municipal Finance-Pricing Departments shall act as the bodies to assist the People’s Committees of the provinces or centrally-run cities in appraising plans on support for the locally-run enterprises; inspecting the use of the enterprise restructure funds’ capital at the locally-run enterprises and exercising the direct management over the local enterprise restructure funds.

3. The Finance Departments or the Finance-Accountancy Sections of corporations 91 are the units which assist the Managing Boards in appraising plans on support for member enterprises, coordinating with the Enterprise Finance Department in inspecting the use of the enterprise restructure funds’ capital at enterprises managed by the corporations and exercising the direct management over the enterprise restructure funds of corporations 91.

Article 19.- Fund accounts

1. The enterprise restructure funds shall be concentrated at the State Treasury system, with the former account "deposits from equitization of State enterprises" used and renamed "funds for support of enterprise restructure and equitization". More concretely:

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b/ The local enterprise restructure funds: shall be deposited to account No.945.07 with account holders being the presidents of the provincial/municipal People’s Committees or the authorized persons.

c/ The enterprise restructure funds of corporations 91: shall be deposited to account No.945.08 with account holders being the chairmen of the corporations’ Managing Boards or the authorized persons.

2. The opening, settlement and use of account "funds for support of enterprise restructure and equitization" shall comply with the guidance of the central State Treasury.

II. FUND PLANNING AND REGULATION

Article 20.- The revenue-expenditure plans and regulation of the enterprise restructure funds

1. Annually, together with the elaboration of the budget plan, basing themselves on the State enterprise restructure and ownership transformation plans, the ministries, the People’s Committees of the provinces and centrally-run cities and corporations 91 shall direct the enterprise management renewal boards to coordinate with the bodies authorized to directly manage the funds in drawing up the draft revenues for and expenditures from the enterprise restructure funds, then reporting them to the ministries, the People’s Committees of the provinces and centrally-run cities and the Managing Boards of corporations 91 for approval and submission to the Finance Ministry (Enterprise Finance Department).

2. On the basis of the situation on the fund management and use in the reporting year, the enterprise restructure and ownership transformation plans of the ministries, localities and corporations as well as the revenue-expenditure plans of the enterprise restructure funds at all levels, the Enterprise Finance Department of the Finance Ministry shall evaluate, integrate and report to the Finance Minister plans on the use and regulation of the fund sources throughout the country.

Article 21.- Regulation of funds

1. Basing themselves on the mobilization decisions of the Finance Minister, within 15 days after receiving such decisions, the mobilized fund-managing bodies shall have to carry out the procedures to transfer money from the funds to the account of the central enterprise restructure fund. Past this time-limit, if the mobilized fund-managing bodies fail to transfer the money, the State Treasuries where the funds open their accounts shall automatically transfer the funds’ capital sources to the central enterprise restructure fund under the mobilization decisions of the Finance Minister and notify such to the bodies managing the mobilized enterprise restructure funds.

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III. ALLOWANCE PAYMENT AND SUPPORT PROVISION

Article 22.- The enterprise restructure funds shall pay allowances and provide supports to laborers and enterprises eligible therefor only when the latter have complete support dossiers and plans which have been approved by the competent agencies.

Article 23.- Before the allocation or payment, the bodies directly managing the enterprise restructure funds at all levels shall have to re-examine the conditions for, and calculation of the allowance and support levels for the beneficiaries.

If detecting any errors or ambiguities, the bodies directly managing the funds shall have to immediately report them to the agencies that approve the support levels and plans for prompt consideration and adjustment thereof. Where the approving agencies cannot give reasonable justifications or supplements to the dossiers or do not adjust the support levels, the bodies directly managing the funds shall have to obey the order on spending at the reset level and report it to the Finance Minister for solution.

Article 24.- The allocation and payment of allowances and supports from the funds to laborers and enterprises subject to restructure and ownership transformation shall be effected according to the following order of priority:

1. Financial support for training and re-training of laborers.

2. Support for implementation of entitlement policies towards laborers who lose or discontinue their jobs.

3. Support for payment of wage and social insurance debts.

4. Support for implementation of price preference policies towards laborers in the equitized State enterprises where the State capital is not enough therefor.

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6. Capital investment in the equitized State enterprises according to the plans already approved by the competent authorities.

Article 25.- Basing itself on the written approvals of the competent authorities as well as the authorized spending orders of the bodies directly managing the funds, the State Treasury shall carry out procedures to transfer allowance and support money to beneficiary enterprises and subjects.

The State Treasury must not use the funds for other purposes or for the payment of expenditures contrary to the provisions of this Regulation.

IV. REPORTING-ACCOUNTING REGIME

Article 26.- The enterprise restructure funds at all levels shall have to open accounting books and fully account all revenues and expenditures and keep vouchers in strict compliance with the State’s prescribed regime.

A fiscal year of the enterprise restructure funds shall commence on January 1st and ends on December 31st. The first fiscal year shall be counted from the day a fund starts its operations till the last day of the year.

Article 27.- Monthly and quarterly, the bodies managing the enterprise restructure funds at all levels (the presidents of the People’s Committees of the provinces and centrally-run cities for the local enterprise restructure funds; and the Managing Boards of corporations, for enterprise restructure funds of corporations 91) shall have to report the situation on the fund management and use to the Finance Minister. In necessary cases, the enterprise restructure funds at all levels shall also have to promptly report and explain matters related to the situation on the fund management and use at the Finance Minister’s request.

Article 28.- At the end of a fiscal year, the bodies managing the enterprise restructure funds at all levels shall, within 45 days, have to direct and urge the making and sending of the fund final account settlement reports to the Finance Ministry (Enterprise Finance Department) for coordination in examination, consideration and submission to the Finance Minister for ratification and integration into a report to the Government.

A fund final account settlement report must fully and honestly reflect the fund situation at the time of making the report; the revenue-expenditure situation and remaining problems in the fund management work such as the uncollected or unspent amounts; the amounts overspent or uncovered by any sources.., which shall be attached with the fund balance certification by the State Treasury where the fund opens its account.

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Article 29.- The enterprise restructure funds shall submit to the regular and periodical inspection and supervision by the Finance Ministry.

On the basis of the reports on the fund management and use situation in localities and corporations 91, the Enterprise Finance Department under the Finance Ministry shall work out and implement plans for inspection of the fund management and use by the Finance Minister’s decisions.

Article 30.- Final account settlement of funds

1. Annually, the enterprise restructure fund-managing bodies at all levels shall have to make the final account settlement of the funds’ revenues and expenditures with the Finance Ministry.

2. Within 90 days after receiving the final account settlement reports of the enterprise restructure funds at all levels, the Enterprise Finance Department under the Finance Ministry shall have to assist the Finance Minister in examining such reports.

3. The results of examination of the funds’ final account settlement reports shall be notified to the presidents of the People’s Committees of the provinces and centrally-run cities and the Managing Boards of corporations 91, and submitted to the Finance Minister for consideration and approval.

Chapter IV

HANDLING OF VIOLATIONS

Article 31.- Acts of violating the provisions of this Regulation shall, depending on their nature and seriousness, be handled according to the current law provisions.

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FOR THE FINANCE MINISTER
VICE MINISTER




Tran Van Ta