DECREE

RATIFYING THE STATUTE ON THE ORGANIZATION AND OPERATION OF THE VIETNAM NORTHERN FOOD CORPORATION

THE GOVERNMENT

Pursuant to the Law on Organization of the Government on September 30, 1992;
Pursuant to the Law on State Enterprises on April 20, 1995;
At the proposal of the Managing Board of the Vietnam Northern Food Corporation,

DECREES:

Article 1.- To ratify the Statute on the Organization and Operation of the Vietnam Northern Food Corporation issued together with this Decree.

Article 2.- The Ministry of Agriculture and Food Industry shall have to discuss with the People's Committees of Hanoi city, Haiphong city and Thai Binh province about drawing up a list of additional members of the Vietnam Northern Food Corporation, and submit it to the Prime Minister for decision no later than the end of October 1995.

The Vietnam Northern Food Corporation shall have to discuss with the People's Committees of Hanoi city, Haiphong city and Thai Binh province about their coordination in fulfilling the tasks of ensuring food supply and stabilizing food prices in these areas pending the participation of the food companies of the Corporation in these cities and province.

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Article 4.- The Minister of Finance, the Minister of Agriculture and Food Industry, the Governor of the State Bank, and the concerned Ministers, Heads of the ministerial-level agencies, Heads of the agencies attached to the Government, shall base themselves on this Statute to guide the implementation.

Article 5.- The Ministers, the Heads of the ministerial-level agencies, the Heads of the agencies attached to the Government, the Presidents of the People's Committees of the provinces and cities directly under the Central Government, the Managing Board and the General Director of the Vietnam Northern Food Corporation shall have to implement this Decree.

ON BEHALF OF THE GOVERNMENT
PRIME MINISTER




Vo Van Kiet

STATUTE

ON THE ORGANIZATION AND OPERATION OF THE VIETNAM NORTHERN FOOD CORPORATION

(Ratified in Decree No. 46-CP of July 17, 1995 of the Government)

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GENERAL PROVISIONS

Article 1.- The Vietnam Northern Food Corporation is a State corporation made up of member units located from Thua Thien-Hue province northward; it comprises independent-accounting enterprises, dependent-accounting units, and non-business units which are closely connected in economic interests, finance, technology, material supply, consumption, servicing, information, training, research, marketing, and import and export, with the operation of the food industry. It is established by the Prime Minister to intensify accumulation, centralization, division along professional lines and production cooperation to undertake State-assigned duties, to raise the capabilities and business efficiency of the member units and the Corporation as a whole, and meet the needs of the economy.

Article 2.- The Vietnam Northern Food Corporation (hereafter referred to as the Corporation) has the tasks of trading foods, consuming all commodity foods produced by farmers, balancing the supply of foods in order to ensure the consumption needs and contributing to the stabilization of food prices, including the designing of development and investment plans, the creation of sources of investment capital, organization of food procurement, storage, processing, reserve, marketing, transport, consumption, import and export, supply of materials and specialized equipment, cooperation and joint venture with domestic and foreign economic organizations; organization of areas of commodity foods, personnel training, application of scientific and technological advances, contributing to the modernization of food production in the region; and engaging in other business activities in compliance with State law and policies.

Article 3.- The Corporation has:

1. The status of a juridical person as provided for by Vietnamese law;

2. A statute on its organization and operation, a managerial and executive apparatus;

3. Capital and asset of its own, and responsibility toward the debts within the capital under its management;

4. A seal and the right to open accounts at the State treasury and banks at home and abroad;

5. Its own table of property balance and centralized funds in accordance with the provision of the Government and the guidance of the Ministry of Finance.

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The head office of the Corporation is located in Hanoi City.

Article 5.- The Corporation submits to the State management of the Ministries, agencies at ministerial level, agencies attached to the Government and the People's Committees of the provinces and cities directly under the Central Government in as capacity as State management bodies; and, at the same time, to the management administered by the said bodies in their capacity as the executor of the ownership right over State enterprises as provided for by the Law on State Enterprises and other provisions of law.

Article 6.- The Corporation is managed by the Managing Board and is operated by the General Director.

Article 7.- The organization of the Communist Party of Vietnam in the Corporation shall operate in accordance with the Constitution and laws of the State of the Socialist Republic of Vietnam and the provisions of the Communist Party of Vietnam.

The Trade Union and other socio-political organizations in the Corporation shall operate in accordance with the Constitution and laws.

Chapter II

RIGHTS AND OBLIGATIONS OF THE CORPORATION

Part I. RIGHTS OF THE CORPORATION

Article 8.-

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2. The Corporation has the right to reassign the resources that it receives from the State to the member units for management and use; adjust the resources it has allocated to the member units in case of need and in accordance with the overall development plan of the entire Corporation.

3. The Corporation has the right to make investment, enter into business joint ventures, joint stocks, purchase part or all of the property of another enterprise in accordance with the provisions of law.

4. The Corporation has the right to transfer, replace, lease, use as collateral, mortgage, properties that are under its management, except for the important equipment and workshops that, as required by Government provisions, must be permitted by an authorized State agency, on the principle of preservation and development of the capital; with regard to the land under its management and use, the Corporation shall comply with the Land Law.

Article 9.- The Corporation has the right to organize its management and business operation as follows:

1. To organize the managerial apparatus and business operation in accordance with the goals and duties assigned by the State;

2. To renew technology and equipment;

3. To open branches and representative offices of the Corporation at home and abroad in accordance with the provisions of law;

4. To do business in trade and lines in compliance with the goals and duties assigned by the State; to expand the scope of business in accordance with the capability of the Corporation and the market demand; to engage in other business lines if they get the permission of authorized State agencies;

5. To take part in the drafting of the plans and quotas for import and export of foods by the State, and to serve as the center for the implementation of these plans and quotas. To have priority to participate in the implementation of the plans of exporting food to serve foreign debts. To serve as the core to coordinate localities in ensuring order in food procurement, consumption and import and export in the region. To have priority in procurement, and stock renewal, for the national food reserve through annual contracts with the Department of National Reserve in accordance with State plans, mechanism and price range.

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7. To set buying and selling prices for major products and services, set the floor prices for imports and ceiling prices for exports, except for the products the prices of which are set by the State;

8. To design and apply labor norms and salary scale per product unit within the framework of norms and scales set by the State;

9. To delegate authority in recruiting, hiring, assigning and training of labor, make offers on salary and bonus and execute other rights of the employer in accordance with the Labor Code and other provisions of law; to decide the salaries and bonuses for the laborers on the basis of the product unit salary scales, service expenses and operation efficiency of the Corporation; 10. To invite and host foreign business partners to Vietnam to work with the Corporation; to decide on sending representatives of the Corporation abroad for business, study, study tour and survey, except for the President of the Managing Board and the General Director who must have the permission of the Prime Minister. The other members of the Managing Board must have the permission of the President of the Managing Board to travel abroad. The Deputy General Directors and other functionaries in the assistant staff and the Directors and Deputy Directors of the member units of the Corporation must have the permission of the General Director.

Article 10.- The Corporation has the following rights in financial management:

1. To use the capital and funds of the Corporation to promptly serve the business needs on the principle of preservation and efficiency. When necessity arises to use capital resources and funds not in line with their purported uses, the principle of repayment shall apply;

2 To mobilize capital for business operations without changing the form of ownership; to issue bonds in accordance with the provisions of law; to mortgage the land-use right in connection with the properties of the Corporation at Vietnamese banks to take loans for business operations in accordance with the provisions of law;

3. To form, manage and use the centralized and capital depreciation funds; the ratio of deduction, management and use of these funds are effected under the guidance of the Ministry of Finance and as prescribed in the Financial Regulation of the Corporation;

4. To use the remainder of the profit after discharging all obligations to the State to set up the fund for development investment and other funds as provided for, and to apportion to the laborers according to the contribution of each individual to the business result of the year, and to the stock shares;

5. To enjoy allowance regimes, price subsidies or other preferential treatments of the State when conducting production for, or catering service to, national defense and security, combating against natural calamities, providing public services or products or services in accordance with the price policy of the State which cannot make up for the production or service cost which the Corporation has spent on these products and services.

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Article 11.- The Corporation has the right to refuse and denounce all requests by any individual or organization for provision of resources not allowed by law, except the voluntary contributions for humanitarian purpose or public interest.

Part II. OBLIGATIONS OF THE CORPORATION

Article 12.-

1. The Corporation has the obligation of receiving and using in an efficient, secure and growing manner the capital allocated to it by the State, including the capital it invests in other enterprises; receiving and using in an efficient manner the land and other resources allocated by the State to realize the business targets and other duties assigned by the State.

2. The Corporation has the obligations to:

a) Clear all debts and credits reflected in the balance of properties of the Corporation as of the time of its establishment;

b) Pay the international credits put at the disposal of the Corporation by decision of the Government;

c) Pay all credits that the Corporation takes directly or the loans that it guarantees for member units to take under guaranty contracts when the member units are not capable of clearing.

Article 13.- The Corporation has the obligation to manage its business operation as follows:

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2. To work out its development strategy, annual and five-year plans and plans for procurement, consumption and import and export of food in the region, in line with the tasks assigned by the State and in accordance with the market demands;

3. To sign and organize the implementation of the economic contracts already signed with partners;

4. To organize the procurement, storage, processing, reserve for circulation, and import and export of food to ensure the State balance on food, and to meet the needs of consumption and export; to receive food from the Southern Food Corporation as mobilized by the State to cater to the consumption in northern areas so as to stabilize food prices; to purchase food in southern areas to cater to northern areas in accordance with the State plan when the need arises;

5. To renew and modernize technology and mode of management; to spend the income from transfers of properties on re-investment and renewal of equipment and technologies of the Corporation;

6. To carry out its obligations toward the laborers in accordance with the provision of the Labor Code, and to ensure that the laborers take part in the management of the Corporation;

7. To implement provisions of the State on environmental protection and national defense and security;

8. To implement the regime of statistical and periodical reports in accordance with the provisions of the State, and of irregular reports at the request of the representative of the owner; and to be responsible for the accuracy of the reports;

9. To be subject to the control of the representative of the owner; to comply with the provisions on inspection of the financial service and other authorized State agencies as provided for by law.

Article 14.-

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2. The Corporation has the obligation to publicize its annual financial reports and provide information to facilitate correct and appropriate assessments of the operation of the Corporation in accordance with the provisions of the Government.

3. The Corporation shall discharge its obligations in tax contribution and other remittance to the State budget in accordance with the provisions of law. In case of transfer of properties among member units in the form of registering increases or decreases of the respective capitals, no registration tax shall have to be paid. The transfer of paddy and rice among member units of the Corporation for continued processing or in accordance with the annual transfer plan of the Corporation to ensure the regional supply of food and stabilize food prices shall be exempted from turnover tax.

Chapter III

THE MANAGING BOARD AND THE CONTROL COMMISSION

Article 15.-

1. The Managing Board carries out the function of managing the operation of the Corporation and is responsible before the Government for the development of the Corporation in accordance with the tasks assigned by the State.

2. The Managing Board has the following powers and tasks:

a) To receive capital (including debts), land and other resources assigned by the State to the Corporation;

b) To consider and approve plans proposed by the General Director on allocating capital and other resources to the member units, and on arrangement of capital and other resources among the member units; to control and supervise the implementation of these plans;

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d) To approve the proposals of the General Director for submission to the Prime Minister for approval of the strategies, schemes and plans for long-term development and the five-year plans of the Corporation; to decide on the annual targets and plans of the Corporation and report them to the Prime Minister, so that the General Director may assign them to the member units;

e) To organize the evaluation and submit to the authorized agencies for approval the investment plans, new investment projects and projects for investment cooperation with foreign partners, which are financed by the capital under the management of the Corporation;

f) To submit to the Prime Minister for approval, or on mandate of the Prime Minister to decide on projects of joint venture with foreign partners in accordance with the provisions of the Government; to decide on projects of domestic joint ventures and economic contracts of large value. To submit to the Prime Minister for decision on investment in projects of Group A; to be mandated to make decisions on investment projects of Group C and a number of projects of Group B; to mandate the General Director or Directors of member units to approve small investment projects. To approve plans for management and business operation of the Corporation as submitted by the General Director. To propose on the establishment, splitting, merger and dissolution of member units in accordance with the provisions of law;

g) To issue and supervise the implementation of the technico-economic norms and standards, including salary scales and prices and norms of processing, transport and storage of foods, to design professional standards, product standards, trade marks, and prices of products and services of the Corporation at the proposal of the General Director on the basis of the common provisions of the branch and of the country;

h) To design and submit to the Prime Minister for approval the Statute and its amended or supplemented contents on the organization and operation of the Corporation. To approve the Statute and Regulation on organization and operation of the member units and the amendments and supplements to the Statute or Regulation on organization and operation of the member units at the proposal of the General Director. To decide on the opening of branches and representative offices of the Corporation at home and abroad in accordance with the provisions of law; to design the Financial Regulation of the Corporation on the basis of the Model Financial Regulation, and submit it to the Ministry of Finance for approval before putting it into effect;

i) To submit to the Prime Minister for decisions on the appointment, dismissal, reward or discipline of the General Director; to submit to the Minister of Agriculture and Food Industry for decisions on appointment, dismissal, reward or discipline of Deputy General Directors and the Chief Accountant of the Corporation at the proposal of the General Director; to decide on appointment, dismissal, reward or discipline of the Directors of member units at the proposal of the General Director; to decide on the overall payroll of the managerial and operational apparatuses of the Corporation and make adjustments when necessary at the proposal of the General Director;

j) To approve plans proposed by the General Director on the setting up and use of the centralized funds corresponding to the plans for business and finance of the Corporation;

k) To consider plans for capital mobilization (in all forms), guarantee loans; liquidate properties of member units to decide, or submit to the Prime Minister for decision, on the principles provided for in Item 4, Article 38, of this Statute;

l) To approve quarterly, bi-yearly and yearly operational reports of the Corporation, the annual financial statements (which include tables of property balances) of the Corporation and its member units as submitted by the General Director, and request the General Director to publicize the annual financial statement in accordance with the provisions of the Ministry of Finance;

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3. The Managing Board is composed of five members appointed and dismissed by the Prime Minister. The criteria of the members of the Managing Board are provided for in Article 32 of the Law on State Enterprises.

4. The Managing Board is composed of a number of full-time members, including the President of the Board, a member who serves as the General Director, a member who serves as the Chairman of the Control Commission, and a number of part-time members who are experts in the fields of food, economics, finance, business management and legal affairs.

5. The President of the Managing Board shall not be also General Director of the Corporation.

6. The term of office of the members of the Managing Board is five years. Members of the Managing Board may be re-appointed. Members of the Managing Board shall be dismissed or replaced in the following cases:

a) Law-breaking or violation of the Statute of the Corporation;

b) Lack of competence to assume duties and the removal is proposed by at least two thirds of the incumbent members of the Managing Board;

c) Voluntary request for relief of duty for a plausible reason;

d) Being transferred or moved to other duties.

7. The President of the Managing Board has the responsibility to organize the discharge of the tasks and powers of the Board as provided for in Item 2 of this Article.

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a) The Managing Board shall adopt the system of collective work, meet every quarter to review and take decisions on matters within its jurisdiction and responsibility. When the need arises, the Board may meet in irregular session to review issues of urgency of the Corporation, at the proposal of the President of the Board, or of the General Director, or the Chairman of the Control Commission, or of over 50% of the total members of the Managing Board;

b) The President of the Managing Board convenes and presides over all meetings of the Board; in case he/she is absent on good reasons, he/she may mandate another member of the Board to preside over the meeting;

c) A meeting of the Managing Board is valid when it is attended by at least two thirds of the members. The documents of the meeting of the Managing Board shall be sent to the members of the Board and the invited representatives five days before the meeting. The content and conclusion of the meeting of the Managing Board are recorded in minutes and shall be signed by all the attending members of the Board. The resolutions and decisions of the Board shall be valid if they are voted for by over 50% of the members of the Managing Board. The members of the Managing Board have the right to reserve their opinions.

d) When the Managing Board meets to consider issues related to the development strategy, annual and five-year schemes and plans, large investment projects, projects for joint venture with foreign countries, annual financial reports, and the issuing of the system of technico-economic norms and standards of the Corporation, it shall invite representatives of the concerned ministries and branches to attend; in case there are important contents which are related to the local authorities, it shall invite representatives of the provincial People's Committee to attend; in case it is related to the interests and obligations of the laborers, it shall invite the representative of the Trade Union. The representatives of the concerned agencies and organizations invited to the meeting have the right to speak, but not to vote; when they detect that the resolutions and decisions of the Managing Board are harmful to the common interests, they have the right to recommend in writing to the Board and, at the same time, to the Heads of the agencies for which they represent, for consideration and settlement according to their jurisdiction. In case of necessity, the Heads of these agencies may report to the Prime Minister;

e) The resolutions and decisions of the Managing Board are binding on the entire Corporation. In case the General Director has a different opinion from the resolution and/or decision of the Managing Board, he/she may reserve his/her opinion and make recommendation to the authorized State agencies for settlement; pending such a decision of the authorized State agencies, the General Director shall still comply with the resolutions and decisions of the Managing Board;

f) All expenses on operations of the Managing Board and the Control Commission, including the salaries and allowances for the members of the Managing Board and the Control Commission and the assistant experts of the Managing Board, shall be accounted for in the managerial expenditure of the Corporation. The General Director shall provide the necessary working conditions and facilities for the Managing Board and the Control Commission.

Article 16.- Assistance to the Managing Board:

1. The Managing Board shall employ an apparatus and the seal of the Corporation to carry out its tasks.

2. The Managing Board has from 3 to 5 assisting experts who work full time.

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Article 17.- Rights and responsibilities of the members of the Managing Board:

1. The full-time members shall be salaried as State employees and shall receive wages on the payment scale provided for State enterprises by the Government and bonuses corresponding to the efficiency of the operation of the Corporation. The part-time members shall enjoy responsibility allowances and bonuses as provided for by the Government.

2. The members of the Managing Board:

a) Shall not in any capacity restrain their capability to operate in honesty and selflessness and shall not sow discords between the interests of the Corporation and those of individuals;

b) Shall not abuse powers for personal benefits or take actions to usurp business opportunities of the Corporation to the detriment of the latter.

c) Shall not act in excess of the powers of the Managing Board as provided for in this Statute.

3. The members of the Managing Board who are the President and the General Director shall not in their own name form private businesses, or limited liability companies or joint-stock companies; shall not hold a managerial or operating post at private enterprises, or limited liability companies or joint-stock companies; shall not maintain any economic contracts with private enterprises, or limited liability companies or joint-stock companies in which their spouses, parents or children are holding managerial or executive posts.

4. The spouses, parents, children and biological brothers and sisters of the President of the Managing Board and the General Director shall not hold the posts of Chief Accountant and Cashier at the Corporation and its member units.

5. The members of the Managing Board share their responsibility before the Prime Minister and law for all resolutions and decisions of the Board; in case of a failure to fulfill the assigned missions, a violation of the Statute of the Corporation, an erroneous decision or an abuse of power, which results in damage to the Corporation and the State, they shall be held responsible for it and shall make material compensation for the damage caused by their action as provided for by law.

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1. The Control Commission has five members, including one who is member of the Managing Board and who will serve as the Chairman of the Control Commission on assignment of the Managing Board. The four other members shall be appointed, dismissed, rewarded and disciplined by the Managing Board; they include a member who is an expert accountant; a member who is recommended by the Congress of the workers and Employees of the Corporation, a member who is recommended by the Minister of Agriculture and Food Industry, and a member who is recommended by the General Director of the General Department for Management of State Capital and Properties at Enterprises.

2. The members of the Control Commission shall not be spouses, parents or siblings of the General Director, the Deputy General Directors or the Chief Accountant of the Corporation, and shall not hold any posts in the executive apparatus of the Corporation or any posts in any food enterprises outside the Corporation.

3. The members of the Control Commission must fill the following criteria:

a) Being expert at accounting, audit, economics, technology in food culture and processing; knowledgeable in legal affairs;

b) Having no less than five years of experience in the related disciplines;

c) Having no criminal records related to economic activities.

4. The term of the members of the Control Commission is five years. In the course of their term, they may be replaced if they fail to discharge their duties.

5. The members of the Control Commission shall receive salaries and bonuses decided by the Managing Board in accordance with the State regime.

Article 19.- Tasks, powers and responsibilities of the Control Commission:

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2. To report to the Managing Board quarterly and annually, and on each operation on the results of its control and supervision work; to promptly detect and report to the Managing Board the activities of an abnormal character or with signs of crime within the Corporation;

3. Not to reveal results of the control and supervision work without the authorization of the Managing Board; to be responsible to the Managing Board and law if found to have intentionally overlooked or covered up criminal acts.

Chapter IV

THE GENERAL DIRECTOR AND THE ASSISTING APPARATUS

Article 20.-

1. The General Director shall be appointed, dismissed, rewarded and disciplined by the Prime Minister at the recommendation of the Managing Board. The General Director is the juridical representative of the Corporation and is responsible before the Managing Board, the Prime Minister and law for his/her direction of the operations of the Corporation. The General Director is the person with the highest executive power in the Corporation.

2. The Deputy General Director is the person to assist the General Director in directing one or a number of fields of operation of the Corporation under the assignment of the General Director, and is responsible before the General Director and law for the duty assigned by the General Director.

3. The Chief Accountant of the Corporation shall assist the General Director to conduct and organize the work of accounting and statistics at the Corporation, and has the powers and tasks provided for by law.

4. The Office and the professional sections of the Corporation have the functions to provide consultancy and assistance to the Managing Board and the General Director in their managerial and executive work.

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1. Together with the President of the Managing Board to receive capital (including debts), land and other resources allocated by the State to manage and use for the realization of the goals and tasks assigned by the State to the Corporation. To distribute the State-allocated resources to the member units of the Corporation along the plans approved by the Managing Board. To make recommendations to the Managing Board for adjusting the capital and other resources to be allocated to the member units, and for further adjustments when changes occur in the tasks of the member units, in forms of increasing or decreasing their capital;

2. To make efficient use of, and to preserve and develop, the capital according to plans approved by the Managing Board. To draft plans for capital mobilization to submit to the Managing Board for approval, and to organize the realization of these plans. To carry out, and to direct the financial company of the Corporation to carry out, capital mobilization and lending in service of the demand for capital of the Corporation and the member units;<%0>

3. To design the development strategy, the long-term and annual plans, operational schemes, plans for purchase, sales, and import and export of food for the Corporation, projects for new investment and intensive investment, projects for investment cooperation with foreign countries, plans for joint ventures, plans for business coordination among the member units, plans for personnel training and fostering in the Corporation, measures to carry out contracts of large economic value to submit to the Managing Board for consideration and decision, or for subsequent submission to authorized State agencies for decision. To organize the implementation of the approved strategy, plans, schemes, projects and measures.

4. To direct business operations of the Corporation; to be responsible for the business results of the Corporation; to implement the food balances assigned by the State to the Corporation so as to ensure food security; to be responsible before the Managing Board, the Prime Minister and law for the implementation of stabilization of food prices in the region and to contribute to the stabilization of the national food prices;

5. To draft, and submit to the Managing Board for approval, technico-economic norms, product quality standards, salary scale, costs and norms for food storage, processing and transport, plans for business development, prices for procurement of food and agricultural materials, and services to be applied uniformly within the Corporation, in line with the general provisions of the branch and the State. To organize and monitor the implementation of the norms, standards, price scale and its application within the entire Corporation;

6. To propose the Managing Board to submit to the Minister of Agriculture and Food Industry for decision to appoint, dismiss, reward or discipline Deputy General Directors and the Chief Accountant of the Corporation; to propose the Managing Board to decide on the appointment, dismissal, reward or discipline of Directors of member units. To appoint, dismiss, reward and discipline Deputy Directors and Chief Accountants at member units, Directors of units attached to member units, and personnel of equivalent rank, at the proposal of the Directors of these member units. To appoint, dismiss, reward and discipline the Chiefs and Deputy Chiefs of Divisions, and the Chief and Deputy Chiefs of the Office, of the Corporation;

7. To design for submission to the Managing Board for approval the total payroll of the Corporation and the plan for adjustment of the organization and staff of the managerial apparatuses at the Corporation and member units; to establish and directly conduct the assisting staff; to monitor the realization of the organizational plan for the managerial staffs of the member units; to submit to the Managing Board for approval the Statutes and Regulations on organization and operation of the member units drafted by their Directors; to approve the schemes for establishment, reorganization and dissolution of the units attached to the member units as proposed by the Directors of the member units;

8. To design, and submit to the Managing Board for approval the Regulation on Labor; Regulation on salary, reward and discipline; the Regulation on secrecy protection to be applied within the Corporation;

9. To organize and conduct the operation of the Corporation in line with the resolutions and decisions of the Managing Board; to report to the Managing Board and authorized State agencies on the results of the business operation of the Corporation including the quarterly, half-yearly and yearly reports, general financial statement and reports on the property balance of the Corporation.

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10. To implement, and monitor the member units in the implementation of the obligation in tax and other contributions as provided for by law and the State. To prepare plans for the after-tax division of the profit of the Corporation, and submit them to the Managing Board for approval in line with State provision;

11. To provide in full documents at the request of the Managing Board and the Control Commission. To prepare documents for the meetings of the Managing Board;

12. To submit to the control and supervision of the Managing Board, the Control Commission and the authorized State agencies, with regard to the conduct of his/her operational duties.

13. To have the authority to take measures in excess of his/her jurisdiction in cases of emergency (natural calamity, hostility, fire and accident) and bear responsibility for such decisions; and, at the same time, report the problems immediately to the Managing Board and authorized State agencies for further settlement.

Chapter V

THE COLLECTIVE OF LABORERS IN THE CORPORATION

Article 22.- The Congress of the Workers and Employees of the Corporation is a form of their exercise of direct involvement in the management of the Corporation. The Congress has the following rights:

1. To take part in the discussion to work out a collective labor bargain for the representative of the collective of laborers to negotiate and sign it with the General Director;

2. To discuss and approve the regulations on the use of the funds directly related to the interests of the laborers in the Corporation;

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4. To present candidates to the Managing Board and the Control Commission.

Article 23.- The Congress of the Workers and Employees is convened and operates in accordance with the guidance of the Vietnam General Confederation of Labor.

Chapter VI

MEMBER UNITS OF THE CORPORATION

Article 24.-

1. The Corporation has its member units which are State-owned enterprises operating on independent financial accounting, dependent financial accounting and as non-business units (See attached list).

2. The member units of the Corporation have their own seals and are allowed to open bank accounts in line with their modes of operation.

3. The member units which are operating on independent and dependent financial accounting shall have their own Statutes on organization and operation; the non-business units of the Corporation shall have their own Regulations on organization and operation. These Statutes and Regulations are to be approved by the Managing Board in compliance with law and the Statute of the Corporation.

Article 25.- The member unit which is a State-owned enterprise operating on independent financial accounting:

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2. The Managing Board and the General Director of the Corporation have the following rights toward the member units which are enterprises on independent accounting:

a) To mandate the Director of the enterprise to manage and conduct the operation of the enterprise in compliance with its Statute which has been approved by the Managing Board of the Corporation. The Director of the enterprise on independent financial accounting is responsible before the Managing Board, the General Director and law for the operation of the enterprise;

b) To appoint, dismiss, reward and discipline the Directors, Deputy Directors and Chief Accountants;

c) To approve plans and monitor their implementation, make financial accounting; to set the levels of funds for reward and welfare of the enterprise in compliance with the guidance of the Ministry of Finance and the Financial Regulation of the Corporation;

d) To put aside part of the funds of capital depreciation and after-tax profits in compliance with the Financial Regulation of the Corporation and the guidance of the Ministry of Finance, so as to establish centralized funds for the Corporation to spend on reinvestment or on investment projects at member units;

e) To approve schemes and plans for extensive and intensive investments, cooperation and joint ventures, to add or withdraw part of the capital, and to transfer stocks which belong to the Corporation but are held by the member units;

f) To regulate financial sources, including those in foreign exchange, among the member units with a view to using the capital in the most efficient way within the entire Corporation, on the principle that the total asset of the target member unit shall not fall below the total of its debt and its registered capital which has been adjusted according to its tasks or scope;

g) To approve the forms of salary, salary scales and measures to ensure the living and working conditions for the workers and employees of the enterprise;

h) To decide on expanding or narrowing the business scope of the member enterprises in line with the overall development strategy of the Corporation;

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j) To monitor the operation of the enterprise and request it to report on its financial situation and business operation.

Article 26.- The member unit of the Corporation which is operating on independent accounting is responsible for its debts and financial commitments within the capital allocated to it for management and use, namely:

1. In development strategy and investment:

a) The enterprise is assigned to implement development investment projects according to the plan of the Corporation. The enterprise shall be allocated the necessary resources by the Corporation to implement such projects;

b) The enterprise makes investments on its own in works and development projects which are not part of the projects directly conducted by the Corporation. In these cases, the enterprise has to mobilize financial resources on its own and be responsible for them.

2. In business operation, the enterprise shall design its own plan and organize its implementation, on the basis of:

a) Ensuring the targets, quotas, major balances and the main technico-economic norms (including prices and unit prices) of the enterprise and in line with the overall plan of the Corporation;

b) Utilizing optimally all the resources that the enterprise has at its disposal or is able to mobilize, in line with market demands.

3. In financial operation and economic accounting:

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b) The enterprise has the right to mobilize capital and other sources of credit in line with law so as to carry out its plan for business operation and development investment;

c) The enterprise is allowed to form funds for capital construction, production expansion, reward, welfare and financial reserve, in line with the Statute of the enterprise which has been approved by the Managing Board and under the guidance of the Ministry of Finance. The enterprise has the obligation to contribute to, and utilize, the centralized funds of the Corporation in accordance with the Statute of the Corporation and decisions of the Managing Board;

d) The enterprise is responsible for paying taxes of all kinds and meeting other obligations (if any) as provided for by law;

e) The enterprise may be mandated by the Corporation to carry out contracts with domestic and foreign clients on behalf of the Corporation.

4. In organization, personnel and labor:

a) The enterprise has the right to propose to the Corporation for consideration and decision, or may be mandated by the Corporation, to establish, reorganize or dissolve attached units, and this work must be done in accordance with the Statute of the Corporation and its own Statute;

b) Within the payroll allotted by the Corporation, the enterprise has <%-2>the right to recruit, assign or dismiss employees in its own managerial and business apparatus. The appointment or dismissal of personnel holding positions in the managerial apparatus of the enterprise and its attached units, the assignment of work and the payment of salary, shall be conducted in line with the delegation of power by the Corporation under this Statute;<%0>

c) The enterprise has the responsibility to develop its human resources to ensure the implementation of the development strategy and business tasks of the enterprise; to attend to the improvement of the working and living conditions of the laborers, in accordance with the Labor Code and the Law on Trade Union.

Article 27.- The member unit which is an enterprise on dependent accounting:

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2. It has the right to sign economic contracts, to conduct business operations, financial operations, and to implement organizational and personnel work, in line with the power delegated by the Corporation. The rights and tasks of the unit on dependent accounting are provided for in details in its Statute on organization and operation approved by the Managing Board.

Article 28.- The non-business units have their Regulation on organization and operation approved by the Managing Board; operate on revenue-for-expense basis; are allowed to generate incomes through providing services, conducting scientific research and training for units at home and abroad; are entitled to benefit from funds for rewards and welfare as provided for by regimes, which, if falling below the average level of the Corporation, shall be supplemented with funds for reward and welfare of the Corporation.

Article 29.-

1. The Financial Company is the member unit enterprise operating on independent accounting of the Corporation, operate in compliance with law and under the guidance of the Governor of the State Bank, in line with the Statute on organization and operation approved by the Managing Board, and under the conduct of the General Director of the Corporation.

2. The Financial Company carries out the task of mobilizing capital for lending out to meet the need in capital of the Corporation and its member units, through taking concessional loans from the Government, commercial loans from banks and financial organizations at home and abroad; issuing corporate stocks and bonds, project bonds, or purchases of valued documents and notes in accordance with the provisions of law; mobilizing idle capital among the workers and employees of the Corporation and of units in the technico-economic branch in which the Corporation operates.

3. The Financial Company conducts its capital mobilization for investment projects of the Corporation and offers other services in compliance with the provisions of the Statute of the Corporation and the Regulation on Financial Companies in Corporations issued by the State Bank. With regard to large projects for which the investors sign the contracts directly, the Financial Company shall perform the service function.

4. The units which utilize capital provided by the Financial Company shall do it on the borrowing-and-payment principle, with an internal interest proposed by the Financial Company and approved by the General Director on mandate of the Managing Board.

Chapter VII

MANAGEMENT OF THE CAPITAL CONTRIBUTED BY THE CORPORATION AND MEMBER UNITS TO ENTERPRISES OUTSIDE THE CORPORATION

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Article 30.- Regarding the capital contributed by the Corporation to outside enterprises, the Managing Board of the Corporation has the following rights and obligations:

1. To approve the plan for capital contribution designed by the General Director to decide, or to submit to the Head of the authorized State agency to decide, in accordance with the delegation of power provided for in Point (f), Par. 2, Article 15, of this Statute;

2. At the proposal of the General Director, to appoint, dismiss, reward and discipline the personnel directly involved in the management of the capital share of the Corporation at the invested enterprise;

3. To monitor and control the use of the capital contributed by the Corporation to outside enterprises; to be responsible for the efficiency of the use, preservation and development of the contributed capital and to collect profits yielded by the capital contributed by the Corporation to the outside enterprises.

Article 31.- The right and obligation of the personnel directly involved in the management of the capital contributed by the Corporation to outside enterprises:

1. To assume managerial position and operational duty at the enterprise which has capital contributed by the Corporation, in line with the Statute of the enterprise;

2. To monitor and supervise the operation of the enterprise;

3. To make obligatory reports and be responsible before the Managing Board of the Corporation for the capital contributed by the Corporation to the enterprise.

Item II. MANAGEMENT OF THE CAPITAL CONTRIBUTED BY INDEPENDENT-ACCOUNTING MEMBER UNITS TO OUTSIDE ENTERPRISES

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1. To design the plan for capital contribution for the General Director to submit to the Managing Board for approval;

2. To appoint, dismiss, reward and discipline the personnel directly involved in the management of the capital contributed by the enterprise to the outside enterprise;

3. To supervise and control the use of the capital contributed by the enterprise; to be responsible for the efficiency of the use, preservation and development of the contributed capital; to collect profits on the capital contributed by the enterprise to the outside enterprise.

Article 33.- The rights and obligations of the personnel directly involved in the management of the capital contributed by the enterprise to the outside enterprise:

1. To assume managerial position and operational duty at the outside enterprise which has capital contribution from his/her own enterprise;

2. To monitor and supervise the business situation of the invested outside enterprise;

3. To make regular reports as required by the director; be responsible before the Managing Board of the Corporation and the Director for the efficiency of the use of the capital of his/her own enterprise at the outside enterprise where he/she is assigned to take part in the management and operation.

Item III. JOINT VENTURE UNITS

Article 34.- The joint venture units in which the Corporation or its member units take part shall be managed and operated in accordance with the Law on Foreign Investment, the Corporate Law and other related laws of Vietnam. The Corporation or its member units shall exercise all financial rights, obligations and responsibility toward these joint ventures in line with the provision of law and in accordance with the signed contracts.

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FINANCE OF THE CORPORATION

Article 35.- The Corporation applies the regime of general accounting, exercises financial autonomy in its business operation in compliance with the Law on State Enterprises, other provisions of law and its own Statute.

Article 36.-

1. The statutory capital of the Corporation is composed of:

a) Capital allocated by the State at the point of establishment of the Corporation;

b) Additional capital allocated by the State (if any);

c) The part set aside from the after-tax profit as addition to the capital, as required by existing regulations;

c) Capital from other sources (if any).

2. When there is an increase or decrease in the statutory capital, the Corporation has to make prompt adjustments in its table of property balance and announce its adjusted statutory capital.

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1. The Corporation may establish and use centralized funds to ensure that its process of development yields high efficiency.

2. The centralized funds of the Corporation shall be established in accordance with provisions of the Statute of the Corporation and the Financial Regulation of the Corporation, and shall be decided by the Managing Board. They include:

a) The fund for development investment which is composed funds from capital depreciation, profit-based contributions from the member units as required by the Ministry of Finance, profits from the stocks of the Corporation at outside enterprises and funds from other sources.

The capital depreciation and profit from re-investment at units on dependent accounting of the Corporation shall be concentrated at the Corporation to invest according to annual plan.

If the Corporation mobilizes the fund from capital depreciation and reinvestment profit of the member unit which is on independent accounting, the mobilization shall be conducted on the borrowing-and-payment basis, with internal interest approved by the General Director on mandate of the Managing Board and under the guidance of the Ministry of Finance;

b) The fund for circulation to ensure the normal performance of the food business is formed by funds from the operating capital of the Corporation, in which the part from bank loans may be made on preferential interest rates when necessary. If the sale of food made on Government-set price to help stabilize food price on the market causes losses to this fund, it shall receive assistance from the price-subsidy fund of the State;

c) The fund for scientific research and concentrated training, to be provided for units which are tasked to conduct scientific research and training and retraining for the employees of the Corporation, shall be formed by funds taken from the funds for production development contributed by the member units and the State-financed budget for non-business and training activities (if any), and from other sources including revenues from services and contracts on scientific research and training signed with enterprises and public service units inside and outside the country;

d)The fund for assistance of food production before and after harvest is formed by funds from sources which are currently allocated to the Corporation by the State and annually supplemented with allocations from the after-tax profit of the Corporation (including its member units) and from other sources. In case of the exercise of the agricultural expansion duty assigned by the State, the Corporation shall be assisted as provided for by the State policy;

e) The funds of financial reserve, reward and welfare shall be established under the guidance of the Ministry of Finance. The size of each fund as well as the allocations to them, and their use, are defined in the Financial Regulation of the Corporation.

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1. The Corporation shall operate on the principle of financial autonomy, self-balancing its revenues and expenditures and being responsible for the preservation and development of its sources of business capital, including the stocks maintained at outside enterprises.

2. The Corporation is responsible for clearing debts prescribed in the table of property balance of the Corporation and its other financial commitments (if any).

3. The Corporation shall monitor and supervise financial operations within the entire Corporation.

4. All credit relations (borrowing, lending, purchase and sale on delayed payment, and guaranty) between the Corporation and outside partners shall be conducted in strict compliance with the limit for each transaction as provided for the Ministry of Finance.

5. The Corporation has the responsibility to design and submit for registration its financial plans, file financial statements and tables of property balance to the authorized levels, and make annual financial statements to the Ministry of Finance. The Ministry of Finance shall check and approve the annual financial statement of the Corporation.

6. To conduct all domestic and foreign revenues from transactions in food and agricultural materials as agreed upon in contracts; to procure these revenues to the budget as guided by the Ministry of Finance.

7. The Corporation is responsible for paying all taxes and other contributions as required by current law and the Financial Regulation of the Corporation, except for the taxes which have already been paid by the member units. It is allowed to spend the after-tax profits as provided for by current law.

8. The profits that the Corporation or the member units have generated from their invested capital at outside enterprises shall be exempted from profit tax if these outside enterprises have already paid taxes before dividing the profit to the contributing share holders.

9. The financial operation of the member units of the Corporation and the financial relations between the Corporation and its member units shall be handled in accordance with the Statute and Financial Regulation of the Corporation.

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11. The Corporation shall strictly comply with the Ordinance on Accounting and Statistics and the current regime on accounting and financial report applied to State enterprises.

12. The Corporation is subject to the monitor and supervision of its financial and business operations by the authorized State agency as provided for by law.

Chapter IX

RELATIONS BETWEEN THE CORPORATION AND STATE AGENCIES AND LOCAL AUTHORITIES

Article 39.- The relations with the Government:

1. To observe laws and strictly implement Government regulations which are related to State corporations and businesses;

2. To carry out the development plans and strategy in line with the overall sectoral and geographical plan and strategy of development of the State;

3. To comply with the regulations on establishment, splitting, merger and dissolution; the policies on organization and personnel; the regimes on finance, credit, tax and profit; the regime on accounting and statistics;

4. To submit to the control and supervision for the observance of law, policies and regimes of the State at the Corporation;

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6. To manage and use the capital, properties, land and other resources allocated by the State to carry out the business tasks, and to preserve and develop these resources;

7. To benefit from the regimes on allowances, price subsidies and other regimes as provided for by the Government.

Article 40.- The relations with the Ministry of Finance:

1. The Corporation is subject to the control and State management of the Ministry of Finance in:

a) Compliance with the regimes on finance, accounting, tax and organization of the accounting apparatus;

b) Financial audit and internal audit within the Corporation.

2. The Ministry of Finance is the government body assigned to perform a number of rights of the owner, and shall have control over the Corporation in:

a) Determining the capital, natural and other resources that have been allocated by the State to the Corporation for management and use;

b) To monitor and ensure the efficiency of the use, preservation and development of the capital and other resources which are allocated in the course of operation and which are reflected through the annual financial statement;

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d) To issue the model Financial Regulation, to approve the Financial Regulation of the Corporation.

3. The Corporation is subject to the monitoring and supervision of its finance and other matters by the Ministry of Finance.

4. The Corporation has the right to propose solutions, mechanisms, financial policies, credits and other matters related to the Corporation; to recommend to the Ministry of Finance and the Prime Minister for approval so as to carry out the transfer of property of high value, enter into investment cooperation with foreign partners or other economic sectors, conduct credit relations above the allowed level, implement financial obligations, distribute after-tax profit, make stock clearance, and make additions to the budget of the Corporation.

Article 41.- The relations with the Ministry of Agriculture and Food Industry:

1. With its State management function, the Ministry of Agriculture and Food Industry is controlling the Corporation in:

a) The issuance of the norms for product quality, technology, including complete and incomplete equipment and components; and technico-economic norms of the branch. The Ministry shall exercise direct control and supervision over the Corporation in its implementation of these norms and standards;

b) The drafting and issuance of the plans and orientations for the development of the technico-economic branch. The Ministry shall exercise direct control and supervision over the Corporation in its implementation of these plans;

c) The Corporation is responsible for the implementation of the above-described provisions and has the right to make recommendations to the Ministry of Agriculture and Food Industry on the above-described contents.

2. With its State-assigned task of performing a number of State-ownership rights, the Ministry of Agriculture and Food Industry is controlling the Corporation in:

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b) Together with the agencies mandated by the Prime Minister, to prepare and submit to the Prime Minister for appointment, dismissal, reward and discipline of members of the Managing Board and the General Director;

c) To appoint, dismiss, reward and discipline Deputy General Directors and the Chief Accountant of the Corporation

d) To take part in the allocation of capital and other resources to the Corporation, to monitor the operation of the Corporation; the Corporation is responsible for reporting as required by the State and at the request of the Ministry of Agriculture and Food Industry;

e) To direct the Corporation in ensuring the food balances of the State and helping stabilize food prices;

f) The Corporation is also subject to the control and supervision of the Ministry of Agriculture and Food Industry in other areas of its jurisdiction as provided for by law.

Article 42.- The other Ministries, agencies at ministerial level and agencies attached to the Government, in their capacity as State-management bodies, shall have control over the Corporation in:

1. The implementation of the technico-economic norms, product specifications and quality standards in line with the branch and national standards;

2. The implementation of the norms on environmental protection;

3. The participation in the evaluation and appraisal of investment projects along the line of the branch's development strategy and plans and the regional economic planning;

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5. The exercise of the rights and obligations of the employees in the Corporation as required by the provision of law;

6. The Corporation is subject to the control, inspection and supervision of these offices in areas of their jurisdiction as provided for by law.

Article 43.- With regard to the local authority in its capacity as the State-management body on geographic areas, the Corporation is subject to its state management and shall comply with the local administrative regulations and discharge obligations towards the local People's Council and People's Committee as provided for by law.

Chapter X

REORGANIZATION, DISSOLUTION AND BANKRUPTCY

Article 44.- The reorganization of the Corporation shall be proposed by the Managing Board and considered and decided by the Prime Minister.

Article 45.- The Corporation shall be dissolved in case the Prime Minister sees that it is no longer necessary to maintain it. In making the decision to dissolve the Corporation, the Prime Minister shall set up the Dissolution Council. The property of the dissolved Corporation, after clearing all payments, shall belong to the State ownership.

Article 46.- The reorganization, splitting, merger, dissolution and re-establishment of the member units of the Corporation shall be proposed by the Managing Board for the Prime Minister to consider and decide.

Article 47.- The Corporation or its member units which no longer have the payment capability to settle their due debts shall be handled in accordance with the Law on Bankruptcy.

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IMPLEMENTATION PROVISIONS

Article 48.- This Statute shall be applied to the Vietnam Northern Food Corporation. All the individuals and member units of the Vietnam Northern Food Corporation have the responsibility to implement this Statute.

This Statute takes effect from the date of the signing of the promulgation Decree.

Article 49.-

1. Proceeding from the Law on State Enterprises and the Statute of the Corporation, the member units of the Corporation shall, depending on their mode of organization, design Statutes or Regulations of their own organizations and operations, which the General Director shall submit to the Managing Board for approval. The Statutes and Regulations of the member units of the Corporation shall not contradict the Statute of the Corporation.

2. In case a supplement or amendment is needed to the Statute of the Corporation, the Managing Board shall submit to the Prime Minister for decision. For the member units of the Corporation, a supplement or amendment to their Statutes or Regulations on organization and operation must be submitted by the General Director to the Managing Board for decision.

Article 50.- In case the documents of the Government, the Ministries, the Agencies at ministerial level, the Agencies attached to the Government, the People's Committees of the provinces and cities directly under the Central Government, or the decisions to establish member enterprises, contain provisions which are contrary to this Statute, this Statute shall apply given the permission of the Government.

APPENDIX

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I. LIST OF MEMBER UNITS OF THE NORTHERN FOOD CORPORATION (at the time of the establishment of the Corporation)

A. STATE-OWNED ENTERPRISES WITH INDEPENDENT ACCOUNTING

1. The Haiphong First-Level Food Company,(1)

2. The Song Hong Food Processing and Trading Company,(2)

3. The Food Packaging Materials Company,(3)

4. The Food Transportation Company,

5. The Food Construction Company,(4)

6. The Luong Yen First-Level Food Company,(5)

7. The Cao Bang Food Company,

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9. The Quang Ninh Food Company,

10. The Ha Giang Food Company,

11. The Lao Cai Food Company,

12. The Son La Food Company,

13. The Yen Bai Food Company,

14. The Tuyen Quang Food Company,

15. The Bac Thai Food Company,

16. The Vinh Phu Food Company,

17. The Ha Bac Food Company,

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19. The Ha Tay Food Company,

20. The Hai Hung Food Company,

21. The Nam Ha Food Company,

22. The Ninh Binh Food Company,

23. The Thanh Hoa Food Company,

24. The Nghe An Food Company,

25. The Ha Tinh Food Company,

26. The Quang Binh Food Company,

27. The Quang Tri Food Company,

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29. The Northern Food Financial Company

B. NON-BUSINESS UNITS:

1. The Food and Foodstuff Vocational School No.1

II. LIST OF JOINT VENTURE UNITS WITH CAPITAL CONTRIBUTION FROM THE VIETNAM NORTHERN FOOD CORPORATION

(at the time of establishment of the Corporation)

1. IC-TUNG SHING Joint Venture Company

Footnotes:

On the basis of merging the Yen My Food Processing Company and Ninh Giang Food Processing Company with the Haiphong First-Level Food Company.

(2) On the basis of merging the Nam Ha Food and Foodstuff Processing Company with the Song Hong Food Company.

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(4) On the basis of merging the Hanoi First-Level Food Company with the Construction Business Company.

(5) On the basis of merging the Hanoi Food Export-Import Company with the Luong Yen Food Processing Company.