Nd 52 8 7 1999 quy che qldtxd english

THE GOVERNMENT No 52/1999/ND-CP SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom – Happiness -Hanoi, July 8,1999 DECREE OF PROMULGATING THE REGULATION ON INVESTMENT AND CONSTRUCTION MANAGEMENT THE GOVERNMENT Pursuant to the Law on Organization of the Government ofSeptember 30, 1992; At the proposals of the Minister of Construction, ,Minister of Finance and Minister of Planning and Investment, DECREES: Article 1.- To promulgate together with this Decree the Regulation on Investment and Construction Management which shall replace the Regulation on Investment and Construction Management issued together with Decree No 42/CP of July 16, 1996 and Decree No 92/CP of August 23; 1997 of the Government Article 2.- This Decree takes effect 15 days after its signing Article 3.- The Minister of Construction shall assume the prime responsibility and coordinate with the Ministry of Planning and Investment, the Ministry of Finance, the State Bank of Vietnam and concerned ministries as well as branches in guiding and inspecting the implementation of the Regulation on Investment and Construction Management issued together with this Decree Article 4.-The ministers, the heads of the ministeriallevel agencies, the heads of the agencies attached to the Government; the presidents of the Peoples Committees of the provinces and centrally-run cities, the Managing Boards of the State corporations and concerned organizations shall have to implement this Decree On behalf offthe Goverment Prime Minister REGULATION ON INVESTMENT AND CONSTRUCTION MANAGEMENT (Issued together with Decree No 5211999/ND-CP of July 8, 1999 of the Government) Chapter I GENERAL PROVISIONS Article 1.- Purposes and requirements of the investment and construction management To encourage various economic sectors to invest in production and business in conformity with the strategy and planning for national socio-economic development in each period in order to restructure the economy along the direction of industrialization and modernization, to boost the economic growth rate and raise the material and spiritual life of the people To use the State-managed investment capital sources with optimal efficiency against corruption and waste To ensure that the construction is carried out according to the construction and architectural planning and satisfies the requirements of durability, beautiful looks and ecological environment protection: to create environment for healthy competition in construction; to apply advanced technologies, to ensure the construction quality and time-table with reasonable costs; to provide warranty for construction works Article 2.management Basic principles in the investment and construction To clearly define the State's management function and assign the responsibility for investment and construction management in conformity with each kind of investment capital source and investors To manage the investment and construction according to projects planning and law Investment projects financed by State-budget capital State-guaranteed credit capital, the State's development investment credit capital and the State enterprises' investment capital must be strictly managed according to the investment and construction order prescribed for each kind of capital With regard to investment and construction activities of people, the State shall only manage the planning; architecture and ecological enm ,,ironment To clearly define the responsibilities and powers of State management bodies, investors; consulting organizations and contractors in the investment and construction process Article 3.- Objects and scope governed by the Regulation on Investment and Construction Management The objects of investment and construction management shall include: a) Investment projects for construction; renovation, overhaul or upgrading of already invested and built projects: b) Investment projects for the procurement of assets including equipment and machinery not to be installed and new scientific and technological products; c) Projects using State-budget capital for the planned development of regions and territories, the planned development of branches as well as the planned urban and rural construction; d) Construction works using State-budget capital but without having to elaborate the investment projects; e) Investment and construction objects without using the State capital Scope of regulation: a) For investment projects of State bodies or State enterprises; which use the State-budget capital, the State-guaranteed credit capital, the development investment credit capital of the State and/or the investment capital of the State enterprises, the State shall manage the investment and construction through its decision on investment after such projects are appraised in term of branch development plans, urban and rural construction plans, construction norms and standards, the use of land and resources, the ecological environment protection (depending on requirements for each type of project), as well as in term of financial plans; prices and investment efficiency of the projects: b) For investment projects of enterprises, which use the State's development investment credit capital, the State's regulations on development investment credits shall apply For investment projects using investment credit capital not guaranteed by the State, the investors shall themselves be responsible for the investment efficiency; the capital-lending organizations shall have to scnitinize the projects and decide the capital loans for investment; c) For investment projects of enterprises, which use other sources of capital, the State shall manage through business registration and construction licensing (if investment projects involve construction) as prescribed in Article 13 of this Regulation: d) For project.; on planned development of regions, territories or branches as well as planned urban and rural construction, the State shall manage the use of budget capital for the execution of such projects and at the same time manage the mobilization of capital from other sources for elaboration and implementation of detailed planning projects: f) For investment projects of Vietnamese missions overseas: security and defense projects which require confidentiality; projects on purchase of copyrights, the elaboration of such investment projects shallcomply with this Regulation; the project appraisal, investment decision and project execution management shall comply with the Government's separate regulations; g) For investment projects of overseas Vietnamese who make investment in Vietnam and of foreigners permanently residing in Vietnam, which are executed under the legislation on domestic investment promotion, the management of the construction thereof shall comply with this Regulation Article 4.- Investment and construction order Investment and construction order shall comprise phrases: a) Investment preparation b) Investment execution; c) Completion of construction and putting projects into exploitation and use Work in the phrases of investment execution and construction completion with projects being put into exploitation and use may be carried out according to order successively or alternately, depending on the concrete conditions of each project, which shall be decided by persons competent to decide the investment For projects where capital must be recovered, the investors shall have to retrieve the capital and refund the investment capital Article 5.- Term interpretation In this Regulation, the following terms shall be construed as follows: "Investment project" means an assortment of proposals concerning the disbursement of capital to create, expand or renovate given material bases in order to achieve the quantitative growth or maintain, improve or raise the quality of products or services within a given period of time (including only direct investment activities) "Construction works" means the products of construction and installation technologies; closely attached to land (including air space, water surface, sea surface and continental shelf) and created by construction materials, equipment and labor Construction works comprises one or several installation in the synchronous and complete technological chains (even produced through cooperation) to turn out products mentioned in the projects "Constructions incident" means damage, collapse of construction structure, construction item(s) or the entire constructions, which reduce or arrest- “ the constructions “ bearing capacity, causing unsafety to surrounding works "Branch-managing ministry" means the ministry, the ministerial-level agency or the agency attached to the Government, which has the function of managing a branch throughout the country in accordance with the Law on Organization of the Government 5 "Persons competent to decide the investment" mean the representatives at law of organizations, State bodies or enterprises, depending on the investment capital sources prescribed in Articles 10, 11, 12 and 13 of this Regulation "Investor" means the person who owns capital or borrows capital or the person who is assigned the responsibility to directly manage and use capital to effect the investment according to the provisions of law "The total investment" means the total expenditure on investment and construction (including capital for initial production) and the project's maximum expenditure limit which is determined in the investment decision and can only be readjusted according to the provisions in Article 25 of this Regulation "The total cost estimate " means the total expenditure needed for the construction investment (expenses for investment preparation, expenses for investment execution including the procurement of equipment, and other expenses of the project), which is calculated in detail at the stage of construction technical design and must not exceed the approved total investment "The investment capital to be settled" means the total lawful expenditure made in the investment process in order to put the project into exploitation and use The lawful expenditure means the expenditure made in strict accordance with the signed contract and the approved estimate design as well as with the criteria, norms, unit prices, financialaccounting regime and current relevant stipulations of the State The investment capital shall be settled within the total investment limit already approved or readjusted (if any) 10 "Construction criteria" mean the technical criteria set for carrying out the survey, designing, construction and installation, test operation upon completion to ensure the construction quality, applicable to each specialized construction work, which are promulgated by the State or ministries with specialized construction function 11 "Construction norms" mean documents defining the minimum technical requirements which must be met by all construction activities as well as measures and construction criteria applied to satisfy such requirements, which are promulgated by theMinistry of Construction 12 "New urban area" means a concentrated area newly built according to an investment project for the development of complete and synchronous technical infrastructure and the housing development of the entire area, linked to an existing city or a new city being formulated with boundary and function being determined as compatible with the urban construction planning approved by the competent State body 13 "Urban technical infrastructure development project" means an investment project for the construction of technical infrastructures in service of the new urban area or for the modification and upgrading of the existing urban area 14 "New urban area development project " means an investment project for the construction of synchronous technical infrastructure and management of housing development for the entire new urban area according to the approved planning Article 6.- Classification of investment projects Depending on projects' nature and investment scale, domestic investment projects are classifred.into three groups: A, B and C for division of management responsibility The characteristics of each group is specified in the Appendix attached to this Regulation For the Group A project which comprises many constituent projects (or miniprojects) in which if each constituent project (mini-project) can operate independently, be exploited and executed according to investment phase inscribed in the written ratification of the pre-feasibility study report by the competent person, each constituent project (miniproject) shall be entitled to the execution of investment preparation stage (from the making of pre-feasibility study report) and the execution of investment according the order like an independent project, and the submission for approval and management shall comply with the regulations for Group A projects Important national projects mean the projects approved by the National Assembly which also decides the policy for investment in accordance with the provisions of Resolution No 05/1997/QH10 of December 12, 1997 of the National Assembly of the Socialist Republic of Vietnam Article 7.-The responsibility for investment and construction management The Ministry of Planning and Investment: a) To study and develop mechanisms and policies for investment as well as for the State management of domestic investment; foreign investment in Vietnam and overseas investment by Vietnamese', b) To identify orientation and structure forinvestment capital in order to ensure the balance between the domestic investment and foreign investment, then submit them to the Government for decision; c) To submit to the Government draft laws, ordinances and legal documents concerning the economic management mechanisms and policies, the promotion of domestic and foreign investment in order to achieve an economic structure suitable to the strategies, planning and plans for socio-economic stability and development; d) To issue investment licenses and guide foreigninvested enterprises to make the investment preparation in accordance with the Law on Foreign Investment in Vietnam and relevant provisions of this Regulation: e) To organize the appraisal of Group A investment projects and submit them to the Prime Minister for considering and deciding the investment or agreeing to let the Ministry issue the business registration certificates to Group A projects not funded by State capital: to monitor the process of investment in investment projects under the State plans; f) To synthesize and submit to the Prime Minister the annual and five-year plans on development investment To coordinate with the Ministry of Finance in inspecting and supervising the implementation of investment plans funded by State managed capital sources: g) To assume the prime responsibility and coordinate with the Ministry of Construction, the Ministry of Trade, the Ministry of Finance and other ministries, branches as well as localities in guiding and inspecting the implementation of the Bidding Regulation: h) To perform the State management over the elaboration, examination; consideration and approval and the implementation of projects on planned socioeconomic development The Ministry of Construction: a) To perform the function of State management over construction, to study mechanisms and policies on management of construction as well as urban and rural construction plans then submit them to the Prime Minister for promulgation or to be authorized by the Prime Minister to promulgate them; b) To promulgate construction criteria, standards, norms, designing process, regulations on construction works quality control, norm system, construction economic-technical indices, investment and construction consultancy expense norms: to agree to let the ministries having specialized construction promulgate their standards, norms, criteria and regulations for the control of the quality of specialized construction works; c) To assume the prime responsibility together with ministries in charge of specialized techniques for organizing the appraisal of the technical designs and total cost estimates of Group A investment and construction projects for ratification by the competent authorities To exercise the unified State management over the construction quality, to monitor, examine acid detect matters related to the quality of constriction works and propose handling measures, particularly the quality of Group A construction projects; d) To guide the activities of construction consultancy enterprises, construction enterprises and organizations managing the execution of investment and construction projects; e) To assume together with the Ministry of Planning and Investment, the Ministry of Finance, the State Bank of Vietnam and other ministries, branches and localities the prime responsibility for guiding and inspecting the observance of the Regulation on Investment and Construction Management The Ministry of Finance: a) To study policies and regimes for mobilization of investment capital from various sources and the management of investment capital in order to submit them to the Prime Minister for promulgation or to promulgate them according to its competence; b) To coordinate with the Ministry of Planning and Investment in planning the allocation of investment capital to ministries, localities and important State projects funded'by the State-budget capital: c) To exercise the unified management of loan capital and aids reserved for development investment by the Government: d) To provide the Government guaranty for foreign capital borrowings by enterprises (except for credit institutions) according to the Government's stipulations: e) To conduct financial inspection and examination of projects of organizations and units which use the State's investment capital sources: to guide and inspect the balance of accounts of investment capital for investment projects funded by the State capital and make the balance of accounts of investment capital for Group A projects funded by the State capital: f) To guide the allocation of State-budget capital for investment; non-business capital of investment and construction nature for projects and programs according to investment plans and under the Prime Minister's direction The State Bank of Vietnam: a) To study the mechanisms and policies for theState management of bank money and credits in investment and construction then submit them to the Prime Minister for promulgation or promulgate them according to its competence: b) To supervise the credit institutions and other financial or credit organizations in performing the following duties: - Mobilizing capital from various sources at home and abroad in order to provide long- , medium- and short-term loans for investment projects on production and business development - Providing loan capital for efficient production and business projects which are feasible and can repay debts: to coordinate with and create favorable conditions for enterprises to borrow capital for materialization of efficient investment opportunities: - To provide loan, payment, performance and bidding security as well as other forms of banking security as prescribed by law; c) To provide guaranty for foreign capital borrowings by credit institutions for investment and construction Other relevant ministries and branches: a) The ministries, the ministerial-level agencies and the agencies attached to the Government shall perform the State management function according to their respective functions, tasks and powers The ministries having the function of managing the specialized construction projects shall promulgate construction-related regulations standards and economic-technical norms after getting the consent of the Ministry of Construction: b) The branch-managing ministries and bodies relating to land, natural resources, biology, technologies, environment, trade, the maintenance and conservation of historical relics, cultural heritages, picturesque landscapes, national defense, security, fire prevention and fight shall have to consider and give written comments on matters related to investment projects within the prescribed time limits Past such time limits, if no replies are received from the relevant branch-managing ministries, such ministries, branches and agencies are considered to have agreed with the written proposals The provincial-level People's Committees (of the provinces and centrally-run cities): The provincial-level People's Committees shall, within their functions and powers, perform their responsibility of State management over all organizations and individuals executing investment projects in their respective localities as prescribed by law Article 8.- Management of planning projectsl 1.The Ministry of Planning and Investment shall be the body managing projects on regional and interprovincial socio-economic development overall planning throughout the country The Ministry of Construction shall exercise the State management over the urban and rural construction planning as well as key area construction planning The provincial-level People's Committees shall manage projects on socioeconomic development overall'planning and the urban and rural construction planning under the local management as assigned by the Government The ministries and centrally-run branches shall manage projects on branch development overall planning as prescribed by the Government Projects on socio-economic development overall planning, specialized branch development planning as well as urban and rural construction planning, when studied for construction, must be widely commented by concerned ministries, branches and localities The urban and rural construction planning, when studied for project elaboration, must be publicized for comments by people and the People's Councils in areas under the planning The construction planning projects (both the overall planning and the detailed planning) already approved by competent levels must be made public regularly at the offices of local administration at all levels and public places in the planning area for implementation and inspection of the implementation thereof by the people Article 9.- Management of capital for planning projects Capital for elaboration of planning projects shall include the capital for investigation, surveys, studies and elaboration of planning projects Capital for elaboration of projects on regional and territorial socio-economic development overall planning; branch development planning, urban and rural 10 construction overall planning, the detailed planning on central cities and on land use may be taken from the State budget and included into the State's annual investment plans Capital for elaboration of projects on detailed planning for the construction of functional urban and rural areas, detailed planning for industrial zones and the construction of new urban areas, detailed planning for specialized branches (tourism, physical training and sports, services, ) may be taken from capital mobilized from investment projects and accounted into the costs of execution of investment projects The Ministry of Planning and Investment andfi ; Ministry of Finance shall have to manage and allocate annual capital for the work of investigation, survevand elaboration of overall planning for regional and territorial socio-economic development, branch development planning as well as urban and rural construction planning, and to guide ministries and localities in organizing the implementation thereof The plans on annual capital for the elaboration of regional construction planning, urban and rural construction plamung shall be elaborated by localities, the Ministry of Planning and Investment shall consult the Ministry of Finance and the Ministry of Construction so as to submit them to the Prime Minister for ratification The management of the use of this capital source shall comply with the division of responsibilities as prescribed by the legislation on the State budget Article 10.- Management of projects funded by State-budget capital The projects funded by State-budget capital shall include: a) Projects on socio-economic, defense or security infrastructures, incapable of recovering capital and the use of their capital is managed according to the division of responsibility for State budget expenditure on development investment: b) Support for enterprises' projects on investment in fields that require the State's participation as prescribed by law; c) Expenses for the work of investigation, surveys and elaboration of projects for regional and territorial socio-economic development overall planning, urban and rural construction planning permitted by the Prime Minister; d) The Government's loans for development investment: e) Basic depreciation capital and other State revenues left for State enterprises to make investment The competence to decide the investment in projects funded by State-budget capital: a) The Prime Minister shall decide or authorize others to decide the investment in Group A projects: