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THE PRIME MINISTER OF
GOVERNMENT
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SOCIALIST REPUBLIC OF
VIET NAM
Independence - Freedom – Happiness
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No. 219/1998/QD-TTg
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Hanoi, November 12,
1998
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DECISION
PROMULGATING THE REGULATION ON LAO BAO AREA OF QUANG TRI
PROVINCE, WHERE ECONOMIC AND TRADE DEVELOPMENT IS ENCOURAGED
THE PRIME MINISTER
Pursuant to the Law on Organization of the
Government of September 30, 1992;
Pursuant to the Agreement on Economic, Cultural, Scientific and Technical
Cooperation between the Socialist Republic of Vietnam and the Lao People’s
Democratic Republic for the 1996-2000 period as well as for 1996 and 1997;
At the proposals of the Minister of Trade and the President of the People’s
Committee of Quang Tri province
DECIDES:
Article 1.- To issue
together with this Decision the Regulation on Lao Bao area of Quang Tri
province, where economic and trade development is encouraged (hereafter
referred to as Lao Bao trade area).
Article 2.- The Lao Bao
trade area shall encompass Lao Bao and Khe Sanh district towns and the communes
of Tan Thanh, Tan Long, Tan Lien, Tan Lap and Tan Hop of Huong Hoa district,
Quang Tri province.
Article 3.- The
ministers of Trade, Defense, Planning and Investment, Finance, Construction,
and Public Security; the General Directors of Customs, Tourism and Land
Administration; as well as the heads of the concerned ministerial-level
agencies and agencies attached to the Government shall coordinate with the
President of the People’s Committee of Quang Tri province in detailing the
implementation of the Regulation issued together with this Decision.
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THE PRIME MINISTER OF
GOVERNMENT
Phan Van Khai
REGULATION
ON LAO BAO TRADE AREA
(Issued together with Decision No. 219/1998/QD-TTg of November 12, 1998 of
the Prime Minister)
Chapter I
GENERAL PROVISIONS
Article 1.-
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Lao Bao trade area shall encompass Lao Bao and
Khe Sanh district towns and the communes of Tan Thanh, Tan Long, Tan Lap, Tan
Lien and Tan Hop of Huong Hoa district, Quang Tri province.
Article 2.- The
Socialist Republic of Vietnam Government encourages Vietnamese and foreign
organizations and individuals to operate in Lao Bao trade area on the basis of
respect for Vietnam’s
independence and sovereignty, equality, mutual benefit and observance of
Vietnamese law as well as international agreements which the Socialist Republic
of Vietnam has signed or acceded to.
Article 3.- Vietnamese
and foreign organizations and individuals shall operate in Lao Bao trade area
in the following forms: trade activities; showrooms, exhibition-cum-fairs;
representative offices and branches of foreign and domestic companies; border
markets; bonded warehouses; import and export, cross-border transportation,
temporary import for re-export, goods transit; sorting of goods for packaging,
processing, recycling, assembly; production of export goods and related
services such as goods transportation, preservation and warehouses; tourism,
hotels, restaurants; post and telecommunications; banking; insurance.
Article 4.- Vietnamese
enterprises of different economic sectors, foreign-invested enterprises in
Vietnam and foreign enterprises in Lao Bao trade area (hereafter referred to as
enterprises of Lao Bao trade area) shall operate under this Regulation, other
provisions of Vietnamese law as well as international agreements which Vietnam
has signed or acceded to.
Article 5.- In addition
to their entitlements prescribed by Vietnamese law and international agreements
which Vietnam has signed or acceded to, enterprises of Lao Bao trade area shall
also be entitled to:
1. Use infrastructure works and services in Lao
Bao trade area in accordance with the regulations of the Management Board of
Lao Bao trade area;
2. Enjoy preferences provided for in Chapter IV
of this Regulation;
3. Transfer the land use right and architectural
constructions according to the right land-use purposes of the approved
projects. In cases where there is a change in a project’s initial investment
purpose, the transfer of the land use right and/or constructions shall be
effected only after it is approved by the competent agency(ies).
Article 6.- Enterprises
of Lao Bao trade area shall have the following obligations:
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2. To fulfill their financial obligations as
prescribed by Vietnamese law;
3. To comply with the regulations on border
security and order; ensure labor safety and industrial sanitation; ecological
and environmental protection and other regulations of the Management Board of
Lao Bao trade area;
4. To follow the periodical and annual reporting
regime in accordance with the provisions of law;
Article 7.- The border
people residing in Huong Hoa district, Quang Tri province, (Vietnam) as well as
in the opposite district of Savanakhet (Laos), and enterprises of Lao Bao trade
area shall be entitled to register business and exchange goods at border
markets in Lao Bao trade area according to the Regulation on organization and
management of Vietnam-Lao border markets.
Chapter II
EXPORT AND IMPORT OF
GOODS AND SERVICES
Article 8.- Goods,
equipment, transport means, supplies (referred collectively to as goods),
luggage and foreign exchanges brought from foreign countries into Lao Bao trade
area and vice versa shall all be subject to the inspection and supervision by
the Customs in accordance with the current provisions of Vietnamese law.
Raw materials, materials and goods, which have
been purchased by enterprises of Lao Bao trade area from foreign markets but
have not been fully used, and such enterprises’ substandard products and
discarded materials still of commercial value, may be sold on domestic markets
if all prescribed customs procedures are cleared.
The General Department of Customs shall
authorize and guide the People’s Committee of Quang Tri province to implement
the customs regulations and create favorable conditions for enterprises of Lao
Bao trade area to conduct the above-said activities.
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Article 10.- Goods
which are processed, temporarily imported for re-export, transported across
borders or transited through Lao Bao trade area shall be subject to current
regulations on goods processing, temporary import for re-export, cross-border
transportation and transit.
Goods transported across borders or transited
through Lao Bao trade area in Vietnam for further transportation to a third
country shall have to comply with Vietnamese law.
The transportation of goods between Lao Bao
trade area and the Delsavan trade area of Laos shall comply with the relevant
agreements concluded between the Vietnamese Government and the Lao Government as
well as the current regulations of each country.
Article 11.- Goods
which are brought into Lao Bao trade area and subject to separate management
under the current regulations shall include:
- Gifts;
- Movable assets;
- Goods and appliances of diplomatic missions
and international organizations working in Vietnam as well as goods and luggage
of people entitled to diplomatic immunity.
Article 12.- Goods of
the following categories shall be banned from circulation in Lao Bao trade
area:
- Goods which are banned from circulation in
Vietnam;
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The import and/or export through Lao Bao trade
area, of goods which are banned from import and/or export by Vietnam but not by
Laos and other countries, must be permitted by the Prime Minister.
Article 13.- The
Ministry of Trade shall authorize and guide the People’s
Committee of Quang Tri province to issue permits for the establishment of
representative offices and branches of foreign companies which operate in the
field of trade, as well as permits for the organization of commodity
exhibition-cum-fairs for domestic and foreign organizations in Lao Bao trade
area.
Chapter III
ENTRY, EXIT, RESIDENCE,
TRAVELING AND COMMUNICATION
Article 14.- Nationals
of the Lao People’s Democratic Republic (hereafter referred to as Lao
nationals) residing in provinces that share the borders with Quang Tri province
shall be allowed to travel in and out of Lao Bao trade area with their identity
cards or border laissez-passers, issued by the Lao competent agency(IES). Their
stay duration in Lao Bao trade area shall not exceed 7 days. If they wish to
travel to other places in Quang Tri province at the invitation of Vietnamese
organizations and/or individuals in the province, the inviting organizations
and/or individuals shall have to send a written request to the Quang Tri
province’s Police Department for
the issue of travel permits. A travel permit is only valid for one travel and
not more than 5 days and shall not be extended.
Lao nationals residing in other provinces as
well as foreigners who enter Lao Bao trade area for market study and
preparation for investment and/or business activities shall be exempt from
entry and exit visas. Their stay duration in Lao Bao trade area shall not exceed
15 days. If they wish to visit other places of Quang Tri province or other
provinces and/or cities of Vietnam, the Entry-Exit Management Agency (the
Vietnamese Ministry of Public Security) shall grant them visas for multiple
entries and exits for no more than 3 months at Lao Bao border-gate.
Article 15.- Foreigners
and overseas Vietnamese operating in Lao Bao trade area shall be allowed to
regularly travel in and out of Lao Bao trade area with travel permits valid for
multiple travels, issued by the Police Department of Quang Tri province, which
correspond to their operation duration in Lao Bao trade area. The Ministry of
Public Security shall authorize and guide the Police of Quang Tri province in
the performance of the above-mentioned task.
Article 16.- Vietnamese
citizens shall be entitled to freely travel in and out of Lao Bao trade area
through the defined gates. If they want to go abroad through Lao Bao trade
area, they must strictly comply with the regulations on entry and exit.
Article 17.- Vietnamese
citizens and foreigners working in Lao Bao trade area shall be allowed to
reside therein. The residence and temporary stay in Lao Bao trade area shall
comply with the regulations of the Management Board of Lao Bao trade area.
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Chapter IV
PREFERENTIAL POLICIES
Article 19.- In
addition to preferences provided for by the Law on Foreign Investment in
Vietnam (for foreign-invested enterprises and foreign enterprises), the Law on
the Domestic Investment Promotion (for Vietnamese enterprises of all economic
sectors), by other legal documents for investment projects in mountainous,
deep-lying and far-flung areas as well as by international agreements which
Vietnam has signed or acceded to, enterprises of Lao Bao trade area shall also
be entitled to preferences prescribed in this Chapter.
Article 20.- Trade and
service activities in Lao Bao trade area shall be eligible for preferences
under the policies for economic development in mountainous, island, deep-lying,
far-flung areas and areas of ethnic minorities in accordance with the current
stipulations of the Government.
Article 21.- Enterprises
of Lao Bao trade area shall enjoy enterprise income tax exemption for the first
four years after their taxable incomes are generated and the 50% reduction of
the payable tax amounts for four subsequent years at most.
Article 22.- Enterprises
of Lao Bao trade area which use their gained profits for re-investment in Lao
Bao trade area for three years or more shall be refunded with their income tax
amounts already paid on the profits used for re-investment.
Article 23.- Enterprises
of Lao Bao trade area, which, after final tax settlement with the tax agency,
suffer from losses, shall be allowed to transfer such losses to the subsequent
year and the loss amounts shall be deducted from their taxable incomes. The
loss-transfer duration shall not exceed 5 years.
Article 24.- Goods and
services used for production, processing and re-processing in Lao Bao trade
area for export or consumption in Lao Bao trade area shall be exempt from value
added tax.
Article 25.- All goods
and service relations between Lao Bao trade area and the rest of the country
shall be the import-export relations.
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2. Goods of Vietnamese origin brought into Lao
Bao trade area and goods produced, processed, re-processed and assembled in Lao
Bao trade area, when being exported, shall be exempt from export tax.
Article 26.- Goods
imported from foreign countries for participation in commodity exhibitions,
fairs and shows for sale in Lao Bao trade area shall be exempt from import tax
but still subject to special consumption tax and value-added tax in accordance
with the current regulations.
Article 27.-
1. Goods produced, processed,
re-processed and assembled in Lao Bao trade area, when being imported into
Vietnamese market, shall enjoy the 10% reduction of the current import tax rate
set for each goods category. In cases where the processed or re-processed goods
have their intra-area contents of 20% or more, when being imported into the
Vietnamese market, shall enjoy import tax reduction corresponding to the
percentage of intra-area contents of those goods.
2. Goods of Lao origin which are imported from
Lao Bao trade area into Vietnam shall enjoy import tax reduction under Decision
No.181/1998/QD-TTg of September 21, 1998 of the Government.
Article 28.-
Enterprises of Lao Bao trade area shall be exempt from land rents for the first
five years from the date they sign the land-lease contracts and shall, from the
sixth year on, enjoy the land rent rate equivalent to 30% of the rate
applicable to the mountainous districts of Quang Tri province.
Article 29.- Organizations
and/or individuals that make contributions to the mobilization of
non-refundable investment capital (capital outside the State budget) for
investment in economic and social projects in Lao Bao trade area shall be
entitled to a certain sum of money as reward at the levels prescribed by the
Ministry of Finance.
Article 30.- In
the period from 1999 to 2005, the State shall annually make separate investment
in Lao Bao trade area through the provincial budget, which shall not be lower
than 50% of the total annual budget revenue collected in Lao Bao trade area.
The investment capital levels and lists of infrastructure construction projects
entitled to separate investment shall be proposed by the People’s Committee of Quang Tri province and
decided by the Ministry of Planning and Investment after consulting the
Ministry of Finance.
Chapter V
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Article 31.- Enterprises
of Lao Bao trade area shall observe the financial-accounting regime in
accordance with the current regulations of Vietnamese law applicable to each
type of enterprises.
Article 32.- The
purchase, sale, payment and other commercial transaction relations among
enterprises of Lao Bao trade area shall be effected in Vietnam dong, Lao kip
and other convertible foreign currencies prescribed by the State Bank of
Vietnam.
The purchase and sale of goods in service of the
daily life of individuals working in Lao Bao trade area shall be effected in
Vietnam dong.
Article 33.- Enterprises
of Lao Bao trade area shall, when exporting goods and services with foreign
currency revenues, have to comply with Vietnam’s
current regulations on the management of foreign exchange.
Article 34.- The
carrying of foreign currencies from foreign countries into Lao Bao trade area
and vice versa must comply with Vietnam’s
regulations on the management of foreign exchange.
Chapter VI
ORGANIZATION OF
MANAGEMENT OF LAO BAO TRADE AREA
Article 35.- The People’s Committee of Quang Tri province shall
set up a Management Board of Lao Bao trade area so as to exercise the
centralized and uniform management of operations of Lao Bao trade area.
The Ministry of Trade, the Ministry of Defense,
the Ministry of Public Security, the Ministry of Construction, the Ministry of
Finance and the Ministry of Planning and Investment; the General Department of
Customs, the General Department of Tourism, the General Land Administration and
the concerned agencies shall coordinate with the People’s
Committee of Quang Tri province in organizing the effective management of
operations of the Management Board of Lao Bao trade area.
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1. To ratify the overall development planning,
plans and regulation on operations of Lao Bao trade area, lists of development
investment projects and detailed plans to be carried out in Lao Bao trade area;
direct the elaboration of the plan for the construction of Lao Bao trade area
and submit it to the competent levels for approval, and exercise the management
of the projects in strict compliance with the approved plan; decide the ratification
of Group B- and C- construction investment projects, based on the agreement
reached with the Ministry of Planning and Investment;
2. To set up the Lao Bao trade area’s
infrastructure construction and development company which shall be a State
enterprise;
3. To coordinate with the ministries and
branches stipulated in Article 35 of this Regulation in organizing the
management of Lao Bao trade area;
4. To direct and create conditions for the
Management Board of Lao Bao trade area in fully performing their assigned tasks
as defined in this Regulation;
5. To direct the Management Board of Lao Bao
trade area in receiving and evaluating dossiers of direct investment in Lao Bao
trade area by business organizations and individuals and issuing licenses
thereto, as authorized by the Ministry of Planning and Investment or the
Ministry of Trade;
6. To direct the People’s
Committee of Huong Hoa district and other provincial functional agencies in
coordination with the Management Board of Lao Bao trade area to take measures
for ensuring social security, order and safety, thus creating favorable
conditions for the operations of enterprises of Lao Bao trade area;
7. To reach agreement with the authorities of
the Lao province of Savanakhet on the principles for coordination,
administration and management of operations of Lao Bao trade area and Delsavan
trade area on the basis of the Government�s Regulation, and in
conformity with the special friendship between the peoples of the two countries
as well as their current respective legislation.
Article 37.- The
Management Board of Lao Bao trade area shall have the following tasks and
powers:
1. To elaborate the development planning, plans
and the regulation on operation of Lao Bao trade area and submit them to the People’s
Committee of Quang Tri province for ratification, popularize such planning,
plans, projects and regulation, and organize and inspect the implementation
thereof;
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3. To grant, withdraw business licenses and
investment licenses as authorized respectively by the Ministry of Trade and the
Ministry of Planning and Investment, after consulting the People�s
Committee of Quang Tri province; to monitor and inspect the compliance with the
granted licenses;
4. To set levels of prices and charges to be
effected in Lao Bao trade area and submit them to the competent State
agency(ies) for consideration and promulgation;
5. To grant business registration certificates,
certificates of goods’ origin in Lao Bao trade area and other certificates when
mandated by the competent State agency(ies);
6. To act as the main body in settling problems
arising in the course of formulation and execution of investment and business
projects and take part in operations of Lao Bao trade area;
7. To coordinate with agencies prescribed in
Article 35 of this Regulation and the local administration in ensuring that all
activities in Lao Bao trade area conform to this Regulation and the operation
charter of Lao Bao trade area.
8. To manage the construction projects financed
by the sources of investment capital budget in Lao Bao trade area.
9. To coordinate with the Management Board of
Delsavan trade area of Laos in ensuring that operations of the two trade areas
comply with the agreements concluded between the Government of the Socialist
Republic of Vietnam and the Government of the Lao People’s
Democratic Republic as well as the agreements made between Quang Tri province
and Savanakhet province.
Article 38.- The
Management Board of Lao Bao trade area shall have its legal person status, its
own seal, bank accounts, full-time personnel and fund for operation to be
allocated by the State budget.
All budget revenues in Lao Bao trade area must
be remitted into the State budget.
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1. Handling of civil and
commercial disputes in Lao Bao trade area:
The Management Board of Lao Bao trade area shall
have the responsibility to conciliate disputes arising in the process of
operation of enterprises of Lao Bao trade area as well as disputes between
enterprises of Lao Bao trade area and organizations and/or individuals outside
the area;
In case of unsuccessful conciliation, the
disputes shall be settled in accordance with the provisions of Vietnamese law.
2. Criminal cases occurring in Lao Bao trade
area shall fall within the jurisdiction of courts as prescribed by Vietnamese
law.
Chapter VII
IMPLEMENTATION PROVISIONS
Article 40.- Operations
of enterprises of Lao Bao trade area other than those prescribed in this
Regulation shall comply with the corresponding provisions of the Commercial
Law, the Law on Foreign Investment in Vietnam, the Law on Domestic Investment
Promotion, the Law on State Enterprises, the Law on Private Enterprises, the
Law on Companies, the Law on the State Bank, the Land Law, and other legal
documents of the State of Vietnam as well as international agreements which
Vietnam has signed or acceded to.
Article 41.- Preferences
for enterprises of Lao Bao trade area provided for in this Regulation shall, as
allowed by the Vietnamese Government, be applicable to enterprises which have
been licensed for operation before the date of promulgation of this Regulation.
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THE PRIME MINISTER OF
GOVERNMENT
Phan Van Khai