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THE
MINISTRY OF FINANCE
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom - Happiness
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No:
85/2002/TT-BTC
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Hanoi,
September 26, 2002
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CIRCULAR
GUIDING THE IMPLEMENTATION OF THE GOVERNMENT’S DECREE No.
69/2002/ND-CP OF JULY 12, 2002 ON MANAGEMENT AND HANDLING OF OUTSTANDING DEBTS
FOR STATE ENTERPRISES
In furtherance of the Government’s Decree No. 69/2002/ND-CP
of July 12, 2002 on management and handling of outstanding debts for State
enterprises (hereinafter called Decree No.69/2002/ND-CP for short), the Finance
Ministry hereby guides a number of concrete points as follows:
A. GENERAL PROVISIONS
1. Objects of application:
1.1. Independent State enterprises and
independent-cost accounting member State enterprises of State corporations,
which are being engaged in business activities or public-utility activities
(hereinafter referred collectively to as operating enterprises).
The State-run commercial banks shall be subject
to specific regulations.
1.2. The State enterprises subject to
equitization, assignment, sale, business contracting, lease or conversion into
one-member limited liability companies under decisions of competent State
bodies, which are carrying out procedures for transformation (hereinafter
referred collectively to as transformed enterprises).
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2.1. For operating enterprises: The handling
scope shall cover the receivable debts and payable debts, which had turned
overdue by the end of December 31, 2000, which the enterprises have compared,
confirmed and urged for payment, but have not yet been repaid for and remain
outstanding till now.
2.2. For the transformed enterprises: The
handling scope shall cover the receivable debts and payable debts, for which
the payment time limits have expired and the enterprises have compared,
confirmed and urged for payment but by the time of transformation they have not
yet been repaid.
B. SPECIFIC PROVISIONS
I. HANDLING RECEIVABLE DEBTS
WHICH ARE IRRECOVERABLE:
1. Bases for determining receivable debts which
are irrecoverable:
The bases for determining receivable debts which
are irrecoverable as provided for in Clause 1, Article 5 of the Government’s
Decree No.69/2002/ND-CP shall include the following documents:
1.1. Documents testifying to the outstanding
debt amounts by the end of December 31, 2000 (for operating State enterprises)
and by the time of debt handling or by the time of transformation (for
transformed enterprises), which have not yet been recovered, including debt
comparison records certified by creditors and debtors or the written
liquidation of economic contracts or written certification by the agencies
which have decided on the establishment of the enterprises or organizations, or
other objective documents proving the outstanding debt amounts and relevant
papers and documents.
1.2. The accounting books, vouchers, documents
proving the irrecoverable debts provided that, by the time of debt handling,
the enterprises are accounting receivable debts on their accounting books.
1.3. Documents proving that the overdue or undue
receivable debts fall under one of the following cases, which are considered
irrecoverable:
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- The dissolution decisions or notifications of
the agencies which have decided on the establishment of such enterprises or
organizations or the courts decisions on enterprise bankruptcy (the copies
signed and stamped by the enterprises- hereinafter called the copies for
short). In case of self-dissolution, there must be the notification of the
enterprises or the certification by the agencies which have decided the
establishment of such enterprises or organizations;
- For operating enterprises, there must also be
the documents proving that the debtors are enterprises or organizations, which
have completed the dissolution or bankruptcy but have not yet paid up debts for
the enterprises: the certification by the agencies which have decided on the
establishment of enterprises or organizations or the courts which have
processed the dossiers on enterprise bankruptcy.
1.3.2. For debtors that have ceased their
operation and become insolvent: The certification by the agencies which have
decided on the establishment of the enterprises or organizations of the
cessation of operation or insolvency of such enterprises or organizations.
1.3.3. For debtors being individuals who have
died, missed or are serving imprisonment sentences, or heirs at law, but are
unable to repay their debts under the courts’ rulings:
- For debtors being individuals who have died:
The death certificates (copies) or death certification by the local
administration;
- For debtors being individuals who have been
missing: The missing declarations (copies) by the courts or certifications by
the local administration;
- For debtors being individuals who have fled
from their localities: The hunt warrants (copies) of the police offices or
certification by the commune or ward police;
- For debtors being individuals who are serving
imprisonment sentences: The imprisonment judgments (copies) of the courts; the
verdicts (copies)of the courts or the local administration’s certification of
insolvency of the debtors or heirs.
1.3.4. For debtors being the agricultural
cooperatives which have already been dissolved, the agricultural cooperatives
which have been transformed and have registered their business under Decree
No.16/CP of February 12, 1997 of the Government, but have met with financial
difficulties, suffered from business losses and become insolvent, and the
agricultural cooperatives which are doing business with profits and have used
such debt amounts for investment in infrastructure which however, has been
damaged by natural disasters such as floods and/or storms, they shall have
their debts forgiven by the State. The evidencing documents shall be the
dossiers on debt handling under the guidance in Circular No.31/2002/TT-BTC of March
29, 2002 or the Finance Ministry of the decisions (copies) of the agencies
competent to write off the debts for cooperatives.
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1.3.6. For the remaining difference of
irrecoverable debts after individuals and/or collectives were already handled
for their responsibilities with the material compensations: The debt-handling
decisions of the Managing Boards or the debt-handling records of the enterprise
debt- handling councils or the decisions of the enterprise directors to handle
individuals and/or collectives for their responsibilities with material
compensations (copies).
1.3.7. The damage differences resulting from the
sale of receivable debts, which are accepted by competent bodies: The debt
dossiers and the debt-sale and purchase contracts (copies).
1.3.8. Debts to be recovered, for which the
debt-claiming expenses are estimated to be larger than the values of the to
be-recovered debts: Documents urging debt repayment, debt-claiming expense
estimates of the enterprises, the debt-handling records of the enterprise
debt-handling council (copies).
1.3.9. For to be- recovered debts which have
turned overdue for 3 years or more as from the due dates, and the debtors still
exist, are operating but suffer from repeated business losses and meet with
exceptional difficulties, being unable to repay their debts and though the
enterprises have actively applied various measures, the debts cannot be
recovered: The documents proving that the debts remain outstanding by the time
of debt handling, which have become overdue for three years or more and have
not yet been recovered; the debt-claiming documents of the enterprises; the
debtors financial statements which have been audited (if so) or the
certifications by the agencies which have decided on the establishment of the
enterprises of the financial situation of the enterprises.
2. Financial handling of receivable debts which
cannot be recovered
2.1. For operating State enterprises, the
receivable debts, which have been overdue or not yet overdue but are determined
with enough grounds as being irrecoverable under the provisions in Clause 1,
Section I above, shall be handled with various sources in the following order:
2.1.1. Using receivable bad debt reserve sources
for offsetting.
2.1.2. If the receivable bad debt reserve
sources are not enough for the offsetting, the enterprises are entitled to
account the deficits into their business operation expenses.
2.1.3. Where the deficits are accounted into
business operation expenses for two consecutive years but the enterprises still
suffer from losses which cannot be made up for while they do not belong to
cases of dissolution or bankruptcy, such enterprises shall compile dossiers of
report to the competent agencies for considering and deciding on the reduction
of the State capital at the enterprises according to the following regulations:
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- The enterprise’s written request for capital
reduction, explaining in detail the handling of receivable debts which cannot
be recovered according to Items 2.1.1 and 2.1.2 of Point 2.1 of this Clause,
the enterprise’s difficulties in being unable to offset the losses due to the
handling of the above-mentioned debts.
- The dossiers and documents proving each
receivable debt amount which cannot be recovered according to regulations in
Clause 1, Section I, Part B of this Circular.
- The financial reports, the record on
examination of the financial reports and the record on tax settlement (if any)
of the enterprise of the year of requesting the handling and the preceding year
(copies).
- The documents of the branch-managing ministry,
the concerned provincial/municipal People’s Committee, or the corporation
(hereinafter called the superior managing agencies for short) requesting
capital reduction for the enterprises.
b) Agencies which appraise and decide on capital
reduction for enterprises:
- For independent-cost accounting enterprises
being members of State corporations and independent-cost accounting enterprises
of ministries, ministerial-level agencies or agencies attached to the
Government or enterprises set up under the Prime Minister’s decisions
(hereinafter called centrally-run enterprises for short), the dossiers and
documents shall be addressed to the Enterprise Finance Department for
appraisal, before they are submitted to the Finance Minister for decision.
- For independent-cost accounting enterprises
being members of State corporations and independent-cost accounting enterprises
set up under decisions of the People’s Committees of the provinces or centrally-run
cities (hereinafter called local enterprises for short), the dossiers and
documents shall be sent to the provincial/municipal Finance-Pricing Services
for appraisal before they are submitted to the provincial/municipal People’s
Committees for decision.
2.1.4. In cases where enterprises suffer from
losses due to the handling of receivable debts which cannot be recovered
according the provisions in Items 2.1.1, 2.1.2 and 2.1.3 of Point 2.1 above but
such enterprises do not belong to cases of dissolution or bankruptcy and should
be retained, with 100% State capital under the overall plan on enterprise
rearrangement, renovation and development in the 2002-2005 period, already
approved by the Prime Minister and have efficient business plans already approved
by competent authorities, they shall send their reports enclosed with dossiers
and documents to the Enterprise Finance Department for consideration before
they are submitted to the Finance Minister for decision on capital support for
enterprises from the source of expenditures for reform of State enterprises
under the Prime Minister�s
Decision No.92/QD-TTg of January 29, 2002 for handling all the losses to ensure
the initial capital of the enterprises.
The procedural dossiers include:
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- The dossiers and documents proving each
receivable debt amount which cannot be recovered according to the provisions in
Clause 1, Section I, Part B of this Circular.
- The financial reports, records on examination
of the financial reports and records on tax settlement (if any) of the
enterprise of the year of requesting for the handling and the preceding year
(copies).
- The competent agency’s decision on reduction
of State capital at the enterprise.
- The efficient business plan approved by the
competent authority.
- The superior managing agency’s written request
for handling of the remaining losses and capital support for the enterprise.
2.2. For State enterprises being under
transformation, the receivable debts which cannot be recovered shall be handled
with various sources in the following order:
2.2.1. Using the receivable bad debt reserve
sources for offsetting;
2.2.2. If the receivable bad debt reserve
sources are not enough for offsetting, the enterprises are entitled to account
the total deficit amount (one-time handling) into their business operation
expenses before their transformation.
2.2.3. Where the enterprises suffer from losses
after the handling of receivable debts which cannot be recovered according to
provisions in Item 2.2.2 of Point 2.2 above, or the enterprises suffer from
losses even before the debt handling, their cases shall be handled as follows:
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b) For State enterprises subject to business contracting,
lease, or transformation into one-member limited liability companies, the
dossiers of report shall be compiled and submitted to the competent agencies
for considering and deciding on reduction of State capital at enterprises.
- Such a dossier includes:
+ The enterprise’s written request for capital
reduction with clear explanation of the reasons therefor and the capital level
asked for reduction.
+ The dossiers and documents proving each
receivable debt which cannot be recovered as provided for in Clause 1, Section
I, Part B of this Circular.
+ The financial reports, records on examination
of the financial reports and the records on tax settlement (if any) of the
enterprise of the year of requesting the handling and the preceding year
(copies).
+ The superior managing agency’s request for
capital reduction for the enterprise.
- Agencies appraising and deciding on capital
reduction for enterprises:
+ For centrally-run enterprises: Sending the
dossiers and documents to the Enterprise Finance Department for appraisal
before they are submitted to the Finance Minister for deciding on the reduction
of State capital at the enterprises.
+ For local enterprises: Sending their dossiers
and documents to the provincial/municipal Finance-Pricing Services for appraisal
before they are submitted to the provincial/municipal People’s Committees for
deciding on the reduction of State capital at the enterprises.
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- Organizations with function of buying and
selling outstanding debts and assets shall receive debts and make payment to
the enterprises at designated prices (decided by the Finance Minister) and
continue seeking ways to recover them. The difference between the debt value
and the actually recovered amount of the organizations with function of buying
and selling outstanding debts and assets shall be subsidized by the Finance
Ministry from the source of enterprise reform fundings.
Such a dossier includes:
- The enterprise’s written request for handling,
clearly stating the reasons therefor, the capital level requested for
reduction, the receivable debts proposed for sale at designated prices (with
proposal on the designated price level) to organizations with function of
buying and selling outstanding debts and assets, the accumulated loss amounts,
irrecoverable debts, the State capital amounts at the enterprise when not yet
handled, the capital amounts for implementation of the preference policy when
selling shares to laborers in the enterprise, the State capital amount needed
to meet the percentage of State capital in the joint-stock company.
- The dossiers and documents proving each
receivable debt which cannot be recovered as provided for in Clause 1, Section
I, Part B of this Circular.
- The financial reports, the records on
examination of the financial reports and the records on final tax settlement
(if any) of the enterprise for the year of requesting the handling and the
preceding year (copies).
- The written handling requests of the superior
managing agency and the agency which has decided on the establishment of the
State enterprise.
- The record of determing the pre-transformation
value of the enterprise, of the Council for determination of the enterprise
value.
- The competent body’s decision on
transformation of the State enterprise (copy).
2.3. The debt handling for transformed
enterprises shall be implemented through synchronous measures together with the
handling of the enterprises pre-transformation problems as determined in the
plan for transformation and rearrangement of enterprise.
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- For operating State enterprises, they must be
monitored on the accounts of indexes outside the accounting balance sheet and
recovered within five years. The recovered amount shall be accounted into the
incomes of the enterprises.
- For transformed enterprises, after the transformation,
the representatives of the owners of the State capital at enterprises shall
have to continue monitoring and recovering the receivable bad debts which have
been already handled before the transformation but remain recoverable, the
collected amounts, after subtracting the recovery expenses, shall be remitted
into the fund for support of rearrangement and equitization of State
enterprises; or transfer the dossiers and documents to organizations with
function of buying and selling outstanding debts and assets under decisions of
the competent State bodies for continuing to monitor and recover them into the
State budget.
II. HANDLING OF OUTSTANDING
PAYABLE DEBTS OF ENTERPRISES
1. Tax debts and State budget remittances:
1.1. Settling by providing investment capital
support:
Enterprises having investment projects
prescribed in Clause 1, Article 11 of Decree No.69/2002/ND-CP shall comply with
the guidance in Section III, Part B of Circular No.32/2002/TT-BTC of April 10,
2002 of the Finance Ministry guiding the implementation of the Prime Minister�s Decision No.172/2001/QD-TTg
of November 5, 2001 (hereinafter called Circular No.32/2002/TT-BTC for short).
1.2. Settling by writing off the debts:
1.2.1. Enterprises being the subjects prescribed
in Clauses 2, 3 and 6 of Article 11 of Decree No.69/2002/ND-CP shall comply
with the guidance at Point 1, Section IV, Part B of Circular No.32/2002/TT-BTC.
1.2.2. Enterprises being the subjects defined in
Clause 4 of Article 11 of Decree No.69/2002/ND-CP shall comply with the
guidance in Clause 2, Section IV, Part B of Circular No.32/2002/TT-BTC.
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1.2.4. For enterprises which receive budget
advance money to buy export goods for repayment of foreign debts, to export to
earn foreign currency(ies) for setting up State reserve fund, or circulation
reserve, but which, due to price fluctuation, fail to buy enough goods fund as
prescribed, hence debiting the budget payment, if such debt amounts were
declared already and certified by the provincial/municipal Debt Settlement
Boards or the branch-managing ministries, they shall be written off.
The enterprises being these subjects must have
documents clearly explaining the debt amounts, the reasons therefor, enclosed
with documents relating to the debt amounts already declared and certified by
the provincial/ municipal Debt Settlement Boards or the branch- managing
ministry.
The enterprises shall send the above dossiers to
the Enterprise Finance Department for consideration and submission to the
Finance Minister for deciding to write off the debts for the enterprises
regarding the difference due to the above reasons.
1.2.5. Enterprises owing the State budget the
goods import money under the Government’s protocol due to the sale of goods on
deferred payment to units under the direction and regulations of competent
bodies and having so far failed to recover debts shall send their documents
clearly explaining the reasons for failure to recover the money, together with
papers relating to the sale of goods on deferred payment, to the Enterprise
Finance Department for consideration and submission to the Finance Minister for
deciding on debt remission.
Enterprises, which import goods under Protocols
and, due to the goods incompatibility with the market requirements, have to
sell them at prices lower than the prices agreed upon with the State, and,
therefore have suffered from losses which have not yet been handled, shall send
their written requests, together with papers relating to the goods sale on
deferred payment to the Enterprise Finance Department for consideration and
submission to the Finance Minister for debt remission.
2. Debts owed to State-run commercial banks
The handling of debts payable by State
enterprises to the State-run commercial banks shall comply with Article 12 of
Decree No.69/2002/ND-CP and the guidance of the Governor of Vietnam State Bank
as provided for in Clause 3, Article 18 of Decree No.69/2002/ND-CP.
3. Debts to be paid to the National Reserve
3.1. State enterprises which owe the National
Reserve as provided for in Clause 1, Article 13 of Decree No.69/2002/ND-CP
shall be handled as follows:
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3.1.2. The paddy prices for handling and
repaying debts to the National Reserve Fund, already declared and certified up
to the time of handling and settlement, shall be the paddy prices used for
calculation of agricultural tax at the time of borrowing as decided by the
provincial/municipal People’s Committees.
3.2. Dossiers:
- Documents proving the debts to be paid by the
enterprises to the National Reserve from the 1988-1990 years up to now, which
remain outstanding: The economic contract, annexes to the contract, the
application for advance money, the application for borrowing, vouchers on
reception, delivery, revenues and income, expenditures relating to the National
Reserve debts and other commitment papers.
- Debt-acknowledging card with signatures and
stamps of the enterprise and Department (Sub-Department) of the National
Reserve.
- Debt comparison record with the signatures and
stamps of the creditor and the debtor.
- The decision on the price for calculation of
agricultural tax of the provincial/municipal People’s Committee at the time of
borrowing.
3.3. Agencies appraising and deciding to write
off debts for enterprises
The enterprises shall send their written
requests together with the written reports to the National Reserve Department
for consideration and submission to the Finance Minister for deciding to write
off the debts.
4. Social insurance debts
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4.2. For transformed State enterprises: Before
being transformed, they shall have to settle definitely the social insurance
debts. The source of money for repayment of social insurance debts shall be
arranged in the plan for enterprise transformation. The State shall provide
support in the following two cases:
- Support for social insurance premiums for the
laborers who have reached the retirement ages but still lack at most one year
of social insurance payment according to Clause 2, Article 3 of the
Government’s Decree No.41/2002/ND-CP of April 11, 2002 on policies towards
laborers redundant from restructuring of State enterprises.
The support order and procedures shall comply
with Circular No.11/2002/TT-BLDTBXH of June 12, 2002 of the Ministry of Labor,
War Invalids and Social Affairs and Decision No.85/2002/QD-BTC of July 1, 2002
of the Finance Minister.
- For State enterprises to be transformed in
form of enterprise sale under the provisions in the Government’s Decree
No.103/1999/ND-CP of September 10, 1999 and Decree No.49/2002/ND-CP of April
24, 2002, where the enterprise buyers do not inherit debts, the to be sold
enterprises shall be given priority to use the proceeds from the sale of
enterprises (after subtracting expenses for the sale of enterprises) for
repayment of social insurance debts up to the time of selling the enterprises
according to the provisions in Circular No.47/2000/TT-BTC of May 24, 2000 of
the Finance Ministry.
Where the proceeds from the sale of enterprises
are not enough for repayment of social insurance debts, the enterprises shall
compile and send dossiers to the fund in support of State enterprise
rearrangement and equitization of the same level for subsidizing the deficit
amounts.
The support order and procedures shall comply
with the Regulation on management, collection, payment and use of the fund in
support of State enterprise rearrangement and equitization, promulgated by the
Finance Minister.
5. Debts payable to organizations and
individuals
For State enterprises decided to be transformed
into joint-stock companies, which, when carrying out the transformation, have
owed debts to organizations and individuals inside and outside the enterprises
but have met with difficulties or have the demand to mobilize more capital,
restructure their debts and get the consents of the creditors, their debts
shall be converted into their stock capital contributed to the equitized
enterprises according to the provisions at Point 3.6, Clause 3, Section II,
Part Two of Circular No.76/2002/TT-BTC of September 9, 2002 of the Finance
Ministry guiding the financial matters when transforming State enterprises into
joint-stock companies.
6. Other payable debts of operating enterprises
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6.1.1. Dossiers and documents
- Documents and directives of competent State
bodies requesting the enterprises to import goods.
- Dossiers and documents proving that the
enterprises have imported the goods lots upon the direction of the competent
State bodies.
- The enterprises written requests for capital
reduction, clearly explaining the goods import upon the directives of the
competent State bodies, the process of importation, goods consumption and the
unsold goods.
- Dossiers and documents proving that the stock
and unsold goods by the time of debt handling are unsaleable.
- The dossiers on liquidation sale of stock and
unsold goods.
- The final settlement of liquidation of stock
and unsold goods.
- The opinions of the superior managing agency.
6.1.2. Agencies appraising and deciding on
capital reduction for enterprises:
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- For local enterprises: To send their dossiers
and documents to the provincial/municipal Finance- Pricing Services for
appraisal and submission to the provincial/municipal People’s Committees for
decision on reduction of State capital at enterprises.
6.2. If enterprises which undertake to borrow
foreign capital for goods import upon the direction of the competent State
bodies or according to plans assigned by the State suffer from losses due to
the foreign exchange rate difference between the foreign exchange rate at the
time of borrowing for goods import and that at the time of repaying their
debts, thus being unable to repay their debts, they shall have to send their
reports thereon, enclosed with dossiers and documents, to the Enterprise
Finance Department for consideration and submission to the Finance Minister for
decision on the provision of exchange rate difference support for the
enterprises to repay their debts, which, however, shall not exceed the
unsettled loss amounts of the enterprises.
Dossiers and documents:
- The enterprises written requests for the
above-said exchange rate difference support, clearly explaining the goods
import upon the direction of the competent State bodies, the process of goods
import, consumption and the foreign exchange rate differences between the time
of borrowing for goods import and the time of repaying debts which result in
the enterprises� losses
and insolvency.
- Documents and directives of competent State
bodies requesting the enterprises to import goods or the State plans assigning
the goods import quotas to the enterprises.
- Dossiers and documents proving that the
enterprises have imported the goods lots upon the direction of the competent
State bodies.
- Dossiers and documents proving the exchange
rate differences between the time of borrowing for goods import and the time of
repaying debts, thus making the enterprises suffer losses and become insolvent.
- The final settlement reports of the years
related to the consumption of the above-said goods lots.
- The opinions of the superior managing agency.
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The ministries, branches and
provincial/municipal People’s Committees shall direct their attached units to
guide enterprises in reviewing and classifying their outstanding debts for
handling according to the provisions in Decree No. 69/2002/ND-CP and the
guidance in this Circular.
This Circular takes effect as from July 27,
2002. Should problems arise in the course of implementation, the agencies and
enterprises are requested to report them to the Finance Ministry for
consideration and settlement.
FOR THE FINANCE MINISTER
VICE MINISTER
Tran Van Ta