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GOVERNMENT OF VIETNAM
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SOCIALIST REPUBLIC OF VIETNAM
Independence – Freedom – Happiness
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No. 107/2022/ND-CP
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Hanoi, December 28, 2022
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DECREE
EXPERIMENTAL TRANSFER OF
EMISSIONS REDUCTIONS AND FINANCIAL MANAGEMENT UNDER EMISSIONS REDUCTION PAYMENT
AGREEMENT IN NORTH CENTRAL REGION
Pursuant to the Law
on Governmental Organization dated June 19, 2015; Law on amendments to Law on
Government Organization and Law on Local Governmental Organization dated
November 22, 2019;
Pursuant to the Law
on Forestry dated November 15, 2017;
At the request of
the Minister of Agriculture and Rural Development;
The Government
promulgates Decree on experimental transfer of emissions reductions (ERs) and
financial management under emissions reduction payment agreement in North
Central Region.
Chapter
I
GENERAL
PROVISIONS
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1. Scope
This Decree provides
for experimental ER transfer and financial management under ERPA in
respect to forest environmental services according to regulations in Clause 3
Article 61 and Article 63 of the Law on Forestry.
2. Regulated entities
This Decree applies to
regulatory agencies, forest owners, organizations, households, individuals, and
residential community whose activities involve emissions reduction and
absorption of greenhouse gas (GHG) emissions from natural forests in 06
provinces of the North Central Region, including Thanh Hoa, Nghe An, Ha Tinh,
Quang Binh, Quang Tri and Thua Thien Hue.
Article
2. Interpretation of terms
In this Decree, the
terms below are construed as follows:
1. ERPA means the
Emissions Reduction Payment Agreement in the North Central Region of Vietnam
which is signed on October 22, 2020 by the Ministry of Agriculture and Rural
Development and International Bank for Reconstruction and Development (IBRD),
according to which IDRB agrees to transfer 95% of Contract ERs and Additional
ERs (if any) under the agreement to the Ministry of Agriculture and Rural
Development in order to serve Nationally Determined Contribution of Vietnam.
2. Emissions reduction, expressed
as tonnes of CO2, means the difference between the amount of CO2
reduced, absorbed, or stored from management and protection of natural forests
in GHG emission reduction areas and the reference level specified in ERPA.
3. Emission reduction (ER) transfer means an act that the Ministry of Agriculture and
Rural Development transfers the ownership of reductions of GHG emissions from
natural forests to Forest Carbon Partnership Facility (FCPF) through IBRD under
ERPA (including Contract ERs (10,3 million tonnes of CO2) and
Additional ERs (no more than 5 million tonnes of CO2, if any)).
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5. Agreement on participation in forest management means a document signed by the forest owner that is an
organization, the residential community and the People’s Committee of commune where
the residential community participating in forest management is located. The
agreement includes contents proposed, discussed and unified by parties in order
to make cooperation in effective management of a specific forest area of the
forest owner.
Article
3. Principles of ER transfer and financial management under ERPA
1. Transfer principles
a) The ER transfer
shall follow ERPA.
b) ERs that have been
transferred under ERPA shall not be transferred to other partners.
2. Principles of financial management
a) Revenue from ERPA
is revenue from forest environmental services in respect to forest carbon
absorption and storage services, reduction of GHG emissions by limitation to
forest loss and degradation; sustainable forest management and green growth
according to regulations of the Law on Forestry, paid under regulations in this
Decree. Other forest environmental service revenues shall be monitored and
separately recorded.
b) Payments are in
Vietnamese Dong, and the actual exchange rate at the time when the commercial
bank where the account for receipt of revenue from ERPA is opened conducts
business operation shall be applied.
c) Implementation
costs shall be reasonable and not be overlapped with those of state budget.
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a) Regarding fixed
funding for forest protection: the fixed funding shall be at least equal to
support funding from state budget for forest protection, and shall not exceed 2
times the support funding from state budget for forest protection on a
case-by-case basis in the same province. The specific fixed funding shall be
decided by the Provincial People’s Committee.
b) Regarding
livelihood development support: 50.000.000 VND/residential community/year.
c) Other expenditure
norms shall comply with applicable laws and receive approval from competent
authorities.
4. Tax
Tax obligations
arising from ER transfer specified in this Decree shall comply with regulations
in relevant law on tax.
Chapter
II
ER TRANSFER
AND FINANCIAL MANAGEMENT UNDER ERPA
Article
4. ER transfer
1. On behalf of the Government of Vietnam and forest owners
who are owner representatives, the Ministry of Agriculture and Rural
Development shall manage and use ERs from natural forests in 06 provinces of
the North Central Region during the duration for implementation of ERPA.
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3. In addition to ERs under ERPA, if IBRD wishes to purchase additional
ERs, the Ministry of Agriculture and Rural Development shall take charge and
cooperate with the Ministry of Natural Resources and Environment, the Ministry
of Finance, People's Committees of 06 provinces in the North Central Region and
relevant agencies in formulating transfer plans and reporting to competent
authorities for consideration and decision.
4. Reductions of
GHG emissions from forest management and protection from 2018 to 2024 will be
transferred until December 31, 2025.
Article
5. Revenue receipt and beneficiaries of ERPA
1. Revenue receipt
a) Revenue is derived
from the transfer of GHG ERs under ERPA.
b) The Vietnam Forest
Protection and Development Fund shall open a foreign currency account at a
commercial bank to receive revenue from ERPA and make allocation to the
Provincial Forest Protection and Development Fund.
c) The Provincial
Forest Protection and Development Fund shall open a VND account at a commercial
bank to receive funding allocated by the Vietnam Forest Protection and
Development Fund and make payments to beneficiaries.
2. Beneficiaries
a) Forest owners that
are assigned to manage natural forests according to Article 8 of the Law on
Forestry.
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c) Residential
community and commune-level People's Committees that conclude agreements on
participation in forest management with forest owners that are organizations.
d) Vietnam Forest
Protection and Development Fund and Forest Protection and Development Funds of
06 provinces in the North Central Region.
dd) Other
beneficiaries that involve emissions reduction and absorption of GHG emissions
from forests in 06 provinces of the North Central Region.
Article
6. Specific payments to be made
1. Forestry support for reduction of GHG emissions:
a) Review,
development, supplementation and completion of guidance on mechanisms and
policies on reduction of GHG emissions in forestry;
b) Review, monitoring
and assessment of changes in forest carbon reserve; inspection of natural forest repurposing; organization and
implementation of measures for sustainable forest management;
c) Enhancement of
enforcement of the law on forest protection and development;
d) Increase in
capacity of organizations and individuals directly participating in forest
management and protection.
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a) Natural forest
protection;
b) Silviculture
measures according to applicable regulations that are approved by competent
authorities under regulations of the law.
3. Livelihood development support
a) Support for
agriculture extension, forestry extension, supply of plant varieties and
livestock breeds; land management and development of cultivated forests;
purchase of equipment for processing agroforestry products; visits for exchange
of experience and development of demonstration models of livelihood
development in association with forest protection and development;
b) Support for
construction of public works of residential community, including clean water
works, lighting, communications, village roads, cultural houses and other works
proposed by the community participating in forest management;
c) Support for dissemination,
technical training, and formulation of conventions, statutes and commitments to
enforce the law.
4. Management:
a) Revenue management
and allocation;
b) Assessment
supervision and inspection;
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d) Communications and
dissemination;
dd) Actions against
complaints and queries and provision of feedback.
Article
7. Payment determination
1. Type of forests and bases for determination of forest area
eligible for payment
a) Forests eligible
for payment are natural forests in 06 provinces of the North Central Region.
b) Bases for
determination of forest area include cyclic forest inventorying and
investigation results; annual forest transition monitoring results.
2. Criteria for determination of amounts allocated to
provinces
a) ERs of each
province;
b) Natural forest area
of each province.
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Article
8. Sharing benefits from ERPA
1. Vietnam Forest Protection and Development Fund
a) Up to 0.5% of total
revenue from ERPA plus deposit interests (if any) may be spent on activities
specified in Point a Clause 4 Article 6 of this Decree. The specific spending
shall be decided by the Ministry of Agriculture and Rural Development.
Expenditure shall comply with regulations in Point a, Point b Clause 1
Article 70 of Government’s Decree No.156/2018/ND-CP dated November 16, 2018 on
enforcement of some Articles of the Law on Forestry.
b) Up to 3% of total
revenue from ERPA may be spent on activities specified in Clause 1, Points b,
c, d, dd Clause 4 Article 6 of this Decree. The specific spending shall be
decided by the Ministry of Agriculture and Rural Development. Expenditure shall
follow the plan approved by the Ministry of Agriculture and Rural Development.
c) The remaining
amount shall be allocated to Forest Protection and Development Funds of 06
provinces in the North Central Region according to regulations in Clause 3
Article 7 of this Decree.
2. Provincial Forest Protection and Development Fund
a) Up to 10% of total
amount allocated plus deposit interests (if any) may be spent on activities specified
in Clause 1, Points a, b, d and dd Clause 4 Article 6 of this Decree. The
specific spending shall be included in the annual expenditure and revenue plan
of the Fund. The plan shall be submitted to the Provincial People’s Committee
for decision.
Expenditure on
management and allocation of revenue specified in Point a, Clause 4 Article 6
of this Decree shall comply with regulations in Point a, Point b Clause 2
Article 70 of Decree No.156/2018/ND-CP. The remaining tasks shall be performed
under the plan approved by the Provincial People’s Committee.
b) The remaining
amount shall be paid to forest owners, People’s Committees of communes and
other organizations assigned by the State to manage natural forests according
to regulations in the Law on Forestry.
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a) The forest owner
may spend up to 10% of the amount provided by the Provincial Forest Protection
and Development Fund to forest management. Expenditure is specified in Point d Clause
3 Article 70 of Decree No. 156/2018/ND-CP;
b) After deducting the
amount used for management purpose, the forest owner shall prioritize payment
for activities in the agreement on participation in forest management, 2% of
which shall be paid to the People’s Committee of commune where the residential
community participating in forest management is located under the agreement.
The remaining amount shall be paid for activities according to regulations in
Point b, Clause 2 Article 6 of this Decree. The participation in forest
management shall comply with Appendix I to this Decree.”
4. The forest owner that is a household, individual or
residential community may use all amount paid for reduction of GHG emissions to
manage, protect and develop forests and improve living standards.
5. People’s Committees of communes and other organizations
assigned by the State to manage natural forests according to regulations in the
Law on Forestry may use the amount paid according to expenditures specified in
Clause 4 Article 70 of Decree No. 156/2018/ND-CP.
6. People’s Committees of communes specified in Point c Clause
2 Article 5 of this Decree may use the amount paid according to expenditures
specified in Points b, d, and g Clause 4 Article 70 of Decree No. 156/2018/ND-CP.
7. The residential community participating in forest
management shall be paid according to regulations in Appendix I issued together
with this Decree in order to manage, protect and develop forests and improve
living standards.
Article
9. Formulation of plan to share benefits
1. Benefit-sharing plan includes overall financial plan and
annual financial plans.
2. Overall financial plan
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3. Annual financial plans
a) Vietnam Forest
Protection and Development Fund
According to the
approved overall financial plan and the amount determined and allocated to the
Provincial Forest Protection and Development Fund according to regulations in
Article 7 of this Decree, Vietnam Forest Protection and Development Fund shall
formulate annual financial plans using Form No. 02 Appendix III issued together
with this Decree and report such plans to Fund Management Council to make
ratification and submit to the Ministry of Agriculture and Rural Development
for approval within its jurisdiction in accordance with regulations of the law.
According to annual
financial plans that have been approved, Vietnam Forest Protection and
Development Fund shall notify the amount allocated to the Provincial Forest
Protection and Development Fund.
b) Provincial Forest
Protection and Development Fund
Depending on the
amount allocated by the Vietnam Forest Protection and Development Fund, the
Provincial Forest Protection and Development Fund shall formulate annual
financial plans using Form No. 03 Appendix III issued together with this
Decree.
After obtaining
approval from the Fund Management Council, the Fund affiliated to the People’s
Committee of province shall submit these plans to the People’s Committee of
province for consideration and decision.
After obtaining
approval from the Fund Management Council, the Fund affiliated to the
Department of Agriculture and Rural Development shall report these plans to the
Department of Agriculture and Rural Development for submission to the People’s
Committee of province for consideration and decision.
According to annual
financial plans that have been approved, the Provincial Forest Protection and
Development Fund shall notify the amount payable to forest owner that is an
organization, the People’s Committee of commune and another organization
assigned by the State to manage forests.
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According to the
notification of the amount payable from the Provincial Forest Protection and
Development Fund, the forest owner shall formulate annual financial plans using
Form No. 04 Appendix III issued together with this Decree and submit such plans
to the competent authority for approval in accordance with the law on finance
in conformity with the organization type of the owner. After that, such plans
shall be sent to the Provincial Forest Protection and Development Fund The
Department of Agriculture and Rural Development shall approve annual financial
plans made by the forest owner that is an economic organization not established
by the State.
According to annual
financial plans that have been approved, the forest owner shall notify the
amount payable to the People’s Committee of commune and the residential
community specified in Point c Clause 2 Article 5 of this Decree.
d) Commune-level
People's Committee and another organization assigned by the State to manage
forests.
According to the
notification of the amount payable from the Provincial Forest Protection and
Development Fund, the People’s Committee of commune and another organization
assigned by the State to manage forests shall formulate annual financial plans
using Form No. 05 Appendix III issued together with this Decree and submit them
to the People’s Committee of district for approval. After that, these plans
shall be sent to the Provincial Forest Protection and Development Fund.
dd) People’s Committee
of commune specified in Point c Clause 2 Article 5 of this Decree.
According to the
notification of the amount payable from the forest owner that is an
organization, the People’s Committee of commune shall formulate annual
financial plans using Form No. 05 Appendix III issued together with this Decree
and submit them to the People’s Committee of district for approval.
Article
10. Disbursement and payment
1. Vietnam Forest Protection and Development Fund
According to annual
financial plans approved by the Agriculture and Rural Development, Vietnam
Forest Protection and Development Fund shall allocate amounts to the Provincial
Forest Protection and Development Funds.
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a) According to annual
financial plans that have been approved, the Provincial Forest Protection and
Development Fund shall pay for the forest owner, the People’s Committee of
commune and another organization assigned by the State to manage forests. The
Provincial People’s Committee shall issue regulations on times of advance payment,
rate of advance and payment time.
b) Payment methods
If the forest owner is
a household, individual or residential community, their amount shall be paid
via their bank account or transferred via a public postal service provider or
by other non-cash payment methods in accordance with regulations of the law.
If the forest owner is
an organization, the Commune-level People's Committee and another organization
assigned by the State to manage forests shall make payment via their bank
account.
3. Regarding forest owners that are organizations
a) On the basis of
annual financial plans that have been approved, the forest owner shall pay the
amount to the residential community participating in the agreement on
participation in forest management according to the acceptance result and the
approved estimate; pay the amount to the Commune-level People's Committee
participating in the agreement on participation in forest management according
to the estimate and the voucher showing actual costs in accordance with regulations
in the law.
b) Payment methods
With regard to
Commune-level People's Committees, their amounts shall be paid via their bank
accounts.
With regard to
residential community, their amount shall be paid via their bank account or transferred
via a public postal service provider or by other non-cash payment methods in
accordance with regulations of the law.
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1. Vietnam Forest Protection and Development Fund shall report
on implementation of ERPA to the Ministry of Agriculture and Rural Development
before November 30 every year.
2. Each Provincial Forest Protection and Development Fund
shall report on implementation of ERPA in their province to the Provincial
People’s Committee (for the Fund affiliated to the Provincial People’s
Committee), the Department of Agriculture and Rural Development (for the Fund
affiliated to the Department of Agriculture and Rural Development) and Vietnam
Forest Protection and Development Fund every 06 months (before June 15), every
year (before October 15).
3. The forest owner that is an organization shall make and
send a report on implementation of ERPA to the superior authority that has
competence in approval according to regulations of the law on finance in
conformity with the organization type of the forest owner. The forest owner
that is an economic organization not established by the State shall make and
send reports on implementation of ERPA to the Department of Agriculture and
Rural Development, the Provincial Forest Protection and Development Fund every
06 months (before June 01), every year (before October 01).
4. The People’s Committee of commune and another organization
assigned by the State to manage forest shall report on implementation of ERPA
to the superior authority, and the Provincial Forest Protection and Development
Fund every 06 months (before June 01), every year (before October 01).
Article
12. Settlement
1. Annual settlement
a) Vietnam Forest
Protection and Development Fund shall close accounting book on December 31
every year, and make settlement report using Form No. 01 Appendix IV issued
together with this Decree. The settlement report shall be made and adjusted
until June 30 in the following year. After that, the report shall be sent to
the Ministry of Agriculture and Rural Development for appraisal and approval
before July 15 of the following year.
b) The Provincial
Forest Protection and Development Fund shall close accounting book on December
31 every year, and make settlement report using Form No. 02 Appendix IV issued
together with this Decree. The settlement report shall be made and adjusted
until June 30 of the following year.
The Fund affiliated to
the Provincial People’s Committee shall send the report to the Department of
Finance for appraisal and approval before July 15 of the following year.
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Within 15 days from
the date on which the settlement report is approved, the Provincial Forest
Protection and Development Fund shall send 01 written result to the Vietnam
Forest Protection and Development Fund.
c) The forest owner
that is an organization shall close accounting book on December 31 every year,
and make settlement report using Form No. 03 Appendix IV issued together with
this Decree. The settlement report shall be made and adjusted until June 30 in
the following year. After that, the report shall be sent to the competent
authority for appraisal and approval in accordance with the law on finance in
conformity with the organization type of the forest owner before July 15 of the
following year. After the report is appraised and approved, 01 written result
of appraisal and approval shall be submitted to the Provincial Forest
Protection and Development Fund. The Department of Agriculture and Rural
Development shall appraisal and approve annual settlement of the funding paid
to the forest owner that is an economic organization not established by the
State.
d) The People’s
Committee of commune and another organization assigned by the State to manage
forest shall close accounting book on December 31 every year, and make
settlement report using Form No. 04 Appendix IV issued together with this
Decree. The settlement report shall be made and adjusted until June 30 of the
following year. After that, the report shall be submitted to the People’s
Committee of district for appraisal and approval before July 15 of the
following year. Within 15 days from the date on which the settlement report is
approved, 01 written result shall be sent to the Provincial Forest Protection
and Development Fund.
dd) The duration for
approval for settlement of the EPRA funding shall comply with applicable
regulations on financial regime for each organization type.
2. ERPA completion settlement
a) Before June 30 of
the year succeeding the year of completion of the ERPA, Vietnam Forest
Protection and Development Fund shall make an ERPA completion settlement report
using Form No. 05 Appendix IV issued together with this Decree and then submit
the report to the Ministry of Agriculture and Rural Development for appraisal
and approval.
b) Before May 30 of
the year succeeding the year of completion of the ERPA, the Provincial Forest
Protection and Development Fund shall make an ERPA completion settlement report
using Form No. 06 Appendix IV issued together with this Decree and then submit
the report to the Department of Finance (for the Fund affiliated to the
People’s Committee of province); the Department of Agriculture and Rural
Development (for the Fund affiliated to the Department of Agriculture and Rural
Development) for appraisal and approval.
c) Before April 30 of
the year succeeding the year of completion of the ERPA, the forest owner that
is an organization shall make an ERPA completion settlement report using Form
No. 07 Appendix IV issued together with this Decree and then submit the report
to the competent authority for appraisal and approval according to regulations
of the law on finance in conformity with the organization type of the forest
owner. After the report is appraised and approved, 01 written result of
appraisal and approval shall be submitted to the Provincial Forest Protection
and Development Fund. The Department of Agriculture and Rural Development shall
appraisal and approve ERPA completion settlement for the forest owner that is
an economic organization not established by the State.
d) Before April 30 of the year succeeding the year of
completion of the ERPA, the People’s Committee of commune and another
organization assigned by the State to manage forest shall make a completion
settlement report using Form No. 08 Appendix IV issued together with this
Decree and send the report to the People’s Committee of district for appraisal
and approval.
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1. Audit principle: Auditing all expenditures from revenues
from ERPA at Forest Protection and Development Funds at all levels;
beneficiaries of ERPA specified in this Decree.
2. Audit duration: Making annual audit and ERPA completion
audit.
3. Auditing unit: Vietnam Forest Protection and Development
Fund shall organize selection for an independent auditing unit according to applicable
regulations of the law and IBRD.
1. Inspection and supervision
a) The Ministry of
Agriculture and Rural Development shall take charge and cooperate with relevant
ministries and regulatory bodies in organizing inspection of the implementation
of ERPA at central and local levels.
b) Vietnam Forest
Protection and Development Fund shall inspect management and use revenue from
ERPA; maintain ERs; and act as the focal point to assist the Ministry of
Agriculture and Rural Development in conducting inspection and supervision at
local authorities.
c) People’s Committees
of provinces shall inspect the implementation of ERPA in their provinces.
d) Provincial Forest
Protection and Development Funds shall inspect management, use and
implementation of activities by beneficiaries of ERPA.
dd) Agencies,
organizations and all people shall participate in supervision of state
agencies, state organizations, households, individuals and residential
community that involve management and use of revenue from ERPA.
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2. Financial disclosure
a) Forest Protection
and Development Funds at all levels and beneficiaries shall disclose finance
according to regulations of relevant laws.
b) The Provincial
Forest Protection and Development Fund and the forest owner that is an
organization shall publish the list of beneficiaries at agencies. They shall
publicly post the list at headquarters of People’s Committees of communes and
to their website.
1. Ministry of Agriculture and Rural Development
a) Take charge and
cooperate with relevant ministries, regulatory bodies, and People's Committees
of 06 provinces in the North Central Region in organizing and providing
guidance on the implementation of ERPA; promulgate a plan to share benefits
from ERPA; urge, inspect and promptly handle problems arising during the
process of implementation within their jurisdiction in accordance with
regulations of the law, thereby avoiding loss and misuse; report on
contents beyond their jurisdiction to competent authorities.
b) Take charge and
cooperate with relevant ministries, central and local authorities in reporting
the implementation of ERPA to the Prime Minister before December 15 every year.
c) Make ER reports and
send such reports to IBRD.
d) Take charge and
cooperate with relevant ministries, central and local authorities in reviewing
and assessing result of the implementation of ERPA, and then reporting to the
Prime Minister before October 30, 2025.
2. Relevant Ministries and regulatory bodies
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1. Organize ERPA implementation in their provinces: Issue ERPA
implementation plans; organize, direct and implement activities under ERPA in
their provinces; integrate the implementation of local programs and projects;
mobilize resources to carry out local forest management, protection and
development.
2. Direct Provincial Forest Protection and Development Funds
to take charge and cooperate with relevant agencies and units in formulating
plans and organizing the implementation of ERPA.
3. Fail to transfer ERs under ERPA during the ERPA
implementation period to other entities.
4. Urge, inspect and promptly handle problems arising during
the process of implementation of ERPA within their jurisdiction in accordance
with regulations of the law.
5. Report on implementation of ERPA to the Ministry of
Agriculture and Rural Development in their provinces before October 30 every
year.
6. Review and assess the implementation of ERPA in their
provinces, and then report it to the Ministry of Agriculture and Rural Development
before July 30, 2025.
1. This Decree comes into force from the date on which it is
signed and the experimentation is conducted until December 31, 2026.
2. If the legislative documents referred to in this Circular are
approved for amendments or superseded by other legislative documents, the new
documents will prevail./.
3. Ministers, Heads of ministerial agencies, Heads of
Governmental agencies, Chairpersons of People’s Committees of 06 provinces,
including Thanh Hoa, Nghe An, Ha Tinh, Quang Binh, Quang Tri and Thua Thien
Hue, and relevant authorities, organizations, and individuals shall be
responsible for the implementation of this Decree./.”
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ON BEHALF OF GOVERNMENT
PP. PRIME MISNISTER
DEPUTY PRIME MINISTER
Vu Duc Dam