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GOVERNMENT
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SOCIALIST
REPUBLIC OF VIETNAM
Independence – Freedom – Happiness
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No.
85/2022/ND-CP
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Hanoi,
October 24, 2022
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DECREE
ON MECHANISM FOR FINANCIAL HANDLING OF VIETNAM NATIONAL OIL
AND GAS GROUP’S PAYMENT OF PRICE OFFSET IN THE OFFTAKE OF NGHI SON REFINERY AND
PETROCHEMICAL COMPLEX PROJECT’S PRODUCTS
Pursuant to the Law on
Government Organization dated June 19, 2015; the Law on Amendments and
Supplements to certain Articles of the Law on Government Organization and the
Law on Local Government Organization dated November 22, 2019;
Pursuant to the Law on State
Budget dated June 25, 2015;
Pursuant to the XVth
National Assembly’s Resolution No. 42/2021/QH15 dated November 13, 2021 passed
in its Second Meeting;
Upon the request of the
Minister of Finance;
The Government herein
promulgates the Decree on the mechanism for financial handling of Vietnam
National Oil and Gas Group’s payment of price offset in the offtake of Nghi Son
Refinery and Petrochemical Complex Project’s products.
Chapter
I
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Article
1. Scope of application
This Decree prescribes the
procedure for financial handling or resolution of Vietnam National Oil and Gas
Group (“PVN”)’s payment of the price offset in the offtake of products of Nghi
Son Refinery and Petrochemical Complex Project (“NSRP Project”) under the Fuel
Product Offtake Agreement ("FPOA") between PVN and Nghi Son Refinery
and Petrochemical Limited Liability Company (“NSRP Company”) in compliance with
paragraph 4 of the National Assembly’s Resolution No. 42/2021/QH15, including: Determination
of claims and rules for the Government’s financial resolution; state budget
estimation, balance sheet audit, final accounting and treatment of the differentials
between revenue and input costs arising from the offtake of NSRP Project
products that occurs when determining annual business results of PVN as the
parent company of the latter.
Article
2. Subjects of application
1. Parent company - Vietnam
National Oil and Gas Group (“PVN”).
2. NSRP Product Distribution
Branch ("PVNDB”).
3. State Audit.
4. Commission for Management
of State Capital at Enterprises.
5. Ministry of Finance.
6. Ministry of Industry and
Trade.
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Article
3. Interpretation
For the purposes of this
Decree, terms used herein shall be construed as follows:
1. NSRP Product Distribution
Branch (“PVNDB”) refers to a dependent accounting unit of the parent company,
PVN, which is founded to carry out the offtake and distribution of NSRP
Project’s fuel products.
2. Nghi Son Refinery And
Petrochemical Complex Project (“NSRP Project”) refers to a project obtaining
the investment certificate No. 262022000036 originally issued on April 14, 2008
by, or legally revised with approval from, Nghi Son Economic Zone Management
Committee.
3. Nghi Son Refinery and
Petrochemical Limited Liability Company (“NSRP Company”) refers to a company incorporated
according to the Agreement under which a joint venture company was created through
the partnership between PVN and its partners, including Idemitsu Kosan Co.,
Ltd; Mitsui Chemicals, INC and Kuwait Petroleum Europe B.V., on April 7, 2008.
4. NSRP fuel product offtake
agreement (“FPOA”) refers to the contract entered into between PVN and NSRP Company
on January 15, 2013 and appendices or other complementary arrangements (where
available) enclosed herewith.
5. Service agreement refers
to a contract signed between PVNDB (under PVN’s authorization) and NSRP Company
dated November 13, 2017 under which PVNDB is bound to supply offtake support
services to NSRP Company, and appendices or other complementary arrangements
for modification or revision thereof (if any) enclosed herein.
6. Free trade agreement
(“FTA”) comprises any multilateral or bilateral agreement to which Vietnam is a
signatory or accedes if it is in force, and which is binding upon Vietnam.
7. LPG refers to the liquefied
petroleum gas defined under the Government’s Decree on gas business.
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Chapter
II
SPECIFIC PROVISIONS
Section
1. DETERMINATION OF CLAIMS AND RULES FOR
THE GOVERNMENT’S FINANCIAL RESOLUTION NEEDED FOR STATE BUDGET ESTIMATION AND
FINAL ACCOUNTING
Article
4. Determination of claims for the Government's resolution action
1. The amount that PVN
claims for the Government’s financial resolution is commensurate with the
negative differential arising in the computation year (the selling price is lower
than the offtake price as PVN has to pay the price offset in the offtake of gas,
oil and LPG products of NSRP Project under FPOA terms and conditions).
2. The negative differential
defined in paragraph 1 of this Article is calculated according to the following
formula:
Revenue from implementing
the offtake chain in the computation year (inclusive of the sums PVNDB earns from
selling gas, oil and LPG products at the selling price, allowing for
corresponding customs duties, or special excise duties on gasoline products
(where applicable), and exclusive of VAT).
+
PVNDB’s other revenue
(exclusive of VAT) and other income directly associated with implementation
of the offtake chain that arise in the computation year (inclusive of PVNDB’s
financial income; indemnities and bonuses that PVNDB is paid for its
fulfillment or failure of contractual obligations; and income other than
those mentioned above).
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Costs and expenses
incurred from implementation of the offtake chain (not yet including VAT) according
to the sales volume of PVNDB’s offtake products in the computation year
(including total amount that PVNDB is obligated to pay for gas, oil and LPG
products to NSRP Company).
3. Basis for calculation of
the revenue from implementing the offtake chain mentioned in paragraph 2 of
this Article above is total revenue arising in each calendar year, starting on
January 1 and ending on December 31, which is the sum of the revenue PVNDB
earns from selling gas, oil and LPG products to wholesale traders or other
purchasers, and the revenue PVNDB earns from supplying its services to NSRP
Company.
a) Revenue from each sale of
gas, oil and LPG products is calculated as follows:
Selling
unit price (exclusive of taxes)
x
(1
+ the lowest special preferential import tariff rate under Vietnam’s FTA commitments
applied to gas, oil and LPG products as per law)
+
Market
surcharges/ price adjustment factors (if any)
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x
Sales
volume of offtake gas, oil and LPG products
Where:
- Selling
unit price (exclusive of taxes) used for finding the revenue is determined
according to the selling price formula stated in the economic agreement signed
between PVNDB and wholesale traders or other purchasers, and by reference to
the FOB price announced by Platts Singapore (applicable
to gas and oil products) or the contractual price (CP) announced by Saudi
Aramco Company (applicable to LPG products).
- Where the payment for gas,
oil and LPG products sold at the selling price, allowing for corresponding
customs duties on these products, from the wholesale trader or other purchaser to
PVNDB is greater than (>) the amount of customs duty determined according to
the lowest special preferential import tariff rate under
Vietnam’s FTA commitments (if any), then the revenue mentioned above will be
calculated according to the amount, allowing for the corresponding customs
duty, that PVNDB can be paid.
- Market
surcharge/ price adjustment factor included in the selling price according to oil
and gas or LPG trading practices (for gas and oil or LPG products) is
determined according to the selling price formula specified in the economic
agreement signed between PVNDB and a wholesale trader or other purchaser. Market
surcharge/ price adjustment factor included in the selling price according to
oil and gas or LPG trading practices (for gas and oil or LPG products) is
determined according to the selling price formula specified in the economic
agreement signed between PVNDB and a wholesale trader or other purchaser (if
any).
b) Revenue from PVNDB’s
supply of services to NSRP Company is determined by total revenue arising in
each computation year (exclusive of VAT), starting on January 1 and ending on
December 31, from its supply of services to NSRP Company under FPOA terms and
conditions.
4. Cost or expense incurred
from implementing the offtake chain according to PVNDB's sales volume in the
computation year prescribed in paragraph 2 of this Article is determined by
total costs and expenses incurred in the computation year (not including VAT),
starting on January 1 and ending on December 31, including:
a) Cost of goods sold (including
monetary value of goods that PVNDB is obliged to pay to NSRP Company);
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c) Management costs;
d) Financial expenses
directly associated with implementation of the takeoff chain (not including costs
of interest on loans that the parent company PVN is granted to pay PVNDB in
advance);
dd) Other associated costs and
expenses (including gas and oil trading costs prescribed by law on gas and oil
business; amounts set aside as provisions; amounts used for paying indemnities
for failure to fulfill contractual obligations when implementing the offtake
chain) are determined separately or arranged into cost items specified in
subparagraph a, b, c and d of this paragraph (if any) in accordance with the
Government’s regulations in effect.
5. Selling expenses, storage
costs and other associated costs or expenses specified in subparagraph b, c, d
and dd of paragraph 4 of this Article (if any) with respect to product
quantities in stock on the date of termination of PVN's obligations to offset
the offtake price are calculated on a basis of costs and expenses distributed
according to the ratio between revenue from selling these quantities in stock
and total revenue from implementing the offtake chain in the same selling year
(starting on the date of PVN’s discharge of its obligations to pay the offset
price of the offtake products).
6. Monetary value of goods
that PVNDB is obliged to pay to NSRP Company (including the amount paid to
offset the offtake price) is calculated by total value of goods arising the
computation year (not including VAT) in relation to the sales volume of the
offtake products in each computation year, starting on January 1 and ending on
December 31. Where:
a) Monetary value of goods
that PVNDB is obliged to pay to NSRP Company (including the amount paid to
offset the offtake price) in each offtake stage is determined according to the
following formula:
Offtake
unit price (exclusive of taxes)
x
(1
+ offset price level equivalent to customs duty rate of 7% applied to gas and
oil products; and 5% applied to LPG products under GGU)
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(1
+ special excise duty rate applied to gasoline products (if any))
x
Sales
volume of offtake products
b) The amount of price
offset in each offtake stage is calculated according to the following formula:
Offtake
unit price (exclusive of taxes)
x
(offset
price level equivalent to customs duty rate of 7% applied to gas and oil
products; and 5% applied to LPG products under GGU)
x
Sales
volume of offtake products
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d) Unit price used for
calculating the monetary value of quantities in stock is determined according
to the first-in first-out (FIFO) method.
dd) If the differential in
the quantities actually received from NSRP Company is greater than (>) the
sales volume in the computation year, such differential will be brought towards
in the following year as a basis for determination of the amount claimed for
the Government’s financial resolution.
7. Market surcharge/price
adjustment factor arranged into the weighted mean of offtake unit prices in the
computation year is less than or equal to (≤) the market surcharge/ price
adjustment factor arranged into the weighted mean of selling prices in that
year.
8. The loading/unloading
place used for fixing the start date of PVNDB’s obligations is determined under
FPOA (at any position where the offtake shipment passes the flange of the door
connecting NSRP Plant with the purchaser’s tanker, fuel truck or pipeline).
9. As for LPG products, it
is obligatory to seek PVN's confirmation that PVN has assumed offtake
obligations to these NSRP Project products for domestic consumption purposes.
10. In the course of
discharge of obligations to pay the offtake price offset to NSRP Company, where
PVNDB pays NSRP Company total amount for its received offtake quantity
exceeding the quantity agreed upon in the original FPOA (signed on January 15,
2013) without recourse to any price offset, and incurring interest for such
transaction; or where PVNDB imports the quantity making up for the deficit occurring
due to NSRP Plant’s temporary suspension, and incurring interest for such
trade, revenue and costs or expenses (not including any price offset for
offtake transactions) arising from the respective excess or imported quantity
will be arranged into the revenue and costs or expenses arising from
implementing the offtake chain as part of the formula referred to in paragraph
2 of this Article.
Article
5. Rules for the Government’s financial resolution
1. The Government shall financially
handle PVN’s payment of price offsets for the products actually received from
NSRP Project that arise within the maximum period of 10 years from the day on
which PVN officially carries out the offtake of NSRP Project products according
to the following rules:
a) Where the results of
implementation of the offtake chain in the computation year (determined
according to the formula specified in paragraph 2 of Article 4 and the
provisions laid down in paragraph 3 through 10 of Article 4 in this Decree) incur
any interest, the Government shall not take any resolution action towards
offtake price offsets that PVNDB is obliged to pay to NSRP Company in
proportion to the sales volume of offtake products sold in the computation year.
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- Differential in each sale
is determined as follows:
- The method for determining
the maximum amount the Government agrees to pay for PVN’s price offset claim
according to the differential between total price offset arising in the
computation year and total amounts that wholesale traders or other purchasers
are obliged to pay to PVNDB according to the formula above is applied if the
lowest special preferential import tariff rate under Vietnam’s FTA commitments applied
to gas, oil and LPG products as per law that is arranged into the selling price
is greater than (>) 0%.. Where the amount calculated according to the
regulations and the formula above is greater than (>) the amount of price
offset for offtake transactions specified in subparagraph b of paragraph 6 of
Article 4 in this Decree, the amount the Government agrees to pay for PVN’s
price offset claim shall equal (=) the latter.
- Where the lowest special
preferential import tariff rate under Vietnam’s FTA commitments applied to
petrol, oil and LPG products as per law that is arranged into the selling price
is 0%, the maximum amount the Government agrees to pay for PVN’s price offset
claim shall be determined according to paragraph 2 of Article 4 in this Decree,
but not exceeding the amount of price offset for offtake transactions specified
in subparagraph b of paragraph 6 of Article 4 herein.
c) The amount the Government
agrees to pay for PVN’s price offset claim as prescribed in subparagraph b of
this paragraph is determined after ruling out the offtake quantity exceeding
the quantity agreed upon in the original FPOA (signed on January 15, 2013; the
quantity of products failing to satisfy quality requirements set out in the
FPOA and national technical regulations (QCVN) of Vietnam in accordance with
law.
2. In each budget year,
after the National Assembly passes the central budget estimate of annual
expenditures used for paying amounts that PVN claims for the Government’s
financial resolution, PVN can improvise its after-tax profits on a quarterly
basis to pay price offsets for offtake transactions provided that these amounts
do not exceed the respective estimated expenditures.
Section
2. STATE BUDGET ESTIMATION, AUDITING AND
FINAL ACCOUNTING OF THE GOVERNMENT’S FINANCIAL RESOLUTION AMOUNTS
Article
6. Estimation of state budget expenditures and recording of state budget
expenditures in the balance sheet
1. PVN is the first-line
budgetary unit making an estimate of the amounts claimed for the Government’s
financial resolution each year (including claims for offtake quantities of
products in stock brought forward from the preceding year). These estimated
claims are calculated according to Article 4 and 12 and other relevant
regulations laid down herein, but not exceeding the estimated amounts of annual
central budget revenue from after-tax profits or profits retained for funds of
the parent company PVN.
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3. After receipt of the
report from PVN's Board of Members mentioned in paragraph 2 of this Article,
the Ministry of Finance shall integrate the estimated total amount of the
Government's financial resolution for PVN's claims into the estimate of central
budget expenditures for reporting to the Government as a basis to seek the
National Assembly’s decision on approval of the state budget estimate and
central budget allocations. When carrying out the estimate of the amounts of
the Government’s financial resolution claimed by PVN; and recording the amounts
of the Government’s financial resolution claimed by PVN as central budget revenue
and expenditure (other expenditure uses), PVN shall not actually pay the state
budget its after-tax profits or profits set aside for funds that are
commensurate with the amounts of the Government's financial resolution paid for
PVN's claims.
4. Whilst waiting for the
National Assembly’s approval of the estimate of annual central budget
expenditure used for paying PVN's claims on the Government’s financial
resolution amounts, PVN is authorized to improvise its production and business
capital to pay price offsets for offtake transactions to NSRP Company in
proportion to the actual quantity of products received from NSRP Company.
Article
7. Treatment of the differentials between estimated expenditure and actual
expenditure
1. Where the negative
differential between the estimated total of central budget expenditures prescribed
in Article 6 herein that is approved by the National Assembly and the actual
total of claims for central budget expenditures arising in the computation year
occurs, PVN shall be entitled to temporarily use production and business
capital of the parent company PVN, and then arrange available amounts in the
subsequent year’s budget estimate to make up the deficit.
2. Where the positive
differential between the estimated total of central budget expenditures
approved by the National Assembly and actual expenditures arising in the
computation year occurs, the surplus of the estimated expenditures shall be
removed when PVN pays it back to the central budget in accordance with
regulations.
Article
8. State budget auditing and final accounting
1. After determining the
claim for the Government’s financial resolution as per Article 4, 5, 12 and
other relevant regulations laid down herein, PVNDB shall prepare its income
(loss/profit) statement in the computation year as a basis to determine the
amount that PVN claims for the Government’s financial resolution. Also, PVNDB
shall carry forward the final amount of revenue and costs or expenses arising
from implementing the offtake chain and other related activities to the parent
company PVN.
2. By June 30 each year, PVN
shall submit a written report to the State Audit on its claim for the Government’s
financial resolution in the immediately preceding year to help in the audit
work as prescribed in paragraph 3 of this Article; simultaneously, send it
through to the Ministry of Finance for monitoring purposes. Documents attached
to PVN's report mentioned above shall include the following:
a) Full texts of the
Resolution of PVN’s Board of Members stating its approval of PVN’s claim for
the Government’s financial resolution.
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3. According to PVN’s
written report stated in paragraph 2 of this Article, the State Audit shall
audit PVN's claim for the Government’s financial resolution before submission
of the audit report on final accounts of annual state budget revenue and
expenditure to the National Assembly in accordance with the Law on State
Budget, law on state budget, Article 4, 5, 12 and other regulations laid down
herein.
4. Based on the State
Audit’s results of the audit stated in paragraph 3 of this Article, PVN shall
prepare a final account of payments commensurate with the Government's
financial resolution amounts while PVN shall approve that final account for
submission to the Ministry of Finance by October 1 on an annual basis in the
following year in order for the Ministry of Finance to integrate it into the
annual final account of state budget revenue and expenditure for the
Government’s submission to the National Assembly in accordance with law on
state budget.
Section
3. TREATMENT OF DIFFERENTIALS BETWEEN
REVENUE AND COSTS OR EXPENSES ARISING FROM IMPLEMENTING THE OFFTAKE CHAIN AND
DETERMINATION OF PVN’S BUSINESS RESULTS FOR USE IN ASSESSMENT AND RATING OF
PVN’S PERFORMANCE
Article
9. Treatment of the differentials between revenue and costs or expenses arising
from implementing the offtake chain on the parent company PVN's part
Based on revenue, other
income, costs or expenses and business results shown in PVNDB’s income
statement submitted to the parent company PVN:
1. Where revenue from
implementing the offtake chain (including other revenue and other income)
subject to paragraph 2 of Article 4 herein is greater than or equal to (≥)
costs or expenses incurred from implementing the offtake chain as provided in
paragraph 2 of Article 4 herein, all revenue and costs or expenses reported by
PVNDB shall be combined into production and business revenue and costs or
expenses of the parent company PVN.
2. Where the negative
differential occurs when revenue from implementing the offtake chain (including
other revenue, other income) prescribed in paragraph 2 of Article 4 herein is
less than (<) costs or expenses incurred from implementing the offtake chain
as per paragraph 2 of Article 4 herein, the parent company PVN shall record reduction
in the parent company PVN's costs of sales of the offtake quantity of gas, oil
and LPG products of NSRP Project, and increase in state budget revenue in proportion
to negative differentials determined according to paragraph 2 of Article 4
herein to the extent that such increase does not exceed the maximum amount that
the Government agrees to pay for PVN's claims referred to in paragraph 1 of
Article 5 herein.
Article
10. Determination of the parent company PVN’s business results after treatment
of differentials between revenue and costs or expenses arising from
implementing the offtake chain
1. Where revenue from
implementing the offtake chain (including other revenue and other income) is
greater than or equal to (≥) costs or expenses incurred from implementing the
offtake chain, all business results of the parent company PVN shall be determined
according to regulations in force.
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Chapter
III
IMPLEMENTATION
Article
11. Responsibilities of Ministries, central authorities and PVN
1. PVN:
a) Ensure that the payment
of the price offset to NSRP Company does not exceed the quantity of products
agreed upon in the FPOA (based on the offtake quantity prescribed at the day on
which FPOA was originally signed on January 15, 2013), and refuse the offtake
of the products failing to satisfy quality standards stipulated in the FPOA and
Vietnam’s national technical regulations prescribed in law.
b) Take responsibility for
the results of negotiation and signing of offtake agreements, agreements on
post-offtake consumption of products (including terms and conditions on the
formula of the off-take price and the selling price) and the performance of the
offtake chain, ensuring that, at the end of the period for implementation of
the financial mechanism prescribed in this Decree, PVNDB does not incur accrued
losses. PVNDB’s annual profits/losses serving as a basis for PVN's assessment
of PVNDB specified in this subparagraph shall be determined according to the method
of eliminating the losses commensurate with the maximum amount the Government
agrees to pay for PVN’s claims as prescribed in subparagraph b of paragraph 1
of Article 5 herein; but recording the positive differential occurring due to
the differential between market surcharges/price adjustment factors (including
special excise duty (if applicable)) that wholesale traders or other purchasers
are obliged to pay to PVNDB at the selling stage and the price offset for offtake
transactions commensurate with market surcharges/price adjustment factors
(including special excise duty) that PVNDB is obliged to pay to NSRP Company at
the offtake stage in proportion to the sales volume of offtake products sold. Where
the amount of the Government’s financial resolution for PVN’s claims determined
according to subparagraph b of paragraph 1 of Article 5 herein is equal to (=) the
price offset for offtake transaction specified in subparagraph b of paragraph 6
of Article 4 in this Decree, PVNDB’s annual profits/losses used as a basis for
PVN’s assessment of PVNDB in this subparagraph shall be determined according to
the method of excluding losses commensurate with the price offset for offtake
transactions prescribed in subparagraph b of paragraph 6 of Article 4 herein
and special excise duty (if any) arising on top of this price offset for
offtake transactions.
c) Determine the amount
claimed for the Government’s financial resolution for payment of the price
offset in the offtake of NSRP Project’s gas, oil and LPG products under Article
4, 5 and 12; clause 1 and 2 of Article 6 herein, and carry out the final
accounts of state budget expenditures commensurate with the amount of the
Government’s financial resolution prescribed in paragraph 4 of Article 8
herein.
d) Determine revenue, costs
or expenses and results from implementation of the offtake chain according to
the provisions of Article 4 of this Decree and losses from the implementation
of the offtake chain that are not treated by after-tax profits and profits
retained for funds of the parent company PVN (if any) as per subparagraph b of
paragraph 1 of Article 5 herein for use in tax declaration, payment and
accounting activities prescribed in law on taxes, law on accounting and financial
regulations of the parent company PVN.
dd) Inspect, supervise the
selling price and manage costs or expenses incurred from implementing the
offtake chain, market surcharges prescribed in Article 4 herein according to internal
management regulations of PVN and regulatory provisions of law.
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g) Report to the Commission
for Management of State Capital at Enterprises for supervision of PVN’s improvisation
of production and business capital of the parent company PVN for the price
offset prescribed in paragraph 4 of Article 6 herein.
h) Report to the Commission
for Management of State Capital at Enterprises and the Ministry of Industry and
Trade on the Resolution of PVN’s Board of Members to seek their approval of the
estimated amount claimed for the Government’s financial resolution as per
paragraph 2 of Article 6 herein to serve the purposes of supervising, approving
the production and business plan, and formulating the plan for supply of gas
and oil products each year.
i) Make full and timely
prepayments and payments of funds for implementation of the offtake chain, and
settlements of price offsets if these offsets meet the regulations laid down in
subparagraph a of this paragraph; address issues and problems arising each year
in accordance with the FPOA and other relevant agreements.
2. Commission for Management
of State Capital at Enterprises:
Supervise and inspect implementation
of the offtake chain, payment of the price offset and improvisation of production
and business capital for payment of price offsets by PVN and PVNDB in
accordance with paragraph 4 of Article 6 and paragraph 1 of Article 7 herein.
3. Ministry of Finance:
a) Integrate PVN’s claims
for the Government's financial resolution determined as per Article 4 herein
into the annual central budget estimate and complete the procedures for
reporting on this estimate to the agency having jurisdiction prescribed in
paragraph 3 of Article 6 herein to seek their approval.
b) Combine the amounts the
Government agrees to pay for PVN's claims as prescribed in paragraph 4 of
Article 8 herein into the annual final accounts of state budget revenue and expenditure,
submitting them to the Government to seek the National Assembly’s approval
according to the audit results of the State Audit and approval of the
finalization reports of PVN's Board of Members.
4. The Ministry of Industry
and Trade:
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b) Notify the day on which
PVN officially carry out the offtake of products of NSRP Project according to
PVN's report to the agencies and units specified in paragraph 1, 3, 4 and 5 of
Article 2 herein in order for them to undertake offtake-related activities and
supervise their performance in accordance with this Decree.
5. State Audit:
a) Audit the amounts that
PVN claims for the Government’s financial resolution before presenting audit
reports on annual final accounts of state budget revenue and expenditure to the
National Assembly in accordance with paragraph 2 and 3 of Article 8 herein.
b) Audit the amounts that
PVN claims for the Government’s financial resolution before presenting audit
reports on annual final accounts of state budget revenue and expenditure to the
National Assembly in accordance with paragraph 2 and 3 of Article 6 herein.
Article
12. Grandfather clause
Financial resolution taking
place during the period from the day of PVN’s official offtake of NSRP Project
product that is notified by the Ministry of Industry and Trade as provided in
subparagraph b of paragraph 4 of Article 11 herein to the end of 2022 (after
receipt of the National Assembly’s complementary approval of 2022 central
budget estimate) shall be carried out as follows:
1. Undistributed profits
earned from the results of implementation of the offtake chain that are accrued
from 2018 to end of 2021 (not including the amounts of the Government’s
financial resolution for PVN’s claims stated in subparagraph b of paragraph 1
of Article 5 herein) shall be used for offsetting the amounts of the Government’s
financial resolution for payment of PVN claims that arise from the day on which
PVN officially commence the offtake of NSRP Project products to the end of
2022.
2. Complementary transfers
to the 2022 estimate of central budget expenditure on the Government’s
financial resolution for payment of PVN’s claims (including the amounts
actually arising from the day on which PVN officially commence the offtake of
NSRP Project products to the end of 2021 and specified in the budget
implementation of 2022) that are funded by after-tax profits or profits
retained for funds for 2022 of the parent company PVN are as follows:
a) Complementary transfers
to the 2022 estimated of central budget expenditure shall be subject to Article
4 herein and given after using undistributed profits prescribed in paragraph 1
of this Article, but not exceeding the estimated central budget revenue from
after-tax profits or profits retained for funds of the parent company PVN in
2022.
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c) Enumerating, making final
accounts and auditing the final accounts of the amounts that PVN claims for the
Government’s financial resolution by the State Audit during the period from the
day on which PVN officially commence the offtake of NSRP Project products to
end of 2022 shall be subject to Article 8 herein.
d) Include the complementary
transfers to the estimate of 2022 central budget that the Government agrees to
pay for PVN’s claims in the final accounts of 2022 state budget revenue and
expenditure.
3. Regarding determination
of products in stock
a) PVN and PVNDB shall be
exempted from applying retroactive regulations under which they are required to
determine values of products in stock prescribed in subparagraph d of paragraph
6 of Article 4 herein in their accounting books and financial reports during
the period from the day on which PVN officially commence the offtake of NSRP
Project products to the end of 2021.
b) If all changes in costs
of goods sold during the period from the day on which PVN officially commence
the offtake of NSRP Project products to the end of 2021 occur due to changes in
the method of calculation of values of products in stock as prescribed in
subparagraph d of paragraph 6 of Article 4, they shall be included as a part of
business results of PVN and PVNDB in 2022 that serves the purposes of making
the estimate and final accounts of 2022 state budget revenue and expenditure
and shall be commensurate with the amounts the PVN claims for the Government's
financial resolution.
Article
13. Implementation provisions
1. Entry into force:
a) This Decree shall enter
into force as from the signature date.
b) This Decree shall be
invalidated when final accounting of the amounts that PVN claims for the
Government's financial resolution under law on state budget and relevant
regulatory provisions is completed (including when quantities of products in
stock determined on the date of discharge of price offset obligations to NSRP
Company are successfully handled).
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FOR
THE GOVERNMENT
PP. THE PRIME MINISTER
THE DEPUTY PRIME MINISTER
Le Minh Khai