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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)
x
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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