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THE
PRIME MINISTER OF GOVERNMENT
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SOCIALIST
REPUBLIC OF VIET NAM
Independence - Freedom – Happiness
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No.
87/2004/QD-TTg
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Hanoi,
May 19, 2004
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DECISION
PROMULGATING THE REGULATION ON MANAGEMENT OF OPERATIONS OF FOREIGN
CONTRACTORS IN THE CONSTRUCTION DOMAIN IN VIETNAM
THE PRIME MINISTER
Pursuant to the Law on
Organization of the Government of December 25, 2001;
Pursuant to the Construction Law of November 26, 2003;
Pursuant to the Government's Decree No. 24/2000/ND-CP of July 31, 2000
detailing the implementation of the Law on Foreign Investment in Vietnam;
Pursuant to the Government's Decree No. 66/2003/ND-CP of June 12, 2003 amending
and supplementing a number of articles of the Bidding Regulation promulgated
together with the Government's Decree No. 88/1999/ND-CP of September 1, 1999
and Decree No. 14/2000/ND-CP of May 5, 2000;
At the proposal of the Construction Minister,
DECIDES:
Article 1.-
To promulgate together with this Decision the Regulation on management of
operations of foreign contractors in the construction domain in Vietnam.
Article 2.- This
Decision takes effect 15 days after its publication in the Official Gazette.
All stipulations contrary to the Regulation promulgated together with this
Decision are hereby annulled.
Article 3.-
The ministers, the heads of the ministerial-level agencies, the heads of the
Government-attached agencies, the presidents of the People's Committees of the
provinces and centrally-run cities and the concerned organizations and
individuals shall have to implement this Decision.
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PRIME MINISTER
Phan Van Khai
REGULATION
ON MANAGEMENT OF OPERATIONS OF FOREIGN CONTRACTORS IN THE
CONSTRUCTION DOMAIN IN VIETNAM
(Promulgated
together with the Prime Minister's Decision No. 87/2004/QD-TTg of May 19, 2004)
Chapter I
GENERAL PROVISIONS
Article
1.- Subjects and scope of application
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In cases where international
agreements which the Socialist Republic of Vietnam has signed or acceded to
contain provisions different from those of this Regulation, such international
agreements shall apply.
Article
2.- Interpretation of terms
The terms and phrases referred
to herein are construed as follows:
1. "Foreign
contractors" mean foreign organizations or individuals having civil legal
capacity; particularly, individuals must also have civil act capacity for
signing and performing contracts. The civil legal capacity and civil act
capacity of foreign contractors are determined under the laws of the countries
of which such contractors bear the nationality.
Foreign contractors may be
principal contractors, general contractors, partnership contractors or
sub-contractors.
2. "Principal
contractors" mean contractors having the direct contractual relationship
with investors.
3. "General
contractors" mean contractors signing contracts directly with the work
construction investors to undertake the whole volume of a type of work or the
whole work volume of a work construction investment project. General
contractors may take the following principal forms: designing general
contractors; work construction general contractors; work designing and
construction general contractors; general contractors for work designing,
technological equipment provision and work construction; general contractors
for formulation of work construction investment projects, work designing,
technological equipment provision and work construction.
4. "Partnership
contractors" mean organizations (other than legal persons), including
foreign contractors or foreign contractors and Vietnamese contractors which
jointly participate in a bidding and perform a contract in Vietnam on the basis
of a partnership contract. A partnership contract must clearly prescribe the
common responsibilities of all contractors to the partnership as well as their
own responsibilities for contracted works of the partnership, and concurrently
determine the leading contractor of the partnership.
5. "Subcontractors"
mean contractors having the contractual relationship with the principal
contractor or the general contractor for performing a portion of the latter's
work.
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7. "Authorized
persons" mean persons authorized by foreign contractors to conduct
transactions in Vietnam in the name of such foreign contractors. The
authorization must comply with the Vietnamese laws.
8. "Investment and
construction consultancy" means professional jobs in investment and
construction activities, including consultancy on formulation of construction
investment projects, construction surveys, architectural designing, technical
designing, management of construction investment projects, supervision of construction
process and other technical or econo-technical services for construction
investment projects.
9. "Construction
process" means the performance of construction and installation of
equipment and technological chains in works in order to put such works into
operation, exploitation and use according to their designs.
10. "Contracting
licenses" mean licenses granted by competent Vietnamese State agencies to
foreign contractors upon each contract after they win biddings or are selected
for contracting according to Vietnamese law provisions.
Article
3.- Principles for managing operations of foreign contractors
1. Foreign contractors can
operate in Vietnam only after being granted contracting licenses by competent
Vietnamese State agencies.
2. Operations of foreign
contractors in Vietnam must comply with the provisions of Vietnamese laws and
relevant international agreements which Vietnam has signed or acceded to.
Chapter II
PROVISIONS ON FOREIGN
CONTRACTORS
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To be granted contracting
licenses, foreign contractors must satisfy the following conditions and
requirements:
1. For bidding packages subject
to compulsory application of the provisions of the Vietnamese bidding
legislation:
a/ Having won biddings or having
been selected for contracting.
b/ Having signed contracts.
2. For bidding packages not
subject to compulsory application of the provisions of the Vietnamese bidding
legislation:
a/ Having won biddings or having
been selected for contracting.
b/ Having signed contracts.
c/ Having full capability
suitable to contracted works according to Vietnamese law provisions.
3. In all cases of being
contracted (as a result of winning bids or being selected as contractors),
foreign contractors shall have to enter into partnership with Vietnamese
contractors or employ Vietnamese subcontractors (except for cases permitted by
the Prime Minister or provided for by Vietnamese laws).
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Article 5.-
Dossiers of application for contracting licenses
1. To be considered for grant of
contracting licenses in Vietnam, foreign contractors must send their
registration dossiers to competent agencies defined in Articles 10 and 16 of
this Regulation.
A dossier of application for
contracting license comprises:
a/ An application for
contracting license (made according to the form guided by the Construction
Ministry).
b/ A copy of the document on the
bidding result or the decision on selection of the contractor or the lawful
contract.
c/ Copies of the establishment
license and the company's charter (or the business registration certificate,
for organizations; the consultancy practice license, for individuals) and the
practice certificate granted by the country of which the foreign contractor
bears the nationality.
d/ The report on operation
experiences related to contracted works and the financial audit report for the
latest 3 years (for the cases mentioned in Clause 2, Article 4 of this
Regulation).
e/ The partnership contract with
a Vietnamese contractor or the written commitment to employ Vietnamese
subcontractors to perform the contracted works (already included in the bid
dossier or tender dossier).
f/ The lawful authorization
letter, for persons other than the contractor's representative at law.
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Article 6.-
Time limits for granting contracting licenses and the licensing fee
1. Competent State agencies
defined in Articles 10 and 16 of this Regulation shall examine dossiers before
granting contracting licenses to foreign contractors within 20 working days
after receiving the complete and valid dossiers specified in Article 5 of this
Regulation. In case of refusal to grant licenses, the agencies competent to
grant contracting licenses must reply the contractors in writing, clearly
stating the reasons therefor.
2. Upon receiving contracting
licenses, foreign contractors must pay a licensing fee prescribed by the
Finance Ministry.
3. Contracting licenses shall
cease to be valid in the following cases:
a/ Contracts are accomplished
and liquidated.
b/ Contracts are no longer
effective as the foreign contractors are suspended from operation, dissolved,
go bankrupt or for other reasons prescribed by Vietnamese laws and laws of the
countries of which such contractors bear nationality.
Article 7.-
Rights and obligations of foreign contractors
1. Foreign contractors have the
following rights:
a/ To request the functional
agencies to guide the compilation of dossiers of application for contracting
licenses and other matters related to operations of contractors according to
this Regulation.
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c/ To have their legitimate
interests in their business in Vietnam under the granted contracting licenses
protected.
2. Foreign contractors have the
following obligations:
a/ To register the addresses,
communications means, transaction accounts and places where they open
transaction accounts of their work executive offices and representatives for
contract performance at the concerned agencies according to the regulations of
the People's Committees of the provinces where the contracted projects exist.
At the same time, to notify such information to the Construction Ministry, the
Public Security Ministry, the Finance Ministry, the Trade Ministry, Vietnam
State Bank and the People's Committees of the provinces and centrally-run
cities where construction works are located.
b/ To register the use of seals
of their work executive offices at the Police Offices of the provinces and
centrally-run cities where construction works are located. Foreign contractors
shall only use these seals for affairs in service of contract performance in
Vietnam according to the provisions of their contracting licenses.
Upon the expiry of contracts,
foreign contractors must return their seals to the agencies which have granted
them.
c/ To register and pay taxes
according to Vietnamese law provisions; to observe the accounting regime, open
accounts and make payments as guided by the Finance Ministry and Vietnam State
Bank in service of business activities under contracts.
d/ To recruit and employ
Vietnamese and foreign laborers according to the Vietnamese labor legislation.
To register only economic managerial
and technical experts and highly skilled laborers whom Vietnam lacks for entry
into Vietnam.
Foreigners working for foreign
contractors in Vietnam must observe the Vietnamese legislations on exit and
entry, register their temporary residence or permanent residence, and register
for being granted work permits according to the provisions of the Vietnamese
labor legislation.
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- Registration for temporary
import for re-export of construction supplies, machines and equipment;
- Registration of the list of
import raw materials, fuels, materials, complete and synchronous equipment for
works under the contracts.
f/ To perform partnership
contracts already signed with Vietnamese contractors or commitments to use
Vietnamese subcontractors deter-mined when participating in biddings or
offering bids according to Vietnamese law provisions.
g/ To purchase insurance
according to Vietnamese law provisions for contractor's works, including:
insurance for professional liability of contractors providing investment and
construction consultancy; insurance for assets and goods for procurement
contractors; insurances of various kinds for construction contractors and other
insurance regimes according to Vietnamese law provisions.
h/ To register for inspection
the quality of supplies and equipment imported and supplied under the
contracts.
i/ To register the safety of
construction equipment and transport means related to business activities of
foreign contractors according to Vietnamese law provisions.
j/ To observe the regulations on
norms, standards, management of quality of construction works, environmental
protection as well as other relevant Vietnamese law provisions.
k/ To implement the reporting
regimes prescribed in contracting licenses.
l/ Upon the completion of works,
foreign contractors shall have to compile dossiers on work completion; provide
warranty; make the settlement of imported supplies and equipment; handle unused
supplies and equipment in work construction contracts according to the
regulations on export and import; re-export construction supplies and equipment
already registered for temporary import - re-export; and liquidate the
contracts. And at the same time, to notify the concerned State management
agencies of the expiry of the contracts, terminate operation of their executive
offices and return the seals of the executive offices to the agencies which
have granted such seals.
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Chapter III
PROVISIONS ON INVESTORS
OR PROJECT OWNERS
Article 8.-
Selection of foreign contractors
When selecting foreign
contractors to perform bidding packages not subject to the compulsory
application of the provisions of the Vietnamese bidding legislation, apart from
their own requirements, investors or project owners shall also base themselves
on the provisions of Point c of Clause 2, Clause 3, Clause 4, Article 4 of this
Regulation to consider, evaluate and select contractors. Contracts between
investors or project owners and foreign contractors shall be made on the
principle of agreement between involved parties but not in contravention of
Vietnamese laws.
Article 9.-
Responsibilities of investors or project owners
Investors or project owners
shall have the responsibilities:
1. To guide foreign contractors
in complying with the provisions of this Regulation and other relevant law
provisions; to assist foreign contractors in preparing documents related to
contracted works which must be declared by foreign contractors in their
dossiers of application for contracting licenses and other relevant procedures
according to Vietnamese law provisions. To register, together with foreign
investors, the export and import of supplies, machines and equipment related to
the contract performance by foreign contractors according to the provisions of
Article 7 of this Regulation.
2. To supervise foreign
contractors in strictly implementing their commitments in partnership contracts
with Vietnamese contractors or commitments to employ Vietnamese subcontractors
already registered when participating in biddings or offering bids.
3. To consider the domestic
capability to supply construction equipment before agreeing on the lists of
construction machines and equipment proposed by foreign contractors for
temporary import and re-export.
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5. To certify the foreign
contractors' settlements of imported supplies and equipment upon the completion
of works.
6. When employing foreign
contractors to provide consultancy on construction management or supervise
construction quality, investors or project owners must notify in writing other
contractors and the construction quality management agencies of the functions
and tasks to be performed by such foreign contractors on their behalf.
Chapter IV
FUNCTIONS, TASKS AND
POWERS OF THE STATE MANAGEMENT AGENCIES
Article
10.- The Construction Ministry
1. To coordinate with the
concerned ministries and branches in managing operations of foreign contractors
in Vietnam according to its functions.
2. To explain and guide the procedures
for, and manage, the grant of contracting licenses for foreign contractors to
perform contracted works according to the provisions of this Regulation.
3. To grant or withdraw
contracting licenses in cases where foreign contractors undertake bidding
packages of group-A projects.
4. To assume the prime
responsibility for, and coordinate with the concerned agencies in, organizing
the inspection of operations of foreign contractors in Vietnam.
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Article
11.- The Finance Ministry
1. To prescribe the contracting
licensing fee rates, the regime of fee collection, payment and use.
2. To explain and guide the
regulations on regimes of tax collection, accounting reports, settlement of
completed work volumes, work construction and installation insurance premium,
goods supply and procurement insurance premium, consultancy service
professional insurance premium and other regulations related to operations of
foreign contractors in Vietnam according to its competence.
Article
12.- The Public Security Ministry
1. To prescribe the registration
and management of seals of foreign contractors' executive offices in Vietnam.
2. To manage the exit and entry,
registration of temporary residence or permanent residence of foreigners
working for foreign contractors in Vietnam.
3. To coordinate with the
relevant agencies in ensuring political security, social order and safety, fire
and explosion prevention and fighting at operating establishments of foreign
contractors.
Article
13.- The Trade Ministry
1. To manage the temporary
import - re-export, temporary export - re-import and import of
machines, equipment and supplies for the construction of works under foreign
contractors' contracts to construct works in Vietnam.
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3. To examine the settlement of
imported supplies, machines and equipment of foreign contractors and handle
unused supplies and equipment according to law provisions.
Article
14.- The Labor, War Invalids and Social Affairs Ministry
1. To manage the recruitment and
employment of laborers being Vietnamese or foreigners working for foreign
contractors in Vietnam.
2. To manage the registration of
safety of equipment in construction activities related to operations of foreign
contractors in Vietnam.
Article
15.- The Planning and Investment Ministry
To manage the system of
information data on foreign contractors operating in Vietnam according to the
provisions of the bidding legislation.
Article
16.- The People's Committees of the provinces and centrally-run cities
1. To manage the registration of
work executive offices, representatives of contractors and operations of
foreign contractors in localities; to direct the concerned agencies and
investors in their localities to implement this Regulation and the relevant law
provisions.
2. To authorize the provincial/municipal
Construction Services to grant and withdraw contracting licenses in cases where
foreign contractors undertake bidding packages under group-B or group-C
projects in their localities.
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Chapter V
INSPECTION AND HANDLING
OF VIOLATIONS
Article
17.- Inspection
1. The Construction Ministry
shall assume the prime responsibility for organizing periodical inspections of operations
of foreign contractors in Vietnam, but no more than once a year.
2. The relevant ministries and
branches shall, with the ambit of their functions and powers, inspect, warn and
handle foreign contractors when they violate this Regulation or other law
provisions.
3. The provincial/municipal
Construction Services shall assist the provincial/municipal People's Committees
in assuming the prime responsibility for organizing the inspection of
operations of foreign contractors in their localities, with the participation
of the provincial/municipal Trade; Finance; Labor, War Invalids and Social
Affairs and Public Security Services; and report once every six months on the
situation of grant of contracting licenses and operations of foreign
contractors in their localities to the Construction Ministry, which shall
subsequently synthesize and report it to the Government.
4. Unexpected inspections shall
be conducted only upon detecting signs of violations of Vietnamese laws
committed by foreign contractors.
Article
18.- Handling of violations
1. Foreign contractors operating
in Vietnam which violate the provisions of this Regulation and other Vietnamese
law provisions shall, depending on the seriousness of their violations, be
handled as follows:
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b/ Being administratively
sanctioned for violations of the administrative regulations in the construction
domain.
c/ Having their contracting
licenses withdrawn, having their right to participate in contracting works in
Vietnam suspended definitely or indefinitely, or being handled in other forms
prescribed by law.
d/ If causing damage, making
compensations therefor according to law provisions.
2. State management agencies
with the inspection function, when concluding that foreign contractors in
Vietnam commit law violations, may handle them according to their competence or
request competent agencies to handle according to their respective functions
and law provisions.
3. Persons competent to manage
operations of foreign contractors in Vietnam, who abuse their positions and
powers to harass for bribes or improperly implement the provisions of this
Regulation shall, depending on the seriousness of their violations, be handled
according to law provisions.
Chapter VI
IMPLEMENTATION PROVISIONS
Article
19.- Implementation provisions
The ministers, the heads of the
ministerial-level agencies, the heads of the Government-attached agencies, the
presidents of the People's Committees of the provinces and centrally-run
cities, and the concerned organizations and individuals shall have to implement
this Regulation.