Circular No. 02/2002/TT-BCN dated September 18, 2002 of the Ministry of Industry guiding the investment in the manufacture and/or assembly of motorcycle engines by domestic enterprises

CIRCULAR

GUIDING THE INVESTMENT IN THE MANUFACTURE AND/OR ASSEMBLY OF MOTORCYCLE ENGINES BY DOMESTIC ENTERPRISES

Pursuant to the Prime Minister’s Decision No. 38/2002/QD-TTg of March 14, 2002 on the management of the manufacture, assembly and import of motorcycle accessories;

Pursuant to the Government Office’s Notice No. 99/TB-VPCP of June 6, 2002 announcing the Prime Minister’s conclusions on the realization of motorcycle localization policy;

Pursuant to Joint Circulars No. 92/2001/TTLT-BTC-BCN-TCHQ of November 20, 2001 of the Ministry of Finance, the Ministry of Industry and the General Department of Customs and No. 52/2002/TTLT-BTC-BCN of June 4, 2002 of the Ministry of Finance and the Ministry of Industry guiding the realization of the tax preference policy for the manufacture of motorcycles and their engines;

The Ministry of Industry hereby guides the investment in the manufacture and assembly of motorcycle engines by domestic enterprises as follows:

I. OBJECTS OF APPLICATION:

This Circular applies to enterprises of all economic sectors, which are set up under Vietnam’s law (except foreign-invested enterprises).

II. SPECIFIC PROVISIONS:

1. The investment projects on the manufacture and/or assembly of motorcycle engines must be formulated in strict accordance with the provisions in the Regulation on construction and investment management, which was issued together with the Government’s Decree No. 52/1999/ND-CP of July 8, 1999 and amended and supplemented in Decree No. 12/2000/ND-CP of May 5, 2000, then submitted to the Ministry of Industry for consideration and appraisal.

2. The investment projects on the manufacture and/or assembly of motorcycle engines must comply with Item d, Point 2 of the Regulation on criteria of motorcycle-manufacturing and -assembling enterprises, issued together with Decision No. 24/2002/QD-BCN of June 7, 2002 of the Minister of Industry.

The provisions on the necessity to manufacture 01 detail assembly of engines, issued together with the above-said Decision, shall be construed as follows:

The enterprises shall have to make investment in technology and workshop by themselves, so as to be capable of manufacturing details of the assembly they have registered (listed in Appendix 6 attached to Joint Circular No. 52/2002/TTLT-BTC-BCN of June 4, 2002 of the Ministry of Finance and the Ministry of Industry) from raw materials and semi-finished products under a complete technological process. They may buy the casting, pressing and forging blanks of such details and detail assemblies from other manufacturers (at home or overseas) and shall not necessarily have to manufacture assorted gaskets and such standardized details as bolts, nuts, bearings

3. The enterprises shall have to implement the motorcycle localization program according to the annual specific target and tempo as follows (counting from the first year after the projects are put into operation):

The first year: The localization rate of engines 20%≥

The second year: The localization rate of 30%engines ≥

The third year: The localization rate of engines 45%≥

The fourth year: The localization rate of 60%.engines ≥

The localization rate of motorcycle engines shall be calculated according to the provisions in Appendix 6, issued together with Joint Circular No. 52/2002/TTLT-BTC-BCN of June 4, 2002 of the Ministry of Finance and the Ministry of Industry.

4. The motorcycle engines, which are manufactured and/or assembled by enterprises, must be checked according to the provisions at Item c, Point 4 (criteria on technical and technological levels) of the Regulation on criteria of motorcycle-manufacturing and -assembling enterprises, issued together with Decision No. 24/2002/QD-BCN of June 7, 2002 of the Minister of Industry.

5. The motorcycle-manufacturing enterprises must obtain copyright for motorcycle engines designs (which are researched or developed by the enterprises themselves or lawfully transferred by original manufacturers). In cases where the enterprises buy the designs and engine-manufacturing technologies from foreign partners, they must obtain technology transfer contracts and/or contracts for the transfer of trademarks and industrial property rights from foreign partners to the Vietnamese side for the manufacture and/or assembly of engines.

The technology transfer contents cover:

- Documents on products designs,

- Documents on engine-manufacturing and/or -assembling technologies,

- Permits for the use of trademarks,

- Training programs,

- Technical assistance programs.

Contracts on the transfer of motorcycle engine-manufacturing technology from foreign countries into Vietnam must be expertised and approved under current law provisions.

6. The motorcycle engine-manufacturing and/or -assembling enterprises must not infringe upon the industrial property right to trademarks and industrial designs in the manufacture and/or assembly of motorcycle engines, have to make registration for their manufactured and/or assembled engines according to current law provisions, and comply with the regulations on the management of motorcycle engines’ numbers, issued by State management agencies.

III. IMPLEMENTATION ORGANIZATION:

1. The investment projects on the manufacture and/or assembly of motorcycle engines shall send dossiers to the Ministry of Industry for consideration and appraisal (for State enterprises, such dossiers shall be sent via the investment-managing agencies). Within 15 working days as from the date of receiving valid dossiers, the Ministry of Industry shall release its official opinions on the contents of the investment projects.

2. After completing the investment, the enterprises shall report such to the Ministry of Industry for concrete inspection.

Enterprises having investment projects on the manufacture of motorcycle engines at home may borrow the State’s development investment credit capital under the provisions in Article 3 of the Prime Minister’s Decision No. 38/2002/QD-TTg of March 14, 2002 on the management of the manufacture, assembly and import of motorcycle accessories.

3. The motorcycle-manufacturing and/or -assembling enterprises, after being inspected and recognized by the Ministry of Industry as having met the criteria issued together with Decision No. 24/2002/QD-BCN of June 7, 2002 of the Ministry of Industry and Joint Circular No. 52/2002/TTLT-BTC-BCN of June 4, 2002 of the Ministry of Finance and the Ministry of Industry, shall be entitled to import motorcycle engines in complete sets (if the enterprises have not yet had motorcycle engine-assembling chains) or motorcycle engines component sets (if the enterprises have already invested in engine-assembling chains) as prescribed in the Prime Minister’s Decision No. 46/QD-TTg of April 4, 2002 on the management of goods import and export in the 2001-2005 period.

4. The enterprises manufacturing and/or assembling motorcycle engines, when carrying out procedures for the import of engines component sets, shall have to produce to the customs offices the written certifications of qualification for the manufacture and assembly thereof, issued by the Ministry of Industry.

5. This Circular takes effect 15 days after its signing.