Circular No. 12/2017/TT-BCT dated July 31, 2017 of the Ministry of Industry and Trade on procedures for issuance and revocation of electricity operating licenses

THE MINISTRY OF INDUSTRY AND TRADE

Circular No. 12/2017/TT-BCT datedJuly 31, 2017 of the Ministry of Industry and Trade on procedures for issuance and revocation of electricity operating licenses

Pursuant to the Government s Decree No. 95/2012/ND-CP dated November 12, 2012, defining the functions, tasks, powers and organizational structure of the Ministry of Industry and Trade;

Pursuant to Law on Electricity dated December 3, 2004; Law on amendments to Law on Electricity dated November 20, 2012;

Pursuant to the Government s Decree No. 137/2013/ND-CP dated October 21, 2013 on guidelines for Law on Electricity and Law on amendments to Law on Electricity;

At the request of Director of Electricity Regulatory Authority,

The Minister of Industry and Trade promulgates a Circular on procedures for issuance and revocation of electricity operating licenses.

Chapter I

GENERAL PROVISIONS

Article 1. Scopeof adjustment

This Circular deals with procedures for issuance and revocation of electricity operating licenses and validity periods thereof in the following lines of business:

1. Electricity consulting services

a) Consulting services in terms of national power development planning, power development planning of provinces and central-affiliated cities (hereinafter referred to as provinces); and hydropower plant planning;

b) Consulting services in terms of power plant construction, including: Thermo-power (inclusive of biomass power), hydropower, and other renewable energies; consulting services in construction of transmission lines and electrical substations;

c) Consulting services in terms of supervisions of execution of power plants including: Thermo-power (inclusive of biomass power), hydropower, and other renewable energies; supervision consulting services in construction of transmission lines and electrical substations.

2. Electricity generation.

3. Electricity transmission.

4. Electricity distribution.

5. Electricity wholesaling.

6. Electricity retailing.

7. Export or import of electricity.

Article 2.Subject of application

This Circular applies to entities engaging in electricity consulting services, electricity generation, electricity distribution, electricity wholesaling, electricity retailing, and export or import of electricity.

Article 3. Exemption from electricity operating licenses

1. Electricity generation for self-consumption without selling electricity to other organizations and individuals.

2. Electricity generation with installed capacity of less than 1 MW to sell electricity to other entities.

3. Purchase of electricity with capacity of under 50kVA from distributing electricity grids to sell electricity directly to electricity-using customers living in rural, mountainous, and islands areas.

4. Dispatch of national electric system and electricity market transaction administration.

Article 4. Rules for granting licenses and validity period of electricity operating licenses

1. Prior to the competitive electricity retailing stage, electricity operating licenses shall be granted for both electricity retailing and electricity distribution.

2. Electricity generation licenses shall be granted to organizations that generate electricity for individual power plants.

3. Maximum validity periods of electricity operating licenses to be issued to electricity-operating units are specified as follows:

4. An electricity operating license with shorter validity period may be granted upon request of the applicant.

5. According to actual conditions of the section in the electricity work, license issuing authority (hereinafter referred to as issuing authority) may grant an electricity operating license with shorter validity period that those prescribed in Clause 3 of this Article.

Article 5. Lines of business stated in electricity operating licenses

1. The license for electricity consulting services is valid nationwide.

2. The license for electricity generation is only valid for individual power plants.

3. The license for electricity transmission, electricity distribution is only valid for management and operation of a specific electrical grid.

4. The license for electricity wholesaling or electricity retailing is only valid within a specific administrative division.

5. The license for export or import of electricity is only valid within a particular electricity delivery station.

Chapter II

APPLICATIONS FOR ELECTRICITY OPERATING LICENSES

Article 6. Applications for licenses for electricity consulting services

1. An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

2. A copy of enterprise registration certificate, establishment decision, or establishment certification obtained by the applicant.

3. A summary of resumes of administrative officers, main consulting experts using form No. 3a prescribed in Appendix issued herewith; copies of graduate degrees, practice certificates and labor contracts bearing signatures of main consulting experts that are named in the list along with the consulting organization.

4. A list of projects with similar scale that the consulting organization or main consulting experts have executed.

5. A list of equipment, technical equipment, and applications serving the consultancy and the consulting organization s undertakings to ensure the consultancy.

Article 7. Applications for licenses for electricity generation

1. An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

2. A copy of enterprise registration certificate obtained by the applicant.

3. A summary of resumes of direct technical manager, team leader of the power plant using form No. 3b prescribed in Appendix issued herewith; copies of graduate degrees, electrical safety cards and operation certificates that are issued by the controlling regulator to the team leader under the National Electricity System Regulation issued by the Ministry of Industry and Trade.

4. A copy of the decision on approval for power plant project or policy of issued by the competent authority.

5. A copy of the decision on approval for environmental impact assessment report or a document certifying the plan for protection of power plant project’s environment issued by the competent authority as prescribed in law on environment.

6. A copy of the power purchase agreement.

7. A list of equipment and devices with strict requirements for labor safety and the investor’s undertakings to use them in accordance with regulations of law.

8. A copy of the acceptance report on fire safety system that is made in accordance with law on fire safety.

9. A copy of the decision on approval for reservoir operation procedures issued by the competent authority (in case of hydroelectric plant).

10. A copy of the process of cooperation between power plant and electric system regulation units.

11. A copy of the acceptance report on information technology infrastructure, communication infrastructure serving electricity market operation as prescribed; a copy of the acceptance report on SCADA system serving the electricity system and electricity market operation as prescribed.

12. A copy of the acceptance report on hydroelectric dams; a registration for dam safety that has been sent to the competent authority; a plan for safety of dams and dam lowlands as prescribed; a report on dam testing (if it is the due date for testing of the hydroelectric dam).

Article 8. Applications for licenses for electricity transmission or electricity distribution

1. An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

2. A copy of enterprise registration certificate, establishment decision, or establishment certification obtained by the applicant.

3. A summary of resumes of direct technical manager, team leader of the power plant using form No. 3b prescribed in Appendix issued herewith; copies of graduate degrees, electrical safety cards and operation certificates that are issued by controlling regulator to the team leader under the National Electricity System Regulation issued by the Ministry of Industry and Trade.

4. A list of key electrical grid sections under its management. In case of purchase, acquisition or acceptance of the electrical grid property without refund, an acceptance report or a transfer report is required.

5. Copies of documents on conditions for fire safety as prescribed.

6. An arrangement or contract’s copy of connection to the national electricity system; a map of grid boundaries and scope of operation.

Article 9. Applications for licenses for electricity wholesaling or electricity retailing

1. An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

2. A copy of enterprise registration certificate, establishment decision, or establishment certification obtained by the applicant.

3. A summary of resumes of business managers and technical managers using form No. 3b prescribed in Appendix issued herewith; copies of graduate degrees or certificates, electricity safety cards of persons in the list.

Article 10. Applications for licenses for electricity export or import

1. An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

2. A copy of enterprise registration certificate, establishment decision, or establishment certification obtained by the applicant.

3. A summary of resumes of business managers and technical managers using form No. 3b prescribed in Appendix issued herewith; copies of graduate degrees or certificates, electricity safety cards of persons in the list.

4. A copy of the decision on approval for international power trade policy and plan for electrical grid connection that has been approved for the international power trade; a copy of the electricity import/export agreement, or a copy of the electricity purchase offer or acceptance of purchase offer of the foreign party.

5. A diagram of electrical grid principles relating to electricity purchase and sale stations and procedures for coordinating operation and handling of power grid incidents between electricity buyer and electricity seller (if any).

6. Copies of documents on fire safety at electrical substations as prescribed.

Article 11. Applications for permission to modify electricity operating licenses

1. The application for permission to modify name or headquarters address of the license holder shall include:

a) An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

b) A copy of enterprise registration certificate, establishment decision, or establishment certification obtained by the applicant.

2. If an applicant for electricity operating license acquires property assignment from a holder of electricity operating license, the application shall include:

a) An application form for electricity operating license using form No. 1 prescribed in Appendix issued herewith.

b) A copy of enterprise registration certificate, establishment decision, or establishment certification obtained by the applicant;

c) Supporting documents on property assignment, staff in charge of technical and operating aspects.

Chapter III

PROCEDURES FOR ISSUANCE AND REVOCATION OF ELECTRICITY OPERATING LICENSES

Article 12. Procedures for issuance and modification of electricity operating licenses

1. At least 30 days before the date on which the business is officially put into operation, the electricity-generating organization shall submit an adequate application for electricity operating license.

2. An applicant for issuance or modification of the electricity operating license shall send an application to the issuing authority as prescribed in Chapter II hereof and take responsibility for its accuracy and truthfulness.

3. Sending methods:

a) In case of applications within the licensing authority of the Ministry of Industry and Trade and Electricity Regulatory Authority: to be processed on the online public service website.

If an electronic application has large capacity or any document thereof is not allowed to be sent online as prescribed by law, it can be submitted in person or by post.

b) In case of applications within the licensing authority of the People’s Committees of provinces and central-affiliated cities (hereinafter referred to as provinces): to be submitted in person, by post, or on the website of the issuing authority (if any).

4. Procedures for issuance and modification of electricity operating licenses online:

a) An e-application shall be submitted in conformity with instructions on the online public service website of the Ministry of Industry and Trade, in particular:

- The applicant creates new account on the online public service website at the address: http://online.moit.gov.vn; use the registered account for declaration and send the application online;

- Within 15 working days from the date on which the satisfactory application is received on the online public service website, the issuing authority shall conduct a verification visit to the applicant’s premises (if necessary) and issue an electricity operating license.

b) People’s Committees of provinces shall provide guidelines for online licensing within their competence (if any) in accordance with this Circular.

5. Procedures for issuance and modification of electricity operating licenses offline:

a) Within 3 working days from the date on which the application for electricity operating license is received, in case of inadequate application, the issuing authority shall notify the applicant of providing additional documents in writing. In the written notice, it must clarify reasons and requirements for additional documents or amendments to figures, documents for completing the application;

b) Within 5 working days from the date on which the written notice is received, the applicant shall provide additional documents, amend figures, documents as required and respond in writing.

Within 60 days from the date on which the written notice is received, if the applicant fails to provide additional documents or make appropriate amendments and respond in writing, the issuing authority may return the application;

c) Within 15 working days from the date on which the satisfactory application is received on the online public service website, the issuing authority shall conduct a verification visit to the applicant’s premises (if necessary) and issue an electricity-operating license.

5. During the application verification or verification visit, if the applicant has not satisfied all of conditions as prescribed, the issuing authority may request the applicant to provide additional license(s) or reject the application in writing (with clear explanation).

6. The issued electricity-operating license shall consist of 3 originals: 1 copy held by the applicant, 2 copies kept by the issuing authority.

7. At least 60 days before the expiry date of the electricity-operating license, if the holder of license wishes to keep its operation, it shall submit an application for electricity operating license as prescribed in Clause 1 of this Article and follow procedures as prescribed.

Article 13. Revocation of electricity operating licenses

1. An electricity-operating license shall be revoked in any case below:

a) The electricity unit violates Article 37 of Law on Electricity;

b) The electricity unit wishes to shut down or transfer its operation to another unit;

c) The competent authority requests to have the electricity unit’s license revoked due to its violation;

d) The electricity fails to comply with Clause 7 Article 16 of this Circular;

dd) The electricity unit violates Point a Clause 9 Article 16 of this Circular.

2. The electricity operating license is revoked according to each line of business. The electricity unit whose license is revoked shall make a new application for electricity operating license in accordance with the decision on revocation of former license.

3. The issuing authority has competence to revoke electricity operating licenses within its licensing competence.

4. Procedures for making decision on revocation of electricity operating licenses

a) If an electricity unit violated Article 37 of Law on Electricity, Clause 4 Article 16 of this Circular and the issuing authority has made a decision on penalty, it shall also make a decision on revocation of the license.

b) If an electricity unit violated Article 37 of Law on Electricity, Clause 4 Article 16 of this Circular and the issuing authority is not the authority that makes a decision on penalty, it shall make a decision on revocation of the license according to the time limit specified in the decision on penalty. If the license is not revoked, the issuing authority shall provide explanation for the maker of decision on penalty;

c) If the electricity unit violates Point a Clause 9 Article 16 of this Circular, the issuing authority shall b entitled to make decision on revocation of license;

d) If the electricity unit wishes to The electricity unit wishes to shut down or transfer its operation to another unit; within 30 working days from the date on which the request of electricity unit or competent authority and relevant documents are received, the issuing authority shall make a decision on revocation of license.

5. Within 2 working days from the date on which a decision on revocation is made, the issuing authority shall send it to the electricity unit whose license is going to be revoked and relevant agencies; publish revocation information on the website of the issuing authority.

Chapter IV

THE POWER TO ISSUE AND MANAGE ELECTRICITY OPERATING LICENSES

Article 14. The power to issue electricity operating licenses

1. The Ministry of Industry and Trade shall issue electricity operating licenses in the following lines of business:

a) Electricity generation in power plants that are large and have key importance for society and economy and national defense and security as included in the list approved by the Prime Minister;

b) Electricity transmission;

c) Electricity export and import.

2. Electricity Regulatory Authority shall issue electricity operating licenses in the following lines of business:

a) Electricity generation in power plants that have capacity of at least 3 MW other than the case prescribed in Point a Clause 1 of this Article;

b) Electricity distribution;

c) Electricity wholesaling;

d) Electricity retailing;

dd) Electricity consulting services.

3. The People’s Committees of provinces and central-affiliated cities (hereinafter referred to as provinces) shall issue or authorize the Departments of Industry and Trade to issue electricity operating licenses in the following lines of business:

a) Electricity generation in power plants that have capacity of less than 3 MW located in the provinces;

b) Electricity distribution with voltage up to 35kV in the provinces;

c) Electricity retailing with voltage up to 0.4 kV in the provinces;

d) Electricity consulting services, including:

- Consulting services in terms of construction of transmission lines and electrical substations with voltage up to 35 kV, enterprise registration at provinces;

- Consulting services in terms of construction of transmission lines and electrical substations with voltage up to 35 kV, enterprise registration at provinces;

4. If an application for multiple licenses in the sector of electricity consulting services, in which at least one sector of services is within the competence of Electricity Regulatory Authority, the electricity operating license for this field shall be issued by Electricity Regulatory Authority.

Article 15. Responsibilities of issuing authority

1. Receive, verify, inspect and manage applications for licensing. Instruct applicants to follow appropriate procedures for application for electricity operating licenses of this Circular.

2. Settle claims in terms of electricity operating licenses within its competence.

3. Inspect and observe the maintenance of conditions in the electricity operating licenses.

4. Revoke electricity operating licenses within its competence according to the procedures prescribed in Article 13 of this Circular.

5. Request the competent authority to take actions against violating electricity units as prescribed by law.

Article 16. Responsibilities of holders of electricity operating licenses

1. Conduct electricity operation in accordance with the license.

2. Request the permission to modify name, headquarters’ address, line of business, managing unit, scope of operation, and validity period of the license.

3. Maintain conditions for electricity services that are registered and licensed during its operation.

4. Comply with relevant law provisions.

5. Pay sufficient fees for electricity operating license as per the law.

6. Do not lease, lend, or self-correct text of the electricity operating license.

7. Regarding electricity generation, within 12 months from the date on which the electricity operating license is issued, the holder of license shall provide additional documents approved by the competent authority as prescribed in Clause 8 Clause 11, Clause 12 Article 7 of this Circular.

8. Undergo inspection and abide by decision on use of license and conditions for registered operation made by the competent authority.

9. Reporting:

a) Report on the change to headquarters’ address stated in the electricity-operating license to the issuing authority within 30 days from the date of change.

b) Report on the loss of license immediately to the issuing authority;

c) Before every March 1, report on the maintenance of conditions for licensed line of business and previous operation using forms No. 4a, 4b, 4c, and 4d prescribed in Appendices issued herewith to the issuing authority and Department of Industry and Trade;

d) Report on the termination of operation or transfer of electricity operation to the issuing authority at least 60 days before the date of termination or transfer;

dd) Send reports with sufficient information upon request of the issuing authority or competent authority;

e) Regarding to electricity generation, the holder of license shall send financial statement which has been audited to Electricity Regulatory Authority for the purpose of calculating electricity generation prices before every June 1.

Article 17. Management and operation of power plants in by hired or authorized organizations

1. Investors of power plants shall fulfill obligations relating to investment and inauguration of power plants as per the law.

2. The organization which is hired or authorized to manage and operate the power plant shall fulfill fully obligations relating to the plant operation according to the contract for hiring or authorization of management of power plant.

Chapter V

IMPLEMENTATIONORGANIZATION

Article 18. Inspection

1. Electricity Regulatory Authority shall inspect the implementation of this Circular nationwide; deal with difficulties and request Ministry of Industry and Trade to amend this Circular.

2. The People’s Committees of provinces shall inspect this Circular under its management; deal with difficulties and request The Ministry of Industry and Trade to amend this Circular.

Article 19. Implementation

1. Electricity Regulatory Authority shall receive and process applications for electricity operating licenses and revoke electricity operating licenses within its and Ministry of Industry and Trade’s issuing competence.

2. The Department of Industry and Trade shall receive and process applications for electricity operating licenses and revoke electricity operating licenses within issuing competence of the People’s Committee of province as authorized.

3. The license holder shall send the copy of license to the local electricity authority within 30 days from the date of licensing.

4. Before every January 15, the Department of Industry and Trade shall report on issuance and revocation of electricity operating licenses in province in the previous year to the Ministry of Industry and Trade and the People’s Committee of province.

Article 20.Effect

1. This Circular takes effect on September 14, 2017 and annuls Circular No. 10/2015/TT-BCT dated May 29, 2015 of the Minister of Industry and Trade on procedures for issuance, revocation and validity period of electricity operating licenses from the effective date of this Circular.

2. Holders of licenses prescribed in Circular No. 10/2015/TT-BCT dated May 29, 2015 of the Minister of Industry and Trade on procedures for issuance, revocation and validity period of electricity operating licenses, Circular No. 25/2013/TT-BCT dated October 29, 2013 of the Minister of Industry and Trade on procedures for issuance, revocation and validity period of electricity operating licenses and Decision No. 32/2006/QD-BCN dated September 6, 2006 of Minister of Industry promulgating conditions, procedures for issuance, amendments, revocation, and management of electricity operating licenses, Decision No. 15/2008/QD-BCT dated July 1, 2008 of the Minister of Industry and Trade amendments to , procedures for issuance, amendments, revocation, and management of electricity operating licenses issued together with Decision No. 32/2006/QD-BCN dated September 6, 2006 of Minister of Industry on keep continual operation stated in licenses and responsibility for complying with this Circular and relevant law provisions which are promulgated after the date of licensing.

3. Any difficulties arising in the course of implementation of this Circular should be reported to Electricity Regulatory Authority, which shall then request the Ministry of Industry and Trade for amendment.

The Minister

Tran Tuan Anh