Circular No. 21/2016/TT-BTTTT dated September 30, 2016 on detailing a number of contents on investment in the form of public-private partnership under the management of the Ministry of Information and Communications

CIRCULAR

Detailing a number of contents on investment in the form of public-private partnership under the management of the Ministry of Information and Communications[1]

Pursuant to the June 18, 2014 Law on Public Investment;

Pursuant to the Government’s Decree No. 132/2013/ND-CP of October 16, 2013, defining the functions, tasks, powers and organizational structure of the Ministry of Information and Communications;

Pursuant to the Government’s Decree No. 15/2015/ND-CP of February 14, 2015, on investment in the form of public-private partnership;

At the proposal of the Director of the Department of Planning and Finance,

The Minister of Information and Communications promulgates the Circular detailing a number of contents on investment in the form of public-private partnership under the management of the Ministry of Information and Communications.

Article 1.Scope of regulation and subjects of application

1. This Circular prescribes investment fields, contents of a feasibility study report, and contents of a contract on an investment project in the form of public-private partnership under the management of the Ministry of Information and Communications.

2. This Circular applies to agencies, organizations and individuals engaged in or involved in investment in the form of public-private partnership under the management of the Ministry of Information and Communications.

Article 2.Investment fields

Projects on construction, renovation, operation, commercial operation and management of infrastructure facilities, and provision of equipment or public services in the following fields:

1. Centralized information technology zones, including investment in technical infrastructure facilities within and outside the zones (roads, electricity, clean water, water drainage, communications, environmental treatment and other infrastructure facilities).

2. Application of information technology, including:

a/ National information systems, national important databases, specialized databases and online information connection systems of an e-government;

b/ Technological infrastructure facilities and technological solutions to ensure information safety;

c/ Technical infrastructure facilities on information technology;

d/ Application of information technology to serve people and businesses;

dd/ Application of information technology in internal activities of state agencies.

3. Other fields in the information and communications sector as decided by the Prime Minister.

Article 3.Contents of a feasibility study report

A feasibility study report must comprise the principal contents prescribed in Article 25 of the Government’s Decree No. 15/2015/ND-CP of February 14, 2015, on investment in the form of public-private partnership, and the following contents:

1. Legal grounds for formulation of the feasibility study report

a/ Laws, decrees and guiding circulars relating to the implementation of the project in the form of public-private partnership;

b/ Laws, decrees and guiding circulars relating to investment fields, application of information technology and centralized information technology zones;

c/ Decisions approving master plans and plans on application of information technology or information technology industries relating to the project on application of information technology and centralized information technology zones; resolutions on an e-government, priority and incentive policies applicable to the project; competent authorities’ decisions and documents on steps of formulation, appraisal and approval of the project proposal; and other relevant legal documents;

d/ Reference documents in the course of study and formulation of the feasibility study report.

2. Necessity and objectives of investment

a/ To analyze the necessity of investment in the project, social demands and the satisfaction of the requirement on application of information technology in state agencies so as to accelerate work performance and reduce operation expenses, in order to dramatically boost the development of an e-government, raise the quality and efficiency of operation of state agencies, and better serve people and businesses;

b/ To prioritize selecting localities that have advantages in traffic, telecommunications and information technology infrastructure facilities, information technology human resources and the degree of information technology application and development to build centralized information technology zones;

c/ The degree of the project’s demand satisfaction before and after investment; and the project’s potential and benefits, as a basis for determining the project’s investment needs, time and size;

d/ Investment objectives of the project, including:

- General objectives: benefits brought about by the project to national and local socio-economic activities; the project’s contribution to general objectives of the information and communications sector and of the country;

- Specific targets: to specify detailed and quantitative indicators (quantity, quality and time); to explain problems solved, the number of beneficiaries of services provided by the project, and other specific targets.

3. Analysis of advantages of the project investment in the form of public-private partnership

a/ To explain advantages of the project investment in the form of public-private partnership, clearly analyzing advantages on capital sources, capital payback capacity, economic efficiency and capacity to transfer risks among related parties;

b/ To demonstrate limitations of the project investment in the form of public-private partnership compared to other forms, including project management and implementation capacity of related parties; and complexity in formulation and performance of terms in the project contract;

c/ For a project proposed by the investor, its feasibility study report must clearly analyze advantages on capital sources and the investor’s capacity to balance capital; the investor’s management capacity and experience; and capital payback capacity, investment efficiency and capacity to receive risks.

4. Conformity of projects with development master plans and plans

a/ Investment projects to build centralized information technology zones must comply with the Prime Minister’s decision approving the master plan on development of centralized information technology zones;

b/ Investment projects on application of information technology in state agencies must comply with the Prime Minister-approved national program on application of information technology in state agencies’ activities;

c/ Other projects must comply with development master plans and plans of the information and communications sector.

5. For a project on application of information technology, the contents of its preliminary design must comply with the provisions on management of state budget-funded investment with application of information technology.

6. Assessment of conformity and compliance with current technical regulations on application of information technology in state agencies in Vietnam.

7. When it is necessary to apply international regulations or standards or phased investment so as to reduce complexity level of a project and increase the feasibility and attractiveness of the project, to give detailed explanations based on the project size and overall plan on project implementation to analyze difficulties in the course of project implementation.

8. Analysis of a project’s risks and proposal of investment incentives and assurance

a/ To determine principal risks of the project and assess impacts of risks, if any, on the project so as to propose the optimal sharing of risks to the competent state agency and investor, and concurrently propose risk reduction solutions and responsibilities of related parties in risk management in the course of project implementation. Such contents shall be presented in a summary of project risks, specifically:

- To determine the project’s principal risks in legal, social and environmental affairs; designing, construction and production; costs for construction, equipment and completion of a work; financial and macroeconomic affairs; market demand; work operation; and contract termination, and other risks (if any).

- To describe principal risks of the project and analyze the possibility of occurrence of risks and the level of risk impacts on the project (in terms of cost, progress, design change, capital allocation, etc.); to assess financial impacts of risks, if any, on the project, and when necessary, to apply different options of financial models on a pilot basis for assessment of such impacts.

Based on specific technical, economic and financial conditions of the project and financial analysis results, to assess risk impacts on the project, and costs and benefits of risk reduction solutions. The feasibility study report must specify the expected sharing of risks and responsibilities of related parties in risk management in the course of project implementation; propose specific supports provided by the competent state agency and the mechanism of risk sharing between the competent state agency and investor.

b/ Based on the assessment of project risks and current conditions of domestic and international financial markets, to give detailed explanations about investment incentive proposals, and types of the Government’s investment guarantee and assurance as prescribed in Chapter 9 of the Government’s Decree No. 15/2015/ND-CP of February 14, 2015, on investment in the form of public-private partnership, together with conditions and necessary standby obligations in the course of performing the project contract.

9. Proposal of investment incentives and assurance

a/ Investment supports and incentives as prescribed in Articles 21 and 22 of the Government’s Decree No. 154/2013/ND-CP of November 8, 2013, on centralized information technology zones; the laws on investment, tax and land; and other relevant laws;

b/ Investment supports and incentives on application of information technology as prescribed in the Government’s Resolution No. 41/NQ-CP of May 26, 2016, on tax incentives to boost the development and application of information technology in Vietnam; the laws on investment, tax and land; and other laws.

Article 4.Contents of a project contract

A project contract must comprise basic contents prescribed in Article 32 of the Government’s Decree No. 15/2015/ND-CP of February 14, 2015, on investment in the form of public-private partnership, and the following contents:

1. Grounds to consider the conformity of the project contract type stated in the approved project proposal or to select another type of project contract.

2. Analysis of strengths and weaknesses of the selected type of project contract to the extent of risk sharing and factors relating to the feasibility of project implementation.

3. Clarification of the responsibilities relating to project implementation (including designing, construction, operation and capital arrangement) of the competent state agency, investor and project enterprise.

4. For projects applying information technology in state agencies which are invested in the form of public-private partnership, the build-lease-transfer contract (BLT) shall apply with the State’s investment capital to be paid to the service-providing investor suitable to annual capital-balancing capacity, and such a project must have the following principal contents:

a/ Size, scope, timetable, and price of the hiring of information technology services;

b/ Output technical specifications of information technology services; quality standards and criteria and requirements for services; requirements and conditions on connection capacity to applications and other information systems to be satisfied by service providers;

c/ Regulations on forms and methods to assess service quality, and forms of supervision and assessment of contract performance results;

d/ Requirements on and process of transfer of the project to the state agency concerned when the contract expires;

dd/ Requirements on information security and safety, and protection of service user information, and other requirements relating to the hiring of information technology services;

e/ Identification of services charged to users or commercializing databases developed from application of information technology under contract (if any), and agreements on principles of sharing of profits and expenses between related parties;

g/ Rights and obligations of every signatory to the contract; time and principles of contract payment and final settlement; and other contents as agreed by the contract signatories;

h/ Conditions, mechanisms and cases eligible for adjustment of lease prices (if any).

Article 5.Organization of implementation

1. This Circular takes effect on November 16, 2016.

2. In the course of implementation of this Circular, organizations and individuals engaged in investment in the form of public-private partnership should report arising problems to the Ministry of Information and Communication (the Department of Planning and Finance) for prompt guidance and settlement.-

Minister of Information and Communications
TRUONG MINH TUAN