Circular 36/2015/TT-BGTVT on management of domestic air transport freight and aviation service prices

CIRCULAR

ON MANAGEMENT OF DOMESTIC AIR TRANSPORT FREIGHT AND AVIATION SERVICE PRICES

Pursuant to the Law on Vietnam Civil Aviation No. 66/2006/QH11 dated June 29, 2006 and Law Amending and Supplementing a Number of Articles of the Vietnam Civil Aviation Law No. 61/2014/QH13 dated November 21, 2014;

Pursuant to the Law on Prices No. 11/2012/QH13 dated June 20, 2012;

Pursuant to the Government’s Decree No. 177/2013/ND-CP dated November 14, 2013, on detailing and guiding a number of articles of the Law on Prices;

Pursuant to the Government’s Decree No.107/2012/ND-CP dated December 20, 2012, defining functions, rights, responsibilities and organizational structure of the Ministry of Transport;

Upon request of the Director of the Department of Transport and the Director of the Civil Aviation Authority of Vietnam;

The Minister of Transport hereby promulgates the Circular on management of domestic air transport freight and aviation service prices.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation and subjects of application

1. This Circular guides the principles of determining the domestic air transport freight and aviation service prices; competence and responsibilities of agencies and units in formulating and appraising price plans and deciding prices and declaring prices.

2. This Circular applies to organizations and individuals providing, using and managing domestic air transport freight and aviation service prices.

Article 2. Payment currency

1. Prices of domestic air transport freights within the territory of Vietnam, prices of aviation services provided for domestic flights are specified in Vietnam Dong (VND).

2. Prices of domestic air transportation services outside the territory of Vietnam are specified in local currency or freely convertible currency in accordance with regulations in such countries.

3. Prices for aviation services provided for international flights are specified in US Dollars (USD). In case of payment in Vietnamese Dong, it shall be converted according to the provisions of the law on foreign exchange.

Article 3. Principles of service pricing determination

1. General principles for domestic air transportation freight and aviation service prices:

a) Service prices are determined on the basis of actual and reasonable production and business costs; consistent with service quality, supply and demand situation in the market;

b) The price level is consistent with the socio-economic development policy in each period and consistent with the price level of the same type of service in the ASEAN region;

c) Service prices must ensure competitiveness, not abuse the monopoly position.

2. In addition to the general principles specified in Clause 1 of this Article, organizations and individuals providing aviation services must comply with the following principles:

a) The price of aviation services for international flights is determined on the basis of ensuring the return of investment capital, creating accumulation for the unit, suitable for output and investment scale; allowing the application of pricing methods to improve the quality of services provided by the airport;

b) Aviation service prices for domestic flights are determined on the basis of domestic market prices, taking into account the relationship between domestic and international prices of the same service;

c) Prices of non-aviation services at airports and aerodromes are charged on the principle of non-exclusivity, suitable with the market, ensuring the interests of customers and regulations of law on prices.

Article 4. Preferential price policy to encourage and expand service users

1. The preferential price policy is built and promulgated on the basis of ensuring transparency, publicity, and non-discrimination among service users in the same type of service provided.

2. The competent agency shall determine preferential pricing policies for services that are specifically priced by the State and provided by state-owned enterprises.

3. Service-providing organizations and individuals take the initiative in formulating and promulgating preferential and discounting policies for their units.

Chapter II

SPECIFIC PROVISIONS

Section 1. PRICING

Article 5. List of services determined by the Ministry of Transport, price brackets

1. Decision on the price of aviation services, including:

a) Take-off and landing services;

b) Inbound and outbound flight control services;

c) Support services to ensure flight operations;

d) Passenger services;

dd) Aviation security assurance services;

e) Flight control services over flight information areas managed by Vietnam.

2. Decision on the price bracket of economy-class domestic passenger transportation services within the territory of Vietnam on routes exploited by enterprises with a monopoly position, enterprises or groups of enterprises with dominant position in the market.

3. Decision on price brackets for a number of aviation services operated by enterprises with monopoly position, enterprises or groups of enterprises with dominant position in the market exploited at airports and aerodromes, including:

a) Airport parking rental service;

b) Passenger check-in counter rental service;

c) Luggage conveyor belt rental service;

d) The service of renting a bridge to take passengers on and off the plane;

dd) Package of ground commercial technical services at airports and aerodromes (for airports where the package method is applied);

e) Automatic luggage sorting service;

g) Aviation fuel refilling service;

h) Services of using underground fuel supply system infrastructure at airports and aerodromes.

4. Decision on price brackets for some non-aviation services:

a) Space leasing services at passenger and cargo terminals;

b) Essential basic services at passenger terminals.

Article 6. Process of making and appraising price plan dossiers

1. Organizations and individuals providing services shall make 02 sets of price plan dossiers and send them to the Civil Aviation Authority of Vietnam in one of the following ways:

a) Direct sending;

b) Send by official dispatch;

c) Send by email with electronic signature or scan with scanned copy of Form with signature and seal, or send by fax and phone to notify, and send by official dispatch at the same time.

2. The price plan dossier comprises:

a) An official dispatch of request for valuation and price adjustment;

b) Price plan;

c) Other relevant documents.

The price plan dossier is specified in Appendix 1 issued together with this Circular.

3. Time limit for appraisal of price plan and time limit for price decision:

a) Within 15 working days from the date of receipt of a complete dossier of the price plan as prescribed, the Civil Aviation Authority of Vietnam shall give a written appraisal opinion on the contents of the price plan.

If the price plan dossier is incomplete, within 03 working days, the Civil Aviation Authority of Vietnam shall request organization or individual to complete the dossier in writing. The appraisal time is counted from the date of receiving the complete dossier as prescribed.

b) Up to 10 working days from the date of receipt of the price plan with comments from relevant agencies and the appraisal document from the Civil Aviation Authority of Vietnam, the Ministry of Transport shall decide the price. In case the price is not decided, the Ministry of Transport shall reply in writing.

c) In case it is necessary to extend the time for evaluating the price plan or deciding the price, the Civil Aviation Authority of Vietnam or the Ministry of Transport must notify in writing and clearly state the reason for the extension to the organization or individual who submits the price plan; the duration shall not exceed 15 working days from the expiry date of price appraisal and decision as prescribed at Points a and b of this Clause.

4. Price adjustment:

a) When factors forming domestic and world prices fluctuate, affecting production and business activities, the Ministry of Transport shall promptly consider and adjust prices;

b) Organizations and individuals have the right to propose the Ministry of Transport to adjust the price according to the law provisions. Organizations and individuals, when requesting the Ministry of Transport to adjust the price level, must clearly state the reason and the basis for determining the price level proposed for adjustment;

c) The order and time limit for price adjustment shall comply with Clauses 1, 2 and 3 of this Article.

Section 2. PRICE DECLARATION

Article 7. List of services with price declaration

1. Services specified in Clauses 2 and 3, Article 5 of this Circular.

2. Aviation services under the valuation competence of service providers, including:

a) Inland freight and postal services;

b) Technical services for ground trade (except for services provided under bilateral or multilateral cooperation contracts);

c) Cargo service at the airport;

d) Service of using equipment in the station;

dd) Other services at the airport.

Article 8. Price declaration method

1. 05 working days before declaring price, service providers shall make 02 sets of price declaration dossiers and send them to the Civil Aviation Authority of Vietnam in one of the following ways:

a) Send directly;

b) Send by official dispatch;

c) Send by email with electronic signature or scan with scanned copy of Form with signature and seal, or send by fax and phone to notify, and send by official dispatch at the same time.

2. Price declaration dossier comprises:

a) A document of the organization or individual, specifying the time and effectiveness of the declared price and accompanying documents;

b) List of specific prices;

The price declaration dossiers are specified in Appendix 2 issued together with this Circular.

3. Price declaration shall not be made in the following cases:

a) The adjusted price increase is within 5% of the previously declared price and not exceed the maximum price as prescribed;

b) The adjusted price reduction is within 10% of the previously declared price and not lower than the minimum price as prescribed.

4. In case the adjusted price increases by 5% or decrease by less than 10% compared to the previously declared price, the organization or individual must declare the price according as prescribed by law.

Article 9. Procedure for receiving and reviewing price declaration dossiers

1. Procedure for receiving dossier:

a) Upon receipt of the price declaration dossier, the Civil Aviation Authority of Vietnam shall record the date, month and year of receipt of the document and stamp on the declaration dossier according to administrative procedures, and at the same time return 01 copy of the dossier to the organization or individual who submits the declare dossier;

b) If the price declaration dossier is incomplete, within 02 working days, the Civil Aviation Authority of Vietnam shall request the declarant to complete his/her declaration dossier in writing.

c) After 05 working days from the date of receipt of the complete price declaration, if there is no request made by the Civil Aviation Authority of Vietnam on explanation and supplement the contents and components of the dossier, the declaration is adopted.

2. Dossier review process:

Follow the document review process specified in Clause 2, Article 16 of the Minister of Finance’s Circular No. 56/2014/TT-BTC dated April 28, 2014, on guiding the Government’s Decree No. 177/2013/ND-CP of November 14, 2013, detailing and guiding the implementation of a number of articles of the Law on Prices.

Section 3. BIDDING FOR NON-AVIATION SERVICES, LISTING, AND PUBLICATION OF PRICES

Article 10. Bidding for non-aviation services

1. In case of not exploiting, using the premises, or providing services, enterprises providing services for operating passenger terminals and cargo terminals must organize bidding to select organizations and individuals to rent the premises and provide non-aviation services.

2. The order and procedures for bidding shall comply with law provisions on bidding.

Article 11. Listing prices

Service-providing organizations and individuals shall list prices for non-aviation services in accordance with Articles 17 and 18 of the Government’s Decree No. 177/2013/ND-CP dated November 14, 2013, on detailing and guiding the implementation of a number of articles of the Law on Prices.

Article 12. Publication of prices

Service-providing organizations and individuals shall:

1. Publicly announce the prices of domestic air transport freights and aviation services to users before providing services or before signing service provision contracts.

2. Publicly announce and send documents to competent state agencies about the preferential price policy within the competence of the unit.

Section 4. RESPONSIBILITIES OF STATE MANAGEMENT AGENCIES AND SERVICE PROVIDING ORGANIZATIONS AND INDIVIDUALS IN IMPLEMENTATION OF SERVICE PRICES

Article 13. Responsibilities of state management agencies

1. The Ministry of Transport shall:

a) Decide on prices and price brackets for services specified in Article 5 of this Circular;

b) Organize the inspection and examination of the observance of law provisions on prices, promptly handle violations in accordance with law provisions.

2. Civil Aviation Authority of Vietnam shall:

a) Guide service-providing organizations and individuals to implement regulations on price management according to the guidance in this Circular and relevant legal documents;

b) Announce and post the list of domestic routes, the list of organizations and individuals that must declare prices for domestic air transport freights and aviation services on the website of the Civil Aviation Authority of Vietnam;

c) Inspect and examine the observance of the law on prices according to its competence.

3. Airport authority shall:

a) Regularly inspect, supervise and urge the implementation of regulations on prices of non-aviation services by organizations and individuals providing non-aviation services at airports and aerodromes;

b) To inspect and examine the observance of the law on prices according to its competence.

Article 14. Responsibilities of service providers

1. To implement regulations on price management under the guidance of this Circular and other relevant legal documents.

2. To prepare and send reports on the implementation of domestic air transport freights and aviation service prices at the request of competent state agencies.

3. To abide by inspection and examination decisions of competent state management agencies.

Chapter III

IMPLEMENTATION PROVISIONS

Article 15. Effect

1. This Circular takes effect on October 01, 2015.

2. The Joint Circular No. 103/2008/TTLT/BTC-BGTVT dated November 12, 2008, of the Minister of Finance and the Minister of Transport, on guiding the management of domestic air fare and freight rates and air service charge rates at Vietnamese airports and airfields and the Joint Circular No. 43/2011/TTLT/BTC-BGTVT dated March 28, 2011, on amending, supplementing the Joint Circular No.103/2008/TTLT/BTC-BGTVT dated November 12, 2008 shall cease to be effective from October 01, 2015.

Article 16. Transitional provisions

1. Prices and price brackets for aviation services which are specified in the Minister of Finance’s Decision No. 1992/QD-BTC dated August 15, 2014, on promulgating a number of prices and price brackets at Vietnamese airports, airfields; Price bracket for domestic passenger transportation of economy class specified in the Minister of Finance’s Decision No. 3282/QD-BTC dated December 19, 2014, on the maximum level of the economy class of passenger transportation on domestic routes with the monopoly position will continue to be applied until there is application of other documents from the Minister of Transport on the price and price bracket for domestic air transport freights and aviation services.

2. Organizations and individuals that lease premises and provide non-aviation services at airports shall continue to perform the terms of contracts signed with enterprises providing passenger and cargo terminal operations services until the contracts expire but not later than December 31, 2016. From January 01, 2017 or after the contracts’ expiration date (for a contract that expires before December 31, 2016), the enterprises providing passenger and cargo terminal operations services shall organize bidding to select organizations and individuals to rent premises and provide non-aviation services as prescribed in Article 10 of this Circular.

Article 17. Implementation

The Chief of the Ministry Office, the Chief Inspector of the Ministry, the General Directors, the Directors of the Civil Aviation Authority of Vietnam, and the heads of the relevant agencies, organizations, and individuals shall be responsible for the implementation of this Circular.

          The Minister

Dinh La Thang 

* All Appendices are not translated herein.