Decision 38/2016/QD-TTg policies to protect and develop forests and invest in supporting agricultural and forestry companies

DECISION

On promulgation of a number of policies to protect and develop forests and invest in supporting infrastructure, assigning public tasks to agricultural and forestry companies

Pursuant to the Law on Organization of the Government dated June 19, 2015;

Pursuant to the Law on Forest Protection and Development dated December 23, 2004;

Pursuant to the Government's Decree No. 23/2006/ND-CP dated March 3, 2006, on implementation of the Law on Forest Protection and Development;

Pursuant to the Government's Decree No. 118/2014/ND-CP dated December 17, 2014, on restructuring, developing and improving the agriculture and forestry companies;

At the proposal of the Minister of Planning and Investment;

The Prime Minister hereby promulgates the Decision on promulgation of a number of policies to protect and develop forests and invest in supporting infrastructure, assigning public tasks to agricultural and forestry companies.

Chapter I

GENERAL PROVISIONS

Article 1. Perspectives on forest development direction

1. The State encourages organizations, households and individuals of all economic sectors to invest in planting forests and processing forest products in accordance with the law on forest protection and development.

2. Production forests are multi-purpose forests; production forests are planted to increase income for forestry practitioners and contribute to protecting the environment and ecology.

3. Organizations, households, individuals and village population communities (hereinafter referred to as communities), shall invest and benefit directly from afforestation, exploitation and processing of timbers and forest products. The State shall support part of the initial costs to encourage forest development, at the same time to pay part of the environmental value brought by planted forests and compensate for low profits due to the specificity of forestry.

4. The development of production forests must be attached with the industry of processing and consumption of forest products, ensuring stable and sustainable forestry.

5. Various economic sectors shall be given priority in supporting to invest in planting production forests, creating motivation to promote forestry development in especially difficult communes. Special priority is given to supporting investment in planting forests for production and timber processing in the Northwest, Central Highlands and mountainous districts of the Central provinces.

Article 2. Scope of regulation and subjects of application

1. Scope of regulation: This Decision provides a number of mechanisms and policies on forest protection and sustainable forestry development.

2. Subjects of application: Domestic organizations, households and individuals and village population communities that operate under Vietnamese law and protect and develop forests, exploit and process forest products and entities specified in Clause 2 Article 1 of the Government's Decree No. 118/2014/ND-CP dated December 17, 2014, on restructuring, developing and improving the agriculture and forestry companies (hereinafter referred to as Decree No. 118/2014/ND-CP).

Article 3. Objectives of forest development

1. By 2020: To plant 900,000 hectares of production forests, with an average of 180,000 hectares planted each year. To plant 75,000 hectares of protection forests and special-use forests, to plant 15,000 hectares each year. Zoning off for forest regeneration of 360,000 hectares.

2. To create jobs and increase income to stabilize the lives of mountainous people.

3. To promote the formation of a long-term and stable forestry market, including the market for providing seeds, technical services, and the market for processing and consuming forest products.

Article 4. Interpretation of terms

1. Investment support: means a form of supporting part of investment capital from the state budget to organizations, households, individuals and communities according to regulations.

2. Post-investment support: means a form of support in which investors (organizations, households, individuals and communities) invest themselves in afforestation and timber processing in accordance with this Decision, and then the State accepts the investment results (partial or entire results), the State will pay investors the capital support from the budget as specified in this Decision.

3. High-technology forestry park: means a zone in which forestry R&D projects are initiated; new products are manufactured; and production technology application of high-tech products serving forestry production, including: Forestry seedling by plant tissue culture; production of ancillary products (glues, coatings, mechanical accessories); manufacturing of equipment for timber processing and forestry product industry.

High-tech forestry park: means an area implementing research and development (R&D) projects of the forestry industry; new product production area; technology application zone for the production of products with high technology content serving forestry production, including: Forestry seed production using tissue propagation technology; auxiliary product production area (adhesives, coatings, mechanical accessories); manufacturing area for equipment serving the timber and forest products processing industry.

Chapter II

POLICIES FOR SUPPORTING IN INVESTING IN FOREST PROTECTION AND DEVELOPMENT

Article 5. Supporting plantation of production forests, plantation of scattered trees and forestry promotion

1. Organizations, households and individuals and communities planting forests on bare land or hills that are planned for production forests shall be entitled to a support from state budget with the support levels as follows:

a) In case of planting big timber trees (to be exploited after 10 years), multi-purpose trees, indigenous trees: VND 8 million/ha; in case of planting small timber trees (to be exploited after 10 years) and scattered trees (equivalent to 1,000 trees/ha): VND 5 million/ha.

b) In case of planting production forests in border communes, Son La, Lai Chau, Dien Bien provinces and provinces of the central highlands: an additional support amount of VND 2 million/ha shall be provided, apart from the support levels specified at Point a Clause 1 of this Article.

2. Organizations, households and individuals and communities planting trial forests (with new varieties, on new land) according to the master plan approved by a competent authority shall be entitled to a capital support equivalent to 60% of the approved afforestation costs. Each model of planning trial forests shall be supported not more than 2 ha.

3. Forest promotion support: VND 500,000/ha for 4 years (1 year for planting and 3 years for tending).

4. Lump-sum support for surveying, designing and signing an afforestation contract: VND 300,000/ha.

5. Lump-sum support for grant of sustainable forestry certificates to enterprises, communities, groups of households and households: 70% of costs, not more than VND 300,000/ha for at least 100 ha (for natural forests or planted forests).

6. Forms of support: Post-investment support and investment support.

7. Supporting conditions:

a) Forest owners that are organizations, households, individuals and communities must have land planned for production forestry allocated or leased by competent authorities and be granted a certificate of land use rights or have stably used the land for 3 years or more, without disputes. For state enterprises and other organizations, land for production forests must be assigned to organizations, households, individuals and communities for long-term stability (at least one cycle).

b) The source of afforestation varieties (seeds, fruits or seedlings) must originate from a seed production facility that has been certified by a competent authority as to the seed source according to regulations.

Article 6. Support for plantation of protection forests, special-use forests, zoning off for forest tending, regeneration, assignment of forest protection

1. Investment in plantation of protection forests and special-use forests: Planned capital from central state budget is VND 30 million/ha; specific investment amount shall be determined based on the economic and technical norms and the projects approved by the competent authority, the provincial-level People’s Committee and agencies deciding on central investment shall balance and supplement the remaining budget deficit according to approved estimates. Organizations (non-state), households, and individuals planting protection forests shall supplement the remaining part (compared to the support level of 30 million VND/ha) according to the technical design estimate for implementation.

2. Support for planting bamboo, canals to protect river banks, stream banks, and works with high risk of landslides. Support level is VND 100,000/cluster (minimum 3 trees/cluster; 1 year of planting and 3 years of care and protection).

3. Assignment of forest protection: Average: VND 300,000/ha/year. Specific levels shall be decided by the provincial-level People’s Committee. In which support for preparing dossiers of assignment of forest protection is VND 50,000/ha/5 years.

a) For households and individuals of poor districts under of the Government’s Resolution No. 30a/2008/NQ-CP dated December 27, 2008: comply with the Prime Minister’s Decision No. 2621/QD-TTg dated December 31, 2013, amending and supplementing certain of production development support levels specified in the Government’s Resolution No. 30a/2008/NQ-CP dated December 27, 2008, on the support program for fast and sustainable poverty reduction in 61 poor districts.

b) For households of ethnic minorities, households of poor King people and communities that are assigned forests in communes with difficult socio-economic conditions (zone II, III) of ethnic and mountainous areas: comply with the Government’s Decree No. 75/2015/ND-CP dated September 9, 2015, on mechanism and policy on forest protection and development associated with the policy on rapid and sustainable poverty reduction and assistance for ethnic minorities in the 2015-2020 period.

c) For assignment of protection of coastal preventive forests and special-use forests: comply with the Prime Minister’s Decision No. 120/QD-TTg dated January 22, 2015, approving the scheme for coastal forest protection and development in response to climate change for the 2015-2020 period.

4. Zoning off for natural forest tending, regeneration: The State encourages development of protection forests, special-use forests using method of zoning off for natural forest tending, regeneration with support amount as follows:

a) Without additional plantation: Support VND 3 million/ha/6 years, the specific level shall be decided by the provincial-level People’s Committee.

b) With additional plantation: Support VND 1.6 million/ha/year for the first 3 years and VND 600 thousand/ha/year for 3 subsequent years.

Article 7. Support for the development of high-tech forestry

1. The State shall provide support in investing in 3 high-tech forestry parks in Northern, Central and Southern regions.

2. Investment contents: The State shall invest in synchronous infrastructure system, R&D facilities and equipment serving research.

3. Enterprises investing in high-tech forestry parks shall be entitled to incentives and supports as specified in the Government's Decree No. 210/2013/ND-CP dated December 19, 2013.

Article 8. Rights and obligations of organizations, households and individuals and communities (hereinafter referred to as forest owners) in plantation of production forests

1. Rights: To be entitled to all products from planted forests, when exploiting products freely circulating and be entitled to preferential policies on tax exemption and reduction and land use levy according to applicable law.

2. Forest owners can use up to 30% of the land area that has been allocated or leased but does not have forests to invest in serving eco-tourism, resorts, combined agricultural and fishery production, of which the area land reserved for infrastructure construction (roads, permanent structures, factories) is a maximum of 20%.

3. Obligations: When exploiting planted forest products, the forest owner must pay the commune's Forest Protection and Development Fund and the village’s Forest Protection and Development Fund an amount equivalent to 80 kg of rice/ha/planted forest cycle, of which 50% is deducted for each fund.

For production forest areas assigned by households, individuals and communities from special-use and protection forest management boards or state enterprises (referred to as assigned party), the forest owners (assigning party) must pay the above amount to the assigning party. In addition, the forest owner is not required to pay any additional amount to the signing party.

After exploiting the planted forest, within 12 months, the forest owner must organize reforestation according to regulations.

In case the forest owner has received support money from the State to replant the forest for more than 5 years but the forest fails to meet the standards prescribed by the State, the forest owner must invest their own capital to replant the forest or return it to the state budget an amount of support received plus commercial interest at the time of recovery.

In case of deforestation due to force majeure causes such as natural disasters, fires, pests, the amount of support received is not required to be refunded.

4. For the area of planted forests that are special-use forests, protection forests already planted with capital from the previous Program 327 and capital from the state budget under the 5 million hectares of new forest planting project, now planned as production forests, the rights and obligations of the forest owner shall comply with Clauses 1, 2 and 3 of this Article.

Article 9. Rights and obligations of organizations, households and individuals and communities (hereinafter referred to as forest owners) in planting protection forests, zoning off for natural forest tending, regeneration

1. Rights: To be entitled to a support from the state budget as specified in this Decision and all products from forests in case of obtaining permission to exploit forests according to the State’s regulations.

2. To be allowed to use up to 30% of land area without forests to develop agricultural production, eco-tourism and resort construction and build infrastructure to serve forestry.

3. Obligations: To plant and protect protection forests and natural forests in accordance with the applicable law on forest protection.

Article 10. Supporting investment in planting and managing seedling forests and seedling gardens

1. The State supports investment in building and maintaining the management and protection of seedling forests and seedling gardens. In which the State (including state enterprises and organizations established by the State) only directly manages seedling forests and seedling gardens of national importance with a maximum area of 30% of the total area planned for seedling forests and seedling gardens; the remainder is assigned, sold, or contracted to other economic sectors for business management in accordance with the law.

2. Seedling forests and seedling gardens managed by economic sectors must be included in the master plan approved by the competent authority and receive investment support in building initial facilities according to projects approved by the competent authority. Maximum support norms from the state budget for silviculture, infrastructure construction and equipment are specified as follows:

a) Not more than VND 55 million/ha for newly planted seedling gardens.

b) Not more than VND 40 million/ha for newly planted seedling forests.

c) Not more than VND 15 million/ha for converted seedling forests.

d) In addition to the above support level, there will also be a support of VND 300,000/ha/year for the cost of managing and protecting seedling forests and seedling gardens; the support term does not exceed 5 years.

Article 11. Supporting investment in building high-quality seedling centers

1. Criteria for supported seedling centers:

a) Being a tissue culture facility with a minimum scale of 1 million plants/year.

b) The land area focused on building a seedling center is at least 3.0 hectares (including land to build houses, workshops, and land for nurseries).

2. Conditions for receiving investment support:

a) For provinces that do not have a tissue culture facility, they will be supported to invest in building a seedling center according to the criteria specified in Clause 1 of this Article.

b) Being a non-state enterprise or a state enterprise with an equitized seedling facility, in which the State holds no more than 50% of the charter capital.

c) The enterprise's capital must contribute at least 30% of the total investment in the seedling center construction project.

3. Investment support categories: Construction of offices, factories, roads, power lines, equipment procurement and technology costs.

4. The maximum support level from the state budget is 5 billion VND for a seedling center.

5. Order of support implementation: Total support amount is granted in 2 installments after acceptance. The first time is to grant 70% of the support capital after the investor completes the investment in items as prescribed in Clause 3 of this Article. The second time the remaining amount is granted after the investor has produced seedlings reaching the designed capacity and quality of seedlings.

Article 12. Support for investment in nurseries

1. Criteria for supported nurseries:

a) Serving as the basis for growing forest trees by using cuttings, buds, seeds, and plants from tissue germination.

b) The minimum land area for nursery construction is 0.5 hectares.

2. Nursery planning: On average, each commune or cluster of communes with 1,000 hectares or more of land planned for production forestry shall have a nursery. When arranging nurseries, existing nurseries should be mainly used; new construction is allowed only when there is a new project to plant raw material forests or in places where it is really necessary.

3. Conditions to receive support

a) The nursery must be part of the province's forestry seed production planning, or the nursery must be part of concentrated material forest planting projects.

b) The nursery owner must commit to using the allocated land for the purpose of producing forest varieties for at least 10 years.

c) Nurseries are under the ownership of non-state economic sectors. If there is State capital (state enterprises, Protection Forest Management Board, Special-Use Forest Management Board), the State capital portion shall not exceed 50%.

4. Investment support item: Initial infrastructure construction, including: Electricity, irrigation system, fence, material garden, leveling, hard foundation construction.

5. Support level: Average VND 300 million for newly built nurseries; newly built nurseries in border communes are supported according to the approved project capital. For nurseries renovated and upgraded to meet nursery standards specified in Clause 1 of this Article, the support level shall not exceed VND 75 million per nursery.

6. Order of support implementation: Total support amount is granted in 2 installments after acceptance. The first time is to grant 70% of the support capital after the investor completes the investment in items as prescribed in Clause 4 of this Article. The second time grants the remaining portion after one year of construction.

Article 13. Supporting investment in forestry roads

1. Boundaries for forest fire prevention and fighting (firebreaks)

a) Support conditions: Firebreaks combined with transport roads, transporting seedlings and materials, within the project area are planned with a level of 15-20 meters of road/ha. When developing a project to support investment in planting production forests, a system of firebreaks must be planned; planning must have the participation of forest owners (including forest owners who are assigned forest land under contract) in the project area. For production forest planting projects that have not previously received support for irebreaks, they are allowed to make additional planning and receive support according to this Decision.

b) The investment support level is VND 30 million/km, in which VND 25 million/km is supported for investment in construction of items of a firebreak while the remainder is used for its maintenance throughout the whole afforestation cycle.

c) Investment order and acceptance of payment and settlement: After being assigned the budget of the planning year by the provincial-level People's Committee, allow the district-level Project Management Board to design the technical design and estimate the firebreak according to standards issued by the Ministry of Agriculture and Rural Development and submitted to the district-level People's Committee for approval. After obtaining approval, allow the district-level Project Management Board to self-organize construction; after completing construction, the provincial-level Department of Agriculture and Rural Development shall be responsible for organizing the acceptance of firebreaks as a basis for settlement with the State Treasury. The district-level Project Management Board shall be responsible for managing and maintaining the entire road throughout the afforestation cycle.

2. Forestry roads: Concentrated raw material production afforestation areas, with an area of 500 hectares or more, and a maximum support of 20 meters of road/ha shall be supported to invest in forestry roads at no more than 450 million VND/km of underground through the stream that is hardened with concrete. Investment management and construction of forestry roads shall be carried out in accordance with applicable regulations.

Article 14. Support for processing of timber from planted forests for poor provinces

1. Domestic investors that have projects of plants processing timber from planted forests; industrial bamboos in Northern west provinces, provinces of Central Highlands, provinces that have poor districts as prescribed in the Government’s Resolution No. 30a/2008/NQ-CP dated December 27, 2008, shall be supported by the state budget as follows:

a) Investment support: Support VND 20 billion/MDF manufacturing plant, with scale of more than 30,000 m³ of MDF/year; support VND 10 billion/plant for plants processing chipboards, industrial laminated bamboo, with scale of more than 20,000 m³; support VND 10 billion/plant for plywood plants, with scale of more than 100,000 m³ to construct infrastructure such as traffic, electricity, water, buildings and waste treatment.

b) Post-investment support: Post-investment support shall be calculated according to the product transportation distance with the rate of VND 1,500/ton/km; the distance shall be calculated from the plant to the center of Hanoi, Da Nang, or Ho Chi Minh City according to the nearest highway; the support shall be calculated according to the actual equipment capacity of the plant; multiplied by the support period of 5 years, funding for support immediately after completion of the plant construction is at least 70% of total support funding.

2. Investment projects entitled to the support specified in Clause 1 of this Article must satisfy the following conditions:

a) Projects under investment policies according to the Law on Public Investment (replacing investment policies as specified in the Law on Investment).

b) MDF or particle board manufacturing plants must combine with the production of at least one of the products of flooring, bar boards, and laminated boards in order to avoid wasting resources; The output of this combined product is included in the support capacity.

c) Equipment manufactured in developed countries (per capita income of more than USD 10,000/year); in case of manufacturing in developing countries, such equipment must be wholly new. The plant is not allowed to relocate its registered production place for 20 years.

d) The existing area of planted forests and raw materials in the province must be enough for the plant to operate at least 60% of capacity in the first 5 years. The project must employ at least 30% of local employees.

dd) Total actual equipment capacity of plants that have been supported may not exceed 200,000 tons/province. Equipment capacity shall be equal to: product yield after taking-over inspection of a production shift x 3 shifts/day x 300 days/year.

e) Provinces which already established paper pulp manufacturing plants with a scale of at least 50,000 tons/year or MDF plants with scale of more than 100,000 m³ are not entitled to support.

g) Satisfying the requirements ono environmental protection as specified in the law on environmental protection.

Chapter III

POLICIES ON INVESTMENT SUPPORT AND ORDER TO IMPLEMENT PUBLIC TASKS

Article 15. Supporting investment and placing order to agricultural and forestry companies (specified in Clause 2 Article 1 of Decree No. 118/2014/ND-CP)

1. Support for plantation of protection forests and special-use forests: Expected support level from central state budget is VND 30 million/ha; specific levels shall be determined on the basis of the economic and technical norms and the projects approved by the competent authority. For the fund exceeding the allocated fund, forest owners shall integrate and mobilize, use other legal fundings for implementation.

2. Assignment of the plan for placing order relating to public tasks:

a) For areas of protection forests, production forests being natural forests not yet reaching the exploitation period that are directly managed by agricultural and forestry companies, 50% of support provided for households and individuals and communities for costs incurred in assignment of forest protection, zoning off for forest tending, regeneration shall be provided.

b) Support for construction of forest protection and management stations, forest fire prevention and fighting facilities and tenement houses for employees.

Chapter IV

INVESTMENT MECHANISM

Article 16. Funding for investment support

1. Central budget.

2. Local budgets: Based on this Decision, provincial-level Peoples Committees shall be responsible for using revenues from the sale of standing trees, forest resource tax, fines for violations against the Law on Forest Protection and Development, revenues retained for hydropower plants and other revenue sources specified by law in order to ensure funding for implementation in localities.

3. Funding integrated from other programs and projects with the same objectives.

4. Total investment demand for the 2016-2020 period to implement this Decision is about VND 61,000 billion, in which VND 45,000 billion is mobilized from various economic sectors (to cover VND 8,000 billion of forest environment service, VND 10,000 billion of credit; and VND 27,000 billion of capital of organizations, individuals and households).

State capital: Investment capital for state budget development is about VND 9,000 billion (VND 8,000 billion of central budget and VND 1,000 billion of local budget); economic capital of VND 5,115 billion, VND 3,000 billion of ODA.

Article 17. Support mechanism

1. Central budget support shall be provided for projects with state budget support level from group C or higher and project implementation period according to silvicultural and production cycles approved by competent authorities.

2. Post-investment support: The State shall prioritize payments for afforestation for areas (allocated or assigned under contract) to organizations, individuals, and households that invest their own capital to plant forests (in 2016-2020 period) according this Policies immediately after acceptance of the forest according to regulations.

3. Supports from the stage budget for assignment under contract for forest protection, zoning off for forest tending, regeneration, afforestation, timber processing that are investment supports and post-investment supports shall not be included in taxable income of organizations, individuals, households and communities.

4. The central budget shall only focus on targeted support for provincial budgets, which also have to receive subsidies from the central budget and a number of important projects of highly pervasive nature of the provinces decided by the Prime Minister; provinces other than those mentioned above shall be responsible for allocating local budgets to comply with this Decision.

5. If in the same support content, there are different policies, the organization, individual or community may only receive support from one policy which is most advantageous to the beneficiary.

Chapter V

SOLUTIONS AND IMPLEMENTATION ORGANIZATION

Article 18. Regarding land

1. Regarding land planned for production forests currently managed by state organizations, if the conditions for allocating land to organizations, households and individuals and communities are not fully satisfied, before applying this Decision, the state organizations shall contract with organizations, households and individuals and communities forestry land for long term (at least one silviculture cycle) to plant production forests.

2. Funding

a) Funding for planning the use of land, allocation of land and forests, lease of land, contracting of land for planting production forests, developing project on supporting the plantation of production forests shall be allocated from the state budget as specified in this Decision.

b) Organizations, individuals, households are allowed to advance their funding as specified to implement tasks specified at Point a Clause 3 of this Article, the State shall refund the advanced amounts in the subsequent budget year.

Article 19. Investment support projects

1. Investors and formulations of projects on support for investment in plantation of forests

a) Projects on support for investment in plantation of production forests of households, individuals and communities on land areas planned for production forests in buffer zones of special-use forests or protection forests shall be made and invested by the management boards of the special-use forests or protection forests.

b) Projects on support for investment in plantation of production forests of households, individuals and communities on land areas planned for raw material zones of state enterprises shall be made and invested by such enterprises.

c) Projects on support for investment in plantation of production forests of non-state enterprises, cooperatives shall be made based on the actually allocated or leased land areas and land of households, individuals and communities that agree to provide raw materials for enterprises and cooperatives shall be invested by such enterprises and cooperatives.

d) For the remaining afforestation land areas in the district or province, one or two projects on support for investment in plantation of production forests shall be made for afforestation by households, individuals and communities and investment by ranger agencies, border guard stations, or protection forest management boards.

dd) Veteran associations are allowed to make projects on plantation of dispersed trees, plantation of bamboos and canals to protect river and stream banks; manage and enjoy benefits as specified in this Decision.

e) Projects on support for investment in plantation of production forests for households, individuals and communities shall be made simply, basically ensuring the principle of not overlapping projects on plantation of production forests, clearly determine the afforestation area each forestry land lot, compartment, or sub-zone and whether the land is bare or planted with forests, in compliance with the plannings on the three kinds of forest.

g) Projects on plantation of protection forests, special-use forests, zoning off for forest tending, regeneration are formulated by forest owners in accordance with applicable regulations and laws

h) The duration of implementation of a project on silviculture investment support shall comply with the silviculture cycle.

i) Management charge for projects on investment support for afforestation, plantation of scattered forestry trees, zoning off for forest tending, regeneration, forest protection shall equal 10% of total investment support for silviculture in the area: 2% for province, district, or commune, and 8% for project owner (in which the project owner allocates 1% to the forest development board). Funding for management shall be used in accordance with applicable regulations.

2. For projects on post-investment support, the project owner is allowed to self-approve the estimated design and implementation, can only disburse 70% of the support level of the investment item after acceptance, and be disbursed 100% of the support level when the entire project is accepted. For investment support projects, project owners can organize the implementation themselves or hire consultants to carry out the investment.

Article 20. Responsibilities of ministries, sectors, and localities

1. The Ministry of Agriculture and Rural Development shall:

a) Assume the prime responsibility for, and coordinate with concerned agencies in, planning the use of forestland, allocation of forestland and forests, lease or contracting of forestland to implement this Decision.

b) Guide local governments to formulate and promulgate: regulations on operation of project management boards at all levels, steering committees for implementation of district-level projects, forest development committees of commune or village levels; regulations on management and use of commune or village forest protection and development funds;

c) Promulgate criteria for national important seedling forests and seedling gardens directly managed by the State; plan the system of seedling forests and seedling gardens; guide the assignment, sale, and contracting of seedling forests and seedling gardens directly managed by the State to other economic sectors for management in accordance with the law. Specify criteria for tissue culture facilities of seedling centers and nurseries.

d) Organize support for brand registration for seedling centers and nurseries. Post on the website on seed management of the Ministry of Agriculture and Rural Development for all seed sources and seedling facilities that have been inspected by competent authorities. Build a management information system to monitor and summarize implementation results.

dd) Set firebreak standards and develop procedures for identifying and liquidating forests due to natural disasters and fires.

e) Coordinate with the following ministries: the Ministry of Planning and Investment and the Ministry of Finance to consolidate annual and mid-term plans on the state investment support according to regulation.

g) Mobilize donors for financial and technical support. Use ODA capital to support the planting of production forests, construction of forestry infrastructure, and training of staff at all levels to effectively implement this Decision.

h) Propagate and disseminate the policy content specified in this Decision and policies related to subjects. Direct, inspect and supervise during the implementation of the Decision.

i) Issue a list of technological forestry products and use the capital assigned by the Ministry of Agriculture and Rural Development to support businesses investing in three high-tech forestry zones.

2. The Ministry of Planning and Investment shall

a) Assume the prime responsibility for, and coordinate with the Ministry of Finance, the Ministry of Agriculture and Rural Development in, balancing annual and mid-term sources of fund for submission to the Prime Minister for decision.

b) Assume the prime responsibility for, and coordinate with the Ministry of Agriculture and Rural Development in, guiding the order of supporting and specifying support levels in accordance with this Decision.

c) Take responsibility for performing the state management of forestry development investment according to the policies; coordinate with the Ministry of Agriculture and Rural Development, the Ministry of Finance and the provincial-level People’s Committee in inspecting and supervising implementation of this Decision.

d) Coordinate with the Ministry of Agriculture and Rural Development in making three-year and five-year reports on comprehensive supervision and assessment of socio-economic impacts in the implementation of this Decision in order to propose modification appropriate to actual requirements for submission to the Prime Minister for decision.

3. The Ministry of Finance shall

a) Assume the prime responsibility for guiding the state treasuries in paying and settling state budget funds for implementation of this Decision.

b) Coordinate with the Ministry of Planning and Investment and the Ministry of Agriculture and Rural Development in synthesizing, developing plans on, and making annual and mid-term state budget estimates for implementation of this Decision.

4. Other relevant ministries and sectors shall perform their assigned functions and tasks.

5. Provincial-level People’s Committees shall:

a) Plan and announce land use master plans to call on all economic sectors to invest in plantation of production forests.

b) Make and approve plannings on breeding forest and nursery systems through 2020, with a vision toward 2030 (consulting the Ministry of Agriculture and Rural Development before approval). Direct provincial-level Departments of Agriculture and Rural Development in quickly granting certificates of standard seed sources according to the Regulation on management of forest plant varieties of Ministry of Agriculture and Rural Development. Announce qualified breeding establishments on the mass media.

c) Provincial-level People’s Committees shall announce prices and technical standards for forest seedlings to be planted in localities for use as a basis for investors to pay and settle capital. Not to approve prices of seedlings on a case-by-case basis.

d) Allocate investment support capital from the state budget for projects. Direct project management boards at all levels in ensuring capital sources for planted forests in the form of post-investment support; approve investment projects according to regulations.

dd) Strengthen the dissemination and popularization of policies specified in this Decision and policies related to various levels, branches and enterprises of all economic sectors, households, individuals and communities in provinces for implementation.

e) Provincial-level People’s Committees shall assign the provincial-level Departments of Agriculture and Rural Development to assume the prime responsibility for, and coordinate with relevant agencies in, accepting investment results of supported items and projects after investment. Acceptance record shall be used as a basis for disbursement of support amounts from the State.

g) Direct, organize, inspect and supervise the implementation of this Decision.

Article 21. Effect

1. This Decision takes effect from November 1, 2016, and replaces Decision No. 147/2007/QD-TTg dated September 7, 2007, on a number of policies for development of production forests in the 2007-2015 period, and Decision No. 66/2011/QD-TTg dated December 9, 2011, of the Prime Minister, on amending and supplementing a number of articles of Decision No. 147/2007/QD-TTg.

2. Projects (approved before the effective date of this Decision) that are being implemented in accordance with Decision No. 147/2007/QD-TTg dated September 7, 2007, and Decision No. 66/2011/QD-TTg dated December 9, 2011, of the Prime Minister, will continue to be implemented and support policies in this Decision will be applied from January 1, 2016. Project owners may proactively adjust unit price, area, product type according to this Decision, but are not allowed to increase the total investment of the projects.

Article 22. Implementation provisions

Ministers, Heads of ministerial-level agencies, Heads of Government-attached agencies, Chairpersons of People’s Committees of provinces and centrally-run cities and heads of relevant agencies shall implement this Decision./.

APPENDIX

(Attached to Decision No. 38/2016/QD-UBND dated September 14, 2016, of the Prime Minister)

THE SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness
---------------

AFFORESTATION CONTRACT

No…./201…/HDTR

Pursuant to the Civil Code of the Socialist Republic of Vietnam 2004;

Pursuant to the Law on Forest Protection and Development No. 29/2004/QH11 of the National Assembly and its guiding documents;

Pursuant to Decision No. ……./QD-TTg of the Prime Minister dated………….on a number of policies for development of production forests;

Pursuant to Decision on approval for investment project for support of plantation of production forests of….No…dated….

Today, on…...[month….date…year….] at…... [place], we are:

1. Party A (Project management board….)

Headquarter: .................................................... Tel.: ................................................

Represented by

(1) Mr./Mrs.: ………………….. Position……………………………………………..,

(2) Mr./Mrs.…………………………..; supervision and forestry promotion officer

ID No. …………. issued by…………………….police, on………month……date…………year………………;

Permanent residential address..........................................................................

Tel. .................................................................................................................

2. Party B (households, individuals, communities)

Represented by Mr./Mrs. ..................................................................; ID No. …………. issued by…………………….police, on………………………………………;

Permanent residential address...............................................................

Tel..................................................................................................................

Both parties mutually agree to enter into an Afforestation Contract with the following terms and conditions:

Article 1. Contract contents

1. Carrying out procedures for issuance of land use right certificate (in a case where Party B has not had a land use right certificate):

a) Party A shall be responsible for measuring and carrying out procedures for issuance of land use right certificate for Party B (for afforestation land area permitted for issuance of land use right certificates by the competent agency) within 1 year. During the application process, this Contract shall be used as a basis for receiving afforestation support from the State.

b) If Party B's forested land area belongs to the land allocated to the State Forestry Company, the Management Board of Protection Forests and Special-Use Forests, Party A shall be responsible for measuring and drawing up a diagram for long-term stable contract (50 years) for Party B to plant forests under this contract.

c) Expenses for issuance of land use right certificate shall be covered by the state budget.

2. Afforestation support and forestry promotion

a) Party A supports Party B to (plant forests, area ....ha of forest at (specify location of parcel, lot, plot, sub-zone, village, commune,) .......

b) The afforestation land area of Party B is eligible for…… support (specific eligible subjects specified in Article 5 of this Decision). Support level provided by the State: ……….. VND/ha. Total support amount is……………………………VND (in words).

c) Support duration: 4 years, including one year of planting and three years of tending, from the signing of this Contract.

d) Standards for seedlings and price of seedlings:

- Type of tree :.......................................................................................... ;

- Crtiera for seedlings: Height ……………. cm, root collar diameter …………. cm, ……………. months old, high quality, no pest, meeting standards for planting;

- Price:…………………… VND/seedling (according to Decision No. …./QD-UB dated……….of the provincial-level People’s Committee).

d) Afforestation techniques: Afforestation density: ……………… seedlings/ha, with attached detailed specifications (standards for holes, row, seasons, etc.).

e) Forestry promotion: Party A advises on plant species, guides the techniques of planting, tending and protecting plants for Party B twice. The first time will take place at least 1 month prior to afforestation and the second time will take place in the second year. Party B has a right to contact via phone, fax or in writing for advice.

g) Supply of seedlings: (Party B may find the supply of seedlings by themselves or require Party A to supply seedlings)

- Party B shall find the supply of seedlings according to the given criteria, quality and price specified in Section d Clause 2 of this Article (specify if Party B may find the source of supply by themselves);

- Party A supplies seedlings to Party B according to the given criteria and quality specified in Section d Clause 2 of this Article.

Article 2. Rights and obligations

1. Party A’s rights and obligations:

a) Rights:

- To monitor and supervise the contract performance by Party B;

- To request Party A to perform the works according to the schedule as specified in the Contract, if Party B breaches the Contract for which Party A has given the third written warning, Party A may request recovery of or (seize) all total investment which was made at the breach time and finalize the Contract in accordance with the law provided that Party A gives a notice at least 30 days in advance to Party B.

b) Obligations:

- To measure and carry out procedures for issuance of land use right certificate for Party B in accordance with law (if Party B has not had a land use right certificate) or forestry land contracting dossier as specified in Clause 1 Article 1 of this Contract;

- Party A is obligated to provide forestry promotion services, supply seedlings as required by Party B with contents specified in Clause 2 Article 1. Party A is obligated to supervise the afforestation, disseminate and raise Party B’s knowledge of plantation of forests and silviculture development;

- In case of receiving Party B’s request for advice on policies and forest promotion in writing, Party B must send a written response to Party B;

- To protect planted forests together with Party B.

2. Party B’s rights and obligations

a) Rights:

- To be entitled to all products of planted forests;

- Products of planted forests are freely circulated;

- To be entitled to other incentive policies on tax reduction and exemption, land levies according to applicable laws;

- Rights of receiving advice on policies and forest promotion from Party A.

b) Obligations:

- To ensure the planting and tending of forests, avoid land waste;

- To exploit products of forests in accordance with law;

- When exploiting products, submit the commune budget or assignor the amount equivalent to 80 kg of rice/ha in order to build the forest development and protection fund of the commune and village, in which the commune-level fund shall use 50% and village fund shall use 50%. To pay taxes to the State (if any) in accordance with the tax law;

- If individuals, households, communities have received the State’s monetary support for afforestation but after 4 years their forests fail to satisfy the criteria set out by the State, they must use their own capital for reforestation or refund to the state budget the monetary support amounts plus the commercial interests at the time of recovery.

Article 3. Contract term

This Contract’s term is equal to one silviculture cycle, in…….years, from the year in which the Parties officially sign this Contract.

Article 4. Force majeure

Parties are waived from liability in case of any damage or breach of this Contract due to force majeure events. Force majeure events shall be determined in accordance with Article 6 of the Prime Minister’s Decision No. 147/2007/QD-TTg dated September 10, 2007, on approving a number of policies on development of production forests for the 2007-2015 period.

Article 5. Contract value and method of payment

1. Contract value: Total amount payable to Party B by Party A is …………………. VND (in words).

2. Payment method

Party A shall make payments to Party B in ………….. installments (subject to supported entities)

- First year: ……………….. VND, in which VND…… of seedlings and VND ………….. of labor

- Second year: …………….. VND in………………………………….. [month/year]

- Third year: …………….. VND in………………………………….. [month/year]

- Fourth year: …………….. VND in………………………………….. [month/year]

Article 6. Dispute resolution

Any dispute arising during the performance of this Contract shall be settled by both Parties through negotiation. In case of failing to negotiation, either Party has the right to file a lawsuit with a competent court agency for resolution but must notify the other Party at least 15 days in advance. The Court's decision is the final decision that the Parties are obliged to implement.

Article 7. Final provision

1. Both Parties agree with the above-mentioned terms of the Contract.

2. This Contract is made into 7 copies in Vietnamese, each copy has (…) pages; of which 3 is kept by Party A, one is kept by Party B, one kept by the supervision and forestry promotion officer, 1 copy is saved at the commune-level People’s Committee and 1 copy is kept at the village for supervision./.