Decision No. 166/2008/QD-TTg dated December 11, 2008 of the Prime Minister adjusting the geographical boundary, and promulgating the Regulation on the operation of, Dong Thap province border-gate economic zone

DECISION

ADJUSTING THE GEOGRAPHICAL BOUNDARY, AND PROMULGATING THE REGULATION ON THE OPERATION OF, DONG THAP PROVLNCE BORDER-GATE ECONOMIC ZONE

THE PRIME MINISTER

Pursuant to the December 25, 2001 Law on Organization of the Government;

Pursuant to the November 29, 2005 Investment Law;

Pursuant to the Governments Decree No. 29/2008/ND-CP of March 14, 2008, providing for industrial parks, export-processing zones and economic zones;

At the proposal of the Minister of Planning and Investment and the President of the Peoples Committee of Dong Thap province,

DECIDES:

Article 1. The geographical boundary of Dong Thap province border-gate economic zone is determined as follows:

1. Dong Thap province border-gate economic zone is a delimited area with functional quarters within the national territory and under the national sovereignty and has the most favorable investment and business environment under current regulations, with socio-economic infrastructure and management policies and mechanisms favorable for business activities and compliant with the market mechanism.

2. Dong Thap province border-gate economic zone (after having its boundary adjusted) has an area of 319.36 km2, with a 48.7-km borderline and 2 international border gales of Thuong Phuoc and Dinh Ba, and 5 subsidiary border gates, namely SoThuong, Thong Binh, Moc Ra, ADon, and Binh Phu. The zone encompasses 11 communes and two townships, including Thuong Phuoc 1, Thuong Phuoc 2, Thuong Thoi Hau A. Thuong Thoi Hau B, Thuong Lac, Thuong Thoi Tien, Tan Hoi and Binh Thanh communes (Hong Ngu district), Binh Phu, Tan Ho Co and Thong Binh communes (Tan Hong district) and Hong Ngu and Sa Ray townships.

Its geographical boundary is determined as follows:

- To the north, it borders on Pray Veng province, Cambodia;

- To the south, it borders on communes of Hong Ngu and Tan Hong districts:

- To the west, it borders on Phu Chau district, An Giang province, separated by Tien river;

- To the east, it borders on Tan Hung district, Long An province.

Article 2. To promulgate together with this Decision the Regulation on the operation of Dong Thap province border-gate economic zone.

Article 3. This Decision takes effect 15 days after its publication in CONG BAO.

Article 4. Ministers, heads of ministerial-level agencies, heads of government-attached agencies and the President of the Peoples Committee of Dong Thap province shall implement this Decision.

REGULATION

ON THE OPERATION OF DONG THAP PROVINCE BORDER-GATE ECONOMIC ZONE
(Promulgated together with the Prime Ministers Decision No. 166/2008/QD-TTgof December 11, 2008)

Charpter 1

GENERAL PROVISIONS

Article 1. Scope of regulation

This Regulation provides for the operation of and a number of policies toward Dong Thap province border-gate economic zone; and rights and obligations of domestic and foreign organizations and individuals conducting investment and business activities in the zone.

Article 2. Development objectives of Dong Thap province border-gate economic zone

1. To build and develop Dong Thap province border-gate economic zone into a driving economic zone and a center for economic cooperation among the Mekong River sub-region countries in the east-west economic corridor, especially between Vietnam and Cambodia.

2. To build the centers in Dong Thap province border-gate economic zone into border urban centers, effectively tap the zones geographical, political, economic, cultural and social conditions in the process of international economic cooperation in order to boost economic development and promote the pervasive effects of the zone on the Mekong river sub-region countries, especially for Vietnam and Cambodia in the integration process.

3. To develop rural areas, especially border areas while restricting adverse impacts on the social and ecological environment, cultural and ethnic minority-related affairs, social order, and security and defense by creating jobs, promoting training and raising peoples intellectual standards and human resource quality.

4. To create conditions for the protection of national sovereignty and border security, effectively settle social problems and improve peoples material and spiritual life, ensure national solidarity and enhance cooperation and friendship with regional countries.

Article 3. Policies towards Dong Thap province border-gate economic zone

The Government of the Socialist Republic of Vietnam encourages domestic organizations and individuals of all economic sectors, overseas Vietnamese and foreign investors to invest and do business in Dong Thap province border-gate economic zone in the areas of import, export, temporary import for re-export and cargo transit transportation under transit cargo transportation agreements; bonded warehouses; duty-free shops, trade fairs and exhibitions; product showroom; import and export production and processing establishments; representative offices, domestic and foreign companies; border-gate marketplaces, socio-economic infrastructure investment; tourism; and financial and banking services in accordance with Vietnams laws and treaties to which Vietnam is a contracting party.

Article 4. Rights of organizations and individuals investing or doing business in Dong Thap province border-gate economic zone

Apart from entitlements provided for by Vietnams laws and treaties to which Vietnam is a contracting party, enterprises investing or doing business in Dong Thap province border-gate economic zone also have the following rights:

1. To enjoy incentives provided for in the Governments Decree No. 29/2008/ND-CP of March 14, 2008, on industrial parks, export-processing zones and economic zones, and this Regulation.

2. To use infrastructure facilities, public facilities and common services in Dong Thap province border-gate economic zone, such as roads, technical infrastructure system, lighting electricity, electricity and water supply and communication and information, and pay charges therefor at rates agreed upon with infrastructure enterprises.

3. To transfer land use rights and assets attached to land within the land-lease or -sublease duration in accordance with the land law and land use purposes of licensed investment projects. If there is any change in the projects original investment purposes, the transfer of land use rights and assets attached to land may only be effected after it is approved by competent authorities.

4. To mortgage the land use right value and assets attached to land within the land-lease or -sublease duration at Vietnam-based credit institutions and overseas credit institutions in accordance with law.

Chapter 2

OPERATION OFTHE INDUSTRIAL AND TRADE CENTER IN DONG THAP PROVINCE BORDER-GATE ECONOMIC ZONE

Article 5. Dong Thap province border-gate economic zone has a industrial and trade center, an administrative management quarter, a border-gate management and control quarter, urban and residential quarters, tourist and service centers and an agricultural, forestry and fisheries development quarter. The area and location of each quarter shall be indicated in the general planning and the detailed planning of Dong Thap province border-gate economic zone.

The industrial and trade center in the zone (below referred to as the industrial and trade center) will be separated from other functional quarters of the border-gate economic zone and inland Vietnam by solid fences with entrance gates so as to ensure the control by relevant functional agencies of people, goods and means of transport.

The industrial and trade center will have no permanent or temporary residents (including foreigners).

Article 6. Goods and service import and export activities of the industrial and trade center

1. Exchange of goods and services between the industrial and trade center and other functionaI quarters in Dong Thap province border-gate economic zone and inland Vietnam is considered import and export relations and must comply with Vietnams laws on import and export, and custom, procedures must be carried out according to Vietnams customs law. Exchange of goods and services between the industrial and trade center and foreign countries is considered exchange among foreign countries.

2. Economic organizations operating in the industrial and trade center may export to and import from abroad all goods and services which are not banned under Vietnams law.

3. Economic organizations and individuals in Dong Thap province border-gate economic zone and inland Vietnam may only import from the industrial and trade center goods and services which are not banned from import and export into the industrial and trade center goods and services which are not banned from export.

4. Goods and services imported from abroad into the industrial and trade center and goods and services exported from the industrial and trade, center to abroad are exempted from import or export duty.

5. Goods and services imported from abroad into the industrial and trade center are not liable to value-added tax.

6. Goods and services produced and consumed in the industrial and trade center are eligible for the value-added tax rate of 0%; goods and services brought from other functional quarters in Dong Thap province border-gate economic zone and inland Vietnam into the industrial and trade center are eligible for the value-added tax rate of 0%. Goods and services brought from the industrial and trade center into other functional quarters of the zone and inland Vietnam are subject to value-added tax in accordance with current law.

7. Excise tax-liable goods and services which are produced and consumed in the industrial and trade center and excise tax-liable goods and services which are imported from abroad or brought from inland Vietnam into the industrial and trade center are not subject to excise tax, except for excise tax-liable cars.

8. Excise tax-liable goods and services which are exported from the industrial and trade center to abroad are not subject to excise tax.

9. Excise tax-liable goods and services which are brought from the industrial and trade center into inland Vietnam are subject to excise tax.

10. For goods processed, re-processed or assembled from imported raw materials and components in the industrial and trade center, when being imported into inland Vietnam, import duty shall be paid only for the quantities of imported raw materials and/or components constituting such goods. If no imported raw materials and components are used, such goods are not liable to import duty when imported into inland Vietnam.

Article 7. Investment incentives

1. All investment projects in the industrial and trade center are entitled to the maximum incentives applicable to geographical areas meeting with exceptional socio-economic difficulties prescribed in the Investment Law, the Law on Enterprise Income Tax, the Law on Value-Added Tax and other incentives under treaties, bilateral or multilateral trade agreements which Vietnam has signed or acceded to.

2. Investment projects in the industrial and trade center are entitled to a corporate income tax rate of 10% for 15 years after commencement of business activities; enjoy tax exemption for at most 4 years after taxable incomes are generated and a 50% reduction of payable tax amounts for subsequent 9 years.

3. Investment projects on the installation of new production chains, expansion of production scale, renewal of technology, improvement of the eco-environment or raising of production capacity are exempted from corporate income tax on the income brought about by the investment for at most 4 years and enjoy a 50% reduction of the payable tax amounts for subsequent 7 years.

Article 8. Incentives for tourists to the industrial and trade center

Domestic and foreign tourists to the industrial and trade center may purchase and bring into inland Vietnam imported goods (goods not banned from import) valued at no more than VND 500,000/person/day free from import duty, value-added tax and excise tax (if any). If the goods value exceeds VND 500,000, the excessive amount will be taxed under current regulations like ordinary imported goods.

Before implementing this policy, the Peoples Committee of Dong Thap province shall promulgate criteria for identification of eligible tourists so as to ensure strict management and prevent tax evasion.

Chapter 3

IMPLEMENTATION PROVISIONS

Article 9. Other matters related to activities of organizations and individuals in Dong Thap province border-gate economic zone not provided for in this Regulation comply with relevant provisions of the Commercial Law, the Investment Law, the Enterprise Law, the Land Law, other legal documents, and treaties to which Vietnam is a contracting party.

Article 10. Incentive mechanisms and policies specified in this Regulation also apply to domestic and foreign organizations and individuals that have been conducting investment or business activities within Dong Thap province border-gate economic zone for their remaining operation duration.