Decision No. 53/2001/QD-TTg dated April 19, 2001 of the Prime Minister on policies toward border gate economic zones

DECISION

ON POLICIES TOWARD BORDER GATE ECONOMIC ZONES

THE PRIME MINISTER

Pursuant to the Law on Organization of the Government of September 30, 1992;

At the proposal of the Ministry of Planning and Investment in Report No. 2933/BKH/QLKT of May 18, 2000, and the suggestions of the ministries and central-level branches and concerned provinces;

DECIDES:

Article 1.-Types of business in border gate economic zones.

1. The following types of business are allowed in the border gate economic zones: export-import, temporary import for re-export, transport of transit goods, bonded warehouse, duty-free shop, exhibition-fair, product show-room, establishments producing or processing imports and exports, representative branches of domestic and foreign companies, border gate markets, investment in infrastructure, service, tourism...

2. It is allowed to set up a tax suspension area in the border gate economic zone, but it must be located separately from other functional areas in the border gate economic zone.

Article 2.-Preferences.

1. Investment in building infrastructure in border gate economic zones

a/ On the basis of the actually collected annual revenues of the State budget in the border gate economic zone (excluding value added tax and special consumption tax on imports, revenues not involved in the local budget balance according to the assignment of responsibilities, such as: confiscation of smuggled goods, contributions by the population, school fees, hospital charges, foreign aid...), the State shall invest back to build the infrastructure of the border gate economic zones at the following rates:

- Reinvestment of 100% in the border gate economic zones with budget revenues of less than VND 50 billion/year.

- Reinvestment of VND 50 billion and 50% of the remaining actually collected revenues of the border gate economic zones with budget revenues of VND 50 billion/year upward.

- Reinvestment of no more than 50% of the actually collected revenues of the border gate economic zones having operated for 5 years (after the test operation) and with actually collected revenues of more than VND 100 billion/year.

b/ Border gate economic zones are eligible for preferential loans from the State (the Development Assistance Fund) to develop their infrastructure and for the use of funds stipulated at Point a, Clause 1, Article 2, to repay principal and interest.

c/ The provincial Peoples Committee shall make dispositions in the annual budget to invest in the border economic zones with low actually collected budget revenues. The investment in the infrastructural works in the border gate economic zone shall be decided by the provincial Peoples Committee according to the current regulations and on the basis of the approved planning and plans.

d/ If the infratructual projects in the border gate economic zone have received all- embracing and complete investments, it can use the remaining fund stipulated at Point a, Clause 1, Article 2 as assistance investment in other projects outside the border gate economic zone (including new border gate economic zones) which are related to and directly serve the border-gate economic zone. The president of the provincial Peoples Committee shall take responsibility for his(her) investment decision. At the same time he (she) shall inform the Ministry of Planning and Investment thereof for integration and overseeing.

2. Trade and tourism

a/ Business enterprises stipulated in Clause 1, Article 1 are eligible for State preferential loans to invest in the building of business establishments at the border gates.

b/ Commercial activities shall enjoy border trade preferences according to the current regulations of the State and the commitments that our country has signed with neighboring countries.

c/ The non-duty mechanism shall apply at the tax suspension areas as at the bonded warehouses.

d/ Investors of touristic investment projects are eligible for preferences as stipulated in Article 15 of Domestic Investment Promotion Law (amended) No. 03/1998/QH10 of May 20, 1998.

3. Land

Domestic and foreign investors investing in a border gate economic zone, when renting land and water surface, besides enjoying the current preferences, are eligible for another 50% reduction of the land and water surface rent rates compared to those currently applied at this border gate economic zone.

4. Taxation

Enterprises in the border gate economic zones shall enjoy preferences in taxation in specific cases as currently stipulated and in accordance with the laws and decrees on taxes and guiding documents of the Ministry of Finance.

Article 3.-Management of some domains

1. Entry and exit

a/ Citizens of the districts of the neighboring country with the border opposite the border gate economic zone may travel into and out of the border gate economic zone with border identity cards or border laissez-passers issued by the competent agency of the neighboring country. When they want to enter other places in the province having the border gate economic zone, the police office of this province shall issue single permission valid for a definite time.

b/Bearers of passports not in the visa exemption category (citizens of the neighboring country or a third country) are exempt from entry visa and allowed to stay at the border gate economic zone for no more than 15 days. If they are on a tour to other areas of Vietnam according to tours organized by international travel enterprises of Vietnam, the entry and exit managing agency (Ministry of Public Security) shall consider the issuance of visas right at the border gate economic zone.

c/ Goods transport means of the neighboring country and a third country are allowed to enter the border gate economic zone according to business contracts between Vietnamese enterprises and their foreign partners. In case these transport means need to deliver or receive goods at other places outside the territory of the border gate economic zone, they shall have to observe the current regulations.

Conductors of transport means (crew members of ships, car drivers, assistant drivers) are allowed to enter or go out of the border gate economic zone with passports, crew member cards, border identity cards or border laissez-passers issued by competent agencies of the foreign country.

d/ It is allowed to broaden the reception at the border gate economic zone of tourists of the foreign country going on tours with passports, cards or other equivalent papers and bound for provinces and cities in the whole country as stipulated in Clause b, Article 3.

e/ Vietnamese owners of goods and transport means who have business relations with partners in the neighboring country are allowed to accompany their goods and means to the neighboring country to deliver or receive goods with identity cards or border laissez-passers issued by competent Vietnamese agencies.

f/ Vietnamese citizens working or living in the district or town where the border gate economic zone is located, are allowed to go to the neighboring country with border identity cards or border laissez-passers issued by competent Vietnamese agencies.

2. Banking

The installation of exchange counters and the buying and selling of the currency of the bordering country at the border gate economic zone shall comply with Decision No. 140/2000/QD-TTg of December 8, 2000 of the Prime Minister issuing the Regulations on the management of currencies of the bordering countries in the border areas and in the border gate economic zones of Vietnam, and the current regulations.

3. Animal and plant quarantine, inspection of the quality of imports

Animal and plant quarantine and the inspection of the quality of imports at the border gate economic zones must be done strictly according to the current provisions of law aimed at restricting to the minimum the spread of epidemics and diseases and the introduction of goods of inferior quality into Vietnam.

Article 4.-Organization of implementation

1. Central agencies

a/ The Ministry of Planning and Investment shall draw up an integrated report to submit to the Prime Minister for supplementing and amending the policies of economic development promotion at the border gate economic zones, assume the prime responsibility and coordinate with the Ministry of Finance and the concerned ministries and branches in proposing to the Government the ending of investment in each border gate economic zone.

b/ The Ministry of Finance shall study and guide the provinces having border gate economic zones in materializing the policies on taxes, charges and fees aimed at creating the most favorable conditions for the enterprises and the export operations at the border gate economic zones.

c/ The Ministry of Trade shall assume the prime responsibility and coordinate with the Ministry of Finance and the concerned ministries and branches in studying trade policies toward the border gate economic zones and the market regulations in the border gate economic zones to assure more preferential treatment of these zones than the border markets, the regulations on the tax suspension areas in the border gate economic zones, and guide the implementation by the provinces having border gate economic zones.

The ministries and branches namely the Ministry of Construction, the Ministry of Agriculture and Rural Development, the Ministry of Science, Technology and Environment, the Ministry of Public Security, the Ministry of Defense, the General Tourism Department, the General Land Administration, the General Customs Department... shall, depending on their functions and tasks, guide the provinces having border gate economic zones in the implementation.

2. Provincial level

a/ The Peoples Committees of the provinces having border gate economic zones shall assume the prime responsibility and coordinate with the ministries and branches at the central level in unifying the content of State administrative management with regard to the activities in the border gate economic zones on the principle: there shall be only one agency to conduct a single inspection and control of the commodities and a single collection of taxes and charges on the goods and services.

The provincial Peoples Committee shall set up the Management Board of the border gate economic zone (the coordinating agency of the related organizations) to help the provincial Peoples Committee to unify the State administrative management with regard to the border gate economic zone and to solve questions arising in the process of carrying out the policies stipulated in this Decision. The Management Board of the border gate economic zone shall have an operating regulation to be adopted by the provincial Peoples Committee.

b/ The Peoples Committee of the province having a border gate economic zone is allowed to establish relations with the provincial administration of the neighboring country in order to solve questions related to the border gate economic zone in the framework of the Agreements signed by the two governments.

Article 5.-Implementation provision.

The border gate economic zones which are experimenting with policies according to earlier decisions of the Prime Minister shall now change to implementing policies based on this Decision, (for the Lao Bao trading zone in particular, Decision No. 219/1998/QD-TTg of November 12, 1998 of the Prime Minister shall apply).

With regard to the establishment of a number of new border gate economic zones, the provincial Peoples Committees shall draw up the projects to submit to the Prime Minister for approval before the policies defined in this Decision can be applied in these zones.

This Decision takes effect 15 days after its signing.

The ministers, the heads of ministerial-level agencies, the heads of agencies attached to the Government, the presidents of the People’s Committees of the provinces and centrally-run cities shall have to implement this Decision.