Decree No. 67/2013/ND-CP dated June 27, 2013 of the Government detailing some articles and implementation measures of the Law on Prevention of Tobacco Harm on tobacco business

THE GOVERNMENT

Decree No. 67/2013/ND-CP dated June 27, 2013 of the Government detailing some articles and implementation measures of the Law on Prevention of Tobacco Harm on tobacco business

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

Pursuant to the Law on the Prevention of Tobacco Harm dated June 18, 2012;

At the request of the Minister of Industry and Trade,

The Government issues the Decree detailing some articles and implementation measures of the Law on Prevention of Tobacco Harm on tobacco business,

Chapter 1.

GENERAL PROVISIONS

Article 1. Scope of regulation

This Decree detailing some articles and implementation measures of the Law on Prevention of Tobacco Harm on tobacco business, in particular:

1. The conditions for producing, trading in tobacco, processing tobacco ingredients, investing in areas where tobacco ingredients are planted and sold, selling tobacco; exporting, importing machinery, equipment, ancillary materials and tobacco; prevention of smuggling and trade fraud.

2. Investment in manufacture of tobacco, processing tobacco ingredients, transfer of industrial property rights, and transfer of the right to use subjects of industrial property related to tobacco manufacture

3. Manufacture and processing of tobacco for export; processing of tobacco ingredients for export.

4. Control of domestic sale of tobacco, announcement of permissible quantity of imported and exported of tobacco.

Article 2. Subjects of application

1. This Decree is applicable to the organizations and individuals engaged in tobacco business and other activities related to tobacco business within Vietnam’s territory.

2. Foreign traders, foreign enterprises in Vietnam regulated by this Decree and relevant legislative documents.

3. This Decree is not applicable to the import and sale of tobacco at duty-free shops. The sale of tobacco in non-tariff zones shall comply with regulations of the Government.

Article 3. Interpretation of terms

In this Decree, the terms below are construed as follows:

1. Tobacco leaves are leaves of the tobacco plant (scientific name Nicotine tobacco L and Nicotine rustic) that are raw materials for processing tobacco ingredients.

2. Tobacco is the product manufactured wholly or partially from tobacco ingredients, and in the form of cigarettes, cigars, shredded tobacco that are used for smoking pipes, smoking, chewing, or sniffing.

3. Tobacco shreds are products processed from tobacco leaves that are shredded.

4. Shredded tobacco is tobacco that are manufactured wholly or partially from tobacco ingredients, and made in the form of tobacco shreds that are used for smoking pipes, rolling, smoking, and chewing.

5. Ancillary materials are all supplies other than tobacco ingredients that are used for manufacturing tobacco products.

6. State import of tobacco is the mechanism for importing tobacco by which the State appoints major importers of tobacco.

7. Permissible of quantity of tobacco manufacture and import is the amount of tobacco that an enterprise, which has a License for tobacco manufacture, is permitted to manufacture or import to sell at home.

8. Tobacco ingredient processing is a process by machinery and equipment in order to create tobacco ingredients.

9. Tobacco suppliers are tobacco manufacturers or tobacco importers or branches or affiliates of tobacco manufacturers.

10. Tobacco distributors are traders that purchase tobacco directly from tobacco suppliers and sell them to tobacco wholesalers.

11. Tobacco wholesalers are traders that purchase tobacco from tobacco distributors and tobacco suppliers to sell to tobacco retailers

12. Tobacco retailers are traders that purchase products from tobacco wholesalers and sell them to consumers.

13. Investment in tobacco cultivation are enterprises providing capital and technologies for planting, cultivating, and harvesting tobacco ingredients, or providing capital (cash, supplies, goods, etc.) and technologies for planters to plant, cultivate, and harvest tobacco.

14. Tobacco manufacturing productivity is the capacity of machinery and equipment for manufacturing product.

Article 4. Principles of tobacco business management

1. The State shall unify the management of the investment, manufacture, sale, export, import of tobacco, and other activities related to the sale of tobacco and tobacco ingredients.

2. Tobacco is in the list of goods restricted from business. Organizations and individuals that manufacture, trade in tobacco, process tobacco ingredients, and make investments in tobacco cultivation must obtain licenses.

3. The State shall control the supply of tobacco to the market (including quantities of manufactured and imported tobacco), appoint major tobacco importers, and control the sale of tobacco on the market to reduce tobacco harm.

4. The State shall rearrange tobacco manufacturers towards making inefficient manufacturers more competitive in the domestic and international marker.

5. The State shall strictly control the trade in tobacco by the Scheme of tobacco trade network.

6. Machinery and equipment used for tobacco manufacture, ingredients, cigarette papers, and tobacco are goods under the management of the Ministry of Industry and Trade.

Chapter 2.

INVESTMENT, TRADING  AND PROCESSING TOBACCO INGREDIENTS

Article 5. Investment of tobacco cultivation and use of tobacco variations

1. The investment in areas where tobacco plants are planted in each locality must be conformable with the planning for tobacco ingredient area approved by competent state authorities and local land planning.

2. The use of tobacco variations must comply with the laws on management of plant varieties.

Article 6. Tobacco ingredient classification

1. Tobacco planters, enterprises that plant, process, trade in tobacco ingredients shall classify tobacco ingredients in accordance with law.

2. The Ministry of Industry and Trade shall cooperate with relevant Ministries and agencies in formulating national technical standards of tobacco ingredient classification.

Article 7. Conditions eligibility certificate issuance to tobacco cultivation investment

Conditions for eligibility certificate issuance to tobacco cultivation investment:

1. The trade in tobacco ingredients is registered.

2. Investment scale, infrastructure, equipment, and personnel:

a) The area for tobacco cultivation is at least 100 hectares a year

b) The premises where ingredients are sold include the classification sector, packaging sector, and storage sector that suit the business scale;

c) The area of the warehouse of tobacco ingredients must not be smaller than 500m2. The warehouse must have a ventilation system and equipment that suitable for the preservation of the tobacco ingredients, including: thermometer and hygrometer to monitor the temperature and relative humidity of the air in the warehouse, equipment for pest prevention; the shelves and platforms where tobacco ingredients are put must be installed at least 20 cm from the ground and 50 cm from the walls and pillars;

d) Employees are proficient and experienced in investment management, technical support, and ingredient purchase. Every employee must hold at least an intermediate degree in agriculture. Each technician is in charge of no more than 50 hectares of tobacco plantation.

3. Condition for trading in tobacco ingredients.

Contracts to invest in tobacco cultivation signed with planters must be suitable for the business scale.

4. Environment protection and fire and explosion prevention.

Vehicles and equipment serving fire prevention and fighting and environment protection must be adequate.

Article 8. Eligibility certificate application in tobacco cultivation investment

1. A written request for the Certificate of eligibility to invest in tobacco cultivation.

2. A copy of the Certificate of Business registration.

3. The declaration of the area, floor plan of the warehouse, workshop, office, and other ancillary sites.

4. The manifest of equipment: ventilation system, fire prevention and fighting equipment, hygrometer, thermometer, pest prevention equipment, shelves and platforms.

5. The list of employees, copies of labor contract and intermediate degrees in agriculture (or higher) of investment managers, technical supporters, and ingredient purchasers.

6. Copies of contracts to invest in tobacco cultivation signed with planters and the statement of planting area and estimated quantity of tobacco leaves.

Article 9. Conditions for License issuance to business in tobacco ingredients

1. The enterprise is established within the law and the trade in tobacco ingredients is registered.

2. The business location is definite.

3. Infrastructure, equipment, and personnel:

a) The means of transport are suitable for the business scale and the preservation of tobacco ingredients during the transport;

b) The area of the tobacco ingredient warehouse is at least 1000 m2. The warehouse must have a ventilation system and equipment that suitable for the preservation of the tobacco ingredients, including: thermometer and hygrometer to monitor the temperature and relative humidity of the air in the warehouse, equipment for pest prevention; the shelves and platforms where tobacco ingredients are put must be installed at least 20 cm from the ground and 50 cm from the walls and pillars;

d) Employees are proficient and hold at least intermediate degrees in agriculture or above.

4. Contracts to entrust the import of tobacco ingredients are signed with tobacco manufacturers, enterprises that process tobacco ingredients, or contracts to entrust the export of tobacco ingredients signed with enterprises eligible to invest in tobacco cultivation or enterprises that process tobacco ingredients.

5. Environment protection and fire and explosion prevention.

Vehicles and equipment serving fire prevention and fighting and environment protection must be adequate.

Article 10. Dossier for the License to tobacco ingredients business

1. The written request for the License to tobacco ingredients business

2. A copy of the Certificate of Business registration.

3. The declaration of the area, floor plan of the warehouse, workshop, office, other ancillary sites, and means of transport.

4. The manifest of equipment: ventilation system, fire prevention and fighting equipment, hygrometer, thermometer, pest prevention equipment, shelves and platforms.

5. The list of employees, copies of labor contract and intermediate degrees in agriculture (or higher) of ingredient purchasers.

6. Copies of contracts to entrust the import of tobacco ingredients are signed with tobacco manufacturers or enterprises that process tobacco ingredients, or contracts to entrust the export of tobacco ingredients signed with enterprises eligible to invest in tobacco cultivation or enterprises that process tobacco ingredients.

Article 11. Authority, procedure for eligibility certificate issuance in tobacco cultivation investment and License to tobacco ingredients business

1. Authority for eligibility certificate issuance in tobacco cultivation investment and License to tobacco ingredients business:

Services of Industry and Trade of central-affiliated cities and provinces (hereinafter referred to as Services of Industry and Trade) shall issue, reissue, and adjust the Certificate of eligibility to invest in tobacco cultivation and License to trade in tobacco ingredients to local enterprises.

2. Procedure for eligibility certificate issuance in tobacco cultivation investment and License to tobacco ingredients business:

a) Each enterprise that invests in tobacco cultivation and each enterprise that trades in tobacco ingredients shall submit 01 application for the Certificate of eligibility to invest in tobacco cultivation or License to trade in tobacco ingredients to the Service of Industry and Trade;

b) Within 10 working days from the day on which the valid application is received, the Service of Industry and Trade shall consider issuing the Certificate of eligibility to invest in tobacco cultivation or License to trade in tobacco ingredients. If the previously mentioned conditions are not met, the Service of Industry and Trade shall issue a written refusal and provide explanation.

c) If the application is not sufficient, the Service of Industry and Trade shall request the enterprise to supplement the application within 05 working days from the day on which the application is received.

3. Making and storing the Certificate of eligibility to invest in tobacco cultivation and the License to trade in tobacco ingredients.

The Certificate of eligibility to invest in tobacco cultivation and the License to trade in tobacco ingredients shall be made into 04 copies; 02 copies are kept by the Service of Industry and Trade, 01 copy is sent to the Ministry of Industry and Trade, and 01 copy is sent to the applicant.

4. Each Certificate of eligibility to invest in tobacco cultivation and License to trade in tobacco ingredients is valid for 05 years. Before the expiration date, the applicant shall submit 01 application for its re-issuance if they wish to continue operating. The documentation and procedure for the re-issuance are specified in Article 39 of this Decree.

Article 12. Conditions of License issuance to process tobacco ingredients

1. The enterprise is established within the law and the tobacco ingredient processing is registered.

2. Infrastructure, equipment, and personnel:

a) The area of the processing facility, including the classification sector, processing sector, packaging sector, and ingredient storage, must suit the business scale. The total area must not be smaller than 5,000 m2 ;

b) Unprocessed tobacco ingredients and processed tobacco ingredients are stored in separate warehouses. The warehouse must have a ventilation system, thermometer and hygrometer to monitor the temperature and relative humidity of the air in the warehouse, equipment for pest prevention; the shelves and platforms where tobacco ingredients are put must be at least 20 cm from the ground and 50 cm from the walls and pillars;

c) Synchronous machinery and equipment are used to produce shredded tobacco, tobacco flakes and other substitute ingredients used for manufacturing tobacco. The ingredient processing line must be specialized and meet standards of industrial hygiene, occupational safety, and environmental hygiene;

d) Adequate devices are used to inspect the quality of ingredients before and after processing;

dd) All machinery has legal origins;

e) Contracts are signed with employees that hold at least college degrees in mechanics and technologies.

3. Contracts to invest in tobacco cultivation are signed with tobacco planters, or ingredient sale contracts are signed with enterprises that invest in tobacco cultivation.

4. Standards of tobacco ingredients

The quality must meet the national technical standards and current regulations on quality.

5. Environment protection and fire and explosion prevention.

Vehicles and equipment serving fire prevention and fighting and environment protection must be adequate.

6. Location of the processing facility

The location of the processing facility must conform with the Strategy and Planning for tobacco production and tobacco ingredients areas that are approved by competent authorities.

Article 13. Dossier for License issuance to process tobacco ingredients

1. The written request for the License to process tobacco ingredients.

2. A copy of the Certificate of Enterprise registration or Certificate of Business registration.

3. The declaration of area, floor plans of the classification sector, processing sector, packaging sector, warehouses, offices, and other ancillary sectors.

4. The manifest of synchronous machinery and equipment for tobacco ingredient processing, equipment for inspecting the quality of ingredients before and after processing, ventilation system, fire prevention and fighting equipment, hygrometer, thermometer, pest prevention equipment, shelves and platforms.

5. Documents proving legal origins of machinery and equipment.

6. The list of employees.

7. Copies of labor contracts enclosed with copies of qualifications in mechanics, technology, and food chemistry of employees that process tobacco ingredients.

8. Copies of contracts to invest in tobacco cultivation signed with tobacco planters and ingredient sale contracts signed with enterprises that invest in tobacco cultivation.

9. Copies of Certificate of qualified tobacco ingredients issued by competent authorities.

Article 14. Authority and procedure for License issuance to process tobacco ingredients

1. Authority for License issuance to process tobacco ingredients

The Ministry of Industry and Trade shall issue, reissue, and adjust the License to process tobacco ingredients.

2. Procedure of issuing the License to process tobacco ingredients:

a) The enterprise that processes tobacco ingredients shall submit 01 application for the License to process tobacco ingredients to the Ministry of Industry and Trade;

b) Within 20 working days from the day on which the valid application is received, the Ministry of Industry and Trade shall consider issuing the License to process tobacco ingredients. If the aforesaid conditions are not met, the Ministry of Industry and Trade shall issue a written refusal and provide explanation.

c) If the application is not sufficient, the Ministry of Industry and Trade shall request the enterprise to supplement the application within 07 working days from the day on which the application is received.

3. Making and keeping the License to process tobacco ingredients:

The License to process tobacco ingredients shall be made into 04 copies; 02 copies are kept by the Ministry of Industry and Trade, 01 copy is sent to the applicant, and 01 copy is sent to the Service of Industry and Trade of the locality where the head office of the enterprise is situated.

4. Each License to process tobacco ingredients is valid for 5 years. 30 days before the expiration date, the enterprise that processes tobacco ingredients shall submit 01 application for the re-issuance if they wish to continue operating. The documentation and procedure for the re-issuance are specified in Article 39 of this Decree.

Article 15. Rights and obligations of enterprises that invest, trade in tobacco ingredients, and process tobacco ingredients

Apart from the rights and obligations stipulated by the laws on enterprises, the enterprises that invest in tobacco cultivation, trade in tobacco ingredients, and process tobacco ingredients also have the rights and obligations below:

1. The enterprises that have the eligibility certificate to invest in tobacco cultivation are entitled to choose the area and tobacco planters in accordance with the Planning for tobacco production and tobacco ingredient area. Sign contracts to invest in tobacco cultivation and to purchase tobacco ingredients with tobacco planters; sign contracts to sell tobacco ingredients with enterprises that have the License to manufacture tobacco or to process tobacco ingredients.

2. Enterprises that have the License to trade in tobacco ingredients may only import tobacco ingredients on behalf of the enterprises that have the License to manufacture tobacco or License to process tobacco ingredients; export tobacco ingredients on behalf of the enterprises that have the Certificate of eligibility to invest in tobacco cultivation or License to process tobacco ingredients.

3. The enterprises that have the License to process tobacco ingredients may use machinery and equipment suitable for processing tobacco ingredients.

4. Enterprises that invest in tobacco cultivation must put up signboards saying their trade names at purchase posts; provide the tobacco ingredient classification criteria and tobacco ingredient samples at purchase posts.

5. Enterprises that invest in tobacco cultivation, trade in tobacco ingredients, or processing tobacco ingredients must maintain the conditions for licensing throughout their operation.

6. Every year, enterprises that invest in tobacco cultivation shall register the tobacco cultivation area and the estimated quantity of tobacco ingredients with the local governments (People’s Committee of communes or wards).

Article 16. Fund for tobacco ingredient planting and processing

1. Enterprises that invest in tobacco cultivation may establish a fund for planting and processing tobacco ingredients in order to develop the tobacco ingredient area.

2. The establishment of the fund for planting and processing tobacco ingredients must comply with regulations of the Ministry of Finance.

Chapter 3.

TOBACCO MANUFACTURE

Article 17. Conditions for License issuance to manufacture tobacco

1. Enterprises that manufacture tobacco before the issuance date of the Government’s Resolution No. 12/2000/NQ-CP dated August 14, 2000 on National Policy on prevention of tobacco harm 2000 – 2010, or the enterprises that have their investment policies agreed by the Prime Minister when merging or cooperating in tobacco manufacturing

2. Conditions of investment and use of tobacco ingredients planted at home

a) Enterprises must participate in investment in tobacco cultivation in the form of direct investment or cooperation with enterprises that have the Certificate of eligibility to invest in tobacco cultivation in accordance with the approved Planning for tobacco ingredient area;

b) Tobacco ingredients planted at home must be used for tobacco manufacture. Where ingredients at home are not sufficient, the needed quantity may be imported according to the annual import plan made by the Ministry of Industry and Trade, except for the manufacture of tobacco bearing foreign makes or exported tobacco. This plan must be conformable with the Tobacco manufacture and tobacco ingredient area planning.

3. Requirements of machinery and equipment:

a) Adequate machinery and equipment are used for rolling and packaging cigarettes;

b) Cigarettes must be rolled and packaged by automated lines, except for traditional products that need manual works;

c) Adequate devices are used for measuring and inspecting quality criteria, such as weight, circumference, and depression of the cigarettes. Enterprises may hire other capable service providers to inspect other physical, chemical, and hygiene criteria of cigarettes. The inspection results must be systematically kept for a longer period of time than the shelf life of products (06 months);

d) All machinery and equipment used for tobacco manufacture have legal origins.

4. Technical regulations and standards of tobacco.

Enterprises must comply with standards and National Technical Regulations on tobacco.

5. Requirements of brand ownership.

Enterprises must acquire legal ownership or right of use of the brands registered and protected in Vietnam.

6. Requirements of environment protection and fire and explosion prevention.

Vehicles and equipment serving fire prevention and fighting and environment protection must be adequate.

Article 18. Conditions for License issuance to manufacture tobacco

1. The written request for the License to manufacture tobacco.

2. A copy of the Certificate of Enterprise registration or Certificate of Business registration that covers the tobacco manufacture.

3. A report on the performance of the enterprise over the last 03 years (if any) and estimated production in the next 05 years (specifying the production of each product).

4. The manifest of machinery and equipment for rolling and packing cigarettes (productivity of each stage).

5. Documents proving legal origins of machinery and equipment.

6. Contracts to process shredded tobacco, contracts for quality inspection services (if any).

7. The declaration of the area, floor plan of the storage, workshop, office, and other ancillary sites.

8. Copies of documents proving the legal ownership right of use of tobacco brands.

9. Copies of the Declaration of conformity with National Technical Regulations on tobacco.

10. Copies of documents proving the investment in the development of tobacco ingredient areas.

Article 19. Authority and procedure for License  to manufacture tobacco

1. Authority to issue the License to manufacture tobacco:

The Ministry of Industry and Trade shall issue, reissue, and adjust the License to manufacture tobacco.

2. Procedure for issuing the License to manufacture tobacco:

a) The enterprise that manufactures tobacco shall submit 01 application for the License to manufacture tobacco to the Ministry of Industry and Trade;

b) Within 20 working days from the day on which the valid application is received, the Ministry of Industry and Trade shall consider issuing the License to manufacture tobacco. If the aforesaid conditions are not met, the Ministry of Industry and Trade shall issue a written refusal and provide explanation.

c) If the application is not sufficient, the Ministry of Industry and Trade shall request the applicant to supplement the application within 07 working days from the day on which the application is received.

3. Making and keeping the License to manufacture tobacco:

The License to manufacture tobacco shall be made into 04 copies; 02 copies are kept by the Ministry of Industry and Trade, 01 copy is sent to the applicant, and 01 copy is sent to the Service of Industry and Trade of the locality where the head office of the enterprise is situated.

4. Each License to manufacture tobacco is valid for 05 year. 30 days before the expiration date, the tobacco manufacturer shall submit 01 application for the re-issuance of the License to manufacture tobacco if they wish to continue manufacturing. The documentation and procedure for the re-issuance are specified in Article 39 of this Decree.

Article 20. Quantity of manufactured and imported tobacco

1. The total quantity of tobacco manufactured and imported to be sold at home must not exceed the total production of tobacco announced by the Ministry of Industry and Trade before the issuance date of the Law on Tobacco harm prevention.

2. The total quantity of tobacco manufactured and imported by an enterprise to be sold at home must not exceed the production in the License to manufacture tobacco.

3. Based on the performance of the enterprise in 03 years and the production plan for the next 05 years, the Ministry of Industry and Trade shall consider and announce the permissible quantity of tobacco manufactured and imported of each tobacco manufacturer in the next 05 year in the License to manufacture tobacco.

4. The quantity of tobacco manufactured by enterprises (converted into 20-cigarette packs) must reach at least 100 million packs per year (including domestic sale and export). If this target is not reached, the business line must be changed or the enterprise must be merged into another enterprise that has the License to manufacture tobacco.

Article 21. Manufacturing capacity and redistribution of manufacturing capacity

1. The tobacco manufacturing capacity of each enterprise and the whole tobacco industry is the capacity of machinery and equipment on the issuance date of the Government’s Resolution No. 12/2000/NQ-CP dated August 14, 2000, which is determined and announced by the Ministry of Industry before the issuance of the Law on Tobacco harm prevention.

2. The capacity of each enterprise is the basis for the management of machinery and equipment for tobacco manufacture and quantity of manufactured and imported tobacco.

3. Where a tobacco manufacturer, which has a market for tobacco and is licensed to manufacture tobacco by the Ministry of Industry and Trade, is not capable, it is entitled to:

a) Have tobacco processed by the enterprises with excess capacity for tobacco manufacture;

b) Renting, borrowing, or buying machinery and equipment from enterprises with excess capacity for tobacco manufacture after the Ministry of Industry and Trade makes a written approval.

4. Redistribution of tobacco manufacturing capacity.

The Ministry of Industry and Trade shall redistribute the tobacco manufacturing capacity from enterprises with excess capacity without feasible plans for utilizing it to the incapable enterprises that have license for manufacture and market. In particular:

a) Consensus shall be reached among tobacco manufacturers in order to ensure their benefits;

b) Where enterprises fail to reach a consensus according to Clause 3 of this Article, the redistribution of machinery and equipment among tobacco manufacturers shall comply with law.

Article 22. Tobacco brand names

1. Tobacco shall only be sold after it has intellectual property rights protected in Vietnam.

2. Manufacturers of foreign tobacco brands must obtain the Prime Minister’s permission to sell them in Vietnam.

3. Only enterprises having Licenses to manufacture tobacco are allowed to print labels or sign contracts with printing facilities to print tobacco labels.

Article 23. Rights and obligations of tobacco manufacturers

Apart fro the rights and obligations stipulated by law, tobacco manufacturers also have the following rights and obligations:

1. Establishing a system for distributing and wholesaling the tobacco they produce and retail tobacco at their affiliated shops without the License to retail tobacco.

2. Distributing tobacco they produce (directly or via branches or affiliates) to enterprises that have licenses for tobacco distribution or wholesaling.

3. Announce the fundamental standards of products and ensure the conformity of their tobacco with National Technical Regulations on tobacco.

Chapter 4.

INVESTMENT IN TOBACCO MANUFACTURE

Article 24. Requirements and procedure for investment in upgrading equipment and technologies; investment in manufacture and processing of tobacco for export; moving; investment in tobacco ingredient processing

1. The investments in upgrading equipment and technologies; investments in manufacturing and processing tobacco for export must comply with the principles below:

a) Investments in tobacco manufacture must be conformable with Tobacco manufacture and tobacco ingredient area planning and business plans of enterprises;

b) Do not make new investments, expand the scale or capacity of tobacco factories that exceed the total capacity of the tobacco industry, which is determined by the Ministry of Industry according to Article 21 of this Decree;

c) The investment in machinery and equipment and tobacco manufacturing technologies must be suitable for the scale and production plan of the enterprise.

2. The procedure for making investments in upgrading equipment and technologies, manufacture and processing of tobacco for export and moving:

a) An enterprise that has a License to manufacture tobacco or License to process tobacco ingredients shall send an application and the investment scheme to the Ministry of Industry and Trade. The application must specify the project name, location, relevant specifications, scale, production, efficiency, and the plan for handling the machinery and equipment being replaced (if they are replaced);

b) Within 15 working days from the day on which the valid application is received, the Ministry of Industry and Trade shall make a written reply. If the application is not valid, the Ministry of Industry and Trade shall send a written request to the enterprise in writing for the supplementation of the application within 07 working days from the day on which the application is received. If the enterprise fails to meet the requirements, the Ministry of Industry and Trade shall makes a written refusal and provide explanation;

c) After the Ministry of Industry and Trade makes the written approval, the enterprise shall make investment in accordance with the procedure for investment and fundamental construction required by law;

d) The enterprise shall send the Ministry of Industry and Trade a report on the settlement of machinery and equipment that are replaced during the investment.

Article 25. Foreign investment in tobacco manufacture

1. Requirements for foreign cooperation in tobacco manufacture:

a) Investments in tobacco manufacture must be conformable with Tobacco manufacture and tobacco ingredient area planning;

b) Investment is made on the basis of cooperation with enterprises that have License to manufacture tobacco to upgrade technologies and equipment, improve the quality and value of products;

c) The state capital shall make up a predominant part in the charter capital of the enterprise (for join-venture);

d) The requirements in Article 17 of this Decree are satisfied;

d) The cooperation is permitted by the Government at the request of the Ministry of Industry and Trade.

2. Procedure for foreign investment in the form of cooperation in tobacco manufacture:

a) Parties of the joint venture shall send the joint venture scheme, the joint venture contract, and the application to the Ministry of Industry and Trade;

The application must specify the project name, location, relevant specifications, scale and targets, production of each product, efficiency, plan for investment in machinery and equipment and handling the machinery and equipment replaced.

b) Within 30 working days from the day on which the application and all documents are received, the Ministry of Industry and Trade shall consider and request the Prime Minister to make a decision. The refusal (if any) must be made in writing;

c) After the Prime Minister makes a written approval, the joint venture parties shall register the establishment of the joint venture in accordance with current laws on investment.

3. The procedure for foreign investment in the form of contracts to transfer industrial property rights or the right to use subjects of industrial property:

a) Parties shall send the application and the documents related to the contract to transfer industrial property rights or contract to transfer the right to use subjects of industrial property to the Ministry of Industry and Trade. The application must specify the contents of the contract to transfer industrial property rights or contract to transfer the right to use subjects of industrial property, the scale, production of each product, efficiency, plan for investment in machinery and equipment and handling the machinery and equipment replaced (if any).

b) Within 30 working days from the day on which the application and all documents are received, the Ministry of Industry and Trade shall consider and request the Prime Minister to make a decision. The refusal (if any) must be made in writing;

c) After the Prime Minister makes a written approval, parties shall perform contracts to transfer industrial property rights or to transfer the right to use subjects of industrial property.

4. d) The enterprise shall send the Ministry of Industry and Trade a report on the settlement of machinery and equipment that are no longer used or are liquidated during the investment, and take responsibility for such settlement.

Chapter 5.

TOBACCO BUSINESS

Article 26. Requirements of the License issuance in tobacco business

1. Requirements of the License issuance to tobacco distribution:

a) The enterprise is established within the law and the tobacco wholesaling is registered;

b) The business location is fixed and clear, the technical requirements are satisfied;

c) The system of tobacco distribution covers at least 02 provinces is established (at least 02 tobacco wholesalers in each province);

d) Letters of introduction or sale contracts signed with tobacco suppliers are presented;

dd) The warehouses under their ownership (or co-ownership) according to the joint venture contract or capital contribution contract, or the warehouse lease contracts are suitable for the business model (the minimum area is 100 m2 ) and the preservation of tobacco during the storage period;

e) The means of transport under the ownership or co-ownership according to the joint venture contract or capital contribution contract, or the contracts to hire means of transport are suitable for the business scale (at least 02 vehicles capable of at least 500 kg) and the preservation of tobacco in transit;

g) The financial capacity is able to ensure the normal operation of the entire distribution system (a certification of at least 02 billion VND is issued by a bank);

h) A written commitment to comply with the requirements for fire prevention and fighting and environment protection is made by the enterprise;

i) The Planning for tobacco trading network approved by competent authorities is complied with.

2. Requirements for the issuance of the License for tobacco wholesaling:

a) The enterprise is established within the law and the tobacco wholesaling is registered;

b) The business location is fixed and clear, the technical requirements are satisfied;

c) A system of tobacco wholesaling is established in the province where the head office is situated (at least 02 tobacco retailers in the province);

d) Letters of introduction or sale contracts signed with tobacco suppliers or tobacco product distributors are presented;

dd) The warehouses under their ownership (or co-ownership) according to the joint venture contract or capital contribution contract, or the warehouse lease contracts are suitable for the business model (the minimum area is 50 m2 ) and the preservation of tobacco during the storage period;

e) The means of transport under the ownership or co-ownership according to the joint venture contract or capital contribution contract, or the contracts to hire means of transport are suitable for the business scale (at least 01 vehicle capable of at least 500 kg) and the preservation of tobacco in transit;

g) The financial capacity is able to ensure the normal operation of the entire wholesaling system (a certification of at least 01 billion VND is issued by a bank);

h) A written commitment to comply with the requirements for fire prevention and fighting and environment protection is made by the enterprise;

i) The Planning for tobacco trading network approved by competent authorities is complied with.

3. Requirements for the issuance of the License for tobacco retailing:

a) The tobacco retailing is registered;

b) The business location is fixed and clear, the technical requirements are satisfied;

c) The area of tobacco sale is at least 03 m2 or larger;

d) Letters of introduction or sale contracts signed with tobacco wholesalers are presented;

dd) The Planning for tobacco trading network approved by competent authorities is complied with.

Article 27. Dossier for License issuance to tobacco ingredients business

1. Application for the License to distribute tobacco:

a) The written request for the issuance of the License to distribute tobacco;

b) A copy of the Certificate of Enterprise registration or Certificate of Business registration and the Certificate of Tax code;

c) Copies of letters of introduction or sale contracts signed with tobacco suppliers, which specify the intended business location;

d) Documents about the business location, including:

- The address, area, and destruction of the tobacco sale location;

- Copies of documents proving the right to use the business location (under ownership or co-ownership or leased for at least 01 year);

- The manifests of equipment for checking and regulating temperature and humidity at the tobacco sale location.

dd) Income statement of the enterprise (when applying for the re-issuance of the license):

- Income statements of the previous 03 years, enclosed with the list and copies of sale contracts signed with other tobacco distributors or tobacco suppliers, the tax that were paid;

- Method of sale and management of the distribution system.

e) The list of traders, a copy of the Certificate of Enterprise registration or Certificate of Business registration and the Certificate of Tax code, the Licenses for tobacco sale of the traders that belong or will belong the tobacco distribution network;

g) Documents about the means of transport: copies of the documents proving the right to use means of transport (under ownership or co-ownership according to the joint venture contract or capital contribution contract; or contracts to hire means of transport for at least 01 year);

h) Documents about the financial capacity: the financial capacity is able to ensure the normal operation of the entire distribution system (a certification is issued by a bank);

i) Documents about the warehouse, including:

- Documents proving the right to use the business location (under ownership or co-ownership or leased for at least 01 year);

- A written commitment to ensure the conformity of the warehouse with the requirements for fire prevention and fighting and environment protection is made by the enterprise;

2. Application for the License for tobacco wholesaling:

a) The written request for the issuance of the License for tobacco wholesaling:

b) A copy of the Certificate of Enterprise registration or Certificate of Business registration and the Certificate of Tax code;

c) Copies of letters of introduction or sale contracts signed with tobacco suppliers or tobacco wholesalers, which specify the intended business location;

d) Documents about the business location, including:

- The address, area, and destruction of the tobacco sale location;

- Copies of documents proving the right to use the business location (under ownership or co-ownership or leased for at least 01 year);

- The manifests of equipment for checking and regulating temperature and humidity at the tobacco sale location.

dd) Income statements of the enterprise:

- Income statements of the previous 03 years, enclosed with the list and copies of sale contracts signed with other tobacco distributors or tobacco suppliers or tobacco wholesalers, the tax that were paid;

- Method of sale and management of the distribution system.

e) The list of traders, a copy of the Certificate of Enterprise registration or Certificate of Business registration and the Certificate of Tax code, the Licenses for tobacco sale of the local traders that belong or will belong the tobacco distribution network;

g) Documents about the means of transport: copies of the documents proving the right to use means of transport (under ownership or co-ownership according to the joint venture contract or capital contribution contract; or contracts to hire means of transport for at least 01 year);

h) Documents about the financial capacity: the financial capacity is able to ensure the normal operation of the entire distribution system (a certification is issued by a bank);

i) Documents about the warehouse, including:

- Documents proving the right to use the business location (under ownership or co-ownership or leased for at least 01 year);

- A written commitment to ensure the conformity of the warehouse with the requirements for fire prevention and fighting and environment protection is made by the enterprise;

3. Application for the issuance of the License for tobacco retailing:

a) The written request for the issuance of the License for tobacco retailing:

b) A copy of the Certificate of Enterprise registration or Certificate of Business registration and the Certificate of Tax code;

c) Copies of letters of introduction or sale contracts are signed with tobacco wholesalers;

d) Documents about the business location, including:

- The address, area, and destruction of the tobacco sale location;

- Copies of documents proving the right to use the business location (under ownership or co-ownership or leased for at least 01 year);

- The manifests of equipment for checking and regulating temperature and humidity at the tobacco sale location.

Article 28. Authority and procedure for License issuance to tobacco business

1. Authority to issue the License to trade in tobacco:

a) The Ministry of Industry and Trade shall issue, reissue, and adjust the License to distribute tobacco;

b) Services of Industry and Trade shall issue, reissue, and adjust the License for tobacco wholesaling;

c) Industry and Trade Chambers or Economic Chambers (affiliated to People’s Committees of districts, towns, and provincial cities – hereinafter referred to as Industry and Trade Chambers) shall issue, reissue, and adjust the License for tobacco retailing.

2. Procedure for issuing Licenses to trade in tobacco

a) Every applicant for the License to trade in tobacco shall make 02 applications according to Article 27 of this Decree. 01 application is sent to the licensing authority, 01 application is kept by the applicant;

b) Within 15 working days from the day on which the valid application is received, the licensing authority shall consider and issue the License to trade in tobacco. If the enterprise fails to meet the requirements, the licensing authority shall makes a written refusal and provide explanation;

c) If the application is not sufficient, the licensing authority shall request the enterprise to supplement the application within 07 working days from the day on which the application is received.

3. Making and keeping the License to trade in tobacco:

a) The License to distribute tobacco shall be made into multiple copies: 02 copies are kept by the licensing authority; 01 copy is sent to the applicant; 01 copy is sent to Market Surveillance Agency; each Service of Industry and Trade in the License shall receive 01 copy; each tobacco supplier or other tobacco distributor in the license (who sell products to the applicant) shall receive 01 copy;

b) The License for tobacco wholesaling shall be made into multiple copies: 02 copies are kept by the licensing authority; 01 copy is sent to the applicant; 01 copy is sent to the Ministry of Industry and Trade; 1 copy is sent to the Sub-department of Market Surveillance; each tobacco supplier or other tobacco distributor in the license (who sell products to the applicant) shall receive 01 copy;

b) The License for tobacco retailing shall be made into multiple copies: 02 copies are kept by the licensing authority; 01 copy is sent to the applicant; 01 copy is sent to the Service of Industry and Trade; 1 copy is sent to the Sub-department of Market Surveillance; each tobacco manufacturer or other tobacco wholesaler in the license (who sell products to the applicant) shall receive 01 copy;

4. Each License to distribute tobacco, License for tobacco wholesaling, and License for tobacco retailing is valid for 05 years. 30 days before the expiration date of the license, 01 application for the re-issuance of the license shall be submitted if they wish to continue the business. The documentation and procedure for the re-issuance are specified in Article 39 of this Decree.

Article 29. Rights and obligations of businessmen issued with Licenses to tobacco business

Apart fro the rights and obligations stipulated by law, the traders issued with Licenses to trade in tobacco also have the following rights and obligations:

1. Buying tobacco having legal origins.

2. Circulate and sell tobacco on the market in accordance with the License to trade in tobacco.

3. Tobacco distributors and wholesalers shall only sell tobacco to traders that have License to trade in tobacco in their distribution system within the licensed localities.

4. Tobacco distributors may buy tobacco from tobacco suppliers or other tobacco distributors and sell them to tobacco wholesalers or retail tobacco at their retail outlets in the locality where their head offices are situated and the licensed localities.

5. Tobacco wholesalers may buy tobacco from tobacco suppliers or tobacco distributors and sell them to tobacco retailers or retail tobacco at their retail outlets in the province.

6. Locations of retail outlets of distributors and wholesalers must be conformable with Planning for tobacco trading network; their area is similar to that of retail outlets of tobacco retailers.

7. Tobacco retailers may buy tobacco from tobacco wholesalers and sell them at licensed locations.

8. Tobacco traders must post valid copies of Licenses to trade in tobacco issued by competent authorities at their head offices, branches, representative offices, and business premises.

9. Each trader is only issued with a type of License to trade in tobacco. The traders issued with License to trade in tobacco must pay fees as prescribed by the Ministry of Finance.

10. Make periodic income statements according to the instruction of the licensing authorities.

Article 30. Tobacco export and import for commercial purposes

1. The commercial import of tobacco must comply with the principles below:

a) Appoint major tobacco importers;

b) The imported tobacco must bear the stamps of tobacco import issued by the Ministry of Finance;

c) The import of tobacco must comply with the management requirements in this Decree and relevant laws on tobacco produced at home.

2. The Ministry of Industry and Trade shall appoint major tobacco importers

3. The export of tobacco must comply with the principles below:

a) The traders issued with the License to manufacture tobacco or License to distribute tobacco or License for tobacco wholesaling may export tobacco that has legal origins according to this Decree and other relevant law;

Where a trader exports tobacco that has legal origins on behalf of another trader that has the License to manufacture tobacco or License to distribute tobacco or License for tobacco wholesaling, the former must have one of the three licenses.

b) If the trader has a License to manufacture tobacco, the quantity of tobacco exported shall not be deducted from the quota for tobacco manufacture for sale at home.

4. The temporary import for re-export and temporary export for re-import of tobacco and tobacco ingredients shall comply with current regulations and guidance of the Ministry of Industry and Trade.

5. The Ministry of Industry and Trade shall provide guidance on the mechanism for state management of tobacco import.

Article 31. Non-commercial import of tobacco

1. Individuals that enter Vietnam may bring tobacco as long as it does not exceed the limits on luggage according to the regulations of the Government.

2. Diplomatic missions, consular offices, and international organizations in Vietnam must comply with Vietnam’s law when they are allowed to import tobacco for use.

3. The enterprises having the License to manufacture tobacco that wish to import tobacco into Vietnam to serve research and experimental production must be allowed by the Ministry of Industry and Trade. The quantity of imported tobacco serving research and experiment production must not exceed 500 packs (20-cigarette pack) or 50 cigars.

Article 32. Prevention of business smuggling and fraud

1. Counterfeit tobacco and substandard tobacco shall be confiscated and destructed. Smuggled tobacco shall be confiscated and handled in accordance with the regulations of the Government.

2. The enterprises that produce or buy tobacco are obliges to cooperate with competent authorities in the preventing of tobacco smuggling and counterfeit tobacco.

Chapter 6.

MANAGEMENT OF MACHINERY AND EQUIPMENT, INGREDIENT, CIGARETTE PAPER, AND TOBACCO STAMPS

Article 33. Management of machinery and equipments for tobacco manufacture

1. Organizations and individuals without the License to manufacture tobacco or License to process tobacco ingredients may not use machinery and equipment for tobacco manufacture in any shape or form.

2. The machinery and equipment for tobacco manufacture of enterprises that manufacture tobacco or process tobacco ingredients shall be sold, export, re-export, and liquidated in accordance with relevant laws and comply with the rules below:

a) Enterprises shall only sell usable machinery and equipment to the enterprises that have the License to manufacture tobacco or License to process tobacco ingredients that matches the production line licensed by competent authorities, or export/re-export them;

b) Machinery and equipment that are not usable or liquidated must be destructed under the supervision of a supervising commission set up by the Ministry of Industry and Trade.

3. Documents about the sale, export, re-export, or liquidation of machinery and equipment and an application shall be sent to the Ministry of Industry and Trade. Within 15 working days from the day on which the documents are received, the Ministry of Industry and Trade shall make a written reply or set up a supervising commission if machinery and equipment are destructed.

4. After machinery and equipment are sold, exported, re-exported, or liquidated, a report on the result shall be sent to the Ministry of Industry and Trade.

5. The Ministry of Industry and Trade shall cooperate with relevant functional agencies in carrying out inspection and handling machinery and equipment for tobacco manufacture without legal origins or that are not destructed as required.

Article 34. Import of machinery and equipment for tobacco manufacture

1. Any enterprise that imports machinery and equipment for tobacco manufacture must satisfy the requirements below:

a) The License to manufacture tobacco or License to process tobacco ingredients is obtained;

b) The imported machinery and equipment for tobacco manufacture are suitable for the capacity of the enterprise, which is announced by the Ministry of Industry and Trade;

c) The investment policies (if any) are approved by the Ministry of Industry and Trade.

2. The enterprise shall send 01 dossier of the import of machinery and equipment for tobacco manufacture, including the written approval for the investment policy, the projects, relevant approving documents, and the written request for the permission of the Ministry of Industry and Trade. Within 10 working days form the day on which the sufficient dossier is received, the Ministry of Industry and Trade shall makes a written reply. The refusal (if any) must be explained.

3. The Ministry of Industry and Trade shall make and promulgate the list of machinery and equipment for tobacco manufacture.

Article 35. Handling machinery and equipment for tobacco manufacture without legal origins

1. Machinery and equipment for tobacco manufacture are considered illegal when:

a) They are imported before the issuance of the Prime Minister’s Directive No. 13/1999/CT-TTg dated May 12, 1999 on the rearrangement of manufacture and trade in tobacco without valid import papers;

b) They are imported after the issuance of the Prime Minister’s Directive No. 13/1999/CT-TTg without valid import papers and written approvals of the Ministry of Industry and Trade (or the Ministry of Industry).

2. Machinery and equipment for tobacco manufacture without legal origins shall be confiscated and handled in accordance with law. Confiscated machinery and equipment shall be handled in accordance with current regulations, and only be sold to the enterprises having the License to manufacture tobacco or License to process tobacco ingredients that matches the line of production licensed by competent authorities, or be destructed.

3. The Ministry of Industry and Trade shall cooperate with the Ministry of Public Security enterprise the Ministry of Finance in carrying out inspection and handling machinery and equipment for tobacco manufacture without legal origins.

Article 36. Management of tobacco ingredient’s and cigarette paper’s import

1. Tobacco ingredients and cigarette paper are under the management of the Ministry of Industry and Trade.

2. Enterprises that import tobacco ingredients, cigarette paper to sell at home, to serve export processing or manufacture must satisfy the requirements below:

a) The License to manufacture tobacco or License to process tobacco ingredients is obtained;

b) The tobacco ingredients and cigarette paper imported must be suitable for the production of the enterprise (for production serving domestic sale);

c) Contracts to manufacture or processing tobacco or tobacco ingredients for export are signed (production or processing for export)

d) The import is approved by the Ministry of Industry and Trade.

3. Importing tobacco ingredients and cigarette paper serving tobacco manufacture for domestic sale:

a) Before November 15 every year, the enterprises that manufacture tobacco and enterprises that process shredded tobacco must send report on their demand for import of tobacco ingredients and cigarette paper to serve the tobacco manufacture for domestic sale and processing of shredded tobacco in the next year to the Ministry of Industry and Trade;

The report must specify the performance, production, import of tobacco ingredients and cigarette paper in the year, the estimated production, the demand for tobacco ingredients and cigarette paper in the next year.

b) According to the reports sent by enterprises, the capacity for satisfying the demand for ingredients, and the quota on tobacco ingredients, the Ministry of Industry and Trade shall notify the import quota to the enterprises and the agencies concerned before December 15.

c) The quota on tobacco ingredients and import quota of each enterprise shall be posted on the website of the Ministry of Industry and Trade;

d) Imported tobacco ingredients and cigarette paper shall only be used for tobacco manufacture and shredded tobacco in accordance with the registration, and must not be sold on the market.

4. Importing tobacco ingredients and cigarette paper serving tobacco manufacture or processing for export:

a) Only the enterprises having the License to manufacture tobacco are allowed to import tobacco ingredients and cigarette paper to manufacture of process tobacco for export;

b) The enterprise shall send the contract to manufacture tobacco for export or contract to process tobacco for export and the written request for the import of tobacco ingredients and cigarette paper to the Ministry of Industry and Trade. According to the request and capacity of the enterprise, and relevant documents, the Ministry of Industry and Trade shall send an import plan to the enterprise and relevant agencies within 07 days from the day on which sufficient documents are received.

5. Importing tobacco ingredients for processing tobacco ingredients for export:

a) Only the enterprises having the License to process tobacco ingredients are allowed to import tobacco ingredients for processing tobacco ingredients for export;

b) The enterprise shall send the contract to process tobacco ingredients for export and a written request to the Ministry of Industry and Trade. According to the request and capacity of the enterprise, and relevant documents, the Ministry of Industry and Trade shall makes a written approval or disapproval of the contract performance within 07 days from the day on which sufficient documents are received.

6. The Ministry of Industry and Trade shall issue the forms for registering demands for cigarette paper, shredded tobacco, and tobacco ingredients.

Article 37. Tobacco stamps

1. Packages of tobacco being sold at home must bear the required by Vietnam’ law.

2. Packages of tobacco being exported, presented, or exhibit overseas may not bear the stamps required by Vietnam’s law.

3. The stamps of tobacco sold in Vietnam shall be only issued to the enterprises that have the License to manufacture tobacco. The quantity of stamps issued to an enterprise every year must not exceed the permissible production.

4. The packages of tobacco imported for sale in Vietnam must bear the import.

5. The Ministry of Finance shall print and issue stamps to enterprise within the law.

Chapter 7.

ADJUSTING AND REISSUING THE ELIGIBILITY CERTIFICATE TO INVEST IN TOBACCO CULTIVATION, LICENSE TO BUSINESS IN TOBACCO INGREDIENTS, LICENSE TO PROCESS TOBACCO INGREDIENTS, LICENSE TO MANUFACTURE TOBACCO, AND LICENSE TO BUSINESS IN TOBACCO

Article 38. Adjusting the Eligibility certificate to invest in tobacco cultivation, License to business in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, and License to business in tobacco

1. When the contents of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco are changed, 01 application shall be sent to the licensing authority.

2. The application includes:

a) The written request for the adjustment;

b) The copy of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco that was issued;

c) Documents proving the necessity of the adjustment.

3. Procedure for adjustment:

a) The applicant shall submit 01 application for the adjustment of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco to a competent authority;

b) Within 15 working days from the day on which the sufficient and valid application is received, the competent authority shall consider adjusting the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco. If the requirements are not satisfied, the licensing authority shall make a written refusal and provide explanation.

Article 39. Reissuing the Eligibility certificate to invest in tobacco cultivation, License to business in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to business in tobacco

1. The Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco that was issued is expired. 30 days before the expiration date of the license, 01 application for the re-issuance of the license shall be submitted if they wish to continue the business. The documentation, authority, and procedure for the re-issuance are similar to those of the new issuance.

2. When the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco is lost, damaged, or burned, 01 application for the re-issuance shall be submitted, including.

a) The written request for the re-issuance;

b) A copy of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco that was issued (if any);

3. Procedure for the re-issuance:

a) The applicant shall submit 01 application for the re-issuance of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco to a competent authority;

b) Within 15 working days from the day on which the sufficient and valid application is received, the competent authority shall consider reissuing the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco. If the requirements are not satisfied, the licensing authority shall make a written refusal and provide explanation.

Chapter 8.

FEES AND CHARGES FOR LICENSE ISSUANCE AND REPORTING REGIME

Article 40. Fees and charges for license issuance

The organizations and individuals issued with the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco shall pay fees as required by the Ministry of Finance.

Article 41. Reporting regime

1. Services of Industry and Trade shall send reports on the issuance of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License for tobacco wholesaling, and License for tobacco retailing to the Ministry of Industry and Trade.

2. Industry and Trade Chambers shall send reports on the trading and issuance of the License for tobacco retailing to Services of Industry and Trade.

3. Every tobacco supplier shall send reports on the production and types of tobacco they manufacture or trade (according to the distribution, wholesaling, retailing system) to the licensing authority and the Service of Industry and Trade of the province where their head office is situated.

4. Every tobacco distributor, wholesaler, and retailer shall send reports on their business to the licensing authority and the Industry and Trade Agency where their head office is situated.

5. Every investor in tobacco cultivation, trader of tobacco ingredients, tobacco distributor, wholesaler, and retailer shall send reports on their business to the licensing authority and the Industry and Trade Agency where their head office is situated.

6. Every tobacco manufacturer shall send reports on the tobacco manufacture and trading to the Ministry of Industry and Trade and the Ministry of Finance, including: the production quantity, export quantity, import quantity, sales, sale prices, special excise duty, VAT payable on each brand.

7. Every enterprise that manufactures tobacco or processes tobacco ingredients shall send the Ministry of Industry and Trade reports on the import and use of machinery and equipment for tobacco manufacture, tobacco ingredients, cigarette paper in the period, the manufacture, trading, and processing of tobacco ingredients .

8. The Ministry of Industry and Trade shall provide guidance the reporting regime and report forms for Services of Industry and Trade, Industry and Trade Chambers, enterprises that manufacture tobacco, process tobacco ingredients, trade in tobacco ingredients, invest in tobacco ingredients, tobacco supplier, tobacco distributors, wholesalers, and retailers.

Chapter 9.

VIOLATIONS AND VIOLATION PENALTIES

Article 42. Violations against the Laws on Tobacco Business

1. Manufacturing, trading in tobacco, trading in tobacco ingredients, processing tobacco ingredients without a license; investing in tobacco cultivation without the eligibility Certificate.

2. Manufacturing, trading, importing, storing, transporting smuggled tobacco (except for the cases in which competent authorities allow the re-export) counterfeit tobacco, and the tobacco products that are not protected in Vietnam, fail to comply with National Technical Regulations on tobacco, defective tobacco, expired tobacco, or tobacco without the stamps required by law.

3. Using, liquidating, importing, exporting, re-exporting, selling machinery and equipment for tobacco manufacture against the law and this Decree.

4. Exceeding the limits of tobacco production.

5. Failing to comply with the laws on hygiene and prevention of tobacco harm.

6. Buying and selling tobacco stamps.

7. Illegally buying and selling cigarette paper.

8. Selling tobacco at offices, schools, hospitals, cinemas, theatres, stadiums, and other public places stipulated by law.

9. Other violations stipulated by law.

Article 43. Revoking the eligibility certificate to invest in tobacco cultivation, License to business in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to business in tobacco

1. The Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, and License to trade in tobacco shall be revoked by competent authorities when violations against the conditions for investment, trading, processing tobacco ingredients, manufacturing, trading in tobacco, and other violations are committed according to law.

2. If the operation is not commenced within one year from the issuance date of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco, the certificate or license shall be revoked.

Article 44. Penalties

Organizations and individuals that commit violations against the law, depending on the nature and seriousness of the violations, shall face disciplinary actions, administrative penalties, or criminal prosecution, and pay compensation for any damage caused by the violations.

Chapter 10.

RESPONSIBILITIES OF STATE MANAGEMENT

Article 45. The Ministry of Industry and Business shall:

1. Promulgate or request the Government and the Prime Minister to promulgate legislative documents on tobacco trading.

2. Provide the forms of the applications, the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco; provide guidance on the reporting regime and forms; make the list of equipment for tobacco manufacture.

3. Cooperate with the Ministries, agencies and local governments in formulating the scheme for restructuring the tobacco industry; manage the establishment, division, merger, and dissolution of enterprises that manufacture tobacco and process tobacco ingredients in accordance with law.

4. Manage the investment and construction in the tobacco industry within the law and this Decree.

5. Formulate and promulgate National Technical Regulations on tobacco ingredients; providing guidance and inspect the standards of tobacco quality.

6. Manage the import of machinery and equipment for tobacco manufacture, tobacco ingredients, cigarette paper, and tobacco products.

7. Impose limits on tobacco production of each tobacco manufacturer in each period.

8. Request the Prime Minister to consider allowing the import of foreign tobacco brands for sale in Vietnam.

9. Cooperate with other Ministries and agencies in providing guidance on state management of tobacco import, temporary import for re-export, temporary export for re-import of tobacco and tobacco ingredients.

10. Cooperate with relevant functional agencies in carrying out inspection and handling machinery and equipment for tobacco manufacture without legal origins or that are not destructed as required.

11. Cooperate with relevant functional agencies in carrying out inspection take actions against the tobacco traders that violate this Decree.

12. Carry out inspections, settle complaints, denunciations, and penalize violations against the laws on tobacco trading.

Article 46. The Ministry of Finance shall:

1. Print and issue stamps to enterprises in accordance with this Decree and current regulations.

2. Provide guidance on the establishment and use of the fund for planting and processing tobacco ingredients.

3. Cooperate with the Ministry of Industry and Trade, relevant Ministries and agencies is promulgating regulations on the fees for the issuance of the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, and License to trade in tobacco.

Article 47. The Ministry of Health shall:

1. Provide guidance on the registration of standards and National Technical Regulations on cigarettes.

2. Cooperate with the Ministry of Industry and Trade in carrying out inspections and penalize the violations against the law on tobacco harm prevention in tobacco trading.

Article 48. Other Ministries, ministerial agencies, and Governmental agencies shall:

Other Ministries, ministerial agencies, Governmental agencies, within the area of their competence, shall cooperate with the Ministry of Industry and Trade in the state management of tobacco trading, and disseminating the implementation of this Decree.

Article 49. Provincial People’s Committees shall:

1. Perform state management of the tobacco industry and resolve the issues under their management.

2. Cooperate with the Ministry of Industry and Trade in the rearrangement of local tobacco enterprises.

3. Inspect the manufacture and sale of tobacco ingredients and tobacco locally.

Chapter 11.

IMPLEMENTATION PROVISIONS

Article 50. Transitional provisions

1. The organizations and individuals whose Certificates of eligibility to trade in tobacco ingredients, Certificates of eligibility to process tobacco ingredients, Licenses to manufacture tobacco, Licenses to trade in tobacco, according to the Government s Decree No. 119/2007/NĐ-CP dated July 18, 2007, are exempt from applying for the re-issuance of such Certificates or Licenses. When such certificates of licenses expire, the licensing procedure stipulated in this Decree shall be followed.

2. The organizations and individuals that have not been issued with the Certificate of eligibility to invest in tobacco cultivation, License to trade in tobacco ingredients, License to process tobacco ingredients, License to manufacture tobacco, or License to trade in tobacco shall follow the licensing procedure stipulated in this Decree.

Article 51. Implementation effect

1. This Decree takes effect on August 15, 2013.

2. The Government s Decree No. 119/2007/NĐ-CP dated July 18, 2007 on tobacco manufacture and trading is annulled from the effective date of this Decree.

Article 52. Implementation responsibilities

1. The Ministry of Industry and Trade shall cooperate with other Ministries and agencies in providing guidance on the implementation of this Decree.

2. Ministers, Heads of ministerial agencies, Heads of Governmental agencies, the Presidents of People’s Committees of central-affiliated cities and provinces are responsible for the implementation of this Decree./.

For the Government

The Prime Minister

Nguyen Tan Dung