Joint Circular No. 10/2013/TTLT-BTP-BCA-TANDTC-VKSNDTC-BTC dated June 26, 2013 of the Ministry of Justice, the Ministry of Public Security, the Supreme People’s Court, the Supreme People’s Procuracy and the Ministry of Finance guiding the implementation of a number of articles of the Penal Code regarding crimes in the tax, finance-accounting and securities sectors

THE MINISTRY OF JUSTICE - THE MINISTRY OF PUBLIC SECURITY - THE SUPREME PEOPLE’S COURT - THE SUPREME PEOPLE’S PROCURACY - THE MINISTRY OF FINANCE

Joint Circular No. 10/2013/TTLT-BTP-BCA-TANDTC-VKSNDTC-BTC of June 26, 2013, guiding the implementation of a number of articles of the Penal Code regarding crimes in the tax, finance-accounting and securities sectors

In order to properly and consistently implement the Penal Code’s provisions on crimes in the tax, finance-accounting and securities sectors, the Ministry of Justice, the Ministry of Public Security, the Supreme People’s Court, the Supreme People’s Procuracy and the Ministry of Finance provide the following guidance:

Article 1. Regarding the crime of tax evasion (Article 161 of the Penal Code)

1. Tax evasion offenders are those who commit one of the acts prescribed in Article 108 of the Law on Tax Administration and concurrently show the signs prescribed in Article 161 of the Penal Code.

2. Evading tax in other particularly serious cases prescribed in Clause 3, Article 161 of the Penal Code is understood as cases in which the evaded tax amount ranges between VND 300 million and under VND 600 million but the offender concurrently commits another related act such as giving bribes; resisting on-duty persons; inflicting  injury on on-duty persons; destroying assets of tax administration agencies, tax officers and other state agencies in charge of tax administration, which is not serious enough for examination for penal liability as an independent crime. In case this act consists of all elements for it to constitute another crime, in addition to tax evasion, the offender shall be examined for penal liability for such crime.

Article 2. Regarding the crime of illegal printing, distribution and trading of invoices and receipts of state budget remittances (Article 164a of the Penal Code)

1. Invoices and receipts of state budget remittances include:

a/ Export invoices used in the export of goods and services abroad or into non-tariff zones; value-added invoices; invoices on sale of goods in inland Vietnam for use by value-added tax declarants; and other invoices, including stamps, tickets, cards and insurance premium receipts, and air freight receipts; international freight vouchers; and receipts of banking service charges;

b/ State budget revenue remittance orders, state budget deposit slips, tax payment declarations, state budget remittance receipts and restored documents in management of state budget revenues.

2. Subjects of this crime include:

a/ Persons who sell goods or provide services or staff members of business organizations which sell goods or provide services;

b/ Staff members of organizations which print invoices on order or order the printing of invoices;

c/ Persons or staff members of organizations which buy goods or services.

3. Acts prescribed in Article 164a of the Penal Code are understood as follows:

a/ Illegal printing of invoices and receipts of state budget remittances means printing invoices or creating e-invoices when still failing to satisfy all prescribed conditions or printing invoices or creating e-invoices with improper contents or insufficient contents as prescribed by law; printing counterfeit invoices or creating counterfeit e-invoices;

b/ Illegal distribution of invoices and receipts of state budget remittances means making invoice issuance notices without sufficient contents; failing to send to post up invoice issuance notices as prescribed.

c/ Illegal trading of invoices and receipts of state budget remittances includes the following acts:

c.1/ Buying or selling blank invoices or invoices with insufficient or incorrect contents as prescribed;

c.2/ Buying or selling invoices already filled in but accompanied with no goods or services;

c.3/ Buying or selling counterfeit invoices, invalid or expired invoices or invoices of other business or service establishments for legalization of bought-in goods or services or issuance to customers upon sale of goods or services;

c.4/ Buying, selling or using invoices with each sheet indicating a different value of goods or services.

4. Involving invoices and receipts of state budget remittances in a large, very large or particularly large quantity is understood as follows:

a/ For blank invoices and receipts, the quantity of between 50 numbers and under 100 numbers is regarded as large; 100 numbers or more, very large or particularly very large;

b/ For invoices and receipts already filled in for illegal purposes, the quantity of between 10 numbers and under 30 numbers is regarded as large; 30 numbers or more, very large or particularly very large.

5. Gaining big illicit profits means gaining a profit of VND 100 million or more from above criminal activities.

6. Causing serious consequences means causing damage worth VND 100 million or more to the state budget.

Article 3. Regarding the crime of breaching regulations on preservation and management of invoices and receipts of state budget remittances (Article 164b of the Penal Code)

1. Subjects of this crime include:

a/ Persons who sell or buy goods or provide services;

b/ Responsible persons of organizations which sell or buy goods or provide services;

c/ Responsible persons of organizations which print invoices on order or order the printing of invoices.

2. Acts of breaching regulations on preservation and management of invoices and receipts of state budget remittances include:

a/ Keeping or preserving invoices in contravention of regulations;

b/ Failing to report or reporting incorrectly on the use, payment or  finalization of invoices;

c/ Damaging or losing invoices;

d/ Destroying invoices in contravention of law;

dd/ Handling the loss, burning or damage of invoices in contravention of law;

3. Causing serious consequences means causing damage worth between VND 100 million and under 500 million to the state budget.

4. Causing very serious consequences and particularly serious consequences means causing damage worth VND 500 million or more to the state budget.

Article 4. Regarding the crime of intentionally disclosing false information or concealing truths in securities activities (Article 181a of the Penal Code)

1. Interpretation of terms

a/ Securities offerings prescribed in Article 181a of the Penal Code include public offering and private placement of securities.

A public offering of securities means the offering of securities via the mass media, including the Internet; offering of securities to 100 investors or more, excluding professional securities investors; or offering of securities to an indefinite number of investors;

A private placement of securities means the organization of the offering of securities to less than 100 investors, excluding professional securities investors, without the use of the mass media or the Internet;

b/ Listing of securities means the putting of eligible securities into trading at stock exchanges;

c/ Depository of securities means the receipt of securities deposited by customers, safe keeping of customers’ securities, delivery of securities to customers and assisting customers in exercising the rights related to their ownership of securities.

d/ Registration of securities means the recording of the ownership and other rights of securities owners;

dd/ Clearing and payment means the final step to complete the process of securities trading.

2. Acts prescribed in Clause 1, Article 181a of the Penal Code are understood as follows:

a/ Intentionally disclosing false information in securities activities means that the offender has disclosed false information relating to operations of a public company or the issuer, listed organization, organization registered for trading, securities company, fund management company or securities investment company, disclosed information different from those in the securities offering dossier, securities listing or trading registration dossier, dossier of application for grant or supplementation of the establishment and operation license of a business operating in the securities sector; or securities registration, depository, and clearing and payment dossier;

b/ Concealing truths in securities activities means that the offender fails to disclose or intentionally discloses insufficient information in the securities offering dossier, securities listing or trading registration dossier, dossier of application for grant or supplementation of the establishment and operation license of a business operating in the securities sector; or securities registration, depository, and clearing and payment dossier.

3. Subject of this crime is any of the following persons:

a/ Chairman of the Board of Directors or Members’ Council or company president, director or director general, chief financial officer or chief accountant of the issuer, listing organization, organization registered for trading, securities investment fund management company or securities investment company;

b/ At-law representative of the issuance consultancy organization, issuance underwriting organization, accredited audit firm and person directly engaged in provision of issuance consultancy or underwriting services or conducting the audit of financial statements or person authorized to disclose information;

c/ At-law representative of the securities registration or depository organization;

d/ Other persons may be accomplices.

4. Some circumstances serving as elements for determining the penalty bracket or aggravating the penalty prescribed in Article 181a of the Penal Code are understood as follows:

a/ Causing serious consequences is causing material damage of between VND 1 billion and under 3 billion to investors;

b/ Causing very serious or particularly serious consequences is causing material  damage of VND 3 billion or more to investors.

In addition to material damage, criminal activities may cause non-material consequences such as affecting the implementation of the State’s policies and laws on the securities market; shattering investors’ confidence in the securities market; affecting the equality, transparency, publicity and safety of the securities market.

In these cases, the determination of whether the degree of consequences caused by criminal activities is serious, very serious or particularly serious shall be carried out on a case-by-case basis.

c/ Gaining big illicit profits means gaining a profit of VND 500 million or more from above criminal activities.

Article 5. The crime of using insider information for securities trading (Article 181b of the Penal Code)

1. Interpretation of terms:

a/ Insider information prescribed in Article 181b of the Penal Code is information relating to the operation of a public company or public fund which has not yet been disclosed and once disclosed, may greatly affect the price of securities of such public company or public fund;

b/ A public company is a joint-stock company which has offered its securities to the public; has its securities listed on a stock exchange or securities trading center; or has its securities owned by at least 100 investors, excluding professional securities investors, and has a contributed charter capital of VND 10 billion or more;

c/ A public fund is a securities investment fund which has offered its fund certificates to the public.

2. Acts of using insider information for securities trading include:

a/ Using insider information to buy or sell securities for oneself;

b/ Using insider information to buy or sell securities for another person;

c/ Disclosing insider information or advising others to buy or sell securities based on insider information.

3. Subject of this crime is any of the following persons:

a/ Members of the Board of Directors or Control Board, director or general director, deputy director or deputy general directors, chief financial officer or chief accountant of a public company; members of the representative board of a public fund;

b/ Major shareholders of the public company or public fund;

c/ Those who audit financial statements of the public company or public fund;

d/ Securities practitioners of securities companies or securities investment fund management companies;

e/ Staff members of organizations or persons that have business cooperation or service relations with the public company or public fund;

g/ Persons directly or indirectly obtaining insider information from those specified at Points a, b, c, d, e of this Clause.

4. Some circumstances serving as elements for determining crime or determining the penalty bracket prescribed in Article 181b of the Penal Code are understood as follows:

a/ Gaining big illicit profits means gaining a profit of between VND 500 million and under 1.5 billion from above criminal activities;

b/ Gaining very big or particularly big illicit profits means gaining a profit of VND 1.5 billion or more from above criminal activities;

c/ Causing serious consequences means causing material damage of VND 1 billion or more to investors;

In addition to material damage, criminal activities may cause non-material consequences such as affecting the implementation of the State’s policies and laws on the securities market; shattering investors’ confidence in the securities market; affecting the equality, transparency, publicity and safety of the securities market.

In these cases, the determination of whether the degree of consequences caused by criminal activities is serious, very serious or particularly serious shall be carried out on a case-by-case basis.

Article 6. The crime of manipulating securities prices (Article 181c of the Penal Code)

1. Causing serious consequences prescribed in Clause 1, Article 181c of the Penal Code means causing material damage of between VND 1 billion and under 3 billion to investors;

2. Causing very serious or particularly serious consequences prescribed at Point c, Clause 2, Article 181c of the Penal Code means causing material damage of over VND 3 billion to investors.

In addition to material damage, criminal acts may cause non-material consequences such as affecting the implementation of the State’s policies and laws on the securities market; shattering investors’ confidence in the securities market; affecting the equality, transparency, publicity and safety of the securities market.

In these cases, the determination of whether the degree of consequences caused by criminal activities is serious, very serious or particularly serious shall be carried out on a case-by-case basis.

3. Gaining big illicit profits prescribed at Point b, Clause 2, Article 181c of the Penal Code means gaining a profit of VND 500 million or more from these criminal activities.

Article 7. Effect

1. This Joint Circular takes effect on August 15, 2013.

2. This Joint Circular replaces Joint Circular No. 21/2004/TTLT-BCA-TANDTC-VKSNDTC-BTP of November 23, 2004, of the Ministry of Public Security, the Supreme People’s Court, the Supreme People’s Procuracy and the Ministry of Justice, guiding the examination of penal liability for illegal trading and use of value-added invoices.

3. The guidance of this Joint Circular will be applied to the investigation, prosecution, first-instance trial, appellate trial, cessation trial or re-opening trial of persons who commit criminal activities before the effective date of this Joint Circular if such guidance lessens the penal liability of these offenders as compared to previous guidance.

4. For convicted offenders, if judgments have become legally valid, the guidance in this Joint Circular will not be applied to making appeals according to the cessation or re-opening procedures, except cases in which other grounds for appeals are available.

5. For cases which are under investigation, prosecution, first-instance trial, appellate trial, cessation or re-opening trial and now the accused or defendants are declared to be exempt from penal liability thanks to the application of the guidance of this Circular, investigative agencies, procuracies or courts shall explain to the accused or defendants that the exemption from penal liability under this Circular does not serve as a ground for making compensation for damage caused by competent persons of procedure-conducting agencies.

6. Any problems or matters which arise in the process of implementation of this Joint Circular and need to be guided or further explained must be reported to the Ministry of Justice, the Ministry of Public Security, the Supreme People’s Court and the Supreme People’s Procuracy and the Ministry of Finance for timely explanation or guidance.-

For the Minister of Justice
Deputy Minister
HOANG THE LIEN

For the Minister of Public Security
Deputy Minister
Lieutenant General LE QUY VUONG

For the President of the Supreme People’s Court
Vice President
DANG QUANG PHUONG

For the Chairman of the Supreme People’s Procuracy
Vice Chairman
HOANG NGHIA MAI

For the Minister of Finance
Deputy Minister
TRUONG CHI TRUNG