Resolution No. 437/NQ-UBTVQH14 dated October 21, 2017 of the National Assembly Standing Committee on tasks and solutions to further improve, and speed up the implementation of, policies and laws on investment in and operation of transport works in the form of build-operate-transfer (BOT) contracts

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Resolution No. 437/NQ-UBTVQH14 dated October 21, 2017 of the National Assembly Standing Committee on tasks and solutions to further improve, and speed up the implementation of, policies and laws on investment in and operation of transport works in the form of build-operate-transfer (BOT) contracts
Issuing body: National Assembly Standing Committee Effective date:
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Official number: 437/NQ-UBTVQH14 Signer: Nguyen Thi Kim Ngan
Type: Resolution Expiry date: Updating
Issuing date: 21/10/2017 Effect status:
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Fields: Construction , Investment , Transport

SUMMARY

In 2019, to collect non-stop automatic toll at BOT stations

At the Resolution No. 437/NQ-UBTVQH14 dated October 21, 2017, the National Assembly Standing Committee On tasks and solutions to further improve, and speed up the implementation of, policies and laws on investment in and operation of transport works in the form of build-operate-transfer (BOT) contracts.

In particular, to promulgate criteria for the construction of toll plazas, set appropriate toll rates and apply advanced technologies (non-stop automatic toll collection).  From 2019, non-stop automatic toll collection shall apply to all toll plazas on national highways nationwide which are invested in the form of BOT contracts.

At the same time, To further study and improve the law on investment in the form of BOT. To add criteria for evaluating the financial capacity of investors; to study and set the level of equity suitable to the nature and characteristics of each group of projects. To review regulations on the formulation, approval and management of costs for the construction, operation and exploitation of transport works in the form of BOT contracts; particularly, to set norms and unit costs and announce the market price index as suitable to practical conditions.

Particularly, to provide the sanctioning of investors that are late in  the finalization, publicization and updating of the number of vehicles, turnover from payback, time for toll collection, responsibility of investors for the quality of works …
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Effect status: Known

THE NATIONAL ASSEMBLY STANDINGCOMMITTEE

 

THE SOCIALIST REPUBLIC OF VIETNAM
Independence - Freedom - Happiness

No. 437/NQ-UBTVQH14

 

Hanoi, October 21, 2017

 

 

RESOLUTION

On tasks and solutions to further improve, and speed up the implementation of, policies and laws on investment in and operation of transport works in the form of build-operate-transfer (BOT) contracts[1]

 

THE NATIONAL ASSEMBLY STANDING COMMITTEE

Pursuant to the Constitution of the Socialist Republic of Vietnam;

Pursuant to Law No. 87/2015/QH13 on Oversight Activities of the National Assembly and People’s Councils;

Pursuant to the National Assembly Standing Committee’s Resolution No. 235/NQ-UBTVQH14 of August 25, 2016, on the 2017 oversight program of the National Assembly Standing Committee, and Resolution No. 321/NQ-UBTVQH14 of December 22, 2016, on the establishment of a team to oversee “the implementation of policies and laws on investment in and operation of transport works in the form of BOT contracts”;

After considering Report No. 177/BC-DGS of August 11, 2017, of the National Assembly Standing Committee’s oversight team, on the result of oversight of the implementation of policies and laws on investment in and operation of transport works in the form of BOT contracts;

 

RESOLVES:

Article 1.Assessment of the situation

The National Assembly Standing Committee agrees with the report on the result of oversight of “the implementation of policies and laws on investment in and operation of transport works in the form of BOT contracts”, of the National Assembly Standing Committee’s oversight team. Over the past time, the system of legal documents on investment in the form of BOT contracts has been partially improved. Many key national transport works have been invested and upgraded, importantly contributing to the implementation of the Party’s policies and guidelines on the construction of a synchronous infrastructure system in the country, promoting socio-economic development, and raising the national competitiveness. The implementation of the policy on mobilization of social resources, including the form of BOT contracts, has been proven correct that helps reduce the burden on the state budget.

However, the system of legal documents and the implementation of transport projects in the form of BOT contracts reveal limitations that need to be removed. Specifically as follows:

The promulgation of legal documents is not prompt, full and synchronous; documents of the highest legal effect are merely decrees. Some regulations are unclear, overlapping, and unsuitable to the reality and international practices.

The selection of investment projects and the order of investment priority are unreasonable. Majority of selected projects are road projects to repair and upgrade the only existing routes, failing to ensure road users’ right of choice. The attracted investment capital sources are limited, which are mainly bank loans. In addition, unstable policies obstruct the attraction of foreign investors.

The formulation, appraisal and approval of projects reveal problems and lack transparency, and designing and cost estimation still show shortcomings, thus increasing the cost estimates of works. The form of contractor appointment applies to most projects, but the financial capacity of many investors and contractors is limited, letting violations occur in the implementation, operation and exploitation of works, causing losses and lower investment efficiency. The ground clearance for some projects meets with difficulties and is not synchronized, thus increasing costs and affecting the progress of project implementation. The construction, supervision and quality control of works are not strict enough so the quality of many projects is unsatisfactory. There remain problems in pre-acceptance test and payment. The financial finalization of works is difficult and prolonged and punishments are not strict enough for investors that are late in financial finalization.

Regulations on road toll collection and toll plazas’ locations remain unsuitable and the implementation of these regulations shows limitations, causing public concerns. The publicization and transparency of information about projects are done improperly. The limitations in communication work lead to lack of consensus and different ways of understanding about transport works in the form of BOT contracts.

Causes of limitations and weaknesses:Management agencies are not experienced enough for fully covering circumstances that arise. The coordination among agencies and units remains ineffective; agencies and units still fail to show their sense of responsibility and even loose their management. The examination and inspection have not been conducted regularly and timely. Sanctions for violations are not strict enough. Many transport projects in the form of BOT contracts are still implemented although the Government and competent agencies have not reviewed, evaluated and amended or proposed amending regulations on investment in this form. The Ministry of Transport is responsible for the inadequacies and violations of the projects the investment in which is decided by itself. The Ministry of Finance is responsible for its promulgation of the circular guiding the toll collection (toll rates, locations of toll plazas and the process of supervision of toll collection) which is proven inappropriate. Local state management agencies are responsible for the limitations and violations of the projects the investment in which is decided by the localities and for the ineffective communication work, leading to the failure to reach consensus among the people for the selection of projects, agreement on locations of toll plazas, assurance of security and order, and delay in ground clearance. Investors are responsible for violations during the implementation of projects.

Article 2.Major tasks and solutions

In order to improve policies and laws, ensuring the efficiency of investment and operation of transport works in the form of BOT contracts in particular and the form of public-private partnership (PPP) in general, the National Assembly Standing Committee requests the Government and Prime Minister to focus on implementation of the following major tasks and solutions:

1.To review investment in the form of PPP, including the form of BOT contracts, over the past time in order to assess the achievements and weaknesses, in order to propose effective solutions.

To implement plans for timely handling shortcomings and weaknesses and seriously review the responsibilities of organizations and individuals for the shortcomings and violations. To summarize and report the results to the National Assembly Standing Committee and the National Assembly at their year-end sessions in 2018.

2.To further study and improve the law on investment in the form of BOT contracts during the overall finalization of the law on investment in the form of PPP through formulating a PPP law and submit it to the National Assembly for promulgation, creating a consistent and comprehensive legal foundation for this form of investment.

To set strict criteria for selecting investment projects in the form of BOT contracts in particular and the form of PPP in general. To add criteria for evaluating the financial capacity of investors; to study and set the level of equity suitable to the nature and characteristics of each group of projects. To review regulations on the formulation, approval and management of costs for the construction, operation and exploitation of transport works in the form of BOT contracts; particularly, to set norms and unit costs and announce the market price index as suitable to practical conditions. To guide in detail the financial matters of investment activities. To provide the sanctioning of investors that are late in  the finalization, publicization and updating of the number of vehicles, turnover from payback, time for toll collection, responsibility of investors for the quality of works when they are operated and handed over to the State, mechanism on consultation before deciding on investment, and service users’ feedback on the provision of services to state management agencies. To define responsibilities of state management agencies for the implementation of the investment and operation of transport projects in the form of BOT contracts.

3.To direct the Ministry of Transport and related agencies to review and finalize the master plan on the synchronous transport infrastructure network nationwide. To invest in transport projects in the priority order suitable to each form of investment based on advantages and characteristics of each region as well as the urgency and interconnection in the whole master plan on the transport system.

BOT road projects shall only be invested for new routes so as to ensure the people’s right of choice, but not for projects to repair and upgrade the only existing routes. The selection of investors and contractors shall be subject to public and transparent bidding in accordance with law, minimizing the form of contractor appointment. To promulgate and implement regulations on publicity and transparency of information about projects to facilitate the people’s supervision.

4.To adopt appropriate solutions for raising domestic and foreign capital for large-scale projects and delayed projects for which further investment is difficult. To issue specific mechanisms and policies to attract foreign capital, support the development of human resources, science and technology. To study solutions for promoting the capital market development to raise long-term funds for projects. To submit relevant laws to the National Assembly for amendment and supplementation in order to attract investment, especially investment from foreign investors, for the fast and synchronous development of the transport infrastructure system.

5.To direct related agencies to promptly make finalization of completed projects so as to make the financial plans and set the official time for toll collection; to remove difficulties and obstacles to investors; to fulfill the State’s commitments with investors on the financial support for ground clearance and resettlement.

To complete the overall review of locations of toll plazas, and policy on toll exemption and reduction at all tool plazas, and strictly manage revenues so as to work out comprehensive, prompt and consistent solutions, ensuring the harmony of interests of the State, investors and road users.

To promulgate criteria for the construction of toll plazas, set appropriate toll rates and apply advanced technologies (non-stop automatic toll collection). In addition, to promulgate framework criteria for bidding to select non-stop automatic toll-collection service providers to avoid monopoly in the toll collection, monitor toll plazas’ revenues and ensure the competition, publicity and transparency in the toll collection. From 2019, non-stop automatic toll collection shall apply to all toll plazas on national highways nationwide which are invested in the form of BOT contracts.

6.To direct localities to actively coordinate with related ministries and sectors and investors in organizing ground clearance, ensuring security and order, and tightening inspection and supervision to prevent overload of vehicles, control the quality of works, ensure smooth traffic flow and prevent loss of revenues, creating jobs for the project-affected people and making appropriate resettlement plans.

7.In the coming time, to further inspect and examine the formulation, appraisal, approval, implementation and operation of transport projects in the form of BOT contracts in particular and the form of PPP in general in order to ensure the transparency, efficiency, and prevention of corruption, waste and group interests in the management of projects.

8.To step up communication work and provide sufficient, accurate and truthful information on investment projects in the form of BOT contracts in accordance with law, pointing out the necessity to invest in projects to reach a consensus from the people, thereby supporting the inspection and supervision of implementation, operation and exploitation of projects.

Article 3.Organization of implementation

1. The Government, Prime Minister, ministries, ministerial-level agencies, government-attached agencies, and People’s Councils and People’s Committees at all levels shall, within the ambit of their tasks and powers, direct and organize the implementation of this Resolution.

2. The Standing Committee, the Committee on Economic Affairs, the Ethnic Council and other Committees of the National Assembly, delegations of National Assembly deputies, National Assembly deputies, and People’s Councils at all levels shall, within the ambit of their tasks and powers, oversee the implementation of this Resolution.-

On behalf of the National Assembly Standing Committee
Chairwoman
NGUYEN THI KIM NGAN

 



[1]Công Báo Nos 827-828 (14/11/2017)

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