Thông tư 74/2015/TT-BTC

CIRCULAR

PROVIDING GUIDANCE ON ESTIMATE, USE AND FINAL PAYMENT OF BUDGET FOR COMPENSATION, SUPPORT AND RESETTLEMENT DUE TO THE GOVERNMENT’S LAND EXPROPRIATION

Pursuant to the Law on Land dated November 29, 2013;

Pursuant to the Law on State Budget dated December 16, 2002;

Pursuant to the Government’s Decree No. 43/2014/NĐ-CP dated May 15, 2014 on providing specific provisions of the Law on Land;

Pursuant to the Government’s Decree No. 47/2014/NĐ-CP dated May 15, 2014 on stipulating compensation, support and resettlement due to the Government’s land expropriation

Pursuant to the Government’s Decree No. 60/2003/NĐ-GOVERNMENT dated June 6, 2003 on providing instructions on the implementation of the Law on State Budget;

Pursuant to the Government's Decree No. 215/2013/NĐ-CP dated December 23, 2013 on defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

At the request of the Director of Public Asset Authority,

The Minister of Finance hereby introduces the Circular on providing guidance on estimate, use and final payment of budget for compensation, support and resettlement due to the Government’s land expropriation.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of application

This Circular shall provide guidance on estimate, use and final payment of budget for compensation, support and resettlement due to the Government’s expropriating land used for the purpose of national defense, security, socio-economic development, national interests and public benefits as stipulated in Article 61 and 62 of the Law on Land adopted in 2013, even if an independent sub-project for compensation, support and resettlement is developed in accordance with regulations laid down in Article 29 of the Government’s Decree No. 47/2014/NĐ-CP dated May 15, 2014 on stipulating compensation, support and resettlement due to the Government’s land expropriation; land located within areas hit by the environment pollution posing a threat to human lives, and land exposed to the risk of land slide, depression, or hit by natural disasters risking human lives in accordance with regulations laid down at Point dd, e Clause 1 Article 65 of the Law on Land adopted in 2013.

Article 2. Applicable entities

1. The organization designated by the competent authority to perform the task of compensation, support and resettlement due to the Government's land expropriation (hereinafter referred to as compensating organization).

2. Other entities involving estimate, use and final payment of budget for compensation, support and resettlement due to the Government’s land expropriation.

Chapter II

SPECIFIC PROVISIONS

Article 3. Source and level of budget for compensation, support and resettlement, and compulsory land audit or compulsory land expropriation

1. The source of budget for compensation, support and resettlement shall not make up more than 2% of total budget for compensation, support and resettlement in a project or sub-project, except for cases stipulated in Clause 2 of this Article.

2. As for projects or sub-projects developed within areas which are faced with difficult or extremely socio-economic conditions in accordance with the legislation on investment; projects or sub-projects executed to develop linear infrastructural facilities, the compensating organization shall be entitled to prepare the estimate of budget for organizing execution of such compensation, support and resettlement specified in these projects or sub-projects, depending on the actual workload, and the level of budget shall not be restricted to 2% of total budget for compensation, support and resettlement specified in these projects or sub-projects.

3. Based on the budget levels applied to each project or sub-project, the compensating organization shall determine the provisional budget for compulsory land audit and expropriation which shall not make up more than 10% of the budget stipulated in Clause 1 or 2 of this Article so as to report it in the general budget estimate.

4. Pursuant to regulations laid down in Clause 1, 2 and 3 of this Article, the Finance Department shall request the People’s Committee of centrally-affiliated cities and provinces (hereinafter referred to as provincial People’s Committee) to grant the decision on specific budget levels and percentages of provisional budget in proportion to the size, nature and characteristic of these projects or sub-projects.

5. If the local steering committee on site clearance at a provincial level is in place, on the basis of tasks assigned to this committee, the Finance Department shall request the provincial People’s Committee to grant a decision to specify the proper percentage of allocated budget for operations of the compensating organization and this provincial steering committee on site clearance.

6. If a company is hired to render compensation, support and resettlement services (hereinafter referred to as a compensation service provider), the cost paid to this service provider shall be accounted for in the estimate of budget for compensation, support and resettlement approved by the competent authority.

Article 4. Expenditures on compensation, support, resettlement, compulsory land audit and expropriation

1. Expenditures on compensation, support and resettlement shall be budgeted for the followings:

a) Disseminating policies and regulations on compensation, support and resettlement due to the Government's land expropriation; influencing relevant entities to comply with the decision on land expropriation;

b) Auditing, evaluating an actual amount of land and attached property susceptible to any possible loss or damage, including handing out declaration forms, instructing petitioners to complete such declaration forms, measuring the land size, keeping a tally of the amount and value of houses, structures, plants, domestic animals and other property susceptible to any possible damage or loss caused by the Government’s expropriation of land owned by each organization, household and individual; checking and comparing information provided in the declaration form with the result of audit and determination of level of loss or damage suffered by specific petitioners; calculating the diminished value of land, house, structure, plant, domestic animal and other property;

c) Determining the land price, including hiring consultants to determine the land price and coefficient of land composition price adjustment (if required), assessing the specific land price; determining the price of property associated with land, all of which shall serve the purpose of expropriating land, arranging compensation, support and resettlement due to the Government's land expropriation;

d) Formulating, approving and publicly announcing the plan for compensation, support and resettlement phased from the compensation factor calculation to the grant of approval for the compensation plan and public announcement of such compensation plan;

dd) Assessing the plan for compensation, support and resettlement;

e) Examining, providing instructions on implementation of compensation policies, dealing with any difficulty that may arise from the compensation activity, and organizing the payment of compensation;

g) Renting work office and equipment provided for the compensating organization and assessment agency (if required);

h) Printing and copying materials, and purchasing stationery and office supplies, and paying petrol costs;

i) Hiring employees charged with working on compensation, support and resettlement (if required);

k) Meeting other expenditures directly related to implementation of compensation, support and resettlement.

2. Expenditures on compulsory land audit or expropriation shall be budgeted for the followings:

a) Notifying and influencing entities to implement the enforcement decision on land audit and expropriation;

b) Purchasing raw materials, fuel, and renting means of transport, security, healthcare and fire-fighting equipment as well as other necessary equipment used for enforcement of land audit and expropriation;

c) Organizing execution of the enforcement of land audit and expropriation;

d) Sealing, destroying, pulling down or transporting property; moving the person who is subject to enforcement proceedings and any other concerned out of the land subject to enforcement actions; renting venues, human force, property protection equipment, and meeting other actual legal expenditures directly used for safe custody of property in the process of compulsory land expropriation if the property owner fails to make payment;

dd) Making video recordings and taking photos so as to support the compulsory land audit and expropriation;

e) Protecting and avoiding reoccupying land subject to the compulsory land expropriation over the period from the commencement of the compulsory land expropriation to the completion of site clearance;

g) Meeting other expenditures directly related to implementation of decision on enforcement of land audit and expropriation.

Article 5. Level of expenditures on compensation, support, resettlement, compulsory land audit and expropriation

1. As for expenditures which have been classified into levels, standards and amounts adopted by the competent authority, the current regulations shall be applied.

2. As for expenditures which have not been classified into standards, levels and amounts adopted by the competent authority, the provincial People’s Committee shall take into account the actual condition existing in each locality to provide appropriate regulations, except for those stipulated in Clause 3, 4 and 5 of this Article.

3. As for expenditures on work office and equipment of the compensating organization and assessment agency, these entities shall be responsible for budgeting for them from their existing fund for work house and equipment so as to support their work.

In case it is impossible to set aside any budget from the existing fund for work house and equipment, these entities shall be allowed to rent work office and equipment. Renting work office and equipment shall be governed under the law on the management and use of State-owned property and the bidding law.

4. Printing and copying materials, and providing stationery, office supplies, and paying costs for petrol, logistic support and expenses used for supporting the management mechanism, all of which shall be calculated depending on the actual demand arising in each project or sub-project.

5. Paying fee to the compensation service provider as agreed upon in the contract signed between the compensating organization and the compensation service provider. The compensation service provider shall be obligated to comply with terms and conditions of the contract and relevant laws. Selection of the compensation service provider shall be governed under legal regulations on bidding.

Article 6. Estimate, use and final payment of budget for compensation, support and resettlement, and compulsory land audit and expropriation

1. Budget for compensation, support and resettlement, and compulsory land audit and expropriation shall be estimated as follows:

a) In addition to setting up the plan for compensation, support and resettlement, the compensating organization shall take into account the levels of budget prescribed in Clause 4 Article 3, the specific expenditures stipulated in Clause 1 Article 4 and the level of expenditures stipulated in Article 5 hereof as well as the project workload so as to prepare the estimate of budget for compensation, support and resettlement, and provisional expenditures on execution of decision on enforcement of land audit and expropriation.

The compensating organization shall prepare their budget estimate to the Finance Department for assessment (as for projects or sub-projects of which the compensation plan shall be approved by the provincial People’s Committee, including those temporarily funded by the land development fund or the State Treasury); to the Finance Division for assessment (as for projects, sub-projects of which the compensation plan is approved by the People’s Committee of a district, town or provincial city) for submission to the People’s Committee at the same level for their approval.

As for projects funded by the central budget within their local areas, the Finance Department (the Finance Division) shall send the estimate of budget for compensation, support and resettlement, and provisional expenditures on compulsory land audit and expropriation so as to consult with the owner of such projects or sub-projects before submitting it to the People’s Committee at the same level for their approval. The project or sub-project owner shall give their written opinions within the maximum duration of 30 working days from the receipt of these written opinions;

b) Whenever the decision on enforcement of land audit or expropriation has been granted by the competent authority, the compensating organization shall refer to the expenditures stipulated in Clause 2 Article 4 and levels of expenditures stipulated in Article 5 hereof to prepare the detailed estimate of budget for execution of compulsory land audit or expropriation for submission to the finance authority as prescribed at Point a of this Clause for their assessment before submitting it to the People's Committee at the same level for their approval;

c) After this estimate has been approved by the competent authority, the compensating organization shall send a copy to the owner of such projects or sub-projects or the land development fund or the State Treasury for their cooperation in implementation.

2. The use of budget for compensation, support and resettlement, and compulsory land audit and expropriation shall be stipulated as follows:

a) Based on the estimate approved by the competent authority, the project owner or the land development fund or the State Treasury shall transfer the temporary or advance financing for such projects or sub-projects to the compensating organization in each project stage.

If there is an urgent demand for immediate compensation, support and resettlement before project execution in accordance with decisions granted by the competent authority but the budget estimate has not been approved yet, the compensating organization shall be entitled to receive a portion of budget in advance (exclusive of expenditures on compulsory land audit or expropriation) from the project or sub-project owner to execute their specified work;

b) The head of the compensating organization shall be responsible for managing and using budget for compensation, support, resettlement and compulsory land audit and expropriation in projects or sub-projects in conformity with the budget estimate approved by the competent authority;

c) If a compensation service provider is employed, the compensating organization shall pay the contractual fee to this provider;

d) Using or accounting for budget for compensation, support and resettlement, and compulsory land audit and expropriation shall be governed under the law on state budget.

3. Accounting for budget for compensation, support and resettlement, and compulsory land audit and expropriation shall be carried out as follows:

a) Accounting for budget for compensation, support and resettlement:

- Within a permitted period of 30 working days upon completion of compensation and site clearance, the compensating organization shall be responsible for collecting documents indicating the actual used expenditures in each project or sub-project, and prepare the final payment of expenditures on compensation, support and resettlement which have been received and used in such project or sub-project for submission to the finance authority as prescribed at Point a Clause 1 of this Article for their approval as stipulated by legal regulations on the state budget.

The finance authority stipulated at Point a Clause 1 of this Article shall approve the budget estimate and send a written notification of the approved final payment to the project owner or the land development fund. This written notification shall be deemed as the document used for accounting for expenditures on compensation, support and resettlement in each project or sub-project.

- If the compensation organization is assigned to simultaneously execute different projects or sub-projects but general costs are not separately reported for each project or sub-project, this organization shall collect all of these general costs incurred in the fiscal year to be distributed to each project or sub-project according to the following formula:

The compensating organization shall formulate the annual cost allocation plan for each project or sub-project (enclosing all documents recording general costs incurred in the fiscal year) and documents recording direct costs incurred by executing each project or sub-project; prepare the final payment of expenditures on compensation, support and resettlement for submission to the finance authority in accordance with regulations laid down at Point a Clause 1 of this Article for their approval as prescribed by legal regulations on the state budget.

The finance authority stipulated at Point a Clause 1 of this Article shall approve the budget estimate and send a written notification of the approved final payment to the project owner or the land development fund. This written notification shall be deemed as the document used for accounting for expenditures on compensation, support and resettlement in each project or sub-project.

If the general costs which have been allocated for each project or sub-project have been accounted for in the fiscal year, but the compensation and site clearance have not been completed yet, these shall be recorded to prepare the final payment of all expenditures on compensation, support and resettlement upon completion of compensation and site clearance work.

Example: The compensating organization X has been assigned to concurrently perform the task of compensation, support and resettlement for 04 projects (A, B, C, D) in 2015. The result of the X’s performing their assigned task till the end of 2015 is given below:

(1) Site clearance task in 3 out of 4 projects like A, B and C has been completed. In particular, the site clearance in the project D has not been completed yet.

(2) The direct costs paid for execution of each project of the X in 2015 are VND 400 million for the project A; VND 350 million for the project B; VND 300 million for the project C; VND 550 million for the project D. Aggregated direct cost incurred by execution of 04 projects in 2015 equals VND 1,600 million.

(3) Aggregated general cost incurred by execution of 04 projects in 2015 equals VND 400 million

(4) The general cost allocated for each project is calculated according to the abovementioned formula as follows:

- Project A = (400 : 1.600) x 400 = VND 100 million;

- Project B = (400 : 1,600) x 350 = VND 87.5 million;

- Project C = (400 : 1,600) x 300 = VND 75 million;

- Project D = (400 : 1,600) x 550 = VND 137.5 million. This sum shall be used for final payment upon completion of the site clearance in the project D.

- The difference between the actual amount of expenditures recorded in the approved final payment and the received amount of expenditures with respect to final payments needed for each project, sub-project or multiple ones, shall be treated as follows:

+ If the actual amount of expenditures recorded in the approved final payment is greater than the received amount of expenditures, the compensating organization shall be paid the remaining amount of expenditures that have not been paid yet. Such remaining amount, however, must be restricted within the level of budget stipulated in Clause 4 Article 3 hereof.

+ If the actual amount of expenditures recorded in the approved final payment is less than the received amount of expenditures, the excess amount of expenditures must be returned to the project owner (or the land development fund, if the budget for execution of projects is received from the Fund) within a maximum period of 30 working days from the date on which the competent authority has approved such final payments.

b) Final payment for expenditures on compulsory land audit or expropriation shall be made as follows:

- Within a permitted period of 30 working days upon completion of compensation and site clearance, the compensating organization shall be responsible for preparing the final payment of budget for execution of compulsory land audit or expropriation for submission to the finance authority stipulated at Point a Clause 1 of this Article for their approval for such final payments as prescribed by legal regulations on the state budget.

The finance authority stipulated at Point a Clause 1 of this Article shall approve such final payments and send a written notification of the approved amount of final payments to the project owner or the land development fund. This written notification shall be deemed as the document used for making final payments for expenditures on execution of compulsory land audit and expropriation in each project or sub-project.

- The difference between the portion of expenditures recorded in the approved final payment and the amount of expenditures received in each project or sub-project upon completion of compensation and site clearance work shall be treated as stipulated at Point a of this Clause.

4. The compensating organization shall be responsible for managing final payment documentation, including the written final payment approved by the competent authority and all relevant documents in accordance with laws.

Chapter III

IMPLEMENTARY PROVISIONS

Article 7. Transitional provisions

1. Projects or sub-projects of which the compensation plan has been approved by the competent authority before July 1, 2014, the estimate, use and final payment of budget for compensation, support and resettlement due to the Government's land expropriation shall continued to be executed under the instructions of the Circular No. 57/2010/TT-BTC of the Ministry of Finance dated April 16, 2010 on stipulating the estimate, use and final payment of budget for compensation, support and resettlement due to the Government’s land expropriation.

2. Projects or sub-projects of which the compensation plan has been approved by the competent authority for the period from July 1, 2014 to the date earlier than the effective date of this Circular, the estimate, use and final payment of budget for compensation, support and resettlement due to the Government's land expropriation shall be executed under the instructions of the Circular No. 57/2010/TT-BTC of the Ministry of Finance dated April 16, 2010 on stipulating the estimate, use and final payment of budget for compensation, support and resettlement due to the Government’s land expropriation. If there is the compulsory land audit or expropriation that may arise, this action shall be governed under the provisions of this Circular.

Article 8. Effect

1. This Circular shall come into force from July 1, 2015.

2. This Circular shall replace the Circular No. 57/2010/TT-BTC of the Minister of Finance dated April 16, 2010 on stipulating the estimate, use and final payment of budget for compensation, support and resettlement due to the Government's land expropriation.

3. In the course of implementation, if there is any difficulty that may arise, agencies or organizations must send their timely feedback to the Ministry of Finance for their cooperation in taking any possible measures./.