The Regulation on management, payment and settlement of projects using public investment capital

Published on 12 - 11 - 2021

On 11/11/2021, the Government issued the Decree No. 99/2021/ND-CP stipulating the management, payment and settlement of projects using public investment capital.

This Decree details the management, payment and settlement of public investment capital for projects and works, the planning and investment preparation tasks in accordance with the Law on Public Investment.

Accordingly, the State Treasury agency performs the task of controlling and paying for public investment capital from the State budget and the lawful revenue of State agencies for investment.

Public non-business units shall control the payment of capital from lawful revenues for investment of their units.

The Ministry of National Defense and the Ministry of Public Security shall base on their tasks and decentralization of management, to authorize an agency to control and pay capital for state secret public investment projects decided by the Prime Minister for investment policy, the top secret and strictly confidential public investment projects of the Ministry of National Defense and the Ministry of Public Security and notify the Ministry of Finance.

Principles of management and payment of public investment capital: The management and payment of public investment capital for tasks and projects must ensure the right purposes, right subjects, savings, efficiency, and compliance with the regulation on public investment management and state budget in accordance with current law and provisions of this Decree.

Investors using public investment capital are responsible for managing and using the capital for the right purposes, the right subjects, economically and efficiently; strictly complying with the provisions of the law on investment finance regime. Investors using public investment capital from the State budget must strictly comply with the provisions of law on the regime of development investment and capital construction investment expenditures as prescribed in the Law on State Budget.

The superior agency of the investor is responsible for inspecting and urging the investor, the project management board (collectively referred to as the investor) within its scope of management implements the public investment plan and uses the public investment capital in accordance with the provisions of current law.

Financial agencies at all levels shall perform the financial management of public investment in observing the regimes and policies on management and payment of public investment capital in accordance with current law and this Decree.

The agency that controls and pays public investment capital is responsible for controlling and paying capital in a timely, complete and correct manner for tasks and projects when fully meeting the payment conditions and dossiers according to regulations.

For public investment projects abroad, the signed contract, the current law of the host country, the international treaty to which Vietnam is a contracting party and the current law of Vietnam are the legal basis to manage, make an advance and pay capital for public investment projects abroad. The governing body, on behalf of the investor, proposes and performs payment transactions for public investment capital with the controlling and payment agency.

The Decree stipulates that for contracts with a contract advance value of more than VND 1 billion, an advance guarantee is required. The value of the contract advance guarantee will be reduced corresponding to the value of the advance recovered through each payment between the principal and the contractor.

Notably, there are 05 cases that no advance guarantee is required, including:

- For contracts with a contract advance value of less than or equal to 1 billion VND, for simple and small-scale contracts, the agreement in the contract shall be complied in accordance with the law on bidding and construction.

- Construction contracts in the form of self-implementation, including those performed by the community under national target programs.

- Project management entrustment contract.

- Works are performed without contracts and compensation, support and resettlement (except for cases that compensation, support and resettlement work requires construction).

- Cases in which project management board expenses are advanced to investors and project management boards.

In addition, the Government also stipulates that, for jobs performed through contracts (including construction contracts and contracts of projects without construction components), the total advance capital amount on the basis of the request of the investor, must not exceed 30% of the contract value (including provisions if any).

This Decree takes effect from January 1, 2022.

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