PRIME MINISTER ------- No. 53/1999/QD-TTg

SOCIALIST REPUBLIC OF VIETNAM Independence- Freedom- Happiness ****** Dated March 26, 1999

DECISION

ON A NUMBER OF MEASURES TO
ENCOURAGE FOREIGN DIRECT INVESTMENT
****

THE PRIME MINISTER

Pursuant to the Law on Organization of the Government of September 30, 1992;

Pursuant to the Law on Foreign Investment in Vietnam of November 12, 1996;

With the aim of encouraging and creating even more favorable conditions for the activities of the enterprises with direct foreign investment;

At the proposal of the Minister of Planning and Investment,

DECIDES:

Article 1- Prices of goods and services

To adjust the prices of some following goods and services:

1. Power selling price:

From July 1st, 1999 the selling price of power for production (normal hours, power potential 6KV to 20KV) for foreign-invested enterprises is 7.5 cent/ Kwh.

Basing itself on this selling price of power, the Government Pricing Commission shall set the concrete selling price of power for production, business and services of foreign-invested enterprises.

2. Telecommunication prices and charges

- From July 1st, 1999 the price of telephone installation for foreign- invested enterprises and foreigners shall be the same as for domestic enterprises and Vietnamese.

- From July 1st, 1999 telephone subscribers charge for foreign-invested enterprises and foreigners is 10 USD/unit/month. Inner region telephone charge shall apply the same rate as for domestic enterprises and Vietnamese.

From July 1st, 1999 international telecommunication charge from Vietnam to other countries shall be reduced by an average of 10%.

From July 1st, 1999 telecommunication surcharge from the hotels shall not exceed 15% of the charge at post offices.

Basing itself on the above-said prices and charges, and after consulting the Government Pricing Commission, the General Department of Post and Telecommunications shall provide for the concrete charge for telephone installation, the telephone subscribers charge, the inner region telephone charge and the international telecommunication charge from Vietnam to other countries.

3. Price of clean water

From July 1st, 1999 the People's Committees of the provinces and centrally-run cities shall apply the same selling price of clean water for use purpose without distinction of domestic enterprises, foreign invested enterprises, Vietnamese and foreigners as stipulated in Inter-ministerial Circular No. 02/TTLB of April 29, 1997 of the Ministry of Construction and the Government Pricing Commission.

Article 2.- Charges and fees

1. From July 1st, 1999 the same entrance fee shall apply to Vietnamese and foreign visitors at each sight seeing point of the historic, revolutionary and cultural sites.

The Ministry of Finance and the People's Committees of the provinces and centrally-run cities shall have to guide and inspect the implementation of this regulation.

2. The Ministry of Finance shall propose to the Government for amendments to Decree No. 193 /CP of December 29,1994 of the Government so that administrative fee shall be collected only for the registration of licenses of foreign invested enterprises as from July 1st, 1999.

3. From July 1st, 1999 the fees for the installation of representative offices of foreign economic organizations in Vietnam shall be conducted at the rate of one million Vietnam Dong, and no fee shall be collected for the extension of permits.

4. Basing itself on Decision No. 04/1999/ND-CP of January 30, 1999 of the Government, the Ministry of Finance shall decide according to its competence or shall propose to the Prime Minister for the reduction or abolition effective from July 1st, 1999 of the charges and fees issued by the ministries, branches or People's Committees of the provinces and cities directly under the Central Government and the Managing Boards of Industrial Zones at provincial level which do not conform with their competence or with the character and objective of the collection of charges and fees.

Article 3.- Currency unit to determine the prices of services, charges and fees

From July 1st, 1999 the Vietnam Dong shall be used to determine the various prices of services, charges and fees except otherwise provided for in separate regulations. The prices of services, charges and fees set in the US dollar stipulated in Article 1 and Article 2 of this Decision shall be converted into Vietnam Dong at the average exchange rate on the inter-bank foreign exchange market announced by the Vietnam State Bank.

Article 4.- Wages of Vietnamese laborers working at foreign-invested enterprises

1. From July 1st, 1999 the minimum wage and the wages of Vietnamese laborers working at foreign invested enterprises shall be determined and paid in Vietnam Dong on the basis of the conversion of the current minimum wage and wages set in the US dollar into Vietnam Dong at the average exchange rate on the inter-bank foreign exchange market announced by the Vietnam State Bank.

From July 1st, 1999 when the consumer price index rises by 10% and more compared with the latest readjustment, the minimum wage and the wages of the Vietnamese laborers working at foreign invested enterprises shall be readjusted accordingly.

2. The Ministry of Labor, War Invalids and Social Affairs shall readjust the areas for application of the minimum wages as stipulated in Decision No. 385/ LDTBXH-QD of April 1st, 1996 of the Ministry of Labor, War Invalids and Social Affairs for application as from July 1st, 1999.

The minimum wage as stipulated in this clause shall apply to the projects which are licensed for investment after the date when this Decision takes effect. For the projects which have been licensed before the date when this Decision takes effect, the foreign-invested enterprises and the collectives of laborers there shall agree on the payment of wages as stipulated in this clause on the basis of voluntariness, preservation of stability of production and maintenance of jobs for the laborers.

3. The Ministry of Finance shall propose to the Government to lay down concrete stipulations for the implementation of Point b, Clause 2 of Article 16 of the Trade Union Law. For the foreign-invested enterprises, the regime of deduction of trade union expenditures from the wage fund shall not apply.