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DECREE
No. 02/1999/ND-CP OF JANUARY 27, 1999 AMENDING AND SUPPLEMENTING A NUMBER OF
ARTICLES OF THE REGULATION ON INVESTMENT IN FORMS OF BUILD-TRANSFER-OPERATE
CONTRACTS AND BUILD-TRANSFER CONTRACTS APPLICABLE TO FOREIGN INVESTMENT IN
VIETNAM
THE GOVERNMENT
Pursuant to the Law on Organization of the Government of September 30,
1996;
Pursuant to the Law on Foreign Investment in Vietnam of November 12,1996;
At the proposal of the Minister of Planning and Investment;
DECREE:
Article 1 . To amend and supplement the following articles of the
Regulation on investment in forms of build-operate-transfer contracts,
build-transfer-operate contracts and build-transfer contracts applicable to
foreign investment in Vietnam, which was issued together with Decree
No.62/1998/ND-CP of August 15, 1998 of the Government (hereafter referred to
as the Regulation):
1. To add to Article 3 of the Regulation a new clause (clause 3) as
follows:
?3. The rights and obligations of BOT enterprises, the relationship
between BOT enterprises and foreign investors in the execution of projects
shall be agreed upon by the parties in the BOT, BTO or BT contracts. To
confirm these matters, the parties may agree in the contracts to carry out
one of the following modes, provided that they comply with all provisions of
the BOT, BTO or BT contracts:
a) The BOT enterprise signs BOT, BTO or BT contract and forms together
with a foreign investor a party to such contract;
b) The BOT enterprise takes over the foreign investor/s rights and
obligations relating to the execution of the project; the taking over must
BOT enterprise shall legalized by a document signed by the BOT enterprise,
the foreign investor and the competent State agency; after it is approved by
the Ministry of Planning and Investment, such document shall be considered an
integral part of the BOT, BTO or BT contract;
c) Other modes approved by the Ministry of Planning and Investment?.
2. To add the following paragraph to the end of Clause 1, Article 24 of
the Regulation:
?The parties may agree in BOT, BTO or BT contract on other principal
contents, including the fact that the lending party shall BOT enterprise
shall entitled to take over part or whole of the rights and obligations of
the BOT enterprise in order to execute the project (hereafter referred to as
the right to take over the project) in cases where the BOT enterprise or the
foreign investor fails to fulfill the corresponding obligations of the BOT
enterprise or the foreign investor stipulated in the BOT, BTO or BT contract
and the investment license. The conditions, procedures and contents for
exercising the lending party/s right to take over the project must be
stipulated in the loan contract, the loan guarantee document or other
agreement signed between the BOT enterprise and/or the foreign investor
and the lending party, and must be approved by the competent State agency?.
3. To amend Clause 2 and 3, Article 24 of the Regulation as follows:
?2 . To execute a BOT, BTO or BT project, the BOT enterprise shall be
entitled to sign contracts for land lease, construction, installation of
machinery and equipment, consultancy and expertise services, purchase of raw
materials and sale of main products and services, capital borrowing, pledge
or mortgage of property and other contracts as prescribed by Vietnamese law.
"3. The parties signing the BOT, BTO or BT contracts and the parties
signing the above-said contracts, which are guaranteed by the Vietnamese
competent State agency in term of the obligation to perform such contracts as
stipulated in Clause 2, Article 10 of this Regulation , shall BOT enterprose
shall entitled to agree in the contracts on the application of foreign laws,
provided that the agreements on foreign law selection are not contrary to the
provisions of Vietnamese law and are approved by the Ministry of Justice?.
4. To amend and supplement Clauses 1 and 3, Article 25 of the Regulation
as follows:
"1. The disputes arising between the competent State agency(ies) and
foreign investors or BOT enterprises in the course of executing BOT, BTO
and/or BT contracts and guarantee contracts prescribed in Clause 2, Article
10 of this Regulation shall be settled first of all through negotiations
and/or conciliation. If the disputes cannot be settled through negotiations
and/or conciliation, the disputing parties may have their disputes settled by
an arbitration council to be set up upon their mutual agreement?.
"2. The disputes arising between BOT enterprises and foreign organizations
or individuals in the course of executing projects, and the disputes arising
between BOT enterprises and Vietnamese economic organizations taking part in
the execution of projects which are guaranteed by the Vietnamese competent
State agency(ies) in term of the obligation to perform the contracts as
prescribed in Clause 2, Article 10 of this Regulation shall be settled first
of all through negotiations and/or conciliation . If the disputes cannot be
settled through negotiations and/or conciliation, the disputing parties may
have their disputes settled by a Vietnamese arbitration organization or an
arbitration council to be set up upon their mutual agreement or an
arbitration established and operating in a third country.
Other disputes arising between BTO enterprises and Vietnamese economic
organizations in the course of executing the projects shall be settled
according to Clause, Article 102 of Decree No.12 ?CP of February 18, 1997 of
the Government detailing the implementation of the Law on Foreign Investment
in Vietnam?.
Article 2. ? This Decree takes effect 15 days after its signing.
Article 3. ? The ministers, the heads of the ministerial- level agencies,
the heads of the agencies attached to the Government and the presidents of
the People/ s Committees of the provinces and centrally-run cities shall have
to implement this Decree.
Source: Department of Ministry of Investment and Planning, HCM city,
Vietnam
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