MINISTRY OF FINANCE AND MINISTRY OF INDUSTRY No. 46/2002/TTLT-BTC-BCN

SOCIALIST REPUBLIC OF VIETNAM Independence - Freedom - Happiness Hanoi, 21 May 2002

INTER CIRCULAR

GUIDING THE METHOD OF DETERMINING THE VALUE, MODE AND PROCEDURES OF PAYMENT OF CHARGES FOR THE USE OF THE STATE-OWNED DATA AND INFORMATION CONCERNING RESULTS OF MINERAL PROSPECTING AND EXPLORATION

Pursuant to the Government’s Decree No. 76/20001 ND-CP dated 15 December 2000 guiding in detail the implementation of the Law on Minerals (revised);

Pursuant to the Government’s Decree No. 87/CP of 19 December 1996 and Decree No 51/1998/ND-CP dated 18 July 1998 guiding the decentralization of State budget management, preparation, implementation and settlement;

The Ministry of Finance and the Ministry of Industry hereby jointly guide the method of determining the value, mode and procedures of payment of charges for the use of the State-owned data and information concerning results of mineral prospecting and exploration as follows:

I. GENERAL PROVISIONS

1.The payment of charges for the use of the State-owned data and information concerning results of mineral prospecting and exploration (hereinafter referred to as the data) is aimed at recovering the State capital invested in the work of mineral reconnaissance, prospecting and exploration.

2. Organizations or individuals permitted to use the data shall, after the mineral deposits have been put into exploitation, pay charges to the State in accordance with the provisions of this Circular. The payment shall be made as from the date of issuing of the mining licence.

3. The data referred to herein means all data obtained and compiled in the process of reconnaissance, prospecting and exploration of solid, gaseous minerals, mineral water or natural thermal water (except for oil and gas and natural water of other kinds) funded by the State budget, which are reflected in the final reports on reconnaissance, prospecting and exploration and associating data approved by competent State authorities.

4. The use of the data shall be made in accordance with the legislation on minerals and this Circular.

In case of using the data for the purpose of scientific research, training or drawing out plans, strategies within the tasks assigned by the State, payment of charges shall not be required under the provisions of this Circular.

5. The data printing and copying services shall be done in accordance with separate regulations and not under the regulation of this Circular.

II. METHOD OF DETERMINING THE VALUE AND MODE OF PAYMENT APPLICABLE TO ORGANIZATIONS AND INDIVIDUALS USING DATA UPON THE START OF EXPLOITATION OF MINES

1. Determining the value of State investment in mineral reconnaissance, prospecting, and exploration according to the current price levels:

A = S (Ki x Zi) + C x H

where :

- Ki is the volume of geologicalproject items based on the statistical data in the final reports on mineral reconnaissance, prospecting and exploration approved by competent State agencies:

- Zi is the current unit price of geological project.

- C is other expenses incorporated in the project value in accordance with the State regulations in force and based on the original price.

- H is the difference coefficient between the current and original price levels; determined as the ratio between the current price and the original price of the total volume of project items:

(Ki x Zi current price / Ki x Zi original price).

2. Determining the value of payment of charges for the use of data (G).

Based on the reserve allocated in the mining license, G shall be determined as follows:

Where:

- A is the value of the State investment calculated according to the formula stipulated in paragraph 1 of section II.

- P is the total reserve of A, B and C₁ categories of the whole mineral deposit covered by the exploration report

- P₁ is the total reserve of A and B categories licensed for mining from the deposit.

- P₂ is the reserve of C₁ category licensed for additional mining from the deposit.

3. Mode of payment of charges for the use of data

a) The organizations and individuals using data shall pay charges for the use of data to the State in lump-sum within the first two years or by instalments according to the mining output. In case where the value of the payment of charges for the use of data is less than VND 500,000,000 (five hundred million), the payment shall be made in lump sum within the first two years.

b) Organizations and individuals that have fully paid charges for the use of data in lump-sum within the first two years from the date of issuing the mining license shall enjoy 10% reduction of the payable amounts and have the right to use or transfer such data to other organizations and/or individuals according to the provisions of the Law on Minerals and Articles 34, 35 and 36 of Decree No 76/2000/ND-CP of the Government.

III. PAYMENT PROCEDURES

1. The Ministry of Industry shall take the lead and coordinate with the Ministry of Finance in determining the value and mode of payment of charges for the use of data applicable to organizations and individuals granted mining licences in accordance the provisions in Section II of this Circular.

2. The Ministry of Finance shall provide for and guide the tax authorities and State treasuries to perform the collection and management of the revenues from this source.

3. Within 30 days after receipt of the decision of the Ministry of Industry on the value and mode of payment of charges for the use of data, the organizations and individuals granted mining licenses shall register and complete the payment procedure with the Tax Departments of the localities where the mines are located. The mining organizations and individuals that make payment by instalments on the basis of annual mining output shall settle annually the amounts of charges subject to payment according to the actual mining outputs with the local Tax Departments.

IV. EXEMPTION, REDUCTION OF CHARGES FOR USE OF DATA

1. Cases of exemption and reduction of charges

a) Organizations or individuals having fully paid charges for the use of data in accordance with Point b, Paragraph 3, Section II of this Circular.

b) There is a difference between the reported and the actual reserves of the mine (the actual reserve is over 30 % less than the reserve of A and B categories stated in the report on the results of exploration of the mine) leading to a reduction in the exploitable reserve of the mine.

2. Procedures of consideration for exemption and reduction of the amounts of charges subject for payment for the use of data in case of difference between the reported and actual reserves of A and B categories

Based on the report made by the organization of individual granted with mining licence on the decrease of the actual reserve of the mine against the reserve licensed for mining on the basis of the exploration report, the Ministry of Industry shall take the lead and coordinate with the Ministry of Finance in inspecting and examining the actual situation of exploitation of the mine, and on the basis thereof shall send a written note to the Mineral Reserve Evaluation Council for the latter to inspect and evaluate in detail the extent and cause of the decrease in the actual reserve of the mine. On the basis of the conclusions in writing by the Mineral Reserve Evaluation Council on the decrease of the actual reserve of the mine and after receiving the consent of the Ministry of Finance, the Ministry of Industry shall decide on the levels of exemption or reduction of charges subject to payment for the use of data.

In case the data using organizations or individuals have fully paid charges for the use of data to the State on lump-sum basis, they shall also be considered for exemption or reduction of charges in accordance with the above provisions.

V. ORGANIZATION OF IMPLEMENTATION

1. Organizations and individuals granted with mining licenses shall make payment of charges for the use of data in accordance with the provisions of this Circular. In case organizations and individuals granted with mining license fail to properly make payment of charges for the use of data, their mining licenses shall be revoked according to the provisions of Articles 33 and 39 of the Law on Minerals.

2. The regime of inspection, control, reward and dealing with violations in the implementation of this Circular shall be in compliance with the provisions of the law currently in force.

3. Organizations and individuals whose mining licenses had been granted before the effective date of this Circular and are still valid shall pay charges for the use of data according to the provisions of this Circular for the reserve volume remaining to be mined. For cases where decisions have been issued on the rate of recovery of capital invested for mineral prospecting and exploration in accordancewith Joint Circular No 96/TT-LB dated 25 November 1993 of the Ministry of Finance and the Ministry of Heavy Industry stipulating the compensation for the cost of mineral prospecting and exploration upon the start of exploitation of a mine, the decisions on the rate of capital recovery previously issued by the Ministry of Industry shall continue to be implemented.

4. This Circular shall take effect 15 days after the date of its signing and shall replace the Joint Circular No 96/ TT-LB dated 25 November 1983 of the Ministry of Finance and the Ministry of Heavy Industry.

In the course of implementation of this Circular, if any problems arise, the concerned organizations and individuals are requested to report such problems to the Ministry of Finance and the Ministry of Industry for consideration and solution.

FOR THE MINISTER OF FINANCE VICE MINISTER Tran Van Ta

FOR THE MINISTER OF INDUSTRY VICE MINISTER Do Hai Dung