DECREE

STIPULATING THE SETTING UP AND OPERATION OF VIETNAM-BASED FOREIGN CULTURAL AND/OR EDUCATIONAL ESTABLISHMENTS

THE GOVERNMENT

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

Pursuant to the Governments Resolution No.90/CP of August 21, 1997 on the orientation and policy of socialization of educational, medical and cultural activities;

In order to enhance the management over and ensure favorable conditions for foreign organizations and individuals to participate in the development of the cultural and/or educational cause in Vietnam;

At the proposals of the Minister of Education and Training and the Minister of Culture and Information,

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.-

1. This Decree stipulates the setting up and operation of Vietnam-based foreign cultural and/or educational establishments (hereafter abbreviated to FCE establishments) which aim to develop education and cultural exchange, not for the profit-making purpose.

2. Revenues earned from activities of foreign cultural and/or educational establishments, after subtracting all lawful expenses, shall only be invested in the development of the cultural and/or educational cause and the construction of infrastructure works, and expended for activities in the common interests of FCE establishments.

3. Foreign cultural and/or educational establishments that operate for the profit-making purpose shall not be subject to this Decree but shall comply with the provisions of the Law on Foreign Investment in Vietnam.

Article 2.-Vietnam-based foreign cultural and/or educational establishments mean the common name of cultural organizations and agencies (such as representative offices, centers, institutes, villages, clubs, libraries, showrooms, parks, museums, zoos, etc.), educational institutions (such as representative offices, international schools, universities, job-training centers, etc.), and cultural-cum-educational centers (such as representative offices, culture and art schools, cultural houses with foreign language classes, etc.), which are set up or jointly set up and operated in Vietnam by overseas Vietnamese, foreigners or foreign legal persons (hereinafter referred collectively to as foreign parties), under the Vietnamese States permission.

Article 3.-The Vietnamese Government encourages the setting up of FCE establishments in the following fields:

1. Training, fostering and improving professional skills in the fields of culture, arts and information;

2. Training technical workers, technicians, scientific and managerial personnel with high qualification in the fields of economics, technology, technical sciences and natural sciences;

3. Cooperating in the building of material cultural works and conducting study on non-material cultural works.

Article 4.-FCE establishments shall be set up in the following forms: representative offices, joint-venture establishments and independent establishments.

1. Representative offices are affiliate units of foreign cultural and/or educational organizations, tasked to represent such organizations in promoting the formulation of projects and/or programs for cooperation in the cultural and educational fields, which the Vietnamese side is interested in; urging and supervising the implementation of agreements on cultural and educational cooperation already signed with the Vietnamese cultural and/or educational organizations.

2. Joint-venture establishments are FCE establishments set up on the basis of international treaties to which the Socialist Republic of Vietnam is a signatory, or on the basis of agreements between foreign parties and Vietnamese cultural and/or educational organizations.

3. Independent establishments are FCE establishments where foreign parties bear all costs for the building of their material and technical foundations, and organize and administer all their operations.

Chapter II

PROCEDURES FOR THE GRANTING, EXTENSION, MODIFICATION, SUPPLEMENT AND WITHDRAWAL OF SETTING-UP AND OPERATION PERMITS

Article 5.-

1. A foreign cultural and/or educational establishment shall be considered and granted permit for setting up its representative office when it fully meets the following conditions:

- Having the legal person status under the law of the country where it has been set up;

- Having a charter, clear operation guidelines and objectives and an operating duration of 3 years or more;

- Having programs and/or projects, which the Vietnamese side is interested in and which are feasible and aimed to promote the development of Vietnams culture and/or education.

2. A dossier of application for the permit to set up a representative office in Vietnam shall comprise:

a/ A permit application containing the following principal contents:

- The full name and nationality of the applying organization and the place where it is headquartered;

- The operation guideline and objectives;

- A summary of the organizations development process;

- The financial sources and capability, as compared to the prescribed minimum financial capability;

- Reason(s) for setting up a representative office in Vietnam and the place where it plans to locate its office;

- The number of Vietnamese and foreigners expected for the representative offices operation.

b/ The charter or operation regulation of the foreign cultural and/or educational organization that applies for permit to set up a representative office.

c/ The written certification of the legal person status, issued by the competent body of the locality where it has been set up.

d/ Documents summarizing the development of cooperation between the cultural and/or educational organization that applies for permit to set up a representative office and Vietnamese cultural and/or educational organizations.

e/ Summarized programs and/or projects already agreed or planned for cooperation with Vietnam.

f/ The curriculum vitae of the person to be appointed the director of the representative office.

Article 6.-

1. A joint-venture establishment shall be granted permit when the Vietnamese party fully meets the following conditions:

a/ Being an organization or individual that has operated for at least 5 years in the field intended for joint-venture;

b/ Having documents certifying that its legal status and financial situation satisfy the joint-venture conditions specified in the joint-venture contracts.

2. A joint-venture establishment shall be granted permit when the foreign party fully meets the following conditions:

a/ Being an organization with legal person status or an individual with legal capacity in the home country;

b/ Having operated for at least 5 years in the field intended for joint-venture;

c/ Having necessary material conditions and technical facilities and equipment as required by the agreed contracts.

3. A dossier of application for permit to set up a joint-venture establishment shall comprise:

a/ A permit application containing the following principal contents:

- The full names, nationalities and addresses of the joint-venture parties;

- The objectives, scope and duration of operation in the joint-venture field;

- The summarized process of each partys operation in the joint-venture field;

- Reason(s) for setting up the joint-venture establishment and the place where it plans to locate its office;

- The number of Vietnamese and foreigners expected to work at the joint-venture establishment.

b/ The agreed contract between the joint-venture parties.

c/ The written certification of the legal status, financial sources and capabilities of the joint-venture parties.

d/ The charter or the statute on organization and operation of the joint-venture establishment.

e/ The curriculum vitae of the person to be appointed the director or the principal (hereinafter collectively called the director).

Article 7.-

1. An independent establishment shall be considered for permit granting when the foreign party fully meets the following conditions:

a/ Being an organization with legal person status or an individual with legal capacity;

b/ Having operated for at least 5 years in the field applied for permit;

c/ Having necessary material conditions;

d/ Bearing nationality of the foreign country that has already signed with Vietnam governmental-level cultural and/or educational cooperation documents, which are still effective.

2. A dossier of application for permit to set up an independent establishment shall comprise:

a/ A permit application containing the following principal contents:

- The full name, nationality and address of the foreign party;

- The objectives, scope and duration of operation in the field applied for permit;

- A summary of past operations in the field applied for permit;

- Reason(s) for setting up the independent establishment and the place where it plans to locate its office;

- The number of Vietnamese and foreigners expected to work at the establishment.

b/ The operation plan.

c/ The written certification of legal status and financial source and capability of the foreign party.

d/ The charter or statute on organization and operation of the independent establishment.

e/ The curriculum vitae of the person to be appointed the director.

Article 8.-Operation duration of FCE establishments in Vietnam:

1. The operation duration of representative offices shall be 5 years counting from the date of permit signing and may be extended. Each extension must not exceed 5 years.

2. The operation duration of joint-venture establishments and independent establishments shall be inscribed by the permit-granting body in their permits, counting from the permit signing date and must not exceed 50 years. A joint-venture or an independent establishment wishing to have its operation duration extended shall have to file an extension application to the permit-granting body within 90 days before the operation duration expires.

Article 9.-The competence to grant, extend, modify, supplement and withdraw permits to/from FCE establishments is prescribed as follows:

1. The Prime Minister shall decide whether or not to grant permits to independent establishments, tertiary and postgraduate education establishments, cultural establishments of national or international scale and group-A projects.

2. The Minister of Education and Training shall decide on FCE establishments operating mainly in the field of education and training, except for cases specified in Clauses 1 and 4 of this Article.

3. The Minister of Culture and Information shall decide on FCE establishments operating mainly in the field of culture and information, except for cases specified in Clause 1 of this Article.

4. The Minister of Labor, War Invalids and Social Affairs shall decide on FCE establishments operating mainly in the field of job training, except for cases specified in Clauses 1, 2 and 3 of this Article.

5. The authorities competent to permit the setting up of FCE establishments in Vietnam shall also be competent to extend, modify, supplement and withdraw permits, temporarily suspend, terminate and dissolve FCE establishments in Vietnam.

Article 10.-The reception and evaluation of permit application dossiers are prescribed as follows:

1. For FCE establishments specified in Clause 1, Article 9 of this Decree, the Ministry of Education and Training, the Ministry of Culture and Information and the Ministry of Labor, War Invalids and Social Affairs shall receive dossiers according to their respective assigned branch-managing functions, consult the concerned ministries, branches and provincial-level Peoples Committees (hereinafter collectively called the provincial Peoples Committees), then submit them to the Prime Minister for consideration and decision.

2. For other cases, the Ministry of Education and Training, the Ministry of Culture and Information and the Ministry of Labor, War Invalids and Social Affairs shall receive dossiers according to their competence provided for in Clauses 2, 3 and 4, Article 9 of this Decree, consult the concerned ministries, branches and provincial Peoples Committees before examining them and making decisions.

Article 11.-The time limits for dossier evaluation are prescribed as follows:

1. For cases specified in Clause 1, Article 9 of this Decree, within 90 days after receiving the complete and valid dossiers, the dossier receiving and evaluating body shall have to complete the evaluation and submit its comments to the Prime Minister. Within 7 days after the Prime Minister decides whether or not to grant permits, the dossier receiving and evaluating body shall notify the result in writing to the applicants.

2. For other cases, within 30 days for representative offices and 60 days for independent FCE establishments after receiving complete and valid dossiers, the permit-granting body shall notify the result in writing to the applicants.

Article 12.-

1. Within 90 days after being granted permits, the FCE establishments shall have to complete the procedures for operation registration with the Peoples Committees of the provinces where such FCE establishments are headquartered.

2. Within 30 days after completing the procedures for operation registration with the provincial Peoples Committee, a FCE establishment shall have to publish on a central newspaper and a local newspaper for 5 consecutive issues the following contents:

a/ The name of the FCE establishment (in Vietnamese and a common foreign language);

b/ The setting up permit (serial number, date and granting body);

c/ The full name of the director;

d/ The location of head office, telephone and fax numbers;

e/ The serial number of account at the bank for transaction.

Article 13.-All FCE establishments that wish to change their names, headquarters and/or directors, to set up branches, add functions and tasks, broaden operation scope or have their permits extended shall have to report to the dossier receiving and evaluating bodies defined in Article 9 of this Decree and such change, addition or extension shall be effected only when they obtain written approvals.

Within 30 days after receiving applications for change, addition and/or extension, the permit-granting bodies shall reply the applicants in writing.

Article 14.-

1. The operation of a FCE establishment shall be terminated in the following cases:

a/ The duration inscribed in the permit expires;

b/ At the request of such FCE establishment;

c/ Under a permit-withdrawal decision of the permit-granting body.

2. The dossier-receiving and evaluating body shall have to notify the concerned FCE establishment and provincial Peoples Committee of the reason(s) for operation termination within 30 days before such FCE establishments operation is terminated.

Article 15.-Within 90 days after being notified of operation termination, the FCE establishment shall have to complete all the related procedures, including the announcement on a central newspaper and a local newspaper of the operation termination, payment of debts, taxes, wages and house rent, liquidation of assets and contracts, return of permit and seal, and send written reports to the permit-granting body and the concerned competent State bodies. In special cases, this time limit may be extended with the permit-granting bodys approval, but it must not exceed one year.

Chapter III

POWERS AND RESPONSIBILITIES OF VIETNAM-BASED FOREIGN CULTURAL AND/OR EDUCATIONAL ESTABLISHMENTS

Article 16.-After being granted permits, FCE establishments can operate according to the objectives, contents and durations stated in their permits. Their efforts shall be concentrated on the building and development of their own establishments in order to better meet arising demands in compatibility with the objectives permitted by the Vietnamese side. They shall be entitled to contact and request the Vietnamese functional bodies to create favorable conditions for their operations.

Article 17.-FCE establishments are obliged to abide by the Vietnamese law, must not take advantage of cultural and/or educational activities to falsely propagate lines, undertakings and policies of the State of the Socialist Republic of Vietnam, split the national solidarity bloc, instigate violence, propagandize aggressive war, undermine fine customs and practices, disseminate debauched cultural products, superstitious practices and social vices.

Article 18.-

1. FCE establishments are entitled to recruit laborers according to the requirements of their operations, to give priority to recruitment of Vietnamese citizens and comply with the provisions of the Labor Code and other relevant provisions of the Vietnamese law on the employment of Vietnamese laborers in Vietnam-based foreign or international agencies and organizations.

2. Vietnamese and foreign citizens working at FCE establishments shall have to abide by and observe the Vietnamese law, exercise their rights and fulfill their obligations on the basis of labor contracts and the provisions of the labor legislation; respect each others honor, human dignity and national traditions.

3. Vietnamese and foreign citizens working at the FCE establishments shall be equal in working conditions and interests of professional fostering and development.

4. Vietnamese citizens working at FCE establishments may join political organizations, socio-political organizations and other mass organizations according to such organizations charters and provisions of the Vietnamese law.

Article 19.-

1. FCE establishments are entitled to rent working offices, dwelling houses and facilities in service of their operations and daily-life needs.

2. FCE establishments that wish to lease land for building of material and technical foundations in service of their operations shall have to submit dossiers of application for land lease together with dossiers of permit application.

3. For land already assigned by the State to the Vietnamese parties for use, if they enter into cooperation with foreign parties in form of joint-venture establishments without changing land use purposes, such joint-venture establishments shall, after being granted permits, be entitled to carry out the procedures for designing, building or performing operations stated in their permits.

4. In cases where the material foundations, facilities and equipment of the FCE establishments fail to ensure the safety, hygienic or environmental conditions, the Vietnamese State management bodies may request the directors of such FCE establishments to repair or improve them within a given duration. If they deem it necessary, they shall order such establishments to temporarily cease their operations to overcome the said situation.

5. FCE establishments must not allow any individual or organization to use their names or locations to carry out activities which are illegal and contrary to the objectives already stated in their permits or registered.

Article 20.-FCE establishments are allowed to import or temporarily import for re-export facilities necessary for their operations as well as for working and daily-life needs of foreign citizens working thereat according to the provisions of the Vietnamese law.

Article 21.-Representative offices and FCE establishments that do not carry out revenue-earning operations are allowed to open accounts exclusively for expenditures (in foreign currencies or in Vietnamese currency of foreign-currency origin) at banks established and operating under the Vietnamese law.

Article 22.-

1. FCE establishments that carry out revenue-earning operations shall have to observe the accounting, statistical and auditing regimes according to the provisions of the Vietnamese legislation on accountancy, statistics and audit; open accounts in foreign currencies and Vietnamese currency at banks established and operating under the Vietnamese law; and effect all revenues and expenditures via such accounts. In special cases where the State Bank of Vietnam consents, FCE establishments shall be allowed to open borrowed capital accounts at overseas banks.

2. In cases where the foreign party puts up the initial capital and borrowed capital for the construction of the material and technical foundation of a FCE establishment, it shall, after fulfilling all the financial obligations, be entitled to transfer abroad:

a/ Capital amounts under its lawful ownership;

b/ Foreign loans and interests thereon paid in the course of operation.

3. FCE establishments shall have to strictly comply with the Vietnamese regulations on foreign exchange management.

Article 23.-

1. FCE establishments are allowed to receive financial or property supports of organizations and individuals at home and abroad to build their material and technical foundations and develop the cultural and/or educational cause.

2. FCE establishments must not receive money or assets in any form from any person (at home and abroad) if such reception violates Vietnamese law.

Article 24.-

1. Vietnamese citizens and foreign citizens working at FCE establishments shall have to pay personal income tax according to the provisions of law.

2. Foreign citizens working in Vietnam at FCE establishments, after paying personal income tax, may transfer abroad their lawful incomes.

Article 25.-FCE establishments shall have to observe the provisions on examination and inspection activities in Articles 28, 29 and 30 of this Decree and create all favorable conditions for examination and inspection activities.

Article 26.-

1. During their operations in Vietnam, FCE establishments shall have their lawful rights and interests protected by the Vietnamese State according to the Vietnamese law and international agreements which the Socialist Republic of Vietnam has signed or acceded to.

2. In cases where international agreements which the Socialist Republic of Vietnam has signed or acceded to contain provisions different from those of this Decree, the provisions of such international agreements shall apply.

Article 27.-

1. FCE establishments shall have to send annual written reports on their operations to the State management bodies defined in Article 28 of this Decree and the Peoples Committees of the provinces where their offices are located. When necessary, at requests of the said bodies, the FCE establishments shall have to report, supply documents or explain matters related to their own operations.

2. FCE establishments that carry out revenue-earning operations shall have to send annual financial reports to the Finance Ministry and the State management body(ies) in charge of such establishments.

Chapter IV

THE STATE MANAGEMENT

Article 28.-The Ministry of Education and Training, the Ministry of Culture and Information and the Ministry of Labor, War Invalids and Social Affairs are bodies assisting the Government in exercising the uniform State management over all activities of FCE establishments related to their own branches, and have the following tasks and powers:

1. To elaborate and submit to the competent bodies for promulgation or promulgate according to their competence legal documents on cultural and/or educational activities of FCE establishments;

2. To guide the procedures for receiving dossiers of application for permits, and assume the prime responsibility for organizing the dossier evaluation and permit granting according to the regulations;

3. To be in prime charge of settling matters related to the setting up and operation of FCE establishments;

4. To guide, examine, inspect and evaluate the organization and operation of FCE establishments and publicly announce the results of examination, inspection and/or evaluation; to handle violations according to the provisions in Chapter V of this Decree.

Article 29.-The ministries, the ministerial-level agencies, the agencies attached to the Government shall, within their assigned functions, have to coordinate with one another in elaborating legal documents on cultural and/or educational activities of FCE establishments; take part in the evaluation of permit application dossiers; guide and settle the procedures related to the setting up of FCE establishments; examine and inspect the operation of FCE establishments; and perform other tasks under their competence as provided for by law.

Article 30.-The Peoples Committees of the provinces where the FCE establishments locate their offices, shall have the following tasks and powers in exercising the State management over cultural and/or educational activities of FCE establishments in their respective localities:

1. To take part in the evaluation of permit application dossiers;

2. To examine and/or inspect the organization and operation of the FCE establishments;

3. To directly manage the FCE establishments based in their respective localities according to the responsibility delegation by the Government;

4. To request the competent State bodies to consider and settle matters related to the organization and operation of FCE establishments;

5. To perform other tasks under their competence as provided for by law.

Article 31.-The provincial/municipal Services of Education and Training, Services of Culture and Information and Services of Labor, War Invalids and Social Affairs shall, within their assigned functions, have to assist the Peoples Committees of the provinces where the FCE establishments locate their offices in performing the State management function in their respective localities over cultural and/or educational activities of the FCE establishments.

Chapter V

HANDLING OF VIOLATIONS

Article 32.-

1. Organizations and/or individuals belonging to FCE establishments that violate the provisions of this Decree shall have to stop their violations and, depending on the seriousness of their violations, be handled as follows:

Warning or a fine of between VND five million and twenty million shall be imposed on one of the following acts:

a/ Erasing, modifying, leasing or lending permits;

b/ Using laborers to work at FCE establishments in contravention of the provisions of this Decree and Vietnams legislation on labor;

c/ Having no signboards, making improper signboards or using signboards in contravention of the provisions of law;

d/ Delaying the payment of rental for and return of working offices and facilities they have rented in case of contract termination;

e/ Failing to report or wrongly reporting on the organization and operation of FCE establishments as prescribed.

2. A fine of between VND twenty million and sixty million shall be imposed on one of the following acts:

a/ Changing names and/or directors or relocating offices from one province or centrally-run city to another without approval;

b/ Temporarily ceasing or terminating operation without prior notices;

c/ Violating the regulations on opening and use of accounts or accounting and statistical regimes;

d/ Causing troubles or obstacles to examinations and/or inspections by the competent State bodies.

3. A fine of between VND sixty million and one hundred million shall be imposed on one of the following acts:

a/ Carrying out operations beyond the objectives, contents and scope already specified in permits;

b/ Operating when permits have expired or FCE establishments are in period of temporary suspension of operation.

4. In cases where a FCE establishment commits a violation act prescribed in Clauses 1 and 2 of this Article that involves aggravating circumstance(s), it shall be fined at the highest level of the fine bracket, and at the same time, may be subject to the temporary operation suspension.

In cases where a FCE establishment commits a violation act prescribed in Clause 3 of this Article that involves aggravating circumstance(s), it shall be fined at the highest level of the fine bracket, and at the same time, may be subject to the temporary operation suspension or permit withdrawal.

Article 33.-Vietnamese and foreign citizens working at FCE establishments who commit acts of violating the provisions of this Decree shall, depending on the seriousness of their violations, be administratively sanctioned or examined for penal liability according to the provisions of the Vietnamese law.

Article 34.-

1. The permit-granting bodies shall issue handling decisions to suspend operation or withdraw permits.

2. The specialized Education and Training, Culture and Information, and Labor, War Invalids and Social Affairs inspectorates shall issue decisions on handling of violation acts prescribed in Clause 3, Article 32 of this Decree; report to the ministers and request the Prime Minister to temporarily suspend operation or withdraw permits of FCE establishments under the Prime Ministers deciding competence in cases where such establishments commit violation acts prescribed in Clause 4, Article 32 of this Decree.

3. The presidents of the Peoples Committees of the provinces, where FCE establishments locate their offices, shall issue decisions to handle violation acts prescribed in Clauses 1 and 2, Article 32 of this Decree; request the concerned competent State management bodies to temporarily suspend operation of FCE establishments under their deciding competence in cases where such establishments commit violation acts prescribed in Clause 4, Article 32 of this Decree.

Article 35.-

1. Vietnamese officials and public employees who violate the provisions of this Decree while on duty shall, depending on the seriousness of their violations, be disciplined or examined for penal liability.

2. FCE establishments may lodge complaints to the competent State bodies or initiate lawsuits at court about/against violation-handling decisions or acts of on-duty Vietnamese officials and/or public employees that they deem wrong.

Chapter VI

IMPLEMENTATION PROVISIONS

Article 36.-

1. The FCE establishments which have been set up under the permission of the Vietnamese Government before the promulgation of this Decree shall not be subject to re-consideration for approval, but have to supplement and complete their dossiers within 60 (sixty) days after the effective date of this Decree and strictly comply with the provisions of this Decree, except for FCE establishments which are permitted by the Vietnamese Government to be set up and managed according to the separate regulations.

2. The working sections of foreign cultural and/or educational organizations currently operating in Vietnam, and have offices and staff members, but not yet been granted permits by the Vietnamese Government shall, within 60 (sixty) days after the effective date of this Decree, have to fill in the procedures for permit application according to the provisions of this Decree. If past the above-said time limit, they still fail to do so, they shall be forced to terminate their operation.

Article 37.-This Decree takes effect 15 days after its signing. The previous stipulations which are contrary to this Decree shall all be annulled.

The Minister of Education and Training, the Minister of Culture and Information and the Minister of Labor, War Invalids and Social Affairs shall have to guide and inspect the implementation of this Decree.

Article 38.-The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the People’s Committees of the provinces and centrally-run cities and the Vietnam-based foreign cultural and/or educational establishments shall have to implement this Decree.