What are regulations on inspection and review of advance funding and recovery of advance disbursements of public funds using State budget in Vietnam?

Pursuant to Clause 6, Article 10 of the Decree 99/2021/ND-CP stipulating inspection and review of advance funding and recovery of advance disbursements of public funds using State budget in Vietnam as follows:

a) Regulatory payment bodies solicit investors to comply with regulations on recovery of advance funding, cooperate with investors in checking over amounts already disbursed in advance for the purpose of recovering amounts of advance disbursement not yet used or misused. Regulatory payment bodies checks the balance of advance funding to ensure that amounts already disbursed in advance are recovered in full in accordance with clause 5 and point d of clause 6 of this Article.

b) By the 5^th of the first month in the following quarter, investors prepare the review report on advance disbursement of funds and recovery of advance funding for investment for each project for submission to regulatory payment bodies where transactions occur, and investor's superiors, clearly stating the balance of advance funding that has not yet been recovered till the reporting time, reasons, issues and problems arising from recovery of the overdue balance of advance funding (if any) as well as recommended solutions.

c) On a six-monthly and annual basis, by July 10 in the budgetary year and by February 28 in the outyear, regulatory payment bodies at all levels prepare the review report on advance disbursements and recovery thereof of ministries, central and local authorities for submission to same-level financial authorities (Form No. 08/SDTƯ), clearly pointing out overdue balances not yet recovered till the reporting time, reasons, issues and problems arising during the process for recovery of the overdue balances (if any) and recommending solutions.

Based on the report of the same-level regulatory payment body, the Ministry of Finance instructs ministries and central authorities in writing to take action to recover overdue balances of advance funding for the projects under the management of ministries, central authorities; instructs departments of finance, district-level finance – planning divisions to report to same-level People’s Committees in order for them to take actions to recover late payments on advance funding for the projects under the management of same-level People’s Committees.

d) Time limits for recovery of advance disbursements:

For the jobs carried out under contracts (e.g. construction contracts, contracts for execution of projects without building part or component): If advance funding is late for recovery for more than 03 months from the due date of recovery stipulated in the contract during which the contractor has not yet used it for executing the project, or misuses it, the investor shall take charge of or cooperate with regulatory payment bodies in recovering advance funding to the state budget. Where the investor has not recovered the advance disbursement yet, the regulatory payment body shall request the investor in writing to recover advance disbursement from the contractor, or request the credit institution to issue the guarantee for recovery of advance funding to fulfill their guarantee obligations when the contractor violates their commitment for use of advance funding to the investor.

For compensation, support and residential resettlement work: If the advance funding is late for recovery for a period of 03 months from the advance funding date during which it is not paid to the beneficiary, the investor shall take charge of and cooperate with the regulatory payment body in requesting the entity in charge of compensation, support and residential resettlement to transmit all of the balances of advance funding to the investor's deposit account at the regulatory payment body in order to facilitate the control, disbursement and recovery of advance funding.

After such period, if the entity in charge of compensation, support and residential resettlement work has not fully transmitted the overdue balance of advance funding to the investor’s deposit account at the regulatory payment body, upon the investor's request, the regulatory payment body may withdraw money from the deposit account of the entity in charge of the compensation, support and residential resettlement work opened at the regulatory payment body and transfer such sum to the investor’s deposit account at the regulatory payment body, and notify such money transfer to the entity in charge of the compensation, support and residential resettlement work.

One year after the date of money transfer to the investor’s deposit account opened at the regulatory payment body, if such sum has not yet paid to the beneficiary, the investor shall refund the amount of advance disbursement to the state budget (except where the person whose land is appropriated for project development purposes refuses to receive compensation or financial support according the approved plan for compensation, support or residential resettlement). Where the investor does not refund advance funding to the state budget, the regulatory payment body shall be allowed to withdraw money from the investor’s deposit account to remit such money into the state budget, reduce the amount of advance disbursement to the project and notify such reduction to the investor in that project.

For other jobs performed without contracts, if the advance funding is late for recovery for the period of 06 months from the advance disbursement date during which the investor has not recovered the advance funding yet, the regulatory payment body shall request the investor in writing to repay the amount disbursed in advance, except when the competent authority (the cost estimate approver) allows extension of the time limit for recovery of advance funding for completing quantities due to objective causes, or in case where advance funding against project management costs is paid to specialized or regional project management authorities. Within 03 months after the date of mandatory repayment of amounts disbursed in advance, if the investor has not refunded the amount disbursed in advance, the regulatory payment body may withdraw money from the investor’s deposit account to remit such sum to the state budget, reduce the amount already disbursed for use by the project and notify this action to the investor.

Best regards!