Circular 85: Advance Investment Capital for Implementing the Plan for Forest Protection and Development

Circular 85: Advance Investment Capital for the Implementation of the Forest Protection & Development Plan (Illustrative Image)

Circular 85/2014/TT-BTC stipulates the advance of investment capital to implement the forest protection and development plan. The file requesting advance capital: based on the documentation to settle the investment capital and the level of advance capital, the Investor prepares a file to request advance capital and sends it to the State Treasury, including:

- Investment capital payment request form or investment capital advance form according to Form No. 04/GDNTTVDT issued with this Circular;- Payment voucher (according to the accounting voucher system regulations of the Ministry of Finance);- Guarantee for the advance amount of the contractor in accordance with regulations and any amending and supplementing documents (if any).

The level of advance capital is implemented according to the following regulations and any amending and supplementing documents (if any):

- The total advance capital for contracts implemented in the year is up to 30% of the annual allocated capital plan for the project; In cases where the project has an allocated capital plan but the advance capital is insufficient according to the contract, after completing the payment and recovering all or part of the previously advanced capital, based on the request of the Investor, the State Treasury will continue to advance capital for the project (the total advance capital does not exceed the contract regulation), with the maximum outstanding advance capital being 30% of the annual allocated capital plan for the project.- In case of advance for compensation, site clearance work, the advance capital is determined based on the progress of the site clearance plan but does not exceed the annual allocated capital for the package or project.

Advance capital is disbursed after the project contracts for forest protection and development become effective; based on the Investor's advance request, and the annual capital plan, the State Treasury controls and transfers the advance capital according to the Investor's request, in accordance with the signed economic contract between the Investor and the contractor not exceeding the aforementioned advance capital limit.

The advance capital is paid through each settlement of the completed volume of the contract, starting from the first payment and fully recovered when the completed volume reaches 80% of the contract value. The settlement amount for each payment is mutually agreed upon by the Investor and the contractor and is explicitly stipulated in the contract;

For compensation and support work when the State recovers land:

- For compensation and support work: after paying to the beneficiaries, the Investor consolidates the vouchers, completes the settlement procedures, and recovers the advance within a maximum of 30 working days from the date of payment to the beneficiaries;- For other tasks: the advance capital is recovered in each payment of the completed volume and fully recovered when the compensation and support tasks are completed.

The Investor, in cooperation with organizations, contractors, individuals, communities, and households participating in the forest development project, calculates the reasonable advance level to propose advance capital, but does not exceed the provision in point b, clause 3 of this Article; simultaneously strictly manages and uses the advance capital for its intended purpose, for the right target, effectively, and is responsible for ensuring the full return of the advanced capital when the volume completion reaches 80% of the contract value;

Note: In cases where the advance capital has not been recovered but is not used, if the six-month period stipulated in the contract for work completion has passed and the contractor has not fulfilled the volume due to objective or subjective reasons or if the advance capital is misused, the Investor, in cooperation with the State Treasury, must recover and return the advanced capital to the state budget. Advance capital must not be disbursed without usage or misused; if by the end of the plan year the advance capital has not been fully recovered due to the contract not reaching the stipulated payment ratio, the recovery will continue in the following year's plan and will not be deducted from the following year's investment capital payment plan.

The state allocates capital to the Investor to settle advances within the plan year, no later than December 31 (except for advance payments for site clearance which are settled until January 31 of the following year). The Investor may settle the advance once or multiple times for a contract based on the need for advance capital payment, but not exceeding the prescribed advance capital; in cases where the allocated capital plan is insufficient for the advance capital, the Investor may continue the advance in the following year's plan.

For more details, see Circular 85/2014/TT-BTC which takes effect from August 15, 2014.

Ty Na

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