Method of determining the rate of post-investment incentive granted by the Vietnam Environment Protection Fund

According to Circular No. 03/2017/TT-BTNMT of the Ministry of Natural Resources and Environment of Vietnam, the method of determining the rate of post-investment incentive to a single project is specified as follows:

- The rate of post-investment incentive to the entire project

Total rate of post-investment incentive to the entire project shall be equal to total annual rate of post-investment incentive to the project which is equal to total rate of post-investment incentive applied to each debt repayment made within one year in the project.

- The post-investment incentive rate applied to a single debt repayment made within a specified year shall be calculated as follows:

In which:

+ The actual amount of principal repayment in each debt repayment installment to which the post-investment incentive is applied shall be determined on the basis of the actual amount of principal repayment as agreed upon in the credit agreement which is eligible for the post-investment incentive.

+ The actual borrowing period as the basis for calculation of the post-investment incentive denotes the period of time (converted into years) from the date (dd/mm/yyyy) of receipt of loan disbursement to the date (dd/mm/yyyy) of unmatured principal paid to the credit institution under the primary credit agreement. The actual borrowing period shall be expressed as 1 month equivalent to 30 days and 1 year equivalent to 360 days.

+ The post-investment preferential interest rate shall be calculated on the basis of the annual preferential lending interest rate approved by the VEPF.

The actual borrowing period shall be determined based on the date of indebtedness specified on the Statement of disbursed capital amounts of the credit institution and the date of repayment of principal specified on the Statement of debt repayments to the credit institution (converted into years) which have been signed by the borrowing project owner and the lending credit institution.  The number of actual borrowing days shall represent the interval between the date of initial disbursement of borrowed fund and the date of first repayment of unmatured principal according to which the actual number of borrowing days of the principal amount repaid in the following installments.

The rate of post-investment incentive to projects financed by foreign currency loans shall be calculated in the original currency unit. Upon the date of grant of the post-investment subsidy, the rate of post-investment incentive denominated in the Vietnamese dong to a single project shall be calculated based on the interbank foreign currency exchange rate between USD and VND or the cross exchange rate between foreign currencies and VND which are quoted by the State Bank of Vietnam.

View details at Circular No. 03/2017/TT-BTNMT of the Ministry of Natural Resources and Environment of Vietnam, effective from May 05, 2017.

-Thao Uyen-

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