Tasks and powers of Vietnam National Coffee Corporation (Vinacafe)

Tasks and powers of Vietnam National Coffee Corporation (Vinacafe) (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Powers of Vietnam National Coffee Corporation (Vinacafe)

(1) Vinacafe's rights to capital and assets:

- Possessing and using Vinacafe's capital and assets to do business, and realize lawful benefits from Vinacafe's capital and assets.

- Dispose of Vinacafe's capital and assets in accordance with the law.

- Using capital and assets under Vinacafe's management for outward investment in accordance with the provisions of the law on investment.

- Managing and using the properties and resources allocated or leased by the State as land and natural resources in accordance with the law on land and natural resources.

- The State does not transfer the state capital invested in Vinacafe and the capital and assets of Vinacafe by non-payment method, except for the case where it decides to reorganize Vinacafe or implement the goal of providing public products and services.

(2) Vinacafe's rights in business:

- Actively organizing production and business, planning to coordinate production and business, organizing the management apparatus according to business requirements, and ensuring effective business.

- Doing business in the lines, trades, and fields specified in the Certificate of Business Registration and those that are not prohibited by law; expanding the business scale according to the capabilities and needs of the domestic and foreign markets in accordance with the provisions of law.

- Searching for domestic and foreign markets and customers and signing contracts.

- Deciding on the purchase and sale prices of products and services, except for public products and services and those priced by the State.

- Deciding on investment projects in accordance with the provisions of the law on investment and other relevant regulations; using Vinacafe's capital and assets for joint ventures, associations, and capital contributions to other enterprises; hiring or purchasing part or the whole of other domestic and foreign companies in accordance with the provisions of the law.

- Organizing the selection of contractors in accordance with the law on bidding.

- Using the state capital collected from equitization, Vinacafe sells part or all of the capital that it has invested in its affiliated units, subsidiaries, or affiliated companies in accordance with the law.

- Decision on investment in new establishment, reorganization, dissolution, or change of ownership of subsidiaries being one-member limited liability companies with the charter capital of each company up to 50% of the total value of assets recorded in Vinacafe's most recent financial statements; single-member limited liability companies owned by subsidiaries in which Vinacafe holds 100% of the charter capital; Vinacafe's dependent units in the country and abroad in accordance with the law, after being approved by the Prime Minister.

- Together with other investors to establish new subsidiaries or domestic and foreign affiliates in the form of limited liability companies, joint stock companies, or foreign-invested companies with Vinacafe's share or contributed capital in each company up to 50% of the total value of assets recorded in Vinacafe's latest financial statements in accordance with the law. In case of using investment capital from the state budget, it must be approved by the Prime Minister.

- Deciding on contracts of buying, selling, borrowing, lending, and other contracts valued at less than 50% of the total value of assets recorded in Vinacafe's most recent financial statements; accepting other companies that voluntarily join the association with Vinacafe in accordance with the law.

- Selection and signing of labor contracts; arranging, employing, training, rewarding, disciplining, and terminating labor contracts; selecting the form of salary and bonus for employees on the basis of production and business efficiency and the provisions of the law on labor, salary, and wages.

- Relationships with state agencies at the central and local levels to perform assigned functions, tasks, and powers; invite and work with foreign partners of Vinacafe; decide to send officials and employees of Vinacafe abroad to work, study, visit, survey, negotiate, and sign economic contracts in accordance with the State's regulations. For the Chairman, members of the Members' Council, and the General Director of Vinacafe going abroad on business, comply with the provisions of law.

- Developing, promulgating, and applying standards, processes, economic-technical norms, labor norms, wage unit prices, and other expenses on the basis of ensuring business efficiency and in accordance with provisions of law.

- Having other production and business rights according to market demand and in accordance with the provisions of law.

(3) Vinacafe's financial rights:

- Mobilizing capital for business in the form of issuing bonds, bills, and corporate promissory notes; borrowing capital from credit institutions and other financial institutions; borrowing capital from employees; and other forms of capital mobilization as prescribed by law.

The mobilization of capital for business is carried out according to the principle of self-responsibility for repayment, ensuring the effective use of mobilized capital, and must not change the form of ownership of Vinacafe. In the event Vinacafe mobilizes capital for ownership conversion, it must be approved by the Prime Minister and comply with the provisions of the law. Foreign loans must be approved by the Ministry of Agriculture and Rural Development and the Ministry of Finance.

- Active use of capital for Vinacafe's business activities; establishing, using, and managing Vinacafe's funds in accordance with the law and in accordance with the characteristics of the main business lines and industries.

- Deciding to depreciate fixed assets according to the principle of the minimum depreciation rate must ensure that it covers tangible and intangible depreciation of fixed assets and is not lower than the minimum depreciation rate prescribed by the Government.

- Enjoying subsidies, price subsidies, or other preferential regimes of the State when performing tasks of public utility, defense, security, disaster prevention, or providing products and services. According to the State's price policy, it is not enough to cover the cost of producing these products and services at Vinacafe.

- Being rewarded for innovation initiatives, technical improvement, management, and technology; bonuses to increase labor productivity; bonus material; and cost savings. These bonuses are accounted for in Vinacafe's business expenses, and are made once with a maximum bonus level not exceeding the effectiveness of innovation, technical and management initiatives, and technology, increase labor productivity, save materials, and reduce costs in one year.

- Enjoying investment and reinvestment incentives in accordance with law; exercising ownership rights over the capital invested in subsidiaries and other enterprises.

- Not having to pay corporate income tax on profits earned from capital contributions to subsidiaries and other enterprises if these subsidiaries and businesses have paid corporate income tax before profit is distributed to the capital contributors and is not subject to other forms of double and compound tax;

- Refusing and denouncing any request to provide resources not prescribed by law by any individual, agency, or organization, except for voluntary contributions for humanitarian and public purposes.

- After fulfilling the tax payment obligation, carry forward the loss in accordance with the Law on Corporate Income Tax and other financial obligations according to the provisions of the law. The financial reserve fund shall be set up, and the remaining realized profits shall be distributed and used in accordance with the provisions of the law. In the event that Vinacafe has a due debt but has not yet paid it off, it is only allowed to increase salaries and deduct bonuses for Vinacafe's employees, including managers, after paying off all due debts.

- Being guaranteed and mortgaged loans to subsidiaries of credit institutions, banks in the country and abroad according to the provisions of the law.

- Having other financial rights as prescribed by law.

(4) Vinacafe's right to participate in public activities:

- Producing and supplying public products and services on the basis of bidding. For public activities according to orders and plans assigned by the State, Vinacafe is obliged to consume products and provide public services to the right subjects, at prices and fees prescribed by the State.

- For public utility tasks assigned by the State, Vinacafe is guaranteed corresponding material conditions.

For products and services carried out by the bidding method, Vinacafe will compensate for its own costs according to the winning bid price.

For public products and services ordered by the State, Vinacafe may use fees or revenue from providing products and services ordered by the State to cover reasonable expenses for public activities and ensure benefits for employees. In case it is not enough, the State will compensate the difference.

- Developing and applying cost norms and wage unit prices in performing the tasks of production and supply of public products and services.

(Article 10 of the Charter of organization and operation of Vietnam National Coffee Corporation issued together with Decision 475/QD-TTg in 2011)

2. Tasks of Vietnam National Coffee Corporation (Vinacafe)

(1) Carrying out the main objectives and tasks assigned by the State; manage and use rationally and effectively the assigned or leased resources; environmental protection; comply with relevant laws.

(2) Vinacafe's obligations to capital and assets:

- Preserving and developing state capital invested in Vinacafe, capital Vinacafe mobilized itself.

- Being responsible for the debts and other property obligations of Vinacafe within the amount of Vinacafe's assets.

- Periodically re-evaluate Vinacafe's assets in accordance with the law.

(3) Obligations of Vinacafe in business:

- Doing business in the right registered lines and trades; ensuring the quality of products and services performed by Vinacafe according to the registered standards.

- Innovating and modernizing technology and management methods to improve efficiency and competitiveness.

- Ensuring the rights and interests of employees and employees' right to participate in Vinacafe management according to the provisions of law.

- Complying with the State's regulations on national defense, security, culture, social order and safety, and protection of natural resources and the environment.

- Implementing accounting, auditing, and financial reporting regimes, statistical reports according to the provisions of law and at the request of the state owner.

- Taking responsibility before the Government and the Prime Minister for the use of capital to invest in establishing other enterprises.

- Implementing risk management and insurance for Vinacafe's assets, liabilities, and people in production and business in accordance with the law.

- Subject to the supervision of the State in the implementation of regulations on the scale, salary table, salary unit price, salary payment regime for employees, the President, members of the Members' Council, the General Director, the Deputy General Directors, the Chief Accountant, and other managers.

- Subject to the supervision and inspection of the state owner; comply with the inspection decisions of the financial authorities and competent state agencies in accordance with the provisions of law.

- Performing other business obligations as prescribed by law.

(4) Vinacafe's financial obligations:

- Financial autonomy, self-discipline in terms of revenues and expenditures; conducting business effectively, ensuring the rate of return on equity invested by the state owner, registering, declaring, and fully paying taxes; performing obligations towards the owner, and other financial obligations as prescribed by law.

- Effectively managing and using: business capital, including capital invested in other companies; natural resources, land, and other resources allocated or leased by the State.

- Using capital and other resources to perform special tasks when required by the State.

- Fully complying with the regulations on the management of capital, assets, funds, accounting, and auditing regimes in accordance with law; be responsible for the truthfulness and legality of Vinacafe's financial activities.

- Implementing the annual financial reporting and financial disclosure regime and providing necessary information for an honest assessment of Vinacafe's performance.

- Performing other obligations specified in Vinacafe's Financial Management Regulations and other provisions of law.

(5) Obligations when participating in public activities:

- Providing public services assigned or ordered by the State according to the right subjects, prices, and fees prescribed by the State.

- Accepting public utility tasks assigned or ordered by the State and assigning part or all of those tasks to subsidiaries to perform according to the State's regulations.

- Performing contract signing and business accounting in accordance with law; taking responsibility before the State for the results of Vinacafe's public activities; taking responsibility before customers, before the law for products and public services directly implemented and provided by Vinacafe.

- Providing a sufficient quantity of public utility products and services, ensuring the right quality, the right audience, and the right time.

- Performing other public-interest obligations as prescribed by law.

(Article 11 of the Charter of organization and operation of Vietnam National Coffee Corporation issued together with Decision 475/QD-TTg in 2011)

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