Chapter I
GENERAL PROVISIONS
Article 1. Scope
This Decree prescribes the act of commissioning, ordering and tendering public-sector goods and services funded by the state budget's regular expenditures.
Article 2. Subjects of application
1. Ministries, quasi-ministerial agencies, Governmental bodies (hereinafter referred to as central authorities), People’s Committees of provinces and centrally-affiliated cities (hereinafter referred to as provincial People’s Committees), People’s Committees of urban/rural districts, towns and provincial cities (hereinafter referred to as district People‘s Committees) and other directly-affiliated managing bodies that are authorized to commission, order and seek tenders for provision of public goods and services funded by the state budget’s regular expenditures.
2. State-owned public service units that are established by competent state agencies under regulatory provisions; have legal personality; supply public services; help in implementing state management mandates.
3. Enterprises from all economic sectors, entities, units (including state-owned public service units not directly under agencies allocated the budget for ordering and tendering for public goods and services); cooperatives having legal personality; persons practising independently and registering their business under law who perform the functions of supplying public goods and services subject to regulatory requirements for provision of public goods and services (hereinafter referred to as other public service providers; producers and suppliers of public utilities, or as bidders or contractors involved in the tendering and bidding process prescribed in bidding law); agencies and entities related to rendering of public goods and services.
4. Ministry of National Defense; Ministry of Public Security; political organizations; social-political organizations; social – political – professional organizations that are entitled to apply regulatory provisions of this Decree and other regulatory provisions of relevant law regarding the act of commissioning, ordering and seeking tenders for public goods and services funded by the state budget's regular expenditures authorized for use by competent authorities.
5. Ministries, central and local authorities, enterprises, entities, agencies and units administering public services; public utilities by using other financial resources (other than state budget funding) that are encouraged to apply regulatory provisions of this Decree.
Article 3. Interpretation
For the purposes of this Decree, terms used herein shall be construed as follows:
1. Public-sector good and service (hereinafter referred to as public good and service) refers to a commodity or service vital for the socio-economic life of the nation, public or maintenance of peace and security that the government administers in the following sectors: Education and training; vocational training; healthcare; culture, sports and tourism; information and communication; science and technology; natural resources and environment; traffic and transport; agriculture and rural development; industry and trade; construction; labor, war invalids and social affairs; justice and other fields prescribed in the government's regulations. It is composed of public services (also known as governmental services) and public utilities (also known as public goods).
2. Public-sector good and service funded by the state budget's regular expenditure (hereinafter referred to as public good), is composed of: Public services funded by the state budget and public utilities.
3. Public service funded by the state budget (hereinafter referred to as state-funded public service) refers to a public service of which costs are covered in full by the government, or a public service of which costs have not yet been fully charged into prices or fees or are covered by state grants.
4. Public utility refers to a commodity or service of which production and supply according to the market mechanism can hardly offset any cost incurred; or which is a particular commodity or service that has access to the Government’s subsidy against the spread between the selling price, the market or selling price or value under the Government's regulations; or between the sum that a beneficiary of a public utility pays as per the Government's regulations and total reasonable production cost that a producer or supplier thereof incurs to production or supply of any public utility ordered by the Government (or commissioned under regulatory provisions of relevant industry-specific law (if any)).
5. Subsidy on public utility refers to financial aid that the state budget grants at a fixed rate per a unit of public utility to a producer or supplier thereof so that they can produce or supply the public utility that the Government orders (or commissions according to regulatory provisions of applicable industry-specific law (if any)).
6. Reasonable cost incurred by a producer or supplier of public utility refers to any actual cost associated with the act of production and supply of a public utility that is proved to be appropriate according to the Law on Corporate Income Tax and other related legal normative documents.
7. Selling price regulated by the Government refers to any price set by the Government at which a producer or supplier sells their public utility on the market.
8. to commission a state-funded public service refers to a state agency assigning a state-owned public service unit to administer its public service under a competent authority’s decision according to its functions and duties.
9. to order a public good or service refers to a state agency’s act of designating a state-owned public service unit; other public service provider; a public utility producer or supplier that meets the Government’s regulatory requirements and conditions concerning placement of orders.
10. to seek tenders/tendering for a public good and service (also to put a public good and service out to tender) refers to the process of selecting a bidder or contractor to award them a contract for provision, supply or administration of a public good and implement that contract in a competitive, fair, transparent and economically effective manner.
Article 4. Budget or funding for supply of public goods
1. State budget’s regular expenditures available for use in public and economic activities prescribed in the Law on State Budget, including:
a) The central government’s budget expenditures used as funding for the process of commissioning, ordering or tendering for public goods by Ministries and central authorities;
b) The local government’s budget expenditures used as funding for the process of commissioning, ordering or tendering for public goods by local authorities.
2. Amounts retained to pay for service provision and fee or charge collection according to law on fees and charges.
3. Revenue gained from public services at the public service prices regulated by the Government.
4. Other financial sources stipulated in law (if any).
Article 5. Classification of public-sector goods and services
1. Public goods funded by the state budget's regular expenditures are classified into the following lists:
a) List of public services financed by the state budget;
b) List of public utilities.
2. Public services financed by the state budget that are shown in Appendix I (Chart 01 and Chart 02) to this Decree are classified into the followings:
a) Chart 01. Industry- or sector-specific state-funded public services.
Details about classification of governmental state-funded public services of Ministries and central authorities shall be given according to the Prime Minister's decisions; details about classification of state-funded public services within the local government jurisdiction shall be given according to decisions of Presidents of provincial People’s Committees.
b) Chart 02. Several lists of state-funded public services.
3. Public utilities are classified as shown in Appendix II hereto.
4. If there is any modification or supplement to classifications of public-sector goods and services shown in clause 2 and 3 of this Article over time, Ministries and central authorities shall take charge of and cooperate with the Ministry of Finance, the Ministry of Planning and Investment, Ministry of Home Affairs or any relevant agency on seeking the Prime Minister's decision to approve the central government budget’s estimated funding for such modification or supplement; the decisions of Presidents of provincial People’s Committees to approve the local government budget’s estimated funding for such modification or supplement. The updated classifications of public-sector goods and services shall be subject to regulatory provisions of this Decree.
Article 6. Methods for commissioning, ordering and tendering for public-sector goods and services
1. With regard to state-funded public services, the commissioning, ordering or tendering methods shall be employed.
2. With regard to public utilities, the ordering and tendering (or commissioning, once permitted by specialized law) methods shall be put to use.
3. Ministries, central authorities, provincial People’s Committees, district People’s Committees or directly-affiliated managing or regulatory agencies can be given the freedom of choice of any appropriate method for administering public-sector goods and services if the chosen method fully meets the conditions set forth in Chapter II and Chapter III and any applicable specialized law.
Article 7. Authority to decide on the method of commissioning, ordering and tendering for public goods and services
1. Ministries, central authorities or directly-affiliated managing bodies may delegate the authority to make decisions to commission or order public goods and services to their directly-controlled public service units; may assign the authority to make decisions to order (or commission, once permitted by specialized law) public goods and services to other public service providers; producers or suppliers of public utilities; or put public goods and services out to tender as allowed according to regulatory provisions by using the central government budget’s funds.
2. Provincial People’s Committees, district People’s Committees or managing bodies under their direct control may delegate the authority to make decisions to commission or order public goods and services to their directly-controlled public service units; may assign the authority to make decisions to order (or commission, once permitted by specialized law) public goods and services to other public service providers; producers or suppliers of public utilities; or put public goods and services out to tender as allowed according to regulatory provisions by using the local government budget’s funds.
3. In case of commissioning or ordering any particular public goods and services by using the central government budget’s funds, the Prime Minister’s decisions shall be applied.
Article 8. Methods and authorization for issuance of decisions on costs or values, unit prices of or subsidies on public goods and services
1. For state-funded public services
a) In case of carrying out the process of commissioning state-funded public services, based on commissioned amounts and quantities; spending regimes, levels and limits subject to competent state agencies’ regulations; Ministries, central authorities, provincial People’s Committees, district People’s Committees or their directly-controlled managing bodies may delegate authority to approve the budget proposals for commissioning public services to state-owned public service units.
b) In case of carrying out the process of ordering state-funded public services, the pricing method, agencies having jurisdiction over appraisal or valuation, pricing procedures and unit prices thereof shall be subject to regulatory provisions of price and other relevant law.
2. For public utilities
Pricing methods, agencies having jurisdiction over appraisal or valuation, pricing procedures, unit prices and subsidies on public goods and services shall be subject to price and other relevant law.
3. Selling prices, costs or values and unit prices of public goods and services shall be determined according to economic – technical norms or cost norms adopted by competent agencies. As part of the aforesaid, personnel wages or salaries included in selling prices, costs or values and unit prices of public goods and services calculated according to statutory base pay rates; pay coefficients arranged by specific professional ranks, grades, titles, and salary-based benefits and contributions shall be subject to state policies and regulations to be applied to state-owned public service units and labor or cost norms (where available) issued by Ministries, central authorities or provincial People's Committees according to jurisdiction. In particular, personnel wages or salaries included in costs or values and unit prices of public goods and services shown in Appendix II to this Decree; personnel wages or salaries included in unit prices of state-funded public goods and services shown in Chart 02 of Appendix I to this Decree that businesses are awarded contracts through the process of ordering or tendering for (or commissioning, once provided in specialized law) public goods and services shall follow the instructions of the Ministry of Labor, War Invalids and Social Affairs.
4. For goods and services on the classification list of products and services of public interest given in the Government's Decree No. 130/2013/ND-CP dated October 16, 2013 on production and supply of products and services of public interest, if they are shifted to the classification list of state-funded public services prescribed herein, authority to decide prices of respective services shall be the same as authority to decides prices of goods and services on the classification list of public utilities stipulated in the Law on Prices and its instructional documents.
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