CIRCULAR

PROVIDING FOR FEES FOR FLIGHTS OVER THE VIETNAM'S AIRSPACE AND THE COLLECTION, TRANSFER AND MANAGEMENT THEREOF

Pursuant to the Law on Civil Aviation of Vietnam dated June 29, 2006 and the Law dated November 21, 2014 on amendments to a number of articles of the Law on Civil Aviation of Vietnam;

Pursuant to the Law on fees and charges dated November 25, 2015;

Pursuant to the Government's Decree No. 120/2016/ND-CP dated August 23, 2016 detailing and guiding the implementation of a number of articles of the Law on fees and charges;

Pursuant to the Government's Decree No. 215/2013/ND-CP dated December 23, 2013 defining the functions, tasks, powers and organizational structure of Ministry of Finance;

At the request of the Director of the Corporate Finance Department;

Minister of Finance promulgates this Circular to provide for fees for flights over the Vietnam's airspace and the collection, transfer and management thereof.

Article 1. Scope and regulated entities

1. This Circular provides for the fees for flights over the Vietnam’s airspace, the exemption from paying fees, the collection, transfer, management and use thereof.

2. This Circular applies to the entities that own, use or manage the aircrafts flying over the airspace of Vietnam (hereinafter referred to as the aircraft operator), providers of flight operation services to flights over the Vietnam’s airspace, competent state authorities and other relevant entities.

3. Where an international agreement to which the Socialist Republic of Vietnam is a signatory regulates otherwise, such international agreement shall prevail.

Article 2. Interpretation of terms

In this document, these terms are construed as follows:

1. Maximum takeoff weight (MTOW) means the maximum takeoff weight specified in the Operation Specification of an aircraft.

2. Operation distance of a flight over the Vietnam’s airspace refers to the distance between an aircraft’s point of entry into and point of exit from an airway in the Vietnam's airspace.

3. Operation distance of a flight over the Vietnam’s airspace and the flight information region managed by Vietnam refers to the distance between an aircraft’s point of entry into and point of exit from an airway managed and controlled by Vietnam.

4. Scheduled flight refers to a commercial flight which is regularly conducted according to the flight schedule announced on the carrier’s airline booking system.

5. Non-scheduled flight refers to any commercial flight other than scheduled flights as prescribed in Clause 4 of this Article.

6. Public aircraft flights refer to the flights of military aircrafts or special-use aircrafts of customs authorities or public security forces and the flights of civil aircrafts for public service purposes only.

7. Special aircraft flights refer to the flights prescribed in Clause 1 Article 2 of the Government’s Decree No. 03/2009/ND-CP dated January 09, 2009 providing for the assurance of special aircraft flights.

8. Special aircraft flights of Vietnam refer to the flights prescribed in Clause 2 Article 2 of the Government’s Decree No. 03/2009/ND-CP dated January 09, 2009 providing for the assurance of special aircraft flights.

9. Foreign special aircraft flights refer to the flights prescribed in Clause 3 Article 2 of the Government’s Decree No. 03/2009/ND-CP dated January 09, 2009 providing for the assurance of special aircraft flights.

Article 3. Flights subject to paying overflight fees

1. Scheduled flights.

2. Non-scheduled flights.

3. Special aircraft flights in combination with commercial transport (which are considered as scheduled or non-scheduled flights as regulated in Clause 4, Clause 5 Article 2 and Clause 1, Clause 2 of this Article herein).

Article 4. Flights exempted from paying overflight fees

Flights over the airspace of Vietnam not for commercial purposes, consisting of:

1. Special aircraft flights (including special aircraft flights combined with commercial transport).

2. Public aircraft flights.

3. Flights for search and rescue, transport of humanitarian aid, disaster and flood relief and other humanitarian activities.

Article 5. Fees for flights over the Vietnam's airspace

1. Fees charged to scheduled flights

a) Scheduled flights over the Vietnam's airspace

b) Scheduled flights over the Vietnam's airspace and the flight information region managed and controlled by Vietnam

2. Fees charged to non-scheduled flights shall be 120% of corresponding fees as prescribed in Clause 1 of this Article.

Article 6. Collector, management and transfer of collected fees for flights over the Vietnam's airspace to state budget

1. Fees for flights over the Vietnam's airspace are considered as government revenues. Vietnam Air Traffic Management Corporation shall be responsible for collecting overflight fees and transfer the entire collected fees to the central-government state budget and enter them into accounts according to corresponding sub-items and chapters. Expenditure for activities related to the collection of fees for flights over the Vietnam's airspace shall be covered by revenues from services provided by the Vietnam Air Traffic Management Corporation.

2. Responsibilities of Vietnam Air Traffic Management Corporation:

Based on the list of airways across the Vietnam’s airspace and the list of airways across the Vietnam’s airspace and the flight information region managed and controlled by Vietnam, which are announced by the Civil Aviation Administration of Vietnam, the Vietnam Air Traffic Management Corporation has the responsibility to:

a) Collect fees for flights over the Vietnam's airspace according to the regulated rates in full and on schedule.

b) Enter collected fees for flights over the Vietnam's airspace into accounts as the government revenues as regulated on the basis of the number of flights subject to paying fees for flying over the Vietnam’s airspace.

c) Register, declare and pay fees for flights over the Vietnam's airspace to the tax agency in the locality where its head office is located, and make transfer of fees to the central-government budget in accordance with regulations in the Circular No. 156/2013/TT-BTC dated November 06, 2013 by Minister of Finance providing guidance on a number of articles of the Law on tax management, the Law on amendments to the Law on tax management and the Government's Decree No. 83/2013/ND-CP dated July 22, 2013.

d) Transfer collected fees during a month to the account of central-government budget at the end of every month in conformity with guidance by the tax agency in the locality where its head office is located; the difference between the stated amount and the fees collected at the end of each month shall be transferred to central-government budget as regulated in Point c Clause 2 of this Article.

3. Vietnam Air Traffic Management Corporation may make deduction of overflight fees receivable in the following cases where it’s unable to collect a receivable in excess of 03 years:

a) An aircraft operator is declared bankrupt;

b) Flights over the Vietnam's airspace are stopped.

Vietnam Air Traffic Management Corporation shall continue following settled debts for a period of not less than 10 years but not exceeding 15 years as of the settlement of each debt as well as adopting debt recovery methods. Collected amount of debts must be transferred to the central-government budget in accordance with prevailing laws.

Article 7. Making and circulation of estimates of fees being collected for flights over the Vietnam's airspace

1. Based on the actual collection of overflight fees and the aviation demand forecasting announced by the Civil Aviation Administration of Vietnam, Vietnam Air Traffic Management Corporation shall make and send the estimate of fees being collected for flights over the Vietnam’s airspace to the Civil Aviation Administration of Vietnam for submitting a consolidated estimate to Ministry of Transport by July 15^th of every year. Ministry of Transport shall consider and aggregate the estimate of fees for flights over the Vietnam’s airspace with its estimates of state budget revenues and expenditures of the following year and send them to Ministry of Finance by July 20^th of every year.

2. Ministry of Transport shall send the estimate of fees for flights over the Vietnam's airspace to the Civil Aviation Administration of Vietnam upon decision on giving estimate by Ministry of Finance. Then, the Civil Aviation Administration of Viet Nam shall send the estimate of fees for flights over the Vietnam's airspace to the Vietnam Air Traffic Management Corporation for implementation.

Article 8. Statement of collected fees for flights over the Vietnam's airspace

1. Vietnam Air Traffic Management Corporation shall make statements of collected fees for flights over the Vietnam’s airspace in accordance with regulations in the Government's Decree No. 120/2016/ND-CP dated August 23, 2016 detailing and guiding the implementation of a number of articles of the Law on fees and charges.

2. Ending a financial year, the Vietnam Air Traffic Management Corporation shall prepare and submit final statement of fees for flights over the Vietnam's airspace collected during a year to the Civil Aviation Administration of Vietnam. The Civil Aviation Administration of Vietnam shall conduct verification and report results thereof to Ministry of Transport and Ministry of Finance as regulated.

Article 9. Effect

1. This Circular takes effect as of January 01, 2017 and shall be applied as of the fiscal year of 2017; replaces the Circular No. 196/2015/TT-BTC dated December 01, 2015 by Minister of Finance providing for fees for flights over the Vietnam's airspace and the collection, transfer and management thereof and the Joint Circular No. 03/2015/TTLT-BGTVT-BTC dated February 27, 2015 by Ministry of Transport and Ministry of Finance providing guidance on financial management and plan for provision of air navigation services.

2. Other contents related to the collection, transfer, management, use, receipts and announcement of regulations on collection of the fees, which are not provided for in this Circular, shall be performed in conformity with regulations in the Law on fees and charges, the Government's Decree No. 120/2016/ND-CP dated August 23, 2016 detailing and guiding the implementation of a number of articles of the Law on fees and charges, the Circular No. 156/2013/TT-BTC dated November 06, 2013 by Minister of Finance providing guidance on a number of articles of the Law on tax management, the Law on amendments to the Law on tax management and the Government's Decree No. 83/2013/ND-CP dated July 22, 2013, and regulations adopted by Ministry of Finance on the printing, issuance, management and use of receipts of fees and charges.

3. If any documents referred to in this Circular are amended, supplemented or replaced, the new ones shall prevail.

4. Ministry of Transport and relevant entities should promptly report difficulties that arise during the implementation of this Circular to Ministry of Finance for consideration.