(MPI) - Continue the 23rd Session, on the morning of April 16th, 2018, the National Assembly Standing Committee discussed matters that remained subject to different views on the draft Law on Special Administrative-Economic Zones Van Don, Northern Van Phong, Phu Quoc.
At the Session: MPI
At the Session, presenting Report on Acceptance and Adjustment of the draft Law on Special Administrative-Economic Zones Van Don, Northern Van Phong, Phu Quoc, Chairman of the NA Law Committee Nguyen Khac Dinh said that the adjusted Draft Law for the National Assembly Standing Committee to discuss at the Session includes 6 chapters, 84 articles and 6 appendices, along with the draft Resolution on Law Enforcement. Basically, the Standing Committee of the Law Committee and the drafting agency agreed on the accepted as well as adjusted contents of the draft Law and this is expressed in detail in Report No. 1311 / BC-UBPL14 of the Law Committee.
Amongst these, regarding local government organization, the model of local government organization in the special zones was readjusted to guarantee that it is in concordance with the Constitution’s regulations, the conclusion of the 11th Plenum of the 11th Party Central Committee and the comments of the Politburo. According to that, the local government in the special zones includes People’s Council and People’s Committee, with basic innovations in government’s structure, functions, tasks, authorities, and responsibilities to ensure leanness, effectiveness, and efficiency.
In term of some special mechanisms and policies relating to land, according to the Draft, the duration of land use is readjusted as follows: On the basic on the scale, the nature of the investment project and investor’s proposal, the Chairman of People’s Committee will decide the duration of land use for production, business at his/her special zone but no more than 70 years. In special cases decided by the Prime Minister, the duration of land use may last longer but no more than 99 years.
Regarding business lines prioritized for development in special zones, National Assembly members and localities have several proposals for new prioritized business lines. However the Standing Committee of the Law Committee and the drafting agency suppose that business lines prioritized for development is a central, throughout content, reflecting development goals and orientation of each special zone, and a foundation for identification and implementation of preferential and other policies, therefore need to be clearly defined in the draft Law and limited for expansion to ensure the principle of focused preferential treatment and promote each zone’s advantages. Only the crucial business lines as proposed by the Government or the Prime Minister could be considered and added. Accordingly, the Standing Committee of the Law Committee and the drafting agency have reviewed and unanimously proposed adding financial services and logistics industry to the priority list of Van Don special zone, adding product production and technology transfer in the field of oceanography, navigation, biology and marine ecology to the priority list of North Van Phong special zone, at the same time applying technical adjustments which are shown in the appendix to ensure strictness and uniformity.
In term of the budget for the special zones, the draft Law was readjusted to stipulate that the budget in special zones belong to the state budget system, equivalent to the district level budget to determine revenue sources, expenditures, budget estimation, execution and settlement of special zones will comply with the State Budget Law and this Law; at the same time, provide the basis for the application of relating laws to special zones’ budget. Besides, the Standing Committee of the Law Committee has coordinated with relevant agencies to absorb feedbacks, readjust and supplement some specific regulations on the budget of special zones in order to ensure closeness, feasibility and create higher initiative for local government in special zones.
In the Draft Law submitted to the National Assembly, it is specified that in all the three special zones, building and operating services, tourism and multi-functional entertainment complex with casino are projects belong to business lines prioritized for development, need to attract investment. These are multi-functional investment projects with large capital investment, therefore, it is necessary to prescribe that investment projects in this field will enjoy tax and land rent incentives like other projects in other business lines prioritized for development to attract investment and ensure international competitiveness. However, this is also a business sector with very high-profit margin and a big attraction for the investors, therefore, preferential policies should be reasonably calculated, to ensure to avoid long-term loss of state budget revenue. On the basis of absorbing a part of the opinions of the National Assembly members, the agencies agreed to readjust toward reducing some preferential treatment of projects in building, operating services, tourism and multi-functional complex with casino as compared to the draft Law, which was summited to the National Assembly by the Government.
The draft Law also adds a new article regarding the cadres, civil servants of local government in the special zones and basically readjusts regulations on policies for people working at agencies and organizations of the local administration in the special zones. Accordingly, basically the current cadres and civil servants in the three localities, who will be rearranged in order to continue working in the three zones' government system, will still be defined as cadres and civil servants, under the Law on Cadres and Civil Servants. As for newly recruited civil servants, they will be hired with fixed term to test the new policy. The recruitment will be done according to working position, based on the principle that the employer directly recruits the labor. At the same time, the wage regime for cadres, civil servants, officials, employees working in state agencies, public service units in the special zones will be vigorously reformed.
Speaking at the meeting, National Assembly Vice Chairman Phung Quoc Hien stated that the main goal of the three special economic zones is to create economic activities with strong spillover effects, promote the comparative advantages of each region. Therefore, the financial and budget aspects must be thoroughly discussed. Through that, we will see how these three special zones will benefit the country, what will we have to pay and what we will gain.
Chairwoman of the National Assembly Nguyen Thi Kim Ngan also proposed that the Drafting Committee should specify the budget for investment in the special areas to ensure feasibility. At the same time, she proposed that the policies for preferential treatment, investment attraction need to be reviewed to ensure that preferential treatments for foreign investors are not higher than for domestic investors. Investment attraction does not mean that the state invests and then applies tax exemption and reduction. According to NA Chairwoman Nguyen Thi Kim Ngan, the policy is to promulgate this Law on the principle of determinedly implementing, making firm steps, learning from experience by doing. This is a difficult law with many new experimental, breakthrough policies. The provisions of this law may be different from other laws but must stay within the framework of the Constitution and the guidelines of the Party.
Explaining to clarify some issues that the NA members are interested in, Minister of Planning and Investment Nguyen Chi Dung said, the main principle of the law is to create an outstanding institution to form new growth poles. Our main duty is to create an institution and support part of the budget to generate seed capital for investors. The second principle is not to violate the Constitution, and not to affect national defense, security, environment and public health.
However, until now, the drafting agency still has some concerns. Firstly, we build an outstanding institution, but the issue is whether the International community and investors will accept it. Secondly, we haven’t identified strategic investors. Thirdly, when we create a new institution, grant more authorities, increase initiative, can the officials absorb and operate? These are matters that the Minister concerns with.
According to Minister Nguyen Chi Dung, the important matter is not about the preferential policies, but about the favorable, open business environment, simple procedures and competitiveness ensuring. Along with that is the development orientation of these special zones and the commitment on development policies of the Government. The 25 out of 85 articles in the draft Law are designed only to govern the environment and policies, in the process of feedback acquisition and readjustment they have been adjusted to reduce the incentives toward focusing only on business lines prioritized and encouraged for development and only in a certain time.
At the ending of the Meeting, Vice Chairman of the National Assembly Uong Chu Luu said that this is a difficult, complex law project, contains sensitive contents, interested by voters. After the discussion, NA Standing committee agreed to name the project as Law on Special Administrative-Economic Zones Van Don, Northern Van Phong, Phu Quoc; agreed that each special zone’s administration will include People's Council, People's Committee and Chairman of People’s Committee of the special zone, with a compact apparatus and specific functions and tasks. The People's Councils and People's Committees of special zones will be clearly decentralized, especially the role and responsibilities of Chairmen of People’s Committees in the special zones is highlighted.
NA Standing Committee also agreed not to organize ward, commune levels in these three zones and only organize Head of the administrative area, appointed by Chairman of the special zone People’s Committee. NA Standing Committee also agreed on the support policy mechanism to ensure feasibility, equal competition principles in the economy, etc. Based on the discussion at the meeting, Vice Chairman of the National Assembly Uong Chu Luu proposed that the verifying agency, the drafting agency and the relevant authorities to continue adjusting the Draft Law, submit to the NA for reviewing and passing at 5th Session./.
Ministry of Planning and Investment