CIRCULAR

GUIDING THE IMPLEMENTATION OF A NUMBER OF ARTICLES OF THE GOVERNMENTS DECREE NO. 40/2008/ND-CP DATED APRIL 7, 2008, ON LIQUOR PRODUCTION AND TRADING

Pursuant to the Governments Decree No. 189/2007/ND-CP dated December 27, 2007, defining the functions, tasks, powers and organizational structure of the Ministry of Industry and Trade;
Pursuant to the Governments Decree No.40/2008/ND-CP dated April 7, 2008, on liquor production and trading;
The Ministry of Industry and Trade guides in detail a number of articles of the Government's Decree No. 40/2008/ND-CP dated April 7, 2008, on liquor production and trading, as follows:

I. GENERAL PROVISIONS

1. This Circular provides guidance on liquor production and trading conditions; the competence, order and procedures for granting, modifying, extending or revoking liquor production and trading licenses.

2. This Circular applies to domestic and foreign organizations and individuals engaged in liquor production and trading and other related activities in the Vietnamese territory.

3. Liquor is on the list of goods restricted from trading. Organizations and individuals of all economic sectors may invest in liquor production and trading (wholesale or retail) only when fully satisfying the prescribed conditions and possessing licenses granted by a competent state agency under this Circulars guidance.

II. LIQUOR PRODUCTION

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1. Conditions on applicants

Being enterprises setup under law and having made business registration for liquor production.

2. Conditions on investment

The size and location of a liquor production establishment must be in line with the master plan on development of the beer, liquor and beverage industry.

3. Conditions on material foundations, technical equipment and personnel

a/ Having specialized machinery and equipment chains for brewing, fermenting, distilling, pouring, etc., suitable to production stages and capacity;

b/ Having technological processes for liquor production up to food quality, hygiene and safety standards;

c/ Having equipment for measuring, and inspecting the quality of, liquor yeast, sugar content and alcohol concentration in the production process;

d/ The total area of a liquor production establishment, including the processing zone and preservation zone, must be at least 500 m², in which a separate warehouse for product preservation must be arranged;

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f/ Having labor contracts signed with technically and professionally qualified persons (possessing an intermediate or higher degree) or experienced persons (certified artisans), suitable to the liquor production line;

g/ Laborers personally engaged in liquor production must possess certificates indicating that they are physically fit and free from contagious diseases, granted by a health agency.

4. Conditions on liquor product quality, hygiene and safety

Liquor products must satisfy quality and hygiene requirements according to Vietnam regulations, manufacturer standards and the Health Ministrys regulations on food hygiene and safety.

5. Conditions on product brand ownership

Liquor producers must have the right to lawfully own or use liquor product brands already registered and protected in Vietnam.

6. Conditions on environmental protection and fire and explosion prevention and fight.

a/ Machinery and equipment lines must be installed in a space satisfying standards on industrial sanitation, environmental sanitation, labor safety and fire and explosion prevention and fight.

b/ There must be adequate facilities and equipment to ensure fire prevention and fight according to regulations.

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1. Competence to grant liquor production licenses.

a/ The Ministry of Industry and Trade shall grant liquor production licenses for investment projects on liquor production with a capacity of 3 million liters or more/year.

b/ Provincial-level Industry and Trade Services shall grant liquor production licenses for investment projects on liquor production with a capacity of under 3 million liters/year in their localities.

2. A dossier of application for a liquor production license

a/ A written application for a liquor production license, made according to the form in Appendix 1 to this Circular, not printed herein;

b/ A valid copy of the investment license or business registration certificate; a valid copy of the tax identification number certificate;

c/ Documents on material foundations, technical equipment and personnel:

- The enterprise's reports on business operation results over the latest 5 years, indicating the production output of each category of liquor product, paid tax amounts, profits (for operating liquor producers);

- Projected production and business operation results (output of each category of product, tax amounts, profits) for 5 years following the year of application;

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- A list of specialized equipment for measuring, and inspecting the quality of, liquor yeast, sugar content and alcohol concentration;

- A list of machinery and equipment for inspecting the temperature and humidity; a design of the system for adjusting the temperature and humidity;

- Areas and design plans of workshops, warehouses, working offices and other supporting zones. Dossiers evidencing the right to own workshops and works and land use rights (lease contracts, land use right certificates, etc.);

- Valid copies of diplomas, professional certificates, health certificates and labor contracts signed with technicians and workers directly engaged in production.

d/ Documents on food quality, hygiene and safety:

- Valid copies of quality registration dossiers and quality standard announcements;

- Valid copies of food hygiene and safety assurance certificates.

e/ Valid copies of papers certifying the right to lawfully own or use liquor product brands;

f/ Documents on environmental protection and fire and explosion prevention and fight:

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- A valid copy of the document approving the fire prevention and fight plan or of the record on inspection of fire prevention and fight safety assurance, granted by a competent fire prevention and fire police agency;

- A list of fire prevention and fight facilities and equipment and their design dossiers.

3. Order of and procedures for granting a liquor production license

a/ within 30 days after receiving a complete and valid dossier, the Ministry of Industry and Trade or the provincial-level Industry and Trade Service of the locality where the enterprise is headquartered shall examine the dossier and grant a liquor production license. In case of refusal, it shall give a written reply clearly stating the reason;

b/ If a dossier incomplete or invalid, within 7 days after receiving the dossier, the licensing agency shall request in writing the modification of the dossier.

4. A licenses hall be made in 4 copies: 2 copies to be kept at the licensing agency, one to be sent to the licensed enterprise, and one to be sent to the Ministry of Industry and Trade (for licenses granted by provincial-level Industry and Trade Services, made according to the form in Appendix 3, not printed herein) or the provincial-level Industry and Trader Service (for licenses granted by the Ministry of Industry and Trade, made according to the form in Appendix 2, not printed herein).

5. A liquor production license is valid for 5 years. 30 days before the expiration of a license, the liquor producer shall send a written for re-grant of the license to the competent licensing agency for consideration and re-grant of such license.

6. Liquor producers will have their liquor production licenses revoked if they violate liquor production conditions or other provision of law or in case of merger or dissolution.

C. Conditions, competence, dossier, order and procedures for grant of licenses for manual liquor production for business purpose

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2. Manual liquor producers who are members of manual liquor production villages are not required to apply for manual liquor production licenses. The villages' representatives shall apply for manual liquor production licenses for the villages and take responsibility for the satisfaction of liquor production conditions commonly applicable to village members.

3. Licensing conditions

a/ Organizations and individuals have made business registration for manual liquor production;

b/ Production establishments must satisfy conditions on environmental protection, food quality, hygiene and safety standards and liquor product brands.

4. Licensing competence, dossier, order and procedures .

a/ Economics or Industry and Trade Sections (below collectively referred to as Industry and Trade Sections) of People's Committees of districts where organizations' or individuals' manual liquor production establishments are located shall grant manual liquor production licenses.

b/ A license application dossier comprises:

- A written application for a license for manual liquor production for business purpose, made according to the form in Appendix 4 to this Circular, not printed herein;

- Valid copies of the business registration certificate and tax identification number certificate;

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- Valid copies of papers certifying the right to lawfully own or use liquor product brands. For manual producers of liquor for supply to other establishments for re-processing, copies of purchase and sale contracts between the two parties are required.

c/ Licensing order and procedures:

- Within 15 day after receiving a complete and valid dossier, the Industry and Trade Section of the Peoples Committee of the district where the organizations or individual's production establishment is located shall examine the dossier and grant a license for manual liquor production for business purpose, made according to the form in Appendix 5 to this Circular, not printed herein. In case of refusal, they shall give a written reply clearly stating the reason;

- If a dossier is incomplete or invalid, within 7 days after receiving the dossier, the licensing agency shall request in writing the modification of the dossier;

5. A license shall be made in 4 copies: 2 copies to be kept at the licensing agency, one to be sent to the licensed establishment, and one to be sent to the provincial-level Industry and Trade.

6. A license for manual liquor production for business purpose is valid for 5 years. 30 days before the expiration of a license, the manual producer of liquor for business purpose shall send a written request for re-grant of the license to a competent licensing agency for consideration and re-grant of such license;

7. Manual producers of liquor for business purpose will have their licenses revoked if they violate liquor production conditions or other provisions of law.

D. Liquor production output

1. Liquor producers may not produce liquor in excess of the capacity and of types of liquor products other than those indicated in their licenses.

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3. Before March 31 every year, subordinate industry and trade management agencies shall report on liquor investment, production and production licensing in localities to their immediate superior industry and trade management agencies.

III. LIQUOR TRADING

A. Conditions on a trader to obtain a liquor wholesale or wholesale agency license

1. Being an enterprise set up under law and having made business registration for liquor trading.

2. Having a fixed place of business with a clear address.

3. Having a warehouse (or a warehouse system) suitable to the enterprise's business capacity and satisfying requirements on liquor quality preservation, fire prevention and fight, food hygiene and safety and environmental protection as prescribed by law.

4. Having a paper of introduction to or liquor wholesale or wholesale agency contract signed with at least one liquor supplier (importer, producer or another wholesaler); organizing a stable distribution system in the locality.

B. Conditions on a trader to obtain a liquor retail or retail agency license

1. Having made business registration for liquor trading.

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3. Having a separate area for liquor trading, satisfying requirements on liquor quality preservation, fire prevention and fight, food hygiene and safety and environmental protection as prescribed by law.

4. Having a paper of introduction to or liquor retail or retail agency contract signed with at least one liquor supplier (importer, producer or and another wholesaler).

C. Competence, order and procedures for granting a liquor trading license

1. Competence to grant a liquor trading license

a/ For liquor wholesalers (or wholesale agents):

- The Ministry of Industry and Trade shall grant liquor wholesale (or wholesale agency) licenses to traders that wholesale liquor in two (02) or more provinces;

- Provincial-level Industry and Trade Services shall grant liquor wholesale (or wholesale agency) licenses to traders that wholesale liquor in a province.

b/ For liquor retailers (or retail agent)

District-level Industry and Trade Sections shall grant liquor retail (or retail agency) licenses to traders that retail liquor in a district.

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a/ A written application for a liquor trading license (made according to the form set in Appendix 6 or 9 to this Circular, not printed herein);

b/ Valid copies of the business registration certificate and tax identification number certificate;

c/ The business plan (for liquor wholesalers), indicating the following details:

- Assessment of the business operation situation and results over the past 3 year, enclosed with valid copies of purchase and sale (or purchase and sale agency) contracts signed with liquor suppliers (if liquor has been traded), indicating general data about kinds of liquor, purchase and sold liquor (total amounts and amounts distributed by liquor suppliers and business places), paid tax amounts, and profits;

Projected business results for the year following the year of application, indicating names and addresses of suppliers of liquor to be purchase, kinds of liquor, purchase and sale prices, quantity and value of purchased and sold liquor (total amounts and amounts distributed by liquor suppliers and business places), tax amounts to be paid, and profits;

- Form of selling products and modes of managing the distribution system;

- A list of traders that belong or will belong to the wholesalers distribution system, including names of traders, addresses of traders' head office, addresses of liquor shops (if any), tax identification numbers, valid copies of liquor trading licenses (if liquor has been traded), and projected business places;

- A dossier on the product warehouse (or system of product warehouses), indicating:

+ Location and capacity of the warehouse;

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+ A list of equipment for inspecting and adjusting the warehouse temperature and humidity (to ensure that the warehouse is always (airy, cool and free from direct sunlight on liquor products);

+ Documents on fire prevention and fight safety, food hygiene and safety and environmental protection as prescribed by law.

d/ A paper of introduction to or a liquor wholesale or wholesale agency contract signed with at least one liquor supplier, for wholesalers; a paper of introduction to or liquor retail or retail agency contract signed with at least one liquor supplier, for retailers;

e/ A dossier on the place for liquor trading (wholesale or retail), comprising:

- Address and description of the liquor trading area;

- Documents evidencing the trader's right to use the trading place (being owner, co-owner, or lessee with a lease duration of at least one year);

- A list of equipment for inspecting and adjusting the temperature and humidity in the liquor trading area (to ensure that the trading area is always airy, cool and free from direct sunlight on liquor products);

- Documents on fire prevention and fight safety, food hygiene and safety and environmental protection as prescribed by law.

3. Order of granting a liquor trading license

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dossier to the provincial-level Industry and Trade Service of the locality where the wholesaler is headquartered ; a liquor retailer shall send a dossier to the district-level Industry and Trade Section of the locality where the retailer is headquartered;

b/ Within 15 days after receiving a complete and valid dossier, the industry and trade state management agency shall examine and evaluate the dossier and grant the trader a liquor trading license, made according to the form in Appendix 7, 8 or 9 to this Circular, not printed herein. In case of refusal, it shall give a written reply clearly stating the reason;

c/ If a dossier is incomplete or invalid, with 7 days after receiving the dossier, the industry and trade state management agency shall request in writing the trader to complete the dossier.

4. A liquor trading license shall be made in 6 copies and handled as follows:

a/ For licenses granted by the Ministry of Industry and Trade: 3 copies to be filed, one to be sent to the Market Administration Department, one to be sent to the provincial-level Industry and Trade Service of the locality where the trader is headquartered, and one to be sent to the licensed trader;

b/ For licenses granted by provincial-level Industry and Trade Services: 2 copies to be filed, one to be sent to the Ministry of Industry and Trade, one to be sent to the Market Administration Sub-Department, one to be sent to the district-level Industry and Trade Section of the locality where the licensed trader is headquartered, and one to be sent to the licensed trader;

c/ For licenses granted by district-level Industry and Trade Sections: 3 copies to be filed, one to be sent to the provincial-level Industry and Trade Service, one to be sent to the Market Administration Team, and one to be sent to the licensed trader.

5. A liquor trading license is valid for 5 years from the date it is granted. 30 days before the expiration of a license, the trader shall written request for re-grant of the license to the industry and trade state management agency which has granted such license.

6. Liquor traders will have their liquor trading licenses revoked if they violate liquor trading conditions and other provisions of law.

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1. Within 10 days after the end of a reporting period, traders shall send their biannual and annual reports on liquor trading to the competent licensing agency.

2. Within 15 days after the end of a reporting period, subordinate industry and trade management agencies shall report on liquor trading in localities to their immediate superior industry and trade management agencies.

IV. FEES FOR GRANTING LIQUOR PRODUCTION AND TRADING LICENSES

Organizations and individuals granted liquor production and trading licenses shall pay fees according to the Finance Ministry's regulations.

V. IMPLEMENTATION PROVISIONS

1. Organization of implementation

a/ The Light Industry Department and the Domestic Market Department shall, within the ambit of their functions and tasks, coordinate with units under the Ministry in performing the following tasks: .

- To receive dossiers, examine, supervise evaluate and submit to the Ministry's leaders for approval guidelines on liquor production investment and grant of liquor production and trading licenses;

- To guide and inspect organizations and individuals in implementing the Government's Decree No. 40/2008/ND-CP dated April 7, 2008, on liquor production and trading, this Circular and relevant provisions of law.

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c/ District-level Industry and Trade Sections shall receive, examine and appraise dossiers and grant licenses of manual liquor production for business purposes or liquor retail licenses.

2. Handing of violations

Organizations or individuals that violate this Circular and relevant provisions of law shall, depending on the severity of their violations, be disciplined, administratively sanctioned or examined for penal liability; if causing damage, they shall pay compensation therefore according to law.

Cadres or civil servants who commit acts of abusing positions or powers to contravene this Circular shall, depending on the severity of their violations, be administratively handled or examined for penal liability according to law.

3. Implementation effect

This Circular takes effect 15 days after it publication in "CONG BAO". To annul the Trade Ministrys Circular No. 12/1999/TT-BTM dated May 19, 1999, guiding the trading in liquor product.

Within 90 days after the effective date of this Circular, liquor producers and traders that fully satisfy the conditions guided in this Circular and wish to continue their production and trading activities shall submit dossiers of application for liquor production or trading licenses. Pending the grant of such licenses, they may continue operating until licensing agencies grant licenses or refuse in writing to grant licenses.

Organizations and individuals involved in liquor production and trading activities shall implement this Circular.

Problems arising in the course of implementation should be reported to the Ministry of Industry and trade for prompt handing.

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FOR THE INDUSTRY AND TRADE MINISTER
VICE MINISTER




Bui Xuan Khu