b) Harvest and apply renewable energy sources;

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d) Gases recovery and utilization from oil drilling;

đ) Methane (CH₄) recovery from waste disposal sites and coal mining for electricity generation, living;

e) Afforestation or reforestation to increase capacity of greenhouse gas absorption and emission reduction;

f) CH₄ emission reduction from husbandry and cultivation activities;

g) Other fields resulting in greenhouse gas emission reduction.

2. MONRE provides detailed guidance on potential fields to develop and carry out CDM project defined in Item 1 of this Article.

Article 4. Form to develop and invest in implementation of a CDM project

CDM project is a new investment project, or a deep investment project, or an open investment project resulting in greenhouse gas emission reduction in the following forms:

1. National/ Domestic investor develops CDM project; provided fund in cash and other eligible assets/ properties to carry out CDM project in Vietnam.

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3. National/ Domestic investor, foreign/ international investor use consultants/ advisors to develop CDM project, and carry out or jointly carry out CDM project in Vietnam.

Article 5. Conditions to a CDM project

1. A CDM project shall have to meet the following conditions:

a) It must be a project developed in line with current law on investment, consistent with strategies and development plans of Ministries, sectors, localities; and contributes to ensure sustainable development of Vietnam;

b) Investors develop and carry out project voluntarily and strictly in line with Vietnamese laws and international conventions that Vietnam country has signed;

c) Ensure feasibility with advanced technology and suitable source of funding; do not use the Official Development Assistance (ODA) or State budget to collect CERs that are to be transferred to foreign investors;

d) Greenhouse gas emission reduction is recognized with an actual amount of reduction, with additionality available; calculated, monitored and checked in line with specific defined plan;

đ) Environment impact statement must be available;

e) Registered and approved by International Executive Board on CDM;

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g) A CDM project must be developed in line with procedures stipulated for a CDM project with a Confirmation Letter or Approval Letter issued by MONRE available.

2. MONRE is responsible for providing guidance to implement the Part g, Item 1 of this Article.

Article 6. Rights and duties of CDM development and implementation investor

1. CDM project development and implementation investors have the following rights:

a) To enjoy preferential treatment: regarding tax, land use fee, land lease fee, deprecation of fix assets; investment credit of State stipulated in this Decision.

b) Entitled to be under consideration of enjoying subsidy policy to products of the CDM project that in prioritized fields.

c) Entitled to be under consideration of getting financial support in project development in line with current laws and regulations.

d) Entitled to sell CERs under their ownership in line with current laws and regulations.

đ) To access and to be provided with information relating to identification of CERs selling price.

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2. Investors in CDM development and implementation in Vietnam shall have to carry out the following duties:

a) To register with the tax management agency when the project begins its implementation to enjoy tax incentives (preferential treatment on tax).

b) To register CERs issued to a CDM project by the International Executive Board on CDM with Vietnam Environment Protection Fund.

c) To carry out financial obligations stipulated to a CDM project, pay relevant fees stipulated in Article 9 of this Decision and in laws and regulations on fees and charges.

d) To be under monitoring of authorized agencies in line with regulations to a CDM project.

đ) To report to DNA in CDM on project implementation and Focal point receiving CERs issued to a CDM project by the International Executive Board on CDM in line with regulations.

Article 7. Management and utilization of CERs

1. CERs is under ownership of CDM project development and implementation investor, is monitored and managed through Vietnam Environment Protection Fund.

Vietnam Environment Protection Fund (VEPF) is responsible for arranging monitoring and management of CERs issued by the International Executive Board of CDM to CDM projects carried out in Vietnam.

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Article 8. Time to sell CERs and CERs selling price

1. After receiving CERs, CDM project development and implementation investor is able

to offer for selling immediately to partner who desires to purchase, or to select suitable time within the valid time of CERs.

2. Selling price of CERs is defined based on negotiation according to market price at the selling time.

3. MONRE is responsible for providing consultancy, support, and monitoring CERs selling.

Article 9. CERs selling fees

1. CDM project development and implementation investor shall have to pay CERs selling fees when selling CERs.

2. CERs selling fees is calculated by percentage (%) of total amount of money (income) that CDM project development and implementation investor get from CERs selling.

In case that CERs owners, who are foreign investors, do not sell CERs to get money but transfer CERs to their own countries to fulfil their commitment of greenhouse gas emission reduction, they shall have to pay fees that is calculated by percentage of total amount of money equivalent to amount of CERs they own based on market price at the time they transfer such CERs to their countries.

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4. Ministry of Finance stipulate specifically level of CERs selling fees; provide guidance on management and utilization of CERs selling fees stipulated in Item 3 of this Article.

Article 10. Accounting for expenses and income of a CDM project

1. Accounting for investment expenses, operation expenses, and income from business production activities of a CDM project shall be carried out in line with current regulation of law.

2. Income from selling CERs is accounted for in other income line. Investors are able to either account for that income in the total income line of the year that CERs are sold or allocate it in income of several years stipulated in Item 3 of this Article.

3. Allocation of income from selling is carried out as follows:

a) In case CERs is sold right in the year CERs become valid, income from selling CERs shall be allocated to the time duration that is the valid time of CERs.

b) In case CERs is sold at any time within valid time duration of CERs, income from selling CERs shall be allocated to the respective years within remaining valid time of CERs.

Article 11. Wear and tear (depreciation) of fixed assets

Fixed assets formed from a CDM project is applied rapid depreciation method stipulated in regulation of depreciation of fixed assets

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1. Business income tax, tax exemption, business income tax reduction applied to CDM project is carried out similar to other projects in the fields under specially preferential treatment for investment as stipulated in Item III, Part A, Annex 1 List of fields under preferential treatment for investment enclosed with Decree 108/2006/NĐ-CP dated 22 Sep. 2006 stipulating and guiding implementation of several Articles of Investment Law; Business income tax law and official documents guiding implementation of Business Income Tax Law.

2. In case a CDM project is an open investment project, a deep investment project or a project that its additional investment is carried out to supplement more equipments of an on-going business entities; additional income gained from such new investment is under preferential treatment of business income tax application as stipulated in Item 1 of this Article. In this case, business enterprises shall have to calculate separately the additional income from new investment to identify amount of preferential business income tax, tax exemption or tax reduction.

3. In case CDM project select the option that total income from selling CERs shall be accounted for in other income line of the year that selling carried out as stipulated in Item 2, Article 10 of this Dicision, CDM project development and implementation investor is allowed to either pay business income tax one time or pay business income tax for several times in line with regulations and law on business income tax.

Article 13. Import duties

CDM project shall be exempted from import duties if goods is imported to create fixed assets of the project; if goods is in form of raw materials, materials, semi-finished products that have not been able to be produced yet by the nation, imported to serve project production activity as stipulated in Item 6 and Item 16, Article 16, Decree 149/2005/NĐ-CP dated 8 Dec. 2005 of the Government stipulating in details performance of Import duties law, Export duties law and current reguations on Export and Import duties.

Article 14. Land use fee, land lease fee

CDM project is exempted from land use fee, land lease fee in line with current regulations and law applied to projects in the fields that under specially preferential treatment for investment.

Article 15. Mobilization of capital fund

1. Investors are allowed to mobilize capital fund in form of cooperation, linkage with other national and international enterprises, economic entities, financial organizations to develop and implement CDM projects.

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3. In case CDM project registered with International Executive Board and contract to sell CERs signed amongst partners, it shall be under prioritized consideration of borrowing money.

Article 16. Subsidy policy to products of CDM projects

1. Products of CDM project shall enjoy subsidy policy of the VEPF if they meet the following requirements:

a) They are in the list of products of CDM project in prioritized fields.

b) Actual costs to produce such products are higher than actual selling price in the signed contract.

2. Duration to enjoy subsidy policy applied to products of CDM project is defined based

on the time the project have products and capacity to make up production cost of the products that under subsidy policy.

3. VEPF apply subsidy policy to products of CDM project in line with this Decision and guidance of MoF.

4. MoF, in cooperation with MONRE, provide detailed guidance on conditions to enjoy subsidy policy, level of subsidy and time to enjoy subsidy policy applied to products of CDM project and in the list of eligible and qualified products.

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1. This Decision shall come into effect after 15 days of its publication on Official Gazette.

2. CDM projects developed and carried out before this Decision issuance shall have to register CERs issued with VEPF and report DNA on CDM within 90 days for monitoring, management, enjoying of rights and carrying out duties stipulated in this Decision.

3. Ministers of MoF, MONRE are responsible for providing detailed guidance on implementation of this Decision

4. Ministers, Leaders of ministerial agencies, Heads of governmental bodies, Chairpersons of PPCs shall be responsible for implementing this Decision./.