Decree No. 119/2007/ND-CP on tobacco production and trade

Issue nos 02·03/Augusl 2007 (Gong Bao nos526-5271August 3,2007) OFFICIAL GAZETTE 45 PartI. LEGAL DOCUMENTS THE GOVERNMENT DECREE No. 119/2007IND·CP OF JULY 18. 2007, ON TOBACCO PRODUCTION AND TRADE THE GOVERNMENT Pursuant to the December 25, 2001 Law on Organization ofthe Government; Pursuantto theGovernment's Resolution No. 12/ 2000/NQ-CP ofAugust 14,2000, on the national poliryforprpVlmtion find"ambat oftobacco 'sharms in the 2000·2010period; At the proposalofthe MinisterofIndustry. DRCRRRS, Chapterl GENERAL PROVISIONS Article1.· Scopeof regulation ThisDecreeprovides fortobacco production and trade, including planning activities; investment in production development; growing, processing, purchase and sale of tobacco raw and auxiliary materials; production and consumption of tobacco products; import and exportof tobacco machinery andequrpment, tobacco rawandauxrliary matenals and tobacco products in the Socialist Republic of Vietnam. Article 2.- Subjectsof application This Decree awlies tv domestic and foreign organizations and individuals involved in tobacco production and trade and related activities in the Vietnamese territory. Article 3.- Application of relevant laws and treaties 1. Tobacco production and trade must comply withthisDecreeand relevantprovisions of law. 2. If a treaty to which the Socialist Reoublic of Vietnam is a contracting partyprovides for tobacco producuon and tradedifferently from lilisDecree, that treaty prevails. Article 4.- Interpretation of terms In thisDecree,the termsbelowareconstrued as follows: I. Tobacco means tobacco leaves WhOMl scientific names are Nicotiana Tabacum L. and Nicotiana Rustica L., including air-cured and frre-cured tobacco leaves. 2. Tobacco raw materialsmeanstobacco leaves in bulk, stemmed tobacco leaves or pip<' tobacco, tobacco plugs, tobacco stems and other tobacco substitutes used for the manufacture of tobacco products. 3. Tobacco products means products wholly or partly madeot tobacco rawmaterials ancnrocessed intocigarettes, cigars, pipetobacco forpipesmoking, and other products used for smoking, enewinz or snuffing. 4. Tobacco auxiliary materials means allsupplies other than tobacco raw materials used for the manufacture of tobaccoproducts. 5. State commerce in the import of tobacco productsmeansan importmechanism underWhich the State designates major enterprises to Import tobacco products. 6. Tobacco production capacity means the capacity of synchronous machinery andequipment © VIETNAM LAW & LEGAL FORUM 46 OFFICIAL GAZETTE Issue nos 02·03/Augus12007 (C6ng Baa nos 526-5271August 3,2007) used for the manufactureof tobaccoproducts. 7. Processing of tobacco raw materials means processing activities carried out on machinery and equipment chains for tobacco stemming or processing into strips, plugs and other substitutes used to manufacture tobaccoproducts. Article 5.- Principlesfor managementof tobacco production and trade 1. The State uniformly manages tobacco production and trade, and holds monopoly in the manufacture and import of tobacco products. 2. The State controls the supply of tobacco products to the market, tobacco production output and the import of tobacco products; applies state commerce to tobacco import; and controls the consumption of tobaccoproducts on the market so as to reduce tobacco's harms. 3.Tobaccorawmaterials are commodities subject to conditionalbusiness. Tradingin tobaccoproducts is restricted. Investment in the manufacture of tobacco products is conditional. Manufacture of tobacco products requires licenses. 4. Tobacco machinery and equipment, tobacco raw materials, cigarettepaperand tobaccoproducts are subject to line managementby the Ministry of Industry. ChapterII GROWING, PROCESSINGOF,AND TRADINGIN, TOBACCORAW MATERIALS Article 6.- Investmentin the growingof tobacco and use of tobacco varieties 1. Investment in development of tobacco growing zones in each localitymustconform to the local landuseplanningandbe basedon theapproved planning for development of tobacco raw material regions. 2.The useof tobaccovarietiesmustcomplywith the provisions of law on management of plant varieties. Article 7.- Grading of tobacco raw materials 1. Tobacco growers, enterprises engaged in tobacco growing or processing or tobacco raw material trading shall grade tobacco raw materials in accordancewith law. 2. The Ministry of Industry shall assume the prime responsibility for, and coordinate with concerned ministries in, promulgating criteria for the gradingof tobacco raw materials. Article 8.- Trading in tobacco raw materials 1.Organizationsand individualsmay only trade in tobacco raw materials when obtaining related businesseligibilitycertificatesfromcompetentstate agencies and strictly observe related business conditionsthroughout their operation process. 2. Conditions for being granted an eligibility certificatefor trading in tobacco raw materials: aI Having business registration for tobacco raw materials; bl Havingbusinessestablishmentswhich satisfy technical,equipment,environmentalsanitation,and firecontrolrequirements; havingbusinessprocesses suitableto the trading in tobacco raw materials;and locations of business establishments conformable with the planning on development of tobacco raw materialregions; c/ Having managerial and technical staffs, and qualifiedandexperiencedemployeesas requiredby law; d/Havingcontractson investmentin tobaccoraw material regionsunderthe planningon development of tobacco raw material regions and annual plans. 3. The Ministry of Industry shaJJ guide in detail the competence,order and procedures for the grant of eligibility certificates for tobacco raw material © VIETNAM LAW s LEGAL FORUM Issue nos 02.03fAugust 2001 (Gong Bao nos 526-5271August 3,2007) OFFICIAL GAZETTE 47 © VIETNAM LAW & LEGAL FORUM trading. Article9.- Processing of tobaccoraw materials 1. Processing of tobacco raw materials is a conditional business line. Enterprises may process tobaccorawmaterialsonly afterobtaining eligibility certificates fromtheMinistryofIndustryandstrictly observe die set couditions rluoughounheir operation process. 2. Conditions for being granted an eligibility certificate for tobaccoraw materialprocessing: aI Being an enterprise set up according to law, havingbusiness registration rortobaccorawmaterial processing; bl Carryingout tobaccoraw materialprocessing activities according to the approved strategy and masterplan of the tobaccoindustry; cf Having material foundations suitable to the business scope: meeting technical, technological, machinery andequipment, environmental sanitation, and fire control requirements; df Having managerial and technical staffs, and qualified and experienced employees as required by law; efHavingcontracts oninvestment in tobacco raw materialregionsunderthe planningon tobaccoraw material regionsand annual plans; ff Having ellgibility certificates for tobacco raw material trading according toArticle 8ofthisDecree. 3. The Ministry of Industry shallguide in detail the order and proceduresfor the grantof eligibility certificates for tobaccoraw material processing. Article 10.- Rights and obligations of traders engaged in tobacco raw material trading or processing In additionto therightsandobligations provided forby theenterpriselaw,tradersengagedin tobacco raw material trading or processing have the following rights and obligations: 1. To select investment regions and tobacco growersaccordingto the planningon development of tobaccoraw material regions. To signinvestment contractswithtobaccogrowersfor the growingand purchase of tohacco raw materials; 2. Enterprises with eligibility certificates for tobacco raw material processingmay use tobacco machinery and equipment suitable to tobacco raw materialprocessingstages. Article 11.- Funds for tobacco raw material growing and processing 1.Enterprisesinvestingin tobaccogrowmg may include in the purchasing prices of tobacco raw materialsamounts for settingup funds for tobacco raw material growing and processing aimed at developingtobaccoraw material regions. 2. The setting up and use of funds fur tobacco raw material growingandprocessingcomplieswith regulationsof the Ministryof Finance. Article 12.- Specialized management of the import of tobaccoraw materials 1. Tobacco raw materials are SUbject to specialized managementby theMinistryofIndustry. 2.Anenterprise importing tobaccoraw materials for domestic production and consumption export or export processing must meet the following conditions: a1Having aneligibility certificate for tobaccoraw material processing according toArticle9 ora permit for the manufactureof tobaccoproducts according to Article 11 of thisDecree; bl Having importedraw materials suitableto its productioncapacityand output; cl Obtainingconsentofthe MinistryofIndustry. 3. For tobacco raw materials imported within quotas,enterprises mustobtainimportpermitsfrom the Ministryof Trade. • 48 OFFICIAL GAZETTE Issue nos 02·03/August 2007 (GOng BaD nos 526·5271August 3.2007) ClwpterIII MANUFACTURE OF TOBACCO PRODUCTS Article 13.- Conditions for the manufacture of tobacco products An enterprisemaymanufacture tobaccoproducts if it meets all the followingconditions: 1.Havingmanufactured tobaccoproductsbefore the time of promulgation of the Government's Resolution No. 1212000INQ-CPofAugust14,2000, on the national policy for tobacco harm prevention and fighting in the 2000-2010period. 2.The manufacture of tobaccoproductsconforms to the approved strategy and master plan of the tobacco industry. 3. TheSfate holdsdominantshares in the charter capital ofthe enterprise. 4.Having apermitforthemanufacture oftobacco products as prescribed in Article 14 of this Decree. 5. Investing in the developmentof raw material regionsandusinghome-made tobaccorawmaterials accordingto the approvedplanningon development of tobacco raw material regions as well as the strategy and master plan of the tobacco industry. 6.Havingsynchronous andadvancedequipment, sausfying the set condirions vn labor safety and hygiene, fire control and environmental sanitation. 7. Ensuring hygieneand safetyrequirementsfor tobacco products according to regulations of the Ministry of Health, and quality of those products according to Vietnamese quality standards. 8. Having lawful ownership or use right of trademarks of tobacco products in Vietnam. Article 14.- Tobacco product manufacture permits 1. Manufacture of tobacco products requires permits grantedby the Ministryof Industry. 2. The Ministry of Industry shall guide in detail the order and procedures for the grant of tobacco productmanufacture permits. 3. An enterprise may only conduct production and business from the date it is grunted a tobacco product manufacture permit. Article 15.- Tobacco production capacity 1.Tobaccoproductioncapacityofeachenterprise and the entire tobacco industry means the capacity of existingmachinery and equipment at the time of promulgation of the Government's Resolution No. 12/2000/NQ-CP of August 14, 2000, which shall be determined and announced by the Ministry of Industry. 2. Productioncapacity of each enterprise serves as a basis for the management of investment in its tobacco machinery and equipment and production output. Article 16.-Tobacco production output 1. The annual tobacco production output of an enterprise must not exceed its production capacity stated in the tobacco product-manufacturepermit, 2. The Ministry of Industry shall specify production output with regard to tobacco products bearing domestic or foreign marks in each period according to the strategic orientations and master plan of the tobacco industry already approved by the Prime Minister. Article 17.- Qualitystandardsoftobaccoproducts 1. Tobacco products must meet Vietnamese quality standards. 2. Enterprises manufacturing tobacco products mustobservequalitystandards setfor thoseproducts. Article 18.- Minimum pricesof tobaccoproducts 1.TheMinistry of Financeshallassumetileprime responsibilityfor, and coordinate with the Ministry of Trade and the Ministry of Industry in, setting © VIETNAM LAW & LEGAL FORUM Issue nos 02·03/AuguS12007 (C6ng Bao nos 526-527/August 3,2007) OFFICIAL GAZETIE 49 minimum pricesof tobaccoproducts. 2. Enterprises manufacturing tohacco products may not sell those products at prices below the minimum pricesset by the Ministryof Finance. Article19.-Tobaccoproductmarksandlabeling 1. Tobacco products may be consumed in Vietnamonlywhentheirmarkshave beenlawfully registeredand protectedin Vietnam. 2. Enterprises manufacturing tobacco products bearingforeign marks for consumption in Vietnam must obtainpermission from the Prime Minister. 3. The labeling oftobaccoproductpackages must comply withcurrentprovisionsof law. FromApril 1,2008, healthwarningswill be displayedin black on white background, representing 30% of the principaldisplaysurfaceof a cigarettepacketwith one of thefollowing contents:"smokingmaycause lung cancer" or " smokingmay causechroniclung diseases." Regulations on the printing of health warningsoncigarettepacketsshallbe implemented according to the schedule set in the Framework Conventionon Tobacco Control. in suitability with the world's situation and Vietnam's characteristics. 4. Only enterprises directly manufacturing tobacco products may print labels or contractwith printingestablishments for the printingof labelsof cigarettepackets. Article 20.-Specializedmanagement ofcigarette paper 1.Domesticenterprisesmanufacturing cigarette paper may only sell products to enterprises having tobacco product manufacture permits or export permits. 2. Only enterprises manufacturing tobacco products may purchase cigarette paper for manufacture in conformity with their permitted production output and may not resell paper to organizations and individualsthat have no tobacco product manufacture permits. 3. An enterpriseimportingcigarettepaper must meet the followingconditions: a/Having atobaccoproductmanufacturepermit as prescribedin Article14 of thisDecree; bl The imported cigarette paper quantity is suitable to the enterprise's permitted tobacco productionoutput; cJ Obtainingconsentof theMinistryof Industry, 4. Investmentincigarettepaperproduotionmust becompatible withtheapproved strategyandmaster planof the tobaccoindustry. Article21.- Tobacco productstamps 1.Tobaccoproductsmanufactured for domestic consumption must bear stamps Oil their packages accordingto state regulations. 2. Tobacco products manufactured for export. offeror exhibition in foreign countriesshallnot bear stamps underVietnamese regulations. 3. Stampsof tobaccoproductsmanufacturedfor consumption in Vietnam may only be allocated to enterprises having tobacco product manufacture permits.The quantityof stampsallocatedannually to an enterprise must not exceed its permitted productionoutpur. 4. Tobaccoproducts imported for consumption in Vietnam must bear import stamps on their packages. 5. The Ministryof Financeshall print, issue and allocate stamps to enterprises according to regulations. Article 22.- Rights and obligations of tobacco product-manufacturing enterprises In additionto therightsandobligationsprovided for by law, an enterprise manufacturing tobacco products has the following rightsand obligations: 1. To sell tobacco products according to its business registration certificate; toorganizea system of wholesaleandretaildistributors accordingto this © VIETNAM LAW & LEGAL FORUM ... 50 OFFICIAL GAZETTE Issue nos 02·03lAugust 2007 (Gong Baa nos526-527/August 3, 2007) Decree. 2. To publicize information about the products andensuretheircompatibility withtobaccohygiene standards prescribedby law. 3. To apply lilt: fulluwiug Ionns uf introduction about the enterprise: a/ Publicizing, introducingtobaccoproductsand finished tobacco shreds on local foreign-language newspapers; bl Pubncizing once on the mass media congratulations introducingits name, address and logo on the occasion of Tet holidays or its annual anniversaries. Article 23.- Conditions for investment in the manufactureof tobaccoproducts 1. Investment in the manufacture of tobacco productsmustconformto theapprovedstrategyand master plan of the tobaccoindustry. 2. Investmentshallnot be made in the building. expansion or raising of the capacity of esrablishmenrs which manufacture tobaccoproducts for domestic consumption in excess of the total tobacco production capacity determined by the Ministry of Industryin accordancewithArticle 15 of this Decree. 3. Foreign investment projects on the manufacture uf tobacco products, including investment under contracts for processing, cooperationin manufacture and industrialproperty franchise, must meet the followingconditions: a/ The investment is made on the basis of joint venture or cooperation with enterprises having tobacco product manufacturepermits for renewal of technologies, equipment or restructuring of productsin orderto raiseproductquality andvalue; bl The State holds dominant shares in the enterprise's chartercapital; c/The enterprisemeetstheconditions prescribed inArticle 13and hasa tobaccoproductmanufacture permit as prescribed in Article 14 of this Decree; d/ The investment is licensed by the Prime Ministerat the proposal of the Ministryof Industry. 4. Investment projects on the manufacture of tobacco products for export or export processing, on in-depth investment, renewalof tobaccoproduct manufacturing equipment or technologies, relocation of manufacture sites under plannings of tobaccoproduct-manufacturing enterprisesmust be approvedby the Ministry of Industry. Chapter IV TRADE IN TOBACCO PRODUCTS Article 24.- Planning Oll the system uf tobacco producttrading networks 1.The State strictlycontrols the trade in tobacco products through the planning on tobacco product tradingnetworks. 2.The Ministry of Trade shall assumethe prime responsibility for, and coordinatewith the Ministry of Industry in, formulating and approving the planning on tobacco product trading networks nationwide. Article 25.- Conditions for trade in tobacco products 1. Conditions for tobacco wholesale trade and wholesaleagency: atThe trader is an enterprise set up according to law and having business registration for purchase and sale of tobacco products; b! Having a stable business place with a clear addressconformablewith theapprovedplanningon tobaccoproduct trading networks; cl Having material foundations and financial capacity suitableto the business scope; d/ Havingcontractsfor tobaccoproductsale and purchaseand a stable tobacco distributionsystem; © VIETNAM LAW & LEGAL FORUM Issue nos02·031Augusl 2007 (Gong Baa nos 526-52TIAugust 3,2ooT) OFFICIAL GAZETTE 51 © VIETNAM LAW & LEGAL FORUM el Having a tobaccoproductwholesale trade or wholesale agencylicenseaccording toArticle26 of this Decree. 2. Conditions for tobacco retail trade or retail agency: a/ The trader has business registration for purchaseand saleof tobacco products; bl Having a stable business place with a clear address conformable withtheapproved planning on tobaccoproducttrading networks; c/Belongingtothedistribution system of tobacco product-manufacturing enterprises or of tobacco productwholesalers or retailers; d/ Havinga tobacco product retail tradeor retail agency license according toArticle 26ofthisDecree. Article 26.- Tobacco product trading licenses I. Tobacco producttrading is a business line to be licensedby theTradeMinistry. 2. The Trade Ministry shall guide in detail the order, procedures and competence for the grantof tobaccoproductwholesale trade, wholesale agency, retail tradeand retail agencylicenses. 3. Traders mayonlystartbusiness fromthe date they are granted tobacco product wholesale trade, wholesale agency, retail trade or retail agency licenses. Article 27.- Rights and obligations of traders processing tobaccoproduct trading licenses Inaddition totherights andobligations prescribed by law, traderspossessing tobacco producttrading licenses also have the following rights and obligations: 1.Topurchase tobacco products oflawfulorigin. 2. To organize the circulation and consumption of tobaccoproducts on the marketaccording to the grantedtobaccoproduct-trading licenses. 3. To wholesale tobaccoproducts to only those tradersthat havetobaccoproduct tradinglicenses. Article 28.- Import of tobacco products for commercial purposes I.Theimport of tobacco products forcommercial purposes must adhereto the following principles: a/ Theprinciple of statecommercein theimport of tobacco products; bl Imported tobaccoproductsmustbeartobacco importstampsissuedby the Ministryof Finance; c/ Imported tobaccoproductsmustcomplywith management requirements stipulated inthisDecree and relevant provisions of law like home-made products 2.TheMinistry ofTradeshallassumetheprime responsibility for, andcoordinatewiththeMinistry of Industry in, guidingin detail the mechanism of statecommercial management of imported tobacco products. Article29.- Importof tobaccoproducts fornon commercial purposes 1. Individuals enteringthe Vietnamese territory may carry along tobacco not in excess of the permitted luggage quotas set by the Government 2. Vietnam-based diplomatic mlssions, consulates andinternational organizations thatwish to import tobaccoproducts for use must adhereto Vietnamese law. 3.TheMinistry ofTrade shallassume the prime responsibility for,andcoordinate withtheMinistry of Industry in. guiding the conditions, procedures and quotas for the import of tobacco products to serve as samples for production and use in other non-commercial activities. Article30.- Prevention andfighting ofsmuggling andtradefrauds 1.Allillegally importedtobaccoandcounterfeit tobacco mustbe confiscated and destroyed. 2. Enterprises producing or trading in tobacco shall coordinate with competent state agencies in OFFICIAL GAZETTE I••ue no. OZ·03IAugu.t 2007 (Gong Baa nos 526-527/August 3,2007) preventing and fighting against smuggling of tobacco products and trading in counterfeit tobacco products. Chapter V TOBACCO MACIllNERY AND EQUIPMENT Article31.- Management of tobacco machinery and equipment 1. Organizations and individuals having no permits for the manufacture oftobacco productsmay not use tobacco machinery and equipment in any form, except for the use of machinery and equipment by tobacco product-processing enterprises specified in Clause 2 Article 10 of this Decree. 2. The sale, export, re-export and liquidation of tobacco machinery and equipment by tobacco product-manufacturing enterprises comply with relevant laws and the following provisions: a/ An enterprise may sell its machinery and equipment which still have use value to enterprises having tobacco production permits; bl Machinery and equipment which have no use value or ate liquidated as a result of in-depth investment shall be destroyed under supervision of a liquidation council set up by the Ministry of Industry, 3. The Ministry of Industry shall assume the prime responsibility for.and coordinate with relevant functional agencies in, inspecting, detecting and handling tobacco machinery and equipment of unlawful origin or not destroyed according regulations. Article 32.- Import of tobacco machinery and equipment 1 An enterprise importing machinery and equipment of the tobacco industry must meet the following conditions: a/Having a tobacco product manufacture permit as prescribed in Article 14 of this Decree; bl tmportmg tobacco machmery and equipment suitable to its production capacity; cJObtaining consent of the Ministry of Industry. 2. Enterprises having eligibility certificates for tobacco raw material processing under Article 9 of this Decree and satisfying the conditions set at Points band c, Clause I of this Article may only import machinery and equipment for tobacco raw material processing. Chapter VI STATE MANAGEMENT RESPONSIBILITY Article 33.- Responsibilities of the Ministry of Industry 1. To submit to the Government or the Prime Minister for promulgation or to promulgate according to its competence legal documents on tobacco production and trade. 2. To formulate strategies and master plans for Vietnam's tobacco industry and submit them to the Prime Minister for approval; 3. 'Io assume the prime responsibility for, and coordinate with concerned ministries, branches and localities in, formulating a scheme on reorganization of the tobacco industry; manage the establishment, division, split, merger and dissolution of enterprises manufacturing tobacco prochll'ts, processing tohacco raw materials or auxiliary materials in accordance with law. 4. To exercise the state management of investment and construction activities in the tobacco industry in accordance with law and this Decree. 5. To promulgate and check standards of the tobacco industry and quality of tobacco products. 6. To organize the specialized management and management of the import of machinery and.. © VIETNAM LAW & LEGAL FORUM Issue nos 02.03/August 2007 (Gong Beo nos 526-527/August 3,2007) OFFICIAL GAZETTE 53 © VIETNAM LAW & LEGAL FORUM equipment for tobacco production, tobacco raw materials, cigarette paper, and the import of tobacco products. 7. To provide for the competence and procedures for the grant, adjustment. extension and withdrawal of eligibility certificates for trading in tobacco raw materials or processing tobacco raw materials and tobacco product manufacturing permits. 8. To determine production capacity and output of tobacco product-manufacturing enterprises. 9. To submit to the Prime Minister for consideration and permission of the manufacture of tobacco products bearing foreign marks and consumed in Vietnam. 10. To coordinate with the Ministry of Trade in guiding the mechanism of state commercial management of the import of tobacco products. 11. To assume the prime responsibility for, and coordinate with the functional agencies in, inspecting, rletecting anri handling tOhHCCO machinery and equipment ofunlawful origin or not destroyed according to regulations, 12. To inspect, examine, settle complaints and denunciations, and handle violations in tobacco production and trade. Article 34.- Responsibilities of the Ministry of Trade 1. To draft and submit to the Government and the Prime Minister for promulgation or promulgate according to its competence legal documents on trade activities in the tobacco domain, 2. To assume the prime responsibility for, and coordinate with the Ministry of Trade in, formulating, approving and publicizing a planning on tobacco product trading networks nationwide, 3. To guide in detail the competence and procedures for the grant, adjustment, extension and withdrawal of tobacco product trading permits. 4. To assume the prime responsibility for, and coordinate with the Ministry ofIndustry in, guiding in detail the mechanism of state commercial management of imported tobacco products. 5, To coordinate with functional state agencies in inspecting and handling organizations and individuals trading in tobacco products in violation of this Decree. 6, To coordinate with the Ministry of Industry in managing the quota-based import of tobacco raw materials. Article 35.- Responsibilities of the Ministry of Finance 1.To organize the printing, issue and allocation of stamps to enterprises in accordance with this Decree and current regulations. 2, To assume the prime responsibility for, and coordinate with the Ministry of Trade and the Ministry ofIndustry in, setting the minimum selling prices of tobacco products. 3. To guide the setting up and use of funds for growing and processing tobacco raw materials. Article 36.- Responsibilities of the Ministry of Health 1. To draft and submit to the Government or the Prime Minister for promulgation or promulgate according to its competence legal documents on foodstuff hygiene and safety and prevention and fighting of tobacco's harms. 2. To inspect and supervise the implementation of regulations on foodstuff hygiene and safety and prevention and fighting of tobacco harms. Article 37.- Responsibilities of ministries, ministerial-level agencies and government-attached agencies Ministries, ministerial-level agencies and govenuuent-attached agencies shall, within the ambit of their powers, coordinate with the Ministry of Industry, the Ministry of Trade and the Ministry 54 OFFICIAL GAZETTE Issue nos OZ·03!Augusl Z007 (Gong Bao nos 526-5271August 3,2007) of Finance in exercising the state management of tobacco trade. Article 38.- Responsibilities of provincial! municipal People's Committees 1. To perform the state management of the tobacco industry and handle issues falling within their competence in localities under their management. 2.Tocoordinate with the Ministryof Industryin implementing the undertakingon reorganizationof tobacco enterprises in localities under their management. 3.To inspect theproductionand consumptionof tobacco taw materials and circulation of tobacco products in localitiesunder their management. Chapter VII VIOLATIONS AND HANDLING OF VIOlATIONS Article 39.- Acts in violationof legal provisions on tobacco production and trade 1. Producing or trading in tobacco without permits. 2. Producing or trading in smuggled tobacco products, counterfeit tobacco. tobacco products of trademarks not protected in Vietnam, not up to Vietnamese qualitystandards, ofpoorqualityor with expired use duration, which fail to comply with labelingregulationsor bearno stampsas prescribed bylaw. 3. Using, liquidating, importing, exporting, re exporting or selling tobacco machinery and equipment in cuntraventionof this Decree and law. 4. Producing tobacco products in excess of permitted production output. 5 Failing to comply with legal provisions on hygiene and safetyof tobaccoproducts,prevention and fightingof tobacco's harms, 6. Selling, purchasing or assigning tobacco product stamps. 7. Illegally selling, purchasing or assigning cigarettepaper. 8. Selling, purchasing tobacco without tobacco trading permits granted by the state management agency in chargeof commerce. 9. Selling tobacco to persons under 18 years of age. 10. Selling tobacco at head offices, schools, hospitals, cinemas, houses for art performances, sportcompetitiongymnasiums, on streetsor at other public places prescribed by law. 11.Advertising, conductingtradepromotion with tobacco in any form. 12. Sponsoring cultural, artistic, sport or other activities in association withtobaccoadvertisement. 13. Selling tobacco through vending machines via the Internet or by telephone. 14. Other violationsprescribed by law. Article 40.- Handling of violations Organizations and individuals committing acts In violationof law on tobacco production and crude shall, depending on the nature and severity of their violations, be disciplined, administrative sanctioned or examined for penal liability, and pay compensationsfor damage in accordancewith law. Chapter VIII IMPJ.RMRNTATION PROVISIONS Article 41.- Implementationeffect I. This Decree takes effect 15 days after its publication in "CONG BAD" and replaces the Government's Decree No. 761200l/ND-CP of October22, 2001,on tobacco productionand trade. 2. Organizations and individuals lawfully © VIETNAM LAW & LEGAL FORUM Issue nos 02·03JAugusl 2007 (C6ng Bao nos 526-527/August 3, 2007) OFFICIAL GAZETTE 55 conducting tobacco production andtrading activities before theeffectivedateofthisDecreemaycontinue operation andbeconsideredforthe grantofpermits oreligibility certificates forproduction andtradein accordance with this Decree. Article 42.- Implementation organization and responsibility 1.TheMinistry oflndustry shallcoordinate with concerned ministries and branches in guiding the implementation of this Decree. 2. Ministers, heads of ministerial-level agencies, heads of govemrnent-attached agencies and presidents of provincial/municipal People's Committees shall implement thisDecree. On behalfofthe Government Prime Minister NGUYEN TAN DUNG © VIETNAM LAW & LEGAL FORUM