Order No. 22/2009/L-CTN on the promulgation of the Law on Royalties

Article 4. Royalty , bases 5. For natural mineral water, natural thermal Royaltybases includenatural resource output water and natural water used for industrial used for royalty calculation,royalty liable price purposes, the natural resource output used for and royalty rate. royalty calculation shall be determined in cubic meter (rn') or liter (1) according to the metering

Article 5. Natural resource output used for systemup to Vietnam's measurement and quality royalty calculation standards. 1. For an exploited natural resource the 6. For natural resources exploited on a quantity, weight or volume of which can be manual, scattered or mobile, irregular basis, if determined, the natural resource output used for the plannedoutputof exploitednatural resources royalty calculation is the quantity, wei ght ur in a year is valued at under VND 200 million, a volume of natural resource actually exploitedin fixed output of exploited natural resources may a royalty period. be determined on a regular or seasonal basis for 2. For an exploited natural resource the royalty calculation. Tax offices shall coordinate quantity, weight or volume of which cannot be with localconcernedagencies in determiningthe derermined because this natural resource contains fixed output of exploited natural resources for different substances and impurities, the natural royalty calculation. resource output used for royalty calculation shall Th e. Government shall detail this Article. be determined based on the quantity, weight or volume of each substance obtained from sorting Article 6. Royalty-liable prices and cla ssification . 1. The royalty-liable price is the exploiter 's 3. For natural resources which are not sold sellingprice of a unitof naturalresource product, but used for turning out other products, if their exclusive of value-added tax. actually exploited quantity, weight or volume ' 2. In case the natural resource's selling price cannot be directly determined, the natur al cannotbe determined yet, the royalty-liable price resource output used for royalty calculation shall shall be determined based all either of lite be determined based on the output of products following grounds: turned out in a royalty period and the use norm a/ The regional market'sactual selling price of of natural resource per unit of product. a unitof natural resource product ofthe samegrade, 4. For natural water used for hydropower which must not be lower than the royalty-liable ge neratio n, the natural resource output used fur price ,~t by th~ People's Committee of a province royaltycalculation is the output of electricity sold or centrallyruncity(below collectively referred to by a hydropowergeneration establishment to an as provincial-level People's Committee); 86 OFFICIAL GAZETTE I•• u" nc.ll-12IM.,eI, 2010 (Cong Baa nos 133-1341March 27, 2010) bl In case the exploited natural resource c/Forexploited natural resources which are not contains different substances, the royalty-liable domesticallysold but exported, it is the exportprice; price shall be determined based on the unit selling dI For crude oil, natural ga s and coal gas, it is price and content of each substance, which must the selling price at the place of delivery. The place not be lower than the royalty-liable price set by of delivery is a place agreed upon in the oil and the provincia l-level People 's Committee. gas contract under which the ownership over 3. In some cases, the royalty-liable price shall crude oil, natural gas and coal gas is transferred to the contractual parties. be determined as "follows: 4. Provincial-level People' s Committees shall a/ For natural water used for hydro power set specific royalty-liable prices of natural gcncrancn, it is the average selling price of resources for which unit selling pr ices of natural commodity electricity; resource products cannot be determined, except bl Fortimber, it is the selling price at the place crudeoil, natural gas, coal gas, and natural water of delivery; if the selling price at the place of used for hydropower generation. delivery cannot be determined, the royalty-liable The Government shali detail this Article. price shall be determined based on the royalty- liable price set by the provincial-level People's Article 7. Royalty rates Committee; 1. The frame royalty tariff is specified below: Royalty rate No Group or category of natural resource. (%J I Metallic minerals 1 Iron and manganese 7-20 2 TItan 7-20 3 ~Clld 9-25 4 Rare earths 12-25 5 Platinum, silver and tin 7-25 6 '£,olfram and antimony 725 t.z Lead, zinc, aluminum, bauxite, copper and nickel 7-25 8 Cobalt, molvbdenum, mercurv, mazneslum and vanadium 7-25 9 Other metaliic minerals 5-25 II Non-metallic minerals 1 Soil exploited for ground leveling and work construction 3-10 2 Rock, except rock used for lime baking and cement production; gravel; 5-15 I sand, excent sand used for glass-making Issue nos 11·12/March 2010 OFFICIAL GAZETTE 87 (Gong Baonos 133-134/March 27, 2010) 3 Soil used for brick-making 5-15 4 Granite and refract ory day 7-20 5 Dolomite and quartzite 7-20 6 Kaolin, mica, technica l quartz, and sand used for glass-making 7-15 7 Pyrite, phosphorite, and stone for lime baking and cement production 5-15 8 Apat ite and serpentine 3-10 C) Pit anthr aci te ~ ()j1 1 4-?0 10 Open-cast anthrac ite coal 6-20 11 Lignile and fat coal 6-20 12 Other coals 4-20 13 Diamond, ruby and sapphire 16-30 14 Emerald, alexandrite and black precious opal 1..6-30 15 Adrite, rodolite, pyrope, berine, spinel and topaz 12-25 16 Bluish-purple, greenish-yellow or orange crystalline quartz: chrysolite; 12-25 white or scarlet precious opal; feldspar ; birusa; and nephrite 17 Other non-metallic minerals 4-25 III Cr ude oil 6-40 IV Nat ural gas and coal gas 1-30 V Nat ural forest products I Timber of group I f5 -35 2 T imber of group II 20-30 3 Timber of groups III and IV 15-20 4 Timber of group s V, VI, VII and VIII and of other categories 10-15 5 Tree branches, tops, stumps and roots 10-20 G Firewood 1-5 7 Bamboo of all kinds 10-15 8 Sandalwood and ca1ambac 25-30 9 Anise, cinnamon, cardamom and liquorice 10-15 OFFICIAL GAZ ETTE Issuenos ll·12lMarch 20'10 (Gong BaD nos 133·1341March 27, 2010) 10 Ot her natural forest products 5-15 VI Natural aq uatic resources I Pea rl, abalone and sea-cucumber 6-10 2 Other natural aquatic resourc es 1-5 VII Natural water 1 Natural mineral water, natural therma l water and refined natural water, 8-10 bottled or tinned 2 Natural water used for hydropower generation 2-5 3 Natura l water used for produc tion and business activities , except water m entioned at Points I and 2 of this group 3.1 Surface water 1-3 3.2 Groundwater 3-8 VIII Natural s wa llo w 's nests 10-20 IX other resources 1-20 2. Specific royalty rates for crude oil, natural Chapter Il1 gas and coa l gas shall be determ ined as partia lly ROVAl TV nFr.T.ARATTON, PAVMENT, progressive based on their daily exploited EXEMYfION AND REDUCTION average output. 3. Pursuant to Clauses 1 and 2 of this Article, Article 8. Roya lty declaration and payment the National Assembly Standing Committee shall R oyalty payers shall regis ter. declare, stipulate specific royalty rates for each category calculate and pay royalties under the law on tax of natural re sou rce in each period on th e adm inistration. following principles: aJ Ensuring conformity with the list of groups Article 9. Royalty exemption and reduction and categories of natural resource and within the 1. Royalty payers that encounter natu ral royalty rate bracket prescribed by the National disasters, fires or unexpected accide nts, causing Assembl y; losses of natural resources for which roya lties bl Contributing to the state managem ent of have been declared and paid, may be cons idered natural reso urces ; protection , exploitation and for exe mption from or red uct ion of payable rational, econo mical and effective use of natural royalties for the lost volumes of natural resources . resources; The paid royal ty amount will be refunded or cl Contri bu ting to as suring state budget c leared against the subsequent period's payable revenues and market stabilization. roya lty amount. Issue nos 11 -121March 2010 OFFICIAL GAZETTE 89 (Gong BaD nos 133-134/March 27, 2010) 2. Royalties are exempted for natural aquatic of these investment licenses, in vestment resources. certificates or signed oil and gas contracts apply. 3. Royalties are exempted tor tree branches In case royalty inceuti ves indic ated in thes e andtops, firewoodand bamboo ofall kinds which investment licenses, investmentcertificates or oil individuals are permitted to exploit for their and gas contracts are lower than those provided daily-life needs. in thisLaw, the royaltyincentiyes specified in this Law will apply for the remaining duration. 4. Royalties are exempted for natural water used tor hydropower generation by households Article n. Implementation detailing and and individuals for their daily-life needs. guidance 5. Royalties are exempted for natural water The Government shall detail and guide the used for agriculture, forestry, fishery and salt- implementation of articles and clauses assigned making; natural water exploited by households to it under this Law; and guide other necessary and individuals for their daily-life needs. contents of this Law to meet state management 6. Royalties are exempted for soil exploited requirements. and used right on allocated and leasedland areas; This Law was passed a ll November 25, 2009, and soil explo ited for ground leveling and by the XU'" National Assembly of the Socialist construction of security and military works and Republic of Vietnam at its 6'" session. dikes. Chairman of the National Assembly 7. Otherscases eligible for royalty exemption or reduc tion as prescribed by the National NGUYEN POO TRONG Assembly Standing Committee. Chnl'fPr IV IMPLEMENTATION PROVISIONS

Article 10. Effect 1. This Law takes effect on July 1, 2010. 2. On the effective date of this Law, the following legal documents cease to be effective: a! Ordinance No 05!1998/PL-UBTVQHIO on Royalties; bl Ordinance No. 07/20081PL·UBTVQH12 Amending and Supplementing Article 6 of the Ordinance on Royalties. 3. For investment projects or oil and gas contracts signed before July 1, 2010, withroyalties specified in theirinvestment licenses, investment certificatesor oil and gas contracts, the provisions