DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.- Regulation scope

This Decree details the implementation of a number of articles of the Science and Technology Law on scientific and technological organizations; individuals involved in scientific and technological activities; organizations performing scientific and technological tasks; the application of results of scientific and technological research and development; a number of measures to ensure scientific and technological development; international scientific and technological cooperation; and the State management over science and technology.

Article 2.- Objects of application

1. This Decree shall apply to Vietnamese organizations and individuals conducting scientific and technological activities in the domains of natural sciences, social sciences and humanity, technical sciences and technologies.

2. This Decree shall apply to foreign organizations and individuals as well as overseas Vietnamese, conducting scientific and technological activities in the territory of the Socialist Republic of Vietnam. Where the international agreements which the Socialist Republic of Vietnam has signed or acceded to contain provisions different from those of this Decree, the provisions of such international agreements shall apply.

Chapter II

SCIENTIFIC AND TECHNOLOGICAL ORGANIZATIONS, INDIVIDUALS ENGAGED IN SCIENTIFIC AND TECHNOLOGICAL ACTIVITIES

Section 1. SCIENTIFIC AND TECHNOLOGICAL ORGANIZATIONS

Article 3.- Planning on the system of scientific and technological organizations

1. The Ministry of Science and Technology shall base itself on the tasks of socio-economic development, security and defense maintenance and the scientific and technological development plan of each period to work out the planning on the system of research and development organizations throughout the country for submission to the Government for decision.

2. The research and development organizations are set up according to the provisions in Articles 10 and 11 of the Science and Technology Law, may choose their names which, however, must conform to their respective organizational forms, functions, major operating domains. The Ministry of Science and Technology shall specify the names of research and development organizations of each type.

3. Organizations and individuals may set up scientific and technological service organizations according to the provisions in Article 13 of the Science and Technology Law in forms of public-service organizations or scientific and technological service-providing enterprises according to the Enterprise Law.

Article 4.- Conditions for setting up research and development organizations, scientific and technological service organizations

The research and development organizations, the scientific and technological service organizations shall be set up when the following conditions are met:

1. Their operation objectives and orientations are compliant with law provisions;

2. They have organization and operation charters;

3. They have enough science and technology personnel with necessary qualification structure, including part-time personnel; have head offices and material-technical foundations capable of deploying scientific and technological activities in line with their respective charters.

The Ministry of Science and Technology shall specify the conditions for setting up research and development organizations as well as scientific and technological service organizations of various types.

Article 5.- Competence to set up, merge, divide or dissolve research and development organizations

1. The Government shall set up national-level research and development organizations.

2. The Prime Minister shall decide or authorize the ministers, the presidents of the People�s Committees of the provinces or centrally-run cities to decide on the establishment of the ministerial-level or the provincial-level research and development organizations.

3. The establishment of research and development organizations within the systems of the National Assembly, the Supreme People�s Court and the Supreme People�s Procuracy shall comply with the Law on Organization of the National Assembly, the Law on Organization of the People�s Courts and the Law on Organization of the People�s Procuracies.

4. Political organizations and socio-political organizations of central level shall decide on the establishment of research and development organizations in accordance with their respective charters.

5. The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the provincial/municipal People�s Committees shall decide on the establishment of grassroots research and development organizations.

6. The heads of the research and development organizations of ministerial- or provincial-level, the research and development organizations of central-level political organizations or socio-political organizations; State-run enterprises, universities, and hospitals shall be entitled to decide on the establishment of grassroots research and development organizations after getting the approval of their immediate superior managing bodies.

7. Political organizations and socio-political organizations other than those prescribed in Clause 4 of this Article, social organizations, socio-professional organizations, organizations and individuals may set up grassroots research and development organizations according to the provisions of this Decree.

8. Persons who are competent to set up research and development organizations may decide to merge, divide or dissolve such research and development organizations.

Article 6.- Registration of operation of research and development organizations, scientific and technological service organizations

1. The research and development organizations and the scientific and technological service organizations must register their operations and may only conduct the already registered scientific and technological activities. If within 12 months after the registration, such organizations fail to commence their operations, the registration shall be no longer valid. If in the course of operation, there are any changes in their operation fields, they must carry out the procedures for additional registration.

2. The registration of operations of the research and development organizations as well as the scientific and technological service organizations is stipulated as follows:

a) The research and development organizations prescribed in Clauses 1,2,3 and 4 of Article 5 of this Decree and the foreign-invested research and development organizations shall make their operation registrations at the Ministry of Science and Technology;

b) The research and development organizations not prescribed at Point a of this Clause shall make their operation registrations at the provincial/municipal Science and Technology Services of the localities where they are headquartered;

c) The foreign-invested scientific and technological service organizations shall effect their operation registrations at the Ministry of Science and Technology; the public-service scientific and technological service organizations shall effect their registrations at the provincial/municipal Science and Technology Services of the localities where they are headquartered.

Article 7.- Dossiers of registration of operation of research and development organizations as well as scientific and technological service organizations.

The dossier of registration of operation of a research and development organization or a scientific and technological service organization comprises:

1. The application for registration of scientific and technological activities;

2. The decision on establishment of such organization, except where the scientific and technological organizations are set up by individuals themselves;

3. The organization and operation charter;

4. The scientific record of the director, the conditions on scientific and technical personnel as well as material-technical foundations; the head-office of the organization.

Article 8.- Granting operation registration to research and development organizations, scientific and technological service organizations

Within 15 days after receiving the complete and valid dossiers, the competent agencies shall have to appraise the dossiers and grant the operation registration to the applying research and development organizations or scientific and technological service organizations. In case of refusal to grant the registration, they must reply in writing and clearly state the reasons therefor. The organizations and individuals that apply for registration of operation of research and development organizations or scientific and technological service organizations shall be held responsible before law for the contents declared in the dossier as provided for in Articles 4 and 7 of this Decree.

Article 9.- The autonomy right of research and development organizations

The State-run research and development organizations shall have the right to autonomy and take responsibility for their respective activities under the provisions in Decree No.10/2002/ND-CP of January 16, 2002 on the financial regime applicable to non-business units with revenue and other provisions of current legislation.

Article 10.- Alignment, joint venture, financial assistance reception

1. The scientific and technological organizations may:

a) Cooperate with domestic as well as foreign organizations and individuals in carrying out scientific and technological activities according to law provisions;

b) Align, enter into joint ventures and/or sign business cooperation contracts with, or contribute capital to, domestic or foreign organizations or individuals for carrying out production and business activities according to law provisions;

c) Organize the production and trading of products being the research and development outcomes or provide scientific and technological services closely linked to their respective functions, tasks and profession. Where enterprises are set up, the provisions of law must be complied with.

2. Scientific and technological organizations may receive financial assistance of domestic and foreign organizations and individuals as well as international organizations to carry out their scientific and techno-logical activities in various scientific and technological fields but must neither cause harms to security and defense nor violate the provisions in Article 8 of the Science and Technology Law and other law provisions.

Section 2. INDIVIDUALS ENGAGED IN SCIENTIFIC AND TECHNOLOGICAL ACTIVITIES

Article 11.- Individuals setting up scientific and technological organizations

1. Individuals may set up scientific and technological organizations under the provisions in Article 4 of this Decree and the operations thereof must not violate the provisions in Article 8 of the Science and Technology Law.

2. The Ministry of Science and Technology shall assume the prime responsibility and coordinate with the concerned agencies in determining specific domains where individuals are entitled to set up scientific and technological organizations and submit them to the Prime Minister for decision.

Article 12.- Individuals receiving financial assistance for scientific and technological activities

1. Individuals may receive financial assistance of domestic and foreign organizations and individuals as well as international organizations to conduct scientific and technological activities, but must not violate the regulations on security and defense and the provisions in Article 8 of the Science and Technology Law.

2. Individuals working in scientific and technological organizations shall receive financial assistance through such scientific and technological organizations.

Individuals working in scientific and technological organizations, who have their own research subjects or are hired by foreign parties to perform scientific and technological tasks not falling within the scope of management by their respective scientific and technological organizations, shall register to receive financial assistance at the provincial/municipal Services of Science and Technology or through an appropriate scientific and technological organization.

Individuals who do not belong to any scientific and technological organization, when getting the agreement of foreign organizations or individuals to provide financial assistance for scientific and technological activities, shall have to register the reception of financial assistance with the provincial/municipal Services of Science and Technology or receive the financial assistance through a scientific and technological organization. The use of financial assistance shall comply with the written agreements between the financial assistance recipients and the donors.

Article 13.- Proposing comments by individuals engaged in scientific and technological activities

The comments proposed by individuals engaged in scientific and technological activities prescribed in Clause 5, Article 17 of the Science and Technology Law shall be received, studied and replied by competent agencies.

Chapter III

ORGANIZING THE PERFORMANCE OF SCIENTIFIC AND TECHNOLOGICAL TASKS

Article 14.- Scientific and technological tasks

1. Scientific and technological tasks mean scientific and technological matters which need to be solved and implemented in forms of scientific and technological subjects, projects or programs.

2. A scientific and technological subject has the major contents of researching into a scientific and technological subject. Subjects may be independent or under scientific and technological projects or programs.

3. Scientific and technological projects have the major contents of carrying out scientific research, technological development, technological application; applying and experimenting socio-economic management solutions, methods and models. Projects may be independent or under scientific and technological programs.

4. A scientific and technological program comprises a group of scientific and technological subjects and projects, which are gathered for a definite purpose aiming to develop specific sciences and technologies or apply them in reality.

5. The Ministry of Science and Technology shall specify the organization of management of activities of scientific and technological programs, subjects or projects.

Article 15.- Determining scientific and technological tasks

1. The Ministry of Science and Technology shall determine and submit to the Government for decision the scientific and technological development strategies and plans; priority scientific and technological orientations; the major scientific and technological tasks of the State as well as plans on resource distribution, and organize the implementation of those scientific and technological tasks.

2. The Prime Minister shall decide on the performance of scientific and technological tasks in direct service of direction and administration and according to other urgent requirements.

3. The ministries, the ministerial-level agencies, the agencies attached to the Government, the People�s Committees of the provinces and centrally-run cities and other State bodies shall base themselves on the priority scientific and technological orientations as well as major scientific and technological tasks of the State and on the socio-economic development demands of the ministries, branches, localities, establishments or enterprises to determine their respective scientific and technological tasks.

4. The scientific and technological organizations shall base themselves on the priority scientific and technological orientations of the State, the requirements of the society as well as their respective assigned functions and scientific and technological domains to determine the scientific and technological tasks.

5. The enterprises shall base themselves on priority orientations for the country�s socio-economic development and their production and business plans to determine scientific and technological tasks.

6. The heads of the agencies and organizations defined in Clauses 1 and 3 of this Article shall:

a) Set up science and technology councils as provided for in Article 22 of this Decree to advise on the determination of scientific and technological tasks and deciding on objectives and contents of scientific and technological projects, subjects or programs;

b) Decide on the organization of performance of scientific and technological tasks by method of selection or direct assignment as provided for in Articles 16 and 17 of this Decree.

Article 16.- Scientific and technological tasks assigned by selection method

1. Scientific and technological tasks to be implemented with the participation of many capable organizations, collectives and/or individuals must be assigned by selection method in order to achieve the highest efficiency.

2. The competent State management agencies of various levels in charge of science and technology must announce on the mass media the scientific and technological tasks expected to be implemented in the subsequent fiscal year, as well as the conditions and procedures for all organizations and individuals to register for participation in the selection within 60 days after the announcement.

3. The heads of the State management agencies in charge of science and technology of various levels shall decide on the results of selecting organizations or individuals to perform the scientific and technological tasks based on the consultations of the selection councils set up under the provisions in Article 23 of this Decree.

4. The selection of organizations and individuals for the performance of scientific and technological tasks must be conducted in an open, fair, democratic and objective manner. The selection results must be announced on the mass media.

Article 17.- Scientific and technological tasks to be assigned directly

1. The to be-directly-assigned scientific and technological tasks are scientific and technological tasks of State secrets, security and defense particularity, a number of urgent scientific and technological tasks and scientific and technological tasks to be performed by only one scientific and technological organization or individual, that meets all conditions on professional qualifications and equipment as well as facilities for the performance thereof.

2. The State management agencies of various levels in charge of science and technology shall select fully qualified organizations and individuals for the performance of scientific and technological tasks. The organizations and individuals that are assigned the scientific and technological tasks must work out schemes and defend them before the science and technology councils set up by the management agencies.

3. The scientific and technological organizations directly assigned scientific and technological tasks may organize the implementation thereof by mode of selection or direct assignment to collectives or individuals in their organizations. If the organization of implementation is conducted by selection mode, the selection councils must be set up according the provisions in Article 23 of this Decree. In case of implementation by mode of direct assignment, the science and technology councils must be set up to consider and approve the schemes for implementation of scientific and technological tasks.

Article 18.- The scientific and technological tasks financed by the Scientific and Technological Development Fund

All organizations and individuals engaged in scientific and technological activities may propose scientific and technological tasks to the State�s Scientific and Technological Development Fund in order to receive financial assistance or loans according to the Government�s regulations on the National Fund for Scientific and Technological Development.

Article 19.- Performance of scientific and technological tasks without using State budget

The State encourages all organizations and individuals to organize by themselves or participate in the performance of scientific and technological tasks in all lawful forms.

Article 20.- Inspection and evaluation in the course of performing scientific and technological tasks

The State management agencies of various levels in charge of science and technology shall, according to their respective jurisdiction, conduct periodical inspection and evaluation of the performance of scientific and technological tasks financed by the State budget in term of scientific contents, implementation tempo and the use of fund. In case of necessity, they can adjust the research contents to suit practical requirements or terminate the performance of such tasks.

Article 21.- Pre-acceptance evaluation of results of the performance of scientific and technological tasks

1. The results of scientific and technological tasks implemented with State budget, when completed, must be subject to objective and accurate pre-acceptance evaluation by specialized science and technology councils set up under the provisions of Article 24 of this Decree. The State management bodies of various levels in charge of science and technology shall, according to their respective jurisdiction, decide to recognize and announce the results of performance of the scientific and technological tasks.

2. Scientific and technological tasks performed without funding by the State budget but with wide scope of their application nationwide, in a branch or a locality or with effects on national interests, defense, security, environment, health and life of people must be appraised by the State management agencies of various levels in charge of science and technology before their application.

Article 22.- Councils for determination of scientific and technological tasks

1. The councils for determination of scientific and technological tasks shall be set up by the heads of agencies or organizations according to their respective jurisdiction to advise on the determination of scientific and technological tasks. The councils are tasked to analyze, evaluate and recommend objectives, requirements and expected results of the programs, subjects and/or projects. Opinions of the council members and recommendations of the councils must be recorded in writing.

2. Such a council shall be composed of the president, two critical members and other members. Its members shall include:

a) Representatives of State management bodies, production and business organizations and other relevant organizations, making up 1/2 of its membership;

b) Scientists and technologists working in relevant scientific and technological domains, making up 1/2 of its membership.

The council members must be prestigious and impartial experts with appropriate professional qualifications and profound knowledge about the scientific and technological fields which they are assigned to advise on for task determination.

Article 23.- Councils for selection of organizations and individuals to perform scientific and technological tasks

1. The councils for selection of organizations and individuals to perform scientific and technological tasks shall be set up by the heads of agencies or organizations according to their respective jurisdiction to advise on the selection of organizations and/or individuals for assuming the prime responsibility for performance of scientific and technological tasks.

2. Such a council shall be composed of the president, two critical members and other members. Its members shall include:

a) Representatives of the concerned State management bodies, production-business organizations utilizing scientific and technological achievements and other relevant organizations, making up 1/3 of its membership;

b) Scientists and technologists working in relevant scientific and technological fields, making up 2/3 of its membership.

The council members must be prestigious and impartial experts with appropriate professional qualifications and profound knowledge about the scientific and technological fields they are assigned to advise on for selection.

3. In case of necessity, the State management agencies in charge of science and technology shall, according to their respective jurisdictions, appoint two unregistered critical experts.

Article 24.- Councils for pre-acceptance evaluation of results of implementation of scientific and technological tasks

1. The heads of agencies or organizations shall, according to their respective jurisdiction, set up councils for pre-acceptance evaluation of results of implementation of scientific and technological tasks with the use of State budget upon the accomplishment thereof.

2. The councils for pre-acceptance evaluation of results of implementation of scientific and technological tasks shall conduct the evaluation and acceptance according to objectives, requirements, contents, results and schedule inscribed in the already signed contracts and take responsibility before the competent State management agencies in charge of science and technology for pre-acceptance evaluation of results of implementation of the scientific and technological tasks.

3. Such a council shall be composed of the president, two critical members and other members. Its members shall include:

a) Representatives of the concerned State management agencies, production-business organizations and other organizations, making up 1/3 of its membership;

b) Scientists and technologists working in the scientific and technological fields assigned to them for evaluation, making up 2/3 of its membership.

The council members are prestigious and impartial experts with appropriate professional qualifications and profound knowledge about the scientific and technological fields assigned to them for pre-acceptance evaluation.

4. In case of necessity, the State management agencies of various levels in charge of science and technology shall, according to their respective jurisdiction, appoint two unregistered critical experts.

Article 25.- Principles for operations of the science and technology councils

1. The science and technology councils defined in Articles 22,23 and 24 of this Decree shall work on the principle of democracy. The council members shall discuss openly the tasks assigned for consultancy. The council members shall give their comments in writing and be accountable therefor.

2. The councils shall give points according to the criteria and point scale or ranking prescribed by the Minister of Science and Technology.

3. Funding for the operations of the science and technology councils defined in Articles 23 and 24 of this Decree shall be estimated as a separate amount in the total funding of programs, subjects or projects. This funding amount shall be assigned to the program-, subject- or project-managing agencies for management. The funding for the scientific and technological task- determining councils defined in Article 22 of this Decree shall be channeled from the non-business scientific funding. Members of the science and technology councils defined in Articles 22,23 and 24 of this Decree shall be paid with remuneration for the performance of the councils� tasks from the funding sources prescribed in this Clause.

4. In case of necessity, the State management agencies of various levels in charge of science and technology may set up other science and technology councils to advise them on each specific matter.

Article 26.- Principles and forms of scientific and technological contracts

1. The scientific and technological contracts shall include contracts for scientific research and technological development, contracts for technological transfer and contracts for scientific and technological services.

2. Scientific and technological contracts shall be effected on the basis of voluntariness, mutual agreement, equality and law compliance.

3. The scientific and technological contracts must be made in writing.

Article 27.- Major contents of scientific and technological contracts

1. The contracts for scientific research and technological development must contain the following major contents:

a) The names, addresses and accounts of the contractual parties;

b) The names of the scientific and technological tasks, research methods, major contents and results to be achieved;

c) Locations, duration and mode of contractual performance;

d) The provisions on the use of research results and division of profits from the use of results;

e) The methods of result evaluation and pre-acceptance test;

f) The intellectual property right;

g) The implementation expenses, way of payment therefor;

h) Liabilities for contractual breaches and dispute settlement;

i) Other agreements.

2. The contents of the contracts for technological transfer or for scientific and technological services shall comply with the provisions of civil legislation.

Article 28.- Rights and obligations of ordering parties

1. The parties ordering scientific and technological contracts shall have the right to:

a) Own the scientific and technological results, if not otherwise agreed upon in the contracts;

b) Transfer scientific and technological results to other persons.

2. The parties ordering scientific and technological contracts shall have the obligations to:

a) Supply necessary information for the contractual performance;

b) Pay fully the material expenses to the contract-undertaking parties as agreed upon in the contracts.

Article 29.- Rights and obligations of the contract-undertaking parties

1. The parties undertaking to perform the scientific and technological contracts shall have the right to:

a) Enjoy the copyright over scientific and technological research results as agreed upon in the contracts;

b) Request the ordering parties to supply information and other conditions as agreed upon in the contracts for the contractual performance;

c) Receive funding from the ordering parties for the contractual performance.

2. The parties undertaking to perform scientific and technological contracts shall have the obligations to:

a) Deliver and hand over products strictly according to the contractual regulations;

b) Not to transfer the scientific and technological results if not so agreed upon by the ordering parties.

Article 30.- Settling contractual disputes

1. The parties breaching scientific and techno-logical contracts shall have to pay compensation for damage caused by their faults and be fined according to the contractual regulations or law provisions.

2. Disputes over scientific and technological contracts shall be settled first of all according to the principles of conciliation, mutual agreement between the parties; if disputes cannot be settled by the parties themselves, they shall be settled at courts, if there is no agreement on arbitration.

Chapter IV

APPLICATION OF RESULTS OF SCIENTIFIC RESEARCH AND TECHNOLOGICAL DEVELOPMENT

Article 31.- Use and transfer of results of scientific and technological research

Basing themselves on the results of pre-acceptance evaluation by science councils, the heads of the State management agencies of various levels in charge of science and technology shall decide to accept the results and the announcement, use as well as transfer of such results. The scientific and technological research results due to the State investment in service of public utility must be announced publicly and widely so that organizations and individuals apply them to production and life. The subject or project managers as well as subject- or project- executing agencies shall have to effect the transfer of research results for application to production and life under the provisions of law.

Article 32.- Encouraging innovations, technical modifications, production rationalization

1. The State management agencies of all levels in charge of science and technology shall adopt measures to step up the movements for innovations, technical modifications and production rationalization; develop scientific and technological services; enhance the popularization of scientific and technological knowledge in order to raise the people�s intellectual level in term of science and technology.

2. Annually, the Ministry of Science and Technology shall coordinate with the Ho Chi Minh Communist Youth Union Central Committee, the Vietnam Labor Confederation, the Union of Vietnam Scientific and Technical Associations as well as social and professional organizations and enterprises in organizing contests for innovations, technical modifications, and/or production rationalization and reserve non-business science budget to support the widespread dissemination and application of the results of such contests to production and life.

3. Enterprises organizing contests for innovations, technical modifications and/or production rationalization shall have the funding therefor calculated as their investment in scientific and technological activities prescribed in Article 40 of the Science and Technology Law.

4. The State encourages all organizations and individuals to organize by themselves or fund the organization of contests for creations, innovations, technical modifications and/or production rationalization.

Article 33.- Encouraging the application of results of scientific research and technological development

1. Organizations and individuals that apply the results of scientific research and technological development to renew their management and technologies, to enhance the competitiveness of their products shall be entitled to enjoy tax and credit preferences as provided for in Articles 42 and 43 of this Decree.

2. Organizations and individuals that conduct scientific and technological activities, when assigning or transferring their research and development results into production and life, shall be given conditions to advertise, introduce and demonstrate their research and development results; to participate in exhibitions, trade fairs.

3. Profits gained from the assignment or transfer of research and development results shall be divided to the scientists who have created the results, to the result owners, to scientific and technological organizations of the scientists and to the brokers. The division percentages shall be agreed upon in the scientific and technological contracts among the parties. Where the technologies are created with the use of State budget, the authors shall receive at most 30% of the payment prices of technological transfer; the authors and collectives organizing the successful application of scientific and technological results shall be rewarded by the scientific and technological result-using parties with a maximum value being equal to 30% of the after-tax additional incomes for a period of 3 years.

4. The brokers for the application of scientific and technological results created with the State budget shall enjoy at most 10% of the payment prices of the technological transfers; the specific amounts and responsibility for payment of this amount shall be agreed upon by the parties.

Article 34.- Applying results of scientific research and technological development for the renewal of policies and socio-economic management

The State management agencies of all levels in charge of science and technology shall take the following measures to step up the application of scientific research and technological development results to formulating industrialization and modernization models and solutions; renew and perfect socio-economic management; build an advanced and national culture and the new-typed Vietnamese:

1. Evaluating and recognizing the scientific and practical significance of scientific and technological works of this domain;

2. Providing funding support, organizing the deployment of experimental models, disseminating and widely multiplying the application of research and development results;

3. Adequately rewarding organizations and individuals that have their research and development projects applied to life.

Article 35.- Applying scientific research and technological development results in enterprises

1. Enterprises applying home-created technologies shall be technologically certified by State management agencies in charge of science and technology in order to enjoy preferences when borrowing credits at banks.

2. Enterprises applying home-created technologies of which the State is the owner shall be exempt from the payment for technology transfer to the State, but have to pay the authors as provided for in Clause 3, Article 33 of this Decree.

Article 36.- Applying scientific research and technological development results to agriculture and rural development

1. The Government shall set up and encourage organizations and individuals to set up establishments for technological transfer and application; expand the networks of organizations for agricultural, forestrial and fishery promotion, scientific and technological services in localities so as to provide services suitable to peasants� requirements; intensify investment in the implementation of scientific and technological projects, build a number of experimental models on scientific and technological application in rural areas, regions meeting with socio-economic difficulties and regions meeting with exceptional socio-economic difficulties.

2. The People�s Committees of all level shall have to create conditions for organizations, individuals, scientific and technological experts within and without the country to organize the widespread application of scientific and technological achievements in localities; create conditions in term of residential houses and land, travel means, equipment and working places for science and technology workers working in the localities.

The provincial/municipal People�s Committees shall partly provide funding support or subsidy for peasants who apply new technologies to production and life.

3. The Ministry of the Interior shall assume the prime responsibility and coordinate with the Ministry of Labor, War Invalids and Social Affairs, the Ministry of Science and Technology in guiding in detail the allowance regime and other entitlements for science and technology workers working in areas meeting with socio-economic difficulties and areas meeting with exceptional socio-economic difficulties.

Article 37.- Investment projects, socio-economic development programs

1. Investment projects of class A, B and socio-economic development programs may draw up spending items for research and development in service of building scientific grounds for projects, programs, stages of investment preparation and investment execution and the settlement of scientific and technological matters arising in the course of implementing programs and projects.

2. Investment projects and socio-economic development programs must be appraised by State management agencies in charge of science and technology in term of scientific grounds and technology in the stage of formulating projects and programs. The levels which manage programs and projects shall have to organize the science and technology councils for appraisal thereof.

3. Technologies put to application in the stage of investment in projects, programs must be appraised. Depending on the scale and nature of projects, programs, the decentralization of technological appraisal shall be compatible with the decentralization of appraisal of construction investment projects.

4. The Ministry of Science and Technology shall guide in detail the order and procedures of appraising the scientific grounds and appraising technologies of investment projects, socio-economic development programs.

Chapter V

MEASURES TO ENSURE SCIENTIFIC AND TECHNOLOGICAL DEVELOPMENT

Article 38.- Training human resources, fostering talents in science and technology

1. The Ministry of Education and Training shall assume the prime responsibility and coordinate with the Ministry of Science and Technology and the Ministry of Planning and Investment in drawing up general plans for training science and technology human resources and submit them to the Government for decision.

2. The priority and key scientific and technological programs of the State must contain items on training human resources and fostering talents in science and technology. The training results shall constitute one of the criteria for evaluation upon the completion of such scientific and technological tasks.

3. Organizations and individuals having full capability and conditions prescribed by the State shall be equal in participating in human resource training and talent fostering in various forms, including the granting of scholarship for Vietnamese citizens to study and raise their professional skills at home and abroad. Expenses for training science and technology human resources of enterprises shall be accounted into reasonable expenses when determining taxable incomes.

Article 39.- Employing science and technology human resources

1. The State-run scientific and technological organizations shall have to build up strong scientific collectives; provide organizational and material support for provisional scientific collectives involving individuals engaged in scientific and technological activities from different scientific and technological organizations to have conditions for participation in and implementation of scientific and technological tasks of the State.

2. Annually, the State management agencies in charge of science and technology, scientific and technological organizations shall consider and reward outstanding scientific and technological projects; reward and provide special privileges in term of working and living conditions for scientists and technologists having talents and great contributions in scientific and technological activities.

3. The State-run research and development organizations must publicly announce the criteria for and organize the selection of science and technology personnel in order to ensure the selection of persons with true research capability. The consideration for appointment, employment and rewards must be based on the scientific and technological results of individuals.

4. Individuals in scientific and technological organizations are entitled to work on the part-time basis for other scientific and technological organizations under labor contracts. The Ministry of Science and Technology shall specify the part-time working regime in scientific and technological organizations.

Article 40.- Scientific positions

1. The scientific positions include research assistant, researcher, principal researcher and senior researcher.

2. Bases for consideration of appointment to scientific positions shall include:

a) Talents, academic training process, contributions and duration for scientific and technological activities;

b) Persons who have outstanding scientific and technological research projects or get high scientific and technological prizes shall be given priority in consideration of appointment to higher scientific positions, regardless of their incumbent positions and duration of scientific and technological activities.

3. The Ministry of the Interior shall assume the prime responsibility and coordinate with the Ministry of Science and Technology in prescribing the criteria for each scientific position, the procedures for consideration and appointment to scientific positions.

Article 41.- Enterprises investing in scientific and technological development

1. Enterprises are entitled to calculate their expenses for scientific and technological development into reasonable expenses when determining the taxable incomes, which include expenses for scientific research and technological development, purchase of technological information and materials, industrial property and expenses for innovations, technical modifications and production rationalization. Amounts of investment in technology to create fixed assets shall be deducted gradually into production costs.

2. Enterprises may set up scientific and technological development funds in order to take initiative in making investment in science and technology according to their development requirements. The funding sources for these funds shall be formulated from pre-tax profits of the enterprises and other sources, if any.

3. Enterprises which invest in scientific and technological research in the priority and key fields of the State shall be considered by competent State agencies in charge of science and technology for financial support from non-business science and technology budget or considered by the scientific and technological development funds for financial support according to the regulation on the funds� operations. The Ministry of Science and Technology shall specify the conditions and procedures for consideration of financial support for these subjects.

4. Apart from the privileges provided for in Clauses 1,2 and 3 of this Article, the enterprises investing in scientific and technological development are also entitled to enjoy other privileges under the current law provisions.

Article 42.- Tax policies for scientific and technological activities

1. Income earned from the implementation of contracts for scientific research and technological development shall be free from enterprise income tax. The determination of non-taxable income shall comply with the provisions on enterprise income tax.

2. Funding received by scientific and technological organizations from the conclusion of contracts for implementation of programs, subjects and/or projects with the use of the State budget and subjects and/or projects financed by scientific and technological funds shall be free from value added tax.

3. Machinery, equipment, accessories, supplies, transport means which cannot be produced at home yet or can be produced at home but fail to meet the requirements; the priority technologies; documents, books, newspapers, electronic information on science and technology, hi-tech equipment imported for direct use in research and development activities, shall be free from import tax and value added tax.

4. Products which are being in the period of trial production shall not be subject to enterprise income tax and value added tax.

5. Enterprises investing in renewing technologies, raising technological levels, turning out projects from new technologies applied for the first time in Vietnam shall be entitled to exemption or reduction of enterprise income tax on the additional income from those activities. Specific cases are prescribed as follows:

a) Domestic enterprises shall comply with the provisions of the Domestic Investment Promotion Law;

b) Foreign-invested enterprises and foreign parties to business cooperation contracts shall comply with the provisions of the Law on Foreign Investment in Vietnam.

6. Taxes levied on activities of scientific and technological consultancy, technological transfer and technological export are defined as follows:

a) Value added tax shall not be collected from technological transfers. Activities of scientific and technological consultancy shall be entitled to the lowest rate of value added tax in the tax bracket;

b) Activities of scientific and technological consultancy, technological transfer and technological export shall enjoy enterprise income tax preference.

7. Scientific and technological information service activities shall enjoy the highest preferences regarding enterprise income tax and the lowest rate of the value added tax.

8. The Ministry of Science and Technology shall assume the prime responsibility and coordinate with the Finance Ministry and concerned agencies in specifying tax privileges for scientific and technological activities defined in this Article; the Ministry of Planning and Investment shall assume the prime responsibility and coordinate with the Ministry of Science and Technology in determining machinery and equipment, which cannot be produced at home yet or can be produced at home but fail to meet the requirements, the priority technologies not yet created in the country, for use as bases for determining tax privileges defined in this Article.

Article 43.- Credit policies for scientific and technological activities

1. Organizations and individuals engaged in scientific and technological activities and borrowing medium- and long-term loans to conduct scientific and technological activities shall enjoy preferential interest rates when borrowing capital at the scientific and technological development funds and other funds.

2. Credit privileges for organizations and individuals that borrow capital for investment in scientific and technological activities shall comply with the charters of the funds where capital is borrowed.

3. In case of borrowing capital from commercial banks for investment in scientific and technological activities, organizations and individuals shall be considered by the Development Assistance Fund for post-investment interest rate support or for investment credit guarantee according to the Fund�s Charter.

4. Scientific and technological programs, subjects or projects, which are in direct service of the State�s key socio-economic programs and the development of the national science and technology resources and demand great capital, shall be given priority in consideration for the use of official development assistance (ODA) capital by mode of:

a) Providing non-refundable aid or preferential loans for research and development activities;

b) Providing loans for investment projects on building of scientific and technological resources or to be- recovered loans for projects on application of scientific and technological results.

5. The Ministry of Science and Technology shall assume the prime responsibility and coordinate with the Ministry of Planning and Investment, the Finance Ministry, the Vietnam State Bank and the concerned ministries and ministerial-level agencies in specifying the credit privileges for scientific and technological activities prescribed in this Article.

Article 44.- Privileges for building of material and technical foundations

1. Organizations and individuals, that invest in the construction of material and technical foundations for scientific and technological activities, shall have their expenses therefor considered reasonable expenses and subtracted when determining enterprise income tax.

2. Scientific and technological organizations which rent land for the construction of material and technical foundations for scientific and technological activities shall enjoy privileges at the highest level for land rent and the lowest level for land use tax as provided for by tax legislation.

3. The Ministry of Science and Technology shall assume the prime responsibility and coordinate with the Ministry of Planning and Investment, the Finance Ministry and concerned ministries in promulgating the Regulation on management and operation of key national laboratories in order to ensure the efficient operation of these establishments.

Article 45.- Evaluation of scientific and technological activities

1. The Ministry of Science and Technology shall specify the criteria, methods, order and organization of the evaluation of scientific and technological activities.

2. The State management agencies of all levels in charge of science and technology must inspect and evaluate scientific and technological activities in the fields under their respective management.

Chapter VI

INTERNATIONAL COOPERATION IN SCIENCE AND TECHNOLOGY

Article 46.- Policies of attracting intellectuals being overseas Vietnamese, talented specialists in the world

1. Intellectuals being overseas Vietnamese and talented specialists in the world shall be encouraged to take part in scientific and technological activities in Vietnam in various forms.

2. Intellectuals being overseas Vietnamese and talented specialists, while working in Vietnam, shall have the following rights and obligations and enjoy the following privileges:

a) To enjoy the rights and fulfill the obligations like Vietnamese individuals engaged in scientific and technological activities, as provided for in Articles 17 and 18 of the Law on Science and Technology;

b) To have the rights and obligations according to scientific and technological contracts or the agreements, already concluded with Vietnamese organizations and/or individuals;

c) To be appointed to scientific and technological posts defined in Article 36 of the Law on Science and Technology;

d) To enjoy other privileges as provided for law.

3. Intellectuals being overseas Vietnamese and foreign talented specialists, who render great services to Vietnam�s cause of scientific and technological development, shall be commended or rewarded, or considered by the Vietnamese State for scientific and technological awards of Vietnam.

Article 47.- Rights and obligations of Vietnamese organizations and individuals in international cooperation in science and technology

1. Vietnamese organizations and individuals are entitled to receive financial assistance from foreign organizations and individuals as well as international organizations for scientific and technological activities in various scientific and technological domains and have to ensure that these activities do not cause harms to the defense, security, environment, morality, fine traditions of the Vietnamese nation and do not violate the provisions in Article 8 of the Law on Science and Technology.

2. Vietnamese organizations and individuals, that are engaged in scientific and technological activities, may join in scientific and technological organizations, scientific and technological societies; participate in research activities, training, consultancy provision, scientific and technological conferences organized by international organizations, foreign organizations and/or individuals; participate in cooperation activities for the performance of scientific and technological tasks of Vietnam. Such participation by organizations and individuals must not violate the provisions in Article 8 of the Law on Science and Technology.

3. Vietnamese organizations and individuals engaged in scientific and technological activities are entitled to perform the scientific and technological tasks of Vietnam overseas; to carry abroad relevant documents and testing samples in service of research activities as provided for by law.

4. Vietnamese scientific and technological organizations may set up their representative offices and branches overseas to promote scientific and technological cooperation.

Article 48.- Scientific and technological organizations with foreign capital

1. Overseas Vietnamese, international organizations and foreign organizations as well as individuals may set up scientific and technological organizations in Vietnam in forms of cooperation or association between foreign organizations or individuals and Vietnamese organizations and/or individuals, or 100% foreign capital (called scientific and technological organizations with foreign capital for short).

2. Scientific and technological activities of scientific and technological organizations with foreign capital must not cause harms to the security, defense, environment, morality, fine traditions of the Vietnamese nation and must not violate the provisions in Article 8 of the Law on Science and Technology.

3. Scientific and technological organizations with foreign capital may be set up according to the Enterprise Law, the Law on Foreign Investment in Vietnam or the Domestic Investment Promotion Law and must abide by the regulations on the conditions for establishment, rights and obligations, procedures and dossiers of application for licenses, incentive and privilege regimes prescribed in corresponding legal documents and the Law on Science and Technology.

4. Research and development organizations with foreign capital may be set up for non-profit purposes and must abide by the regulations on the conditions for establishment, rights and obligations, procedures, dossiers of application for operation registration, organization and operation charters, are entitled to enjoy incentive and preferential regimes like those prescribed for Vietnamese scientific and technological organizations and individuals.

Chapter VII

STATE MANAGEMENT OVER SCIENCE AND TECHNOLOGY

Article 49.- Tasks and powers of the Ministry of Science and Technology

The Ministry of Science and Technology shall be accountable to the Government for performing the State management over science and technology throughout the country and have the tasks and powers prescribed by the Government.

Article 50.- Tasks and powers of the ministries and ministerial-level agencies in the management of science and technology

The ministries and ministerial-level agencies shall perform the State management over science and technology and be responsible for scientific and technological activities in the branches or domains assigned to them for management; have the responsibility to determine and organize the implementation of scientific and techno-logical tasks in the domains assigned to them for management; ensure the efficient management and use of scientific and technological resources of their respective branches; have full-time science and technology management organizations to assist the ministers or the heads of the ministerial-level agencies in performing the State management over science and technology according to the Government�s regulations.

Article 51.- Tasks and powers of the People�s Committees of all levels in the management of science and technology

1. The People�s Committees of the provinces and centrally-run cities shall perform the State management over science and technology in their respective localities, be responsible for scientific and technological activities of their localities; have the responsibility to determine and organize the implementation of scientific and techno-logical tasks of the provinces or cities; organize the application of scientific and technological achievements to production and life in their localities; ensure the efficient management and use of scientific and technological resources of their respective localities.

The provincial/municipal Services of Science and Technology shall be accountable to the provincial/municipal People�s Committees for performing the State management over science and technology in the localities.

2. The People�s Committees of rural districts, urban districts, provincial capitals and cities shall perform the State management over science and technology in their respective localities as assigned by the provincial/municipal People�s Committees. Basing themselves on the specific conditions of their localities, the People�s Committee presidents shall decide on appropriate forms and modes of science and technology management within the Government-assigned frameworks of organizational apparatuses of rural districts, urban districts, provincial capitals and cities.

Chapter VIII

IMPLEMENTATION PROVISIONS

Article 52.- Implementation effect

This Decree takes effect 15 days after its signing.

All previous regulations contrary to this Decree are hereby annulled.

Article 53.- Implementation guidance and responsibility

1. The ministers of Science and Technology; Planning and Investment; Finance; Education and Training; Labor, War Invalids and Social Affairs; and the Interior shall, depending on their respective functions, tasks and powers, guide the implementation of this Decree.

2. The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the provincial/municipal People�s Committees shall have to implement this Decree.

On behalf of the Government
Prime Minister
PHAN VAN KHAI