DECREE

ON SCIENCE AND TECHNOLOGY ENTERPRISES

Pursuant to the Law on Government organization dated June 19, 2015;

Pursuant to the Law on Science and Technology dated June 18, 2013;

Pursuant to the Law on Enterprises dated November 26, 2014;

Pursuant to the Law on Investment dated November 26, 2014;

Pursuant to the Law on Land dated November 29, 2013;

At the request of the Minister of Science and Technology;

The Governments promulgates a Decree on science and technology enterprises.

Chapter I

GENERAL PROVISIONS

Article 1. Scope and regulated entities

1. Scope

This Decree provides for enforcement of Article 58 of the Law on Science and Technology regarding science and technology enterprises (STE).

2. Regulated entities

This Decree applies to the following entities:

a) Enterprises founded and operated under Vietnamese law provisions and perform production, business and provide services by using the scientific and technological achievements;

b) Other organizations and individuals relating to certification of the STEs and implementation of State’s incentive and support policies intended for the STEs.

Article 2. Definition

For the purposes of this Decree, the terms below shall be construed as follows:

1. “science and technology product” (including post-incubation technology, goods, services and other forms) means the result of production or service provision by applying or developing the scientific and technological achievements.

2. “land for construction of scientific research center of an STE” means any land used for construction of laboratories or establishment of technology incubators and STE incubators or construction of experiment centers or trial production facilities.

Article 3. Scientific and technological achievements

1. The results of science and technology activity performance, achievements of science and technology objectives and scientific research and technology development shall be considered the scientific and technological achievements.  The scientific and technological achievements shall be used as a basis for grant of the STE Certificate.

2. The scientific and technological achievements shall be presented in one of the following forms:

a) Invention, useful solutions, industrial designs, integrated circuit designs, plant varieties issued with a protection certificate under provisions of the law on intellectual property or international registration certificate under provisions of the international agreement to which Vietnam is a signatory; computer programs issued with a copyright registration certificate;

b) New livestock breeds, plant varieties, fish seeds or forest tree varieties, technical advances recognized by the Ministry of Agriculture and Rural Development;

c) Award for science and technology achievements given by competent regulatory agencies in cooperation with the rewarding organizations or given under approval for reward of the competent regulatory agencies as per law provisions on scientific and technological reward; 

d) Scientific and technological achievements certified by competent authorities as per law provisions;

dd) Technologies received under technology transfer agreements certified by competent authorities as per law provisions.

3. Enterprise running new investment project on scientific research and technology development is any enterprise carrying out new production or trading project or replacing its existing production and trading technologies by using the scientific and technological achievements.

Article 4. STE Certificates

1. The STE Certificate shall be used as a basis for implementing incentive and support policies intended for the STEs and shall enter into force nationwide. 

2. The STE Certificate shall also be the certificate of registration of science and technology operation.

3. The STE Certificate shall be used as a basis for providing investment incentives for the STEs.

Chapter II

STE CERTIFICATION

Article 5. Power to issue, change, re-issue, revoke STE Certificates and cancel validity thereof

1. The Department of Science and Technology of the province in which the headquarters of the STE is located shall take charge of receiving applications for a STE Certificate and issue the certificate, unless otherwise prescribed in Clause 2 this Article.

2. The Department of Market and Science and Technology Enterprise Development and the Ministry of Science and Technology shall be responsible for assisting the Minister of Science and Technology in receiving the applications and issuing the STE Certificate for cases in which:

a) scientific and technological achievements are from accomplishment of special science and technology objectives; play an essential role in socio-economic development, national defense and security nationwide; or have particular significance for development of national science and technology potential; or help to deal with science and technology problems relating to different sectors and fields or in inter-regions, especially environment, health; information-telecommunications technology infrastructure; 

b) the STE is founded as a result of conversion of public scientific and technological organization that registered science and technology operation with the Ministry of Science and Technology

c) the Department of Science and Technology does not have techniques necessary for assessment of the scientific and technological achievements and sends a written request for issuance of the STE Certificate to the Department of Market and Science and Technology Enterprise Development;

d) the enterprise has its subsidiary and production facility in more than one province and centrally-affiliated city and sends a written request for issuance of the STE Certificate to the Department of Market and Science and Technology Enterprise Development.

3. In case the enterprise is issued with a STE Certificate as prescribed in Clause 1 this Article, the Department of Science and Technology shall send a copy of such certificate to the Department of Market and Science and Technology Enterprise Development and relevant agencies for implementation of incentive and support policies.

4. In case the enterprise is issued with a STE Certificate as prescribed in Clause 2 this Article, the Department of Market and Science and Technology Enterprise Development shall send a copy of such certificate to the Department of Science and Technology of the place in which the headquarters or accounting branch of such enterprise is located.  The Department of Science and Technology shall send the copy of such certificate to relevant agencies for implementation of incentive and support policies.

5. The issuer of STE Certificate shall have the power to change, re-issue, revoke the STE Certificate or cancel validity thereof.

Article 6. Conditions for grant of STE Certificates  

1. Every enterprise may be granted a STE Certificate if it:

a) is founded and operated under provisions of the Law on Enterprises;

b) has the potential for creating or applying the scientific and technological Science and Technology Enterprise assessed and recognized by the competent authority under regulations in Clause 2 Article 7 hereof;

c) the profit earned from production of or trade in science and technology products accounts for at least 30% of its total profit.

2. Every enterprise founded for less than 5 may be granted a STE Certificate if satisfying requirements specified in Point a and b Clause 1 this Article.

Article 7. Procedures and applications for certificate issuance

1. The enterprise meeting conditions specified in Article 6 hereof shall send an application for the STE Certificate to the competent authority as prescribed in Article 5 hereof. The application shall be sent directly or by post or via online system.

2. The application shall include:

a) An application form for certificate according to Form No.01 provided in the Appendix issue thereto;

b) A copy of the written document on recognition of scientific and technological achievements issued by a competent authority (attached with the original for comparison purpose or certified true copy) which may be one of the following documents:

- Certificate of intellectual property right protection;

- Decision on recognition of new plant varieties, livestock breeds, fish seeds or forest tree varieties or technique advances;

- Proof for award for science and technology achievements given by the competent regulatory agencies in cooperation with the awarding organization or given under award approval of such competent regulatory agencies;

- Decision on recognition of achievements of science and technology objectives funded by state budget or certificate of registration of the aforesaid achievements; Conformation or appraisal report on achievements of science and technology objectives not using state budget;

- Certificate of technology transfer registration;

- Other conformation or recognition reports with equal validity.

c) A plan for producing, trading science and technology products according to Form No.02 provided in the Appendix issued thereto.

Article 8. Application appraisal and issuance of STE Certificates

1. The agency having power to issue the STE Certificate (hereinafter referred to as “the issuing authority”) shall send the applicant a response to the satisfactoriness of the application which specifies the information or document needed to be changed or adjusted and duration for change/adjustment if such application is found unsatisfactory within 3 working days from the day on which the application is received.

2. The issuing authority shall consider whether to issue or refuse to grant the STE Certificate within 10 working days from the day on which the satisfactory application is received.  The STE Certificate shall be issued according to Form No.03 provided in the Appendix issued thereto.

In case the scientific and technological achievements are related to different sectors or fields with complicated information, it is required to invite experts or establish an advisory council to assess the application; however; the STE Certificate shall be issued within 15 working days from the day on which the satisfactory applications is received.

3. For the case specified in Point c Clause 2 Article 5 hereof, the Department of Science and Technology shall send a proposal together with the application to the Department of Market and Science and Technology Enterprise Development for certificate issuance within 5 working days from the day on which the satisfactory application is received.

4. The issuing authority shall post information about the name, address and list of science and technology products of the enterprise on its website within 5 working days from the day on which the STE Certificate is granted.

Article 9. Change and re-issuance of STE Certificates

1. The STE shall send an application for change or-re-issuance of the STE Certificate to the competent authority specified in Article 5 hereof if:

a) it wishes to change the enterprise registration information;

b) it wishes to amend the list of science and technology products;

c) the STE Certificate is lost, burned, torn or destroyed in other forms.

2. The application for change/re-issuance of the STE Certificate shall be sent directly or by post or via the online system, including:

A) An application form for change/re-issuance of the STE Certificate according to Form No.04 provided in the Appendix issued thereto;

b) The written document proving change in the enterprise registration information for case of change of the enterprise registration information;

c) Documents prescribed in Point b and c Clause 2 Article 7 hereof for the case of amendments to the list of science and technology products.

3. The competent authority shall consider whether to change or re-issue the STE Certificate within 5 working days from the day on which the satisfactory application is received.  The STE Certificate shall be changed within 10 working days from the day on which the satisfactory application is received in case of amendments to the list of science and technology products scientific.

Article 10. Revoking STE Certificates and cancelling validity thereof

1. The competent authority specified in Article 5 hereof shall decide to revoke the STE Certificate and notify such revocation to the enterprise if:

a) such enterprise has its certificate revoked;

b) the profit earned from production of and trade in science and technology products fails to account for at least 30% of total revenue of the enterprise in 5 consecutive years; except for the case in which the enterprise has operated less than 5 years from the day on which the STE Certificate is issued;

c) the enterprise fails to send reports for 3 consecutive years as regulated;

d) the STE Certificate is issued ultra vires or against established procedures;

In case of certificate revocation, the enterprise shall not continue to enjoy benefits from incentive and support policies intended for STEs.

2. The competent authority shall notify the violations committed by the enterprise and decide to cancel the validity of the STE Certificate if such enterprise:

a) infringes the property rights or use rights of the scientific and technological achievements provided in the application for certificate;

b) falsifies the information provided in the application for the STE Certificate.

In case the STE Certificate is invalidated, the enterprise is required to return the provided funding and pay compensations for the benefits enjoyed and face penalties as per law provisions.

3. The authority competent to revoke the STE Certificate and cancel validity thereof shall send a written notification of such revocation or cancellation to agencies relating to implementation of incentive and support policies intended for STEs and post information about such revocation or cancellation on its website within 30 working days from the day on which the decision on certificate revocation or validity cancellation is issued.

Article 11. Funding for application appraisal for issuance, change, re-issuance, revocation of STE Certificates and cancellation of validity thereof

1. Funding for application appraisal for the purpose of issuance, change, re-issuance, revocation of STE Certificates and cancellation of validity thereof shall be provided by state budget. 

2. The expenditures and expenditure level shall comply with current law provisions on acceptance of achievements of ministerial or provincial science and technology objectives.

Chapter III

INCENTIVE AND SUPPORT POLICIES

Article 12. Remission of corporate income tax

1. The enterprise earning income from production of and trade in science and technology products shall be entitled to the same remission of corporate income tax thereon as those applied to enterprises running new scientific research and technology development projects. To be specific, tax exemption for 4 years and 50% tax reduction for the next 9 years.

2. The revenues and incomes mentioned in Clause 1 Article 2 hereof and revenues from provision of IT services applying scientific and technological achievements shall be revenues and incomes from brand new services. 

3. An STE shall not be entitled to remission of corporate income tax in the fiscal year if the revenue from production of and trade in science and technology products in such year fails to account for at least 30% of its total revenue.

4. Conditions and procedures for remission of corporate income tax shall comply with provisions of the law on corporate income tax and tax management. 

Article 13. Remission of land rent and water surface rent

1. An STE is entitled to remission of land rent and water surface rent in accordance with provisions of the law on land.

2. The Department of Science and Technology shall cooperate with the authorities receiving applications of land users under regulations in Article 60 of Decree No.43/2014/ND-CP dated May 15, 2014 of the Government when determining the land area entitled to land rent remission for science and technology purpose.  The procedure and application for remission of land rent and water surface rent shall comply with provisions of the law on land rent and tax management.

Article 14. Credit incentives for STEs conducting scientific research, technology development and production and trading

1. Investment projects on creating science and technology products of an STE may be funded by State’s investment loans as per provisions of the law in force.

2. The STE fulfilling science and technology objectives, applying the scientific and technological achievements or producing or trading science and technology products may receive funds or loans with preferential interests, loan interest subsidy and guarantee for loans from the National Technology Innovation Fund, National Foundation for Science and Technology Development of Ministries, ministerial agencies, Governmental agencies, provinces and provincial authorities. 

a) The STE that uses its assets as collateral as per law provisions may take loans with preferential interest or up to 50% interest rate subsidy when taking commercial bank’s loans from the National Technology Innovation Fund and National Foundation for Science and Technology Development of ministries, ministerial agencies, Governmental agencies, provincial authorities.

b) The STE setting up feasible science and technology project may take loans with preferential interest or obtain guarantee for loans taken from commercial banks from the National Technology Innovation Funds or National Foundation for Science and Technology Development of ministries, ministerial agencies, Governmental agencies, provincial authorities.

3. b) National Technology Innovation Fund and National Foundation for Science and Technology Development of ministries, ministerial agencies, Governmental agencies, provincial authorities shall specify regulations on granting loans and subsidies of loan interests, guarantee for loans and enabling eligible STEs to receive to such incentives.

4. The STE eligible to receive supports as required by the Credit Guarantee Fund For Medium And Small-Sized Enterprises may obtain guarantee for loans from this Fund as per law provisions.

Article 15. Transfer of assets derived from science and technology objectives funded by state funding

Transfer of assets derived from science and technology objectives funded by state funding to the enterprises shall comply with the Government’s regulations on management and use of assets derived from science and technology objectives funded by state budget.

Article 16. Support for research activities and commercialization of scientific and technological achievements

1. An STE may claim preferential import/export duty treatment for scientific research, technology development and production or trading as regulated by the law on import and export duty.

2. The STE may be exempt from charges for use of machines and equipment in national laboratories, technology incubators, STE incubators, State scientific and technological research centers for the purpose of conducting scientific research, developing and incubating technology or trial production of new products and incubating STEs.  In case of expenses incurred on purchase of raw materials for research activities, the enterprise shall pay such expenses for key national laboratories, technology incubators, enterprise incubators and State's science and technology research centers.

3. The STE may use funds from National Foundation for Science and Technology Development for enterprises and other legal contributions for commercializing the scientific and technological achievements.

The STE may be given priority for participation in support projects for commercialization of scientific and technological achievements and intellectual property of the State.  Tasks to be supported and support levels shall comply with the State's regulations on support projects for commercialization of scientific and technological achievements and intellectual property.

4. The STE may be exempt from registration fee when registering land use rights or house ownership as per provisions of the law on registration fee.

5. Ministries and ministerial agencies shall establish national technical regulations applied to science and technology products that are on the list of Group 2 products if there is no technical regulation applied.

Article 17. Supporting and encouraging technology use and innovation

1. The STE investing in material-technical facilities for technology decoding may receive loans, guaranteed loans or financial support valued 50% of the interest of commercial bank's loans from the National Technology Innovation Fund.

2. The STE having projects included in the sector integration or value chain may receive loans from the Fund for Development of Medium and Small-size Enterprises as per law provisions in force.

3. The STE self-investing in scientific research and technology development of which the results are efficiently transferred or applied in reality and recognized by the science and technology authority may receive funds from state budget; in case such results have significance for socio-economic development and national defense and security, they may be purchased by the State after consideration.

4. The STE shall be given priority in claiming intellectual property rights, recognizing and registering science and technology products for sale with the aim of new product development.

5. The STE obtaining achievements in science and technology or commercialization of science and technology products shall be commended and rewarded.

Chapter IV

IMPLEMENTATION

Article 18. STEs’ responsibilities

1. The STE shall take legal responsibility for validity of possession and use of the scientific and technological achievements for production and trade purposes.

2. The STE shall provide information and document on production of and trade in science and technology products to the local Department of Science and Technology every year in a timely, sufficient and accurate manner.

Article 19. Responsibilities of the Ministry of Science and Technology

1. Take charge and cooperate with relevant agencies in providing guidelines for implementing this Decree.

2. Take charge and cooperate with relevant agencies in disseminating the policy on STE development; support programs and projects on development of STEs; commend and reward the STEs as regulated.

3. Conduct inspection, supervision and handling of violations against regulations on the issuance of STE Certificates and operation of the STEs under management as per law provisions; decide to return the State's funding and assets allocated in case the STE fail to produce and trade products specified in the application for certification or operate in an inefficient manner or commit violations against laws.

4. Be accountable to the Government and Prime Minister for urging and checking implementation of this Decree; play the role of the agency in charge of dealing with problems arising during implementation and send reports to the Prime Minister for handling of problems beyond the competence and conduct annual assessment of implementation of this Decree in order to learn from experience.

The Department of Market and Science and Technology Enterprise Development is affiliated to the Ministry of Science and Technology and shall assist the Minister of Science and Technology in performing the duty of state management in support for development of the STEs.

Article 20. Responsibilities of the Ministry of Finance  

1. Instruct local tax agencies and financial bodies to offer preferential treatment to the STEs as prescribed in Chapter III hereof.

2. Send recommendations and proposals of solutions for dealing with questions arising during implementation of incentive and support policies intended for the STEs.

Article 21. Responsibilities of other ministries

1. Other ministries and ministerial agencies shall focus on formulating national technical regulations meeting requirements for development of the STEs.

2. Instruct ministerial Fund for Development of Medium and Small-sized Enterprises and National Foundation for Science and Technology Development to provide support for the STEs as prescribed in Article 14, 16 and 17 hereof.

Article 22. Responsibilities of Vietnam Development Bank  

1. Implement investment loans policies intended for the STEs as per law provisions.

2. Send proposals of measures to deal with questions and difficulties arising during implementation of the aforesaid incentive loans policies.

Article 23. Responsibilities of provincial People's Committees

1. Issue programs and plans for development of the STEs in each specific period and provide funding for implementation.

2. Instruct the Department of Science and Technology to post the procedures and forms for registration of the STE Certificate on their website; send annual reports on registration of the STE certificate and results of production and trade performed by local enterprises to the Department of Market and Science and Technology Enterprise Development before December 15.

3. Instruct other relevant departments and National Foundation for Science and Technology Development of provincial level (if any) to implement incentive and support policies intended for the STEs and enterprises running new investment projects on scientific research and technology development prescribed herein.

4. Lease out land and infrastructure facilities with the lowest rent as regulated; allocate land fund to provincial STEs when preparing plans or planning on local land use.

Chapter V

IMPLEMENTATION PROVISIONS

Article 24. Transition clauses

1. Enterprises issued with the STE Certificate which have been provided with preferential treatment and support, including those issued with a certificate but not yet enjoying benefits from incentive programs under provisions specified in legal documents before the effective date of this Decree shall continue to receive preferential treatment and supports for the remaining period as prescribed in the aforesaid legal documents; in case the enterprise satisfies requirements specified in Chapter III hereof, it is entitled to select to enjoy benefits from which current incentive programs or benefits provided herein for the remaining period.

2. The remaining period for claiming preferential treatment shall be calculated consecutively from the day on which the incentive program for the STE is run under regulations provided in legal documents issued before the effective date of this Decree.

Article 25. Effect

1. This Decree comes into force from March 20, 2019.

2. Decree No.80/2007/ND-CP dated May 19, 2007 of the Government on science and technology enterprises; Decree No.96/2010/ND-CP dated September 20, 2010 of the Government on amendments to a number of Articles of Decree No.115/2005/ND-CP dated September 05, 2005 of the Government on autonomy mechanism and self-responsibility of public science and technology organizations and Decree No.80/2007/ND-CP; Article 19 of Decree No.95/2014/ND-CP dated October 17, 2014 of the Government on investment in and finance mechanism for science and technology activities shall expire from the effective date of this Decree. 

Article 26. Implementation responsibilities

Ministers, Directors of ministerial agencies and Governmental agencies, Chairpersons of provincial People’s Committees and Directors of relevant agencies and organizations shall take responsibility to implement this Decree./