CIRCULAR

GUIDING A NUMBER OF ARTICLES OF DECREE NO. 121/2021/ND-CP DATED DECEMBER 27, 2021 OF THE GOVERNMENT OF VIETNAM ON THE BUSINESS OF PRIZE-WINNING ELECTRONIC GAMES FOR FOREIGNERS

Pursuant to Decree No. 121/2021/ND-CP dated December 27, 2021 of the Government of Vietnam on the business of prize-winning electronic games for foreigners;

Pursuant to Decree No.87/2017/ND-CP dated July 26, 2017 of the Government of Vietnam on functions, duties, entitlements and organizational structure of the Ministry of Finance of Vietnam;

At the request of the Director of the Department of Banking and Financial Institutions;

The Minister of Finance of Vietnam hereby promulgates the Circular guiding a number of Articles of Decree No. 121/2021/ND-CP dated December 27, 2021 of the Government of Vietnam on the business of prize-winning electronic games for foreigners.

Chapter I

GENERAL PROVISIONS

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This Circular provides for contents of token management; license issuance fees; financial regulations; price reduction; accounting and reporting regulations according to regulations prescribed in Clause 2 Article 12, Article 27, Clause 2 Article 35, Clause 4 Article 36, and Article 37 of Decree No. 121/2021/ND-CP dated December 27, 2021 of the Government of Vietnam on the business of prize-winning electronic games for foreigners (hereinafter referred to as "Decree No. 121/2021/ND-CP”).

Article 2. Regulated entities

1. Enterprises engaged in the business of prize-winning electronic games for foreigners.

2. Persons eligible for playing these games and persons permitted to enter facilities for doing the business of prize-winning electronic games for foreigners according to regulations of the law.

3. State management agencies with functions related to the license issuance, management, supervision, inspection of the business of prize-winning electronic games for foreigners.

4. Other organizations and individuals related to the business of prize-winning electronic games for foreigners.

Chapter II

SPECIFIC PROVISIONS

Article 3. Token management

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2. Enterprises may temporarily suspend the use of tokens according to management needs. At least 5 working days before the temporary suspension of the use of tokens, enterprises shall send written notifications to Departments of Finance and local tax authorities that directly manage them for monitoring and management. The contents of such notifications shall specify the time of temporary suspension of the use of tokens, reasons, and estimated time to resume the use. In case of changes to the estimated time to resume the use of tokens, enterprises shall send written notifications to the mentioned agencies.

3. Enterprises shall adopt Token Monitoring and Management Books, including the following fundamental contents:

a) Forms of tokens;

b) Quantities and types of tokens that enterprises purchase, re-export, or destroy, in which specify each price, type of foreign currency, date of purchase, re-export, or destruction, name of the manufacturer, and provider (if any);

c) Other contents according to management requirements of enterprises.

Article 4. Management of cash and tokens at the vaults, checkout counters, and prize-winning electronic game machines

1. Enterprises shall develop and issue regulations on financial management and token management procedures and organize the management, ensuring separation between vaults, checkout counters, and prize-winning electronic game machines.

2. Enterprises may only exchange cash and tokens with players before they play and return cash to players at checkout counters and shall issue Money Exchange Invoices according to the form in Appendix No. 1 promulgated hereof. Cashier divisions shall monitor the specific amount of money and tokens transacted in the period.

3. Enterprises shall arrange specialized crates (bags) to store cash and tokens. These boxes (bags) shall be sealed before being taken out of the vault and be sealed immediately after being taken out of prize-winning electronic game machines.

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Article 5. License issuance fees

1. The fee for processing applications for issuance and renewal of business eligibility certificates of enterprises is 150.000.000 VND.

2. The fee for processing applications for re-issuance and adjustment of business eligibility certificates of enterprises is 5.000.000 VND.

3. Fees for processing applications for issuance, re-issuance, adjustment, and renewal of business eligibility certificates prescribed in Clause 1 and Clause 2 of this Article are central budget revenues.

4. After the processing, the Ministry of Finance of Vietnam shall inform enterprises eligible for issuance, re-issuance, adjustment, and renewal of business eligibility certificates of processing fee payment as prescribed by law.

5. After receiving notifications from the Ministry of Finance of Vietnam, enterprises shall transfer the mentioned fees to the state budget according to the current state budget appendix according to Circular No. 328/2016/TT-BTC dated December 26, 2016 of the Ministry of Finance of Vietnam guiding the collection and management of state budget revenues via the Vietnam State Treasury and amendment documents (if any), and send a state budget payment copy to the Ministry of Finance of Vietnam. Enterprises may only receive the issued, re-issued, adjusted, and renewed business eligibility certificates after transferring the mentioned fees to the state budget.

Chapter III

FINANCIAL MANAGEMENT AND REGULATIONS ON ACCOUNTING, AUDIT, AND REPORT

Article 6. Principles of keeping business account and management of revenues and costs

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2. Enterprises engaged in the business of prize-winning electronic games shall separately keep business accounts of related revenues, costs, and profits and separately monitor such matters in the bookkeeping and financial reporting systems.

3. The determination of other revenues, costs, profits, and contents related to tax regarding the business of prize-winning electronic games shall comply with regulations of laws on taxation.

Article 7. Revenues

1. Revenues from the business of prize-winning electronic games includes:

a) Direct revenues from the business of prize-winning electronic games are all of the money collected from exchanging tokens with players and the money collected at prize-winning electronic game machines minus the amount returned to players due to winners or players did not spend all of the tokens.

b) Revenues from financial activities and other revenues from the business of prize-winning electronic games according to current accounting regulations.

2. The price reduction of enterprises engaged in the business of prize-winning electronic games prescribed in Article 35 of Decree No. 121/2021/ND-CP is implemented as follows:

a) Persons eligible for price reduction are persons who purchase tokens with the value of at least 50.000 USD/time

b) Enterprises may receive reductions of taxable revenues according to laws on taxation. The determination of tax eligible for reduction shall comply with laws on taxation.

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Article 8. Costs

1. The operating cost of the business of prize-winning electronic games is all of the operating costs of the business of prize-winning electronic games determined according to the law. In case the operating cost of the business of prize-winning electronic games is in association with other business activities of an enterprise, allocate such costs according to the percentage (%) between its revenues from the business of prize-winning electronic games compared to the total revenues.

2. Prize payout costs are the amount paid to winners when playing games on prize-winning electronic game machines by enterprises according to the game rules and laws on taxation.

Article 9. Regulations on accounting and audit

1. Enterprises shall implement accounting regulations according to the Law on Accounting of Vietnam and current regulations of laws on accounting

2. Annual financial reports of enterprises engaged in the business of prize-winning electronic games shall be audited by an independent audit organization legally permitted to operate in Vietnam

3. Enterprises shall implement regulations on storage of financial reports in accordance with the Law on Account of Vietnam and amendment or replacement documents (if any). Particularly for declaration forms prescribed in Appendixes No. 1, No. 2, No. 3, No. 3, and No. 4 promulgated hereof, the minimum storage time is 5 years to serve the inspection of state management agencies.

Article 10. Regulations on reports

1. Regarding financial reports

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b) Within 120 days after the end of the annual accounting period, enterprises engaged in the business of prize-winning electronic games shall disclose financial reports as prescribed by law.

2. Regarding professional reports

a) Every quarter and year-end, enterprises engaged in the business of prize-winning electronic games shall compile and send the following professional reports:

- Reports on quantities and types of machines and prize-winning electronic games according to the form prescribed in Appendix No. 6 promulgated hereof;

- Reports on quantities and types of machines and prize-winning electronic games according to the form prescribed in Appendix No. 6 promulgated hereof;

- Reports on the operational status of the business of prize-winning electronic games according to the form prescribed in Appendix No. 8 promulgated hereof.

b) Time to finalize the report data

- Regarding quarterly reports: The time to finalize the report data is from the 1st day of the first month of the quarter to the end of the last day of the last month of the quarter in the reporting period;

- Regarding annual reports: The time to finalize the report data is from January 1 to December 31 of the reporting year.

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Professional reports prescribed in Point a of this Clause shall be sent to the Ministry of Finance of Vietnam, Departments of Finance, Departments of Culture, Sports, and Tourism of Vietnam (or Departments of Culture and Sports of Vietnam), and local Taxation Department within 15 days after the end of the accounting period (quarterly or annually). Legal representatives of enterprises engaged in the business of prize-winning electronic games shall take legal liability regarding the accuracy and honesty of such reports.

3. Aside from reports prescribed in Clause 1 and Clause 2 of this Article, enterprises engaged in the business of prize-winning electronic games shall compile and submit irregular reports at the management request of the Ministry of Finance of Vietnam.

4. Methods for sending reports

a) Send directly in the form of paper documents;

b) Send by post in the form of paper documents;

c) Send by the email system or the specialized reporting and information software system;

d) Other methods as prescribed by law.

Chapter IV

RESPONSIBILITIES OF ORGANIZATIONS

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Manage, supervise, inspect, and take charge of providing advisory services to assist People's Committees of provinces or centrally affiliated cities in managing, supervising, and inspecting the operation of the local business of prize-winning electronic games according to Decree No. 121/2021/ND-CP, regulations prescribed in this Circular, and relevant laws.

Article 12. Local Taxation Departments shall:

1. Cooperate with Departments of Finance and relevant agencies in managing, supervising, and inspecting the operation of the local business of prize-winning electronic games according to Decree No. 121/2021/ND-CP, regulations prescribed in this Circular, and relevant laws.

2. Take legal liability for the management and inspection of the fulfillment of tax and fee payment obligations regarding enterprises engaged in the business of prize-winning electronic games as prescribed by law.

Article 13. Enterprises engaged in the business of prize-winning electronic games shall:

1. Comply with regulations of the law regarding the operation of the business of prize-winning electronic games according to Decree No. 121/2021/ND-CP, regulations prescribed in this Circular, and relevant laws.

2. Assume responsibility for developing and issuing their professional regulations and management procedures, ensuring transparency, honesty, and compliance with legal regulations on the operation of the business of prize-winning electronic games.

Chapter V

IMPLEMENTATION

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1. This Circular comes into force as of August 8, 2022.

2. This Circular replaces the following documents:

a) Circular No. 11/2014/TT-BTC dated January 17, 2014 of the Ministry of Finance of Vietnam guiding certain Articles of Decree No. 86/2013/ND-CP dated July 29, 2013 of the Government of Vietnam on the business of prize-winning electronic games for foreigners;

b) Circular No. 57/2017/TT-BTC dated June 2, 2017 of the Ministry of Finance of Vietnam on Amendments to Circular No. 11/2014/TT-BTC dated January 17, 2014 of the Ministry of Finance of Vietnam guiding certain Articles of Decree No. 86/2013/ND-CP dated July 29, 2013 of the Government of Vietnam on the business of prize-winning electronic games for foreigners.

3. This Circular annuls Article 8 of Circular No. 84/2020/TT-BTC dated October 1, 2020 of the Ministry of Finance of Vietnam on Amendments to regulations on periodic reports under the decision-making entitlements of the Minister of Finance of Vietnam in the field of finance and banking.

4. Difficulties that arise during the implementation of this Circular shall be reported to the Ministry of Finance of Vietnam for considerations and solutions./.

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