Unlocking Revenue Streams: Navigating Challenges for 11 Struggling BOT Traffic Projects

On June 6, the National Assembly’s Standing Committee continued its 46th session, providing opinions on the revision, explanation, and editing of the draft Law amending and supplementing a number of articles in seven existing laws: the Law on Bidding; the Law on Investment in the form of Public-Private Partnership; the Customs Law; the Law on Export and Import Taxes; the Investment Law; the Public Investment Law; and the Law on Management and Use of Public Assets.

The Ministry of Finance controls ceiling prices for medical products and services

Reporting at the meeting, Deputy Minister of Finance Tran Quoc Phuong said that the Government had edited the provisions of the Bidding Law to grant state-owned enterprises the autonomy to make procurement and bidding decisions.

Specifically, the draft law stipulates that the selection of contractors by any entity, including state-owned enterprises, using the state budget must comply with the Bidding Law.

Deputy Minister of Finance Tran Quoc Phuong. Photo: QH

For contractor selection activities not using the state budget, state-owned enterprises have the right to make autonomous decisions based on ensuring transparency, efficiency, and accountability.

“The draft law adds regulations to enhance inspection, supervision, and evaluation of effectiveness, ensuring that the implementation of the autonomy of state-owned enterprises is associated with tight management, risk prevention, and efficient use of capital by enterprises,” emphasized the Deputy Minister of Finance.

According to Mr. Tran Quoc Phuong, this draft law only grants autonomy to public non-business units that can ensure regular and investment expenses (Group 1) and public non-business units that can ensure regular expenses (Group 2) to decide on non-state budget procurement activities. As for public non-business units that can partially ensure regular expenses (Group 3), they must still comply with the Bidding Law regarding procurement activities using the unit’s legal income sources (not the state budget).

However, taking into account the opinions, the Deputy Minister of Finance said that the decree would assign the Ministry of Health to control the ceiling prices for medical products and services within the scope of payment by the Health Insurance Fund.

At the same time, medical facilities are required to publicly announce the purchase prices of medicines, supplies, and medical equipment on the electronic information system of the industry and sector. This enhances transparency and social supervision, ensuring that the exercise of autonomy does not affect patients’ rights and the payment capacity of the Health Insurance Fund.

Regarding the regulation allowing the selection of contractor selection methods, the Government has also edited it to include direct appointment, selection of contractors in special cases, and placement.

In addition to the prioritized application of the above forms, investors can choose other forms such as open bidding, competitive bidding, and other suitable forms corresponding to the scale and nature of the package.

“Continue to expand the cases where direct appointment, selection of contractors in special cases, limited bidding, placement, etc., can be applied to ensure flexibility in organization and implementation,” said Mr. Tran Quang Phuong. He added that the Government would be assigned to detail the selection of contractor selection methods for the remaining forms.

Delegates attending the afternoon session on June 6. Photo: QH

Proposing a mechanism to handle difficulties in reducing the revenue of BOT projects

Regarding the mechanism for sharing the increase and decrease in revenue in the Law on Investment in the Form of Public-Private Partnership (PPP Law), the Government has edited it to stipulate a framework of ratios.

Specifically, the reduction is set at 75-90%, and the increase is 110%-125%, allowing the competent authority to decide during the project preparation and negotiation with investors, ensuring flexibility.

For PPP projects in science and technology, the requirement for investors to share the increased revenue in the first three years after the operation and business commencement is waived. Along with this, a 100% sharing rate of the difference between the actual revenue and the revenue in the financial plan is allowed if the actual revenue is lower during the same period.

Especially, the draft law has proposed a mechanism to handle difficulties in reducing the revenue of BOT projects in the road sector signed before January 1, 2021.

Deputy Minister of Finance Tran Quoc Phuong assessed that supplementing the provisions of the PPP Law on the risk treatment mechanism for revenue reduction in BOT projects with contracts signed before the effective date of the PPP Law is necessary to uniformly and thoroughly handle difficulties.

“According to the Government’s statistics, there are currently 11 underperforming BOT traffic projects,” said Mr. Phuong. He added that these projects encountered difficulties mainly due to objective reasons or the fault of state agencies and not the investors.

Currently, the Government has directed the Ministry of Transport (now the Ministry of Construction) to negotiate with investors and lenders to reduce interest rates and profits. However, in reality, there may be other underperforming BOT traffic projects…

Along with this, Notification 127 of the Office of the Central Committee on the conclusions of the key leaders at the February 2025 meeting also requested that the Government urgently develop policies to thoroughly resolve difficulties in some BOT traffic projects.

Based on the above contents, the Government proposed not to issue a separate resolution but to supplement the provisions of the PPP Law on the general handling mechanism for not only projects with quantified difficulties but also projects with similar problems that have not been quantified.

“The Government will detail the method of determining the sharing ratio, the procedure for implementing the mechanism for sharing the reduction in revenue, ensuring fairness, transparency, not increasing service prices and fees, not extending the toll collection time, and harmonizing the interests of the people, businesses, and the State,” Mr. Tran Quoc Phuong stated.

You may also like

Probe Initiated into Bid Rigging Scandal: Task Force to Investigate the Alleged Wrongdoing in the $750 Million Project

Let me know if you would like me to tweak it further or provide additional ideas to enhance the headline’s impact.

The Ministry of Finance has launched an official investigation into a tender package for a highway project, which was previously lost by the Son Hai Corporation.

A Bold Proposal: The Son Hai Group’s Unprecedented Offer to the Prime Minister

“The North-South Highway Project: Unlocking Vietnam’s Eastern Potential.”

Leading Paint Manufacturer, Son Hai Group, Raises Concerns Over Missed Opportunity in $750 Million Project: Binh Phuoc Considers a Critical Issue.

The Binh Phuoc Province is considering a crucial matter after receiving a bid evaluation response from the Son Hai Group.

Investigating Tender Irregularities in Binh Phuoc: Vice-Premier Heeds Son Hai Group’s Appeal

Let me know if you would like me to incorporate any keywords or adjust the tone to match a specific style guide.

“The Deputy Prime Minister has instructed the joint Ministry of Finance and Construction to submit a report on the inspection results by June 10th.”

“Investigating the Selection Process: Task Force Examines Contractors for the Ho Chi Minh City – Thu Dau Mot – Chon Thanh Expressway (Binh Phuoc Province Section)”

The Government Office has issued Document No. 4755/VPCP-CN, conveying the directions of Deputy Prime Minister Tran Hong Ha regarding the selection of a construction contractor for the highway construction package under the Ho Chi Minh City – Thu Dau Mot – Chon Thanh Expressway Project (Binh Phuoc province section).