New rules for petrol, oil trade
QĐND – Monday, October 19, 2009, 20:41 (GMT+7)
Petrol retailers will hold the pump price of petrol on the domestic market in line with market prices under State management.
This follows a decree issued by the Government on Oct. 15 on oil and petrol trading in Vietnam. The decree applied to Vietnamese traders who are engaged in petrol and oil trading in the domestic market.
The decree specified the terms for issuing licences on trading, importing, producing and distributing petrol, with specific regulations on retail prices effective from December 15, 2009.
The decree has rules governing the raising and lowering of petrol and oil retail prices.
According to the decree, petrol traders will have to peg their retail prices to wholesale global prices.
Due to fluctuating global wholesale prices, traders will be allowed to peg their retail prices to world petrol prices, meaning if prices decline within 12 percent, these cost saving will have to be passed onto consumers at retail outlets.
If wholesale prices decline more than 12 percent against the existing retail prices, petrol traders have able to cut their retail prices after authorised agencies have implemented measures adjusting import taxes and contribution to the petrol price stabilisation fund.
Traders can introduce retail price increases of 7 percent if prices of petrol and oil wholesale prices surge by 7 percent.
In case wholesale prices increase by 7-12 percent, traders can increase retail prices by 7 percent plus 60 percent of the surplus of 7-12 percent. The balance would be compensated by the petrol price stabilisation fund.
If wholesale prices increase more than 12 percent, the State will develop solutions to retain retail price stability through the stabilisation fund and import tax reductions.
Once implemented, the decree will remain effective until 2025, with petrol traders responsible for ensuring the stabilization of petrol and oil reserves.
Dealers that want to be licensed to sell petrol and oil must operate officially sanctioned petrol stations, operate stations meeting standard criteria and have sufficiently trained staff.
New petrol stations must be approved by the relevant agencies.
According to the decree, existing petrol stations that have failed to achieve planning approval, have to upgrade or relocate to meet the requirement set by the decree.