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Legal Update

Decree 68 on Sanctions for Legal Breaches in the Electricity Domain

5 November 2010
Mayer Brown JSM Legal Update

On 15 June 2010 the Vietnamese Government issued Decree No. 68/2010/ND-CP on the sanctioning of legal breaches in the electricity domain (Decree 68). Decree 68 defines acts of breach and contemplates penalties against and remedies for such breaches.

Salient provisions of Decree 68 are discussed below.

Scope of Regulation

Sanctions for legal breaches in the electricity domain apply in the case of intentional or unintentional acts committed by individuals who and organisations which violate the provisions of electricity legislation to the extent that they are not considered as violations under criminal law provisions. The subject sanctions apply to violations of the provisions on:

  • Electricity activity permits
  • Building and installation of electricity works
  • Generation of electricity
  • Transmission of electricity
  • Distribution of electricity
  • Wholesale and retail of electricity
  • Use of electricity
  • Electrical safety
  • Operation of the electrical system
  • Electricity market

Applicable entities

Decree 68 applies to the following individuals and organisations:

  • Individuals and organisations in breach of the provisions contained in Decree 68
  • Foreign individuals who and organisations which breach the provisions contained in Decree 68 in the territory, exclusive economic zones and continental shelf of Vietnam, unless otherwise stipulated in international treaties of which Vietnam is a member

Minors who commit legal breaches in the electricity domain will be sanctioned pursuant to Article 7 (Dealing with minors committing legal breaches) of the Ordinance on Handling of Administrative Breaches.

Principles and statute of limitations for sanctions

Sanctions for legal breaches in the electricity domain (breaches) must comply with the following principles:

  • Individuals or organisations will be sanctioned only for breaches stipulated in Decree 68.
  • Sanctions for breaches must be conducted by the competent persons defined in Decree 68.
  • All breaches must be promptly detected and immediately stopped. Sanctions must be conducted in a quick, just and thorough manner. All consequences caused by breaches must be remedied in strict accordance with the provisions of law.
  • A breach will be sanctioned only once. A person who commits several breaches will be sanctioned for each breach. Several organisations which or persons who jointly commit a breach will all be sanctioned therefor.
  • Sanctions for breaches must be based on the nature and seriousness of such breaches, personal identifications and extenuating as well as aggravating circumstances in order to decide on appropriate sanctions and measures. Extenuating or aggravating circumstances will apply in accordance with the relevant provisions in the Ordinance on Handling of Administrative Breaches.
  • No sanction will be imposed on breaches in cases of emergency, legitimate self-defence, unexpected events or on breaches committed by persons who suffer from mental or other diseases which render them unable to perceive or control their acts.

Under the statute of limitations, the time limit for sanctioning a breach is one year, counting from the date such breach is committed.

Forms of sanctions and remedial measures

Sanctions comprise principal and additional sanctions.

  • Principal sanctions

For each act of breach, the breaching individual or organisation must be subject to one of the following principal sanctions:

    • Warnings: Warnings must be given in writing and apply to individuals and organisations committing minor or first-time breaches involving extenuating circumstances. Warnings also apply for all breaches committed by minors aged 14 years, or above but under 16 years.

    • Pecuniary fines: A fine may be imposed depending on the nature and seriousness of each breach and must be within the fine bracket prescribed in Decree 68 for such breach. The specific fine amount for a breach is the average of the fine bracket for such breach; if the breach involves extenuating circumstance(s), the fine may be reduced to an extent not falling under the minimum level of the relevant bracket; if the breach involves aggravating circumstance(s), the fine may be increased to an extent not exceeding the maximum level of the bracket.
  • Additional sanctions

Depending on the nature and seriousness of the breaches, organisations and individuals committing such breaches may also be subject to the application of one or more of the following additional sanctions:

    • Deprivation of the right to use the electricity activity permit for a definite time
    • Confiscation of material evidences and/or means used for committing breaches
    • Confiscation of all monies received from acts of breach
    • Withdrawal of the electricity activity permit
  • Remedial measures

Apart from the principal and additional sanctions mentioned above, breaching individuals and organisations may also be forced, among other things, to restore works altered due to the breaches committed to the original state and/or to dismantle illegal construction works.

Compensation for damages caused by breaches

Any individual who or organisation which commits breaches and causes damage to the interests of the State and the legitimate rights and interests of other individuals or organisations must pay compensation therefor in accordance with the provisions of the civil law.

Effectiveness

Decree 68 took effect on 1 August 2010 and replaced Decree No. 74/2003/ND-CP dated 26 June 2003 regulating sanctions for administrative breaches in the electricity domain.

For inquiries related to this Legal Update, please contact:

Dao Nguyen ( )

Kevin B Hawkins ( )

Thinh Dan ( )

Learn more about our Vietnam offices and Energy practice.

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