Friday, November 16 2018

VietNamNews

Airports corp mishandled $280m

Update: January, 13/2018 - 09:52
The State-owned Airports Corporation of Việt Nam (ACV) has been accused of overcharging cars going in and out of airports, collecting VNĐ551 billion from October, 2012, to the end of 2015..— Photo zing.vn

HÀ NỘI — The Government Inspectorate (GI) recently issued a report on wrongdoings at the State-owned Airports Corporation of Việt Nam (ACV) involving VNĐ6.3 trillion (US$280.3 million) and 7.2ha of land.

The report looked into ACV’s compliance with laws and policies on the management and usage of capital and assets, and during the equitisation, divestment, and restructuring of the group.

The Government watchdog acknowledged ACV’s efforts in recent years to upgrade aviation infrastructure – airports, aprons, and runways – to match development demands. However, multiple incidents of misconduct, including in land management, asset valuation, tax declaration, and fee collection were found. The inspection agency has asked the Ministry of Transport and ACV to handle those involved in these offences.

In 2014-2015, ACV signed 803 lease contracts for a total area of 120,221 sq.m of its airport land, all without going through the public bidding process, and collected VNĐ701.1 billion ($31.19 million).

At the time ACV was converting to a joint-stock company, so it could no longer enjoy the free use of State land as before and must choose a form of land allocation with collection of land use levies or land lease. However, the group failed to complete procedures to hand back more than 2,888ha of land as well as not signing yearly leases for 197ha of land.

This cost the State budget VNĐ330 billion in land tax. The main cause, according to the inspectorate, was due to the airports’ irresponsibility and lax management- and failure to co-ordinate with local authorities to define airport land boundaries.

Currently, 11 airports under ACV’s management have still not obtained land-use rights for 7,225ha from local authorities.

Regarding equitisation and divestment, the inspectorate concluded that, from July 1 in 2014 to December 31 in 2015, during asset valuation, ACV did not account for the value of airfields that it claimed were “no longer under its ownership”.

However, post-equitisation, the airports corporation still continued to use, monitor, and subtract the depreciation (VNĐ903 billion, or $40.18 million) of these assets as its business expenses. The group also excluded the taxiway E6 of the international airport at Đà Nẵng. This move was considered a violation of regulations, and ACV will need to pay an additional VNĐ692 billion ($30.79 million) in business tax.

The Government Inspectorate also said that the equitisation process in ACV was slow, adding that failed negotiations with potential strategic stakeholders, caused its financial struggles to remain unsolved for a long time.

Previously, the aviation group was also accused of overcharging cars going in and out of airports, collecting VNĐ551 billion from October, 2012, to the end of 2015. The inspectorate said while this practice brought more revenues to the ACV and the State budget, it was “a serious violation of legal provisions, causing losses to customers.”

However, Lê Mạnh Hùng, ACV’s general director, said the charge was totally fair and accurately calculated, and the group was still collecting the fees as usual. It also said it had submitted reports to relevant State agencies to explain its reasonings.

The Government has asked the transport ministry to work with the finance ministry to submit plans to address the wrongful charging of fees, among other violations of ACV, by the end of  March.

From the end of the inspection until now, ACV has handled financial violations of more than VNĐ1.16 billion ($51.53 million).

Airports Corporation of Việt Nam, established in 2012 as a 100 per cent State-owned company, has undergone restructuring to become a joint-stock corporation with the State being the controlling shareholder (above 95 per cent) in 2015. With charter capital hitting VNĐ21.78 trillion, it is the largest aviation operator in Việt Nam and manages all civil airports in the country. — VNS

 

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