Petroleum enterprises return licenses
The petroleum business is considered a super profitable industry, a fertile land, a “golden goose” that attracts many investors. Therefore, at one point, the number of petroleum stores nationwide reached more than 18,000; 500 distributors and 38 petroleum trading enterprises.
However, the information that has "startled" many people is that since the beginning of the year, nearly 20 petroleum distributors have returned their licenses and it is predicted that this wave will not stop. Most recently, on October 21, the Ministry of Industry and Trade decided to revoke the Certificate of Eligibility to be a Petroleum Distributor for Hoang Hai Investment Consulting Joint Stock Company (Phu Thuong Ward, Tay Ho District, Hanoi).
The reason for the revocation is because Hoang Hai Investment Consulting Joint Stock Company requests to return the certificate because it cannot maintain the conditions to be a petroleum distributor according to regulations.
Although the Domestic Market Department affirmed that the return of licenses by enterprises does not affect the petroleum business activities in the market. However, in such a short time, many enterprises requesting to return their licenses is also an alarming bell about the shortcomings of the market and the State management of petroleum.
Talking to Lao Dong, Mr. Giang Chan Tay - Director of Boi Ngoc Petroleum Company said that currently, the draft Decree on petroleum business has not yet thoroughly resolved three basic issues. These are the restriction on purchasing from three sources; not ensuring business costs and profits, leading to low discounts; and not being able to deliver domestic petroleum to the 15oC standard to reduce loss.
A group of petroleum distributors, agents and retailers have also sent a petition to the Government. In particular, businesses believe that the regulation that distributors are only required to buy from a single source, the main trader, and are not allowed to buy and sell with each other is discriminatory and restricts the business rights of businesses.
"The regulation restricting the rights of enterprises is not within the authority of the decree. The decree restricting the rights of enterprises by attaching those rights to unreasonable conditions is illegal. In addition, the regulation on the rights of enterprises according to the approach of the draft decree leads to inequality and discrimination," said Mr. Giang Chan Tay.
What does the Ministry of Industry and Trade say?
In response to the business's recommendations, speaking with PV Lao Dong Newspaper, Mr. Phan Van Chinh - Director of the Domestic Market Department (Ministry of Industry and Trade) said that the draft Decree on petroleum business management under construction stipulates that distributors do not buy goods from each other, which has been carefully considered by the ministry.
Because in practice, through inspection, examination and investigation, the authorities recommended to the Ministry of Industry and Trade and the Government that there should be regulations to ensure that petroleum management gradually moves towards the market but must cut out intermediaries to reduce costs. Therefore, the Ministry of Industry and Trade has drafted a decree with such a consistent orientation.
Mr. Chinh affirmed: Enterprises are allowed to do anything that is not prohibited by law. However, for conditional business lines such as petroleum, enterprises must fully comply with the conditions.
Accordingly, the decentralized petroleum supply chain includes the source stage; distribution enterprises and retail enterprises.
Previously, when amending the decrees on petroleum business, issuing Decree 80, the Government approved the elimination of intermediaries such as general agents. "Implement management according to the straight chain, not the horizontal chain," said Mr. Chinh.
The Decree also stipulates that the conditions for becoming a wholesale trader, a distributor and a retail enterprise are completely different. Therefore, in each segment, enterprises must meet the correct conditions of that segment, without discrimination.
For distributors, businesses can only buy from the source. Because there are currently 30 sources in the market, it will create competition in the market. However, Mr. Chinh said that this regulation has been reviewed to cut many conditions for this group.
