Hi Huong,

Thank you for your clarifications over a zoom meet yesterday. Let me summarize our understanding:

1) JSK has to determine with Tax method that it wishes to adopt prior to we being able to go
forward with the tax simulations.
Comments:
We prefer Actual Method due to :

Under Hybrid method we shall have to pay CIT 5% on revenue.

Example :
Services Charges = US$ 3.0 / mmBtu and annual quantity is 21,760,000 mmBtu
Annual revenue = US$65,280,000
CIT = 5% of US$65,280,000 = US$ 3,264,000

Under Actual method we shall have to pay CIT 20% on profit.

Example :
Annual revenue = US$65,280,000
Say profit is 10% = US$6,528,000
CIT = 20% of US$6,528,000 = US$1,305,600

We are able quantity our documentary evidences to Vietnamese tax authorities onto the
above profit margins as your report mentions “Strict Compliance” and “More administrative
than deemed method given the application of simplified VAS”.

As you would understand that under the service charges, our investments are most done
during the implementation/investment stage. Thereafter remaining local purchase if any are
related to operation, maintenance and local salaries.

We look forward to your comments onto the above.

2) Option to get PGN into Deemed Method & JSK into Actual Method

I would like bring to your attention that as consortium member PGN can be brought into the
GSPA and that they can opt for Deemed method without any TIN.

Referring to your report : Less admin requirements than other methods. Under Deemed
(Withholding) Method, the foreign contractor can avoid significant compliance costs for
book-keeping and tax audit/tax check. Its FCT filings (including submission of FCT returns and
settlement of FCT liabilities to the State Budget) would rest upon the Vietnamese buyer so
the contractor does not need to concern about tax filings in Vietnam.

Note to EY :
Kind request to advise us against the above point 2, if EY considers that Hybrid is a better
option and supporting information. Would much appreciate it.
3) In case of LNG import at PhuMy floating terminal whereby Genco3 to pay for the VAT
directly, that they have to be willing to be a “Importer of Record” whereunto during zoom
meet, EY related that this shall subject to discussions with Genco3.

Comments:
Our comments are that G3 is purchasing gas at the end of the pipeline and thus we are
unsure if they would be willing to pay for LNG is liquid state for this is a matter or title and
risk transfer from LNG ship to Floating terminal. We will discuss this with G3 and update you.
Nevertheless, as mention, we would like to engage your services to accompany JSK when it
enters the related stage with EY

4) Specially Encouraged Investment Project list.

I refer to your information about tax exemptions for project classified under the above list
from Ministry of Planning & Investment. Please kindly check up and provide us such a list
and information that we could benefit from.

5) Current Tax practices and norms of Genco3.

We will be able to clarify this with Genco3 as the evaluation progresses to the next phase.
Whilst so, I will get our counterpart in Vietnam to check unto this and revert back to you.

6) Administrative cost
We are still following up onto other possible cost that would incur in the implementation
and operation of the services under the GSPA. Whilst so, as requested to you during the
meet, I do hope you could also assist us on this information through your resources.

7) Vietnamese contractor names must be listed into GSPA for deductions.

In relevance to your information above, we need to address this with Genco3. In meanwhile,
do send us the related information and the Item under Article 16 on Law on Import and
Export.

8) MFN Status related import duties & HS Codes for the equipment and rest for your
computation.

Comments :
Shall get the HS Codes list for you.

Also, I see that there are 164 nations currently as WTO members along with Vietnam. In
meanwhile, we are particular about for LNG commodity component and this represents
giant share. Please reconfirm the applicable import duty rates of 5% if LNG cargoes
originates from MFN status countries (meaning WTO members; other than ATIGA members).

I refer to your report that as for the rest outside ATIGA and MFN, it is 150% of applicable
import duty rates on MFN members.

9) ….