Hanoi (VNA) – Nineteenformer executives and officials of the Thai Nguyen Iron and Steel JSC (TISCO)and the Vietnam Steel Corporation (VNS) were brought to trial in Hanoi on April12 for their involvement in wrongdoings at TISCO.

The first-instance trial,held by the Hanoi People’s Court, is expected to last 10 days.

Fourteen defendants werecharged with “violating regulations on the management and use of State assets,causing losses and wastefulness” under Clause 3 of Article 360 in the 2015Penal Code.

They included Tran Trong Mung(born in 1949, former General Director of TISCO), Tran Van Kham (born in 1961,former Chairman of the Board of Directors and General Director of TISCO), MaiVan Tinh (born in 1952, former Chairman of the VNS Board of Directors), and DauVan Hung (born in 1951, former General Director of VNS).

Two former members of the VNSBoard of Directors and three former members of the TISCO Board of Directorswere accused of “lacking sense of responsibility, causing serious consequences”under Clause 3 of Article 360 in the 2015 Penal Code.

According to the indictmentissued by the Supreme People’s Procuracy, the VNS Board of Directors decided theinvestment in the second-phase production expansion project of TISCO and TISCOwas the investor of the project.

Thisproject initially had total investment of more than 3.8 trillion VND (164.9million USD at the current exchange rate). The China Metallurgical GroupCorporation (MCC) won the construction bid in 2007.

OnJuly 12, 2007, then TISCO General Director Tran Trong Mung and MCC GeneralDirector Shen Heting signed an engineering, procurement, and construction (EPC)contract worth over 160 million USD (equivalent to over 3.5 trillion VND). Thevalue, including taxes and expenses necessary for contract implementation, wasstipulated not to change during the implementation process.

TISCOand MCC launched the implementation on September 29, 2007. However, after morethan 11 months since the contract took effect, MCC still failed to select orcontract with subcontractors, or carry out the EPC contract. Instead, itproposed extending the contract implementation duration and raising thecontract value by more than 138 million USD.

Theindictment said that although the related individuals at TISCO and VNS wereaware that MCC had infringed the contract and groundlessly proposed theimplementation extension and value hike, they did not consider contracttermination, revoke the advance, or report to competent persons to abolish thebidding result and re-organise the bidding process so as to ensure theproject’s effectiveness and progress.

Amongthe defendants, TISCO General Director Mung held the overall responsibility forthe project’s effectiveness while VNS Chairman Mai Van Tinh was in charge ofapproving and directing the project implementation.

TheSupreme People’s Procuracy held that the violations of rules on the managementof State assets and the lack of sense of responsibility by those at TISCO andVNS have caused losses of over 830 billion VND to the State. The sum is theinterest rate TISCO had to pay to banks for the period from the time theproject began lagging behind schedule, on May 31, 2011, to the date an officialinvestigation was launched, on April 18, 2019./.