B-163206, APR. 11, 1968
Highlights
PAYMENT WILL BE MADE IN PIASTERS AT THE RATE OF EXCHANGE RECOGNIZED BY THE U.S. GOVERNMENT ON THE DATE PAYMENT IS MADE.'. WAS RECEIVED AND PAID IN PIASTERS AT THE EXCHANGE RATE OF 80 $VN TO $1 IN OCTOBER 1967. THE ADDITIONAL AMOUNT NOW CLAIMED IS BASED ON A 38-PIASTER SUBSIDY ESTABLISHED BY DECREE. IT IS CLEAR THAT UNDER THE EXPRESS TERMS OF THE CONTRACT THE CONTRACTOR IS ENTITLED TO RECEIVE PAYMENT FOR THE SUPPLIES DELIVERED BY CONVERTING THE UNITED STATES DOLLARS CALLED FOR BY THE CONTRACT INTO PIASTERS AT THE EXCHANGE RATE RECOGNIZED BY THE UNITED STATES AT THE TIME OF PAYMENT. ARE NOT IN A POSITION TO STATE WHAT RATE IS RECOGNIZED BY THE UNITED STATES. WE HAVE OBTAINED THE VIEWS OF RESPONSIBLE OFFICIALS OF THE DEPARTMENTS OF STATE AND TREASURY.
B-163206, APR. 11, 1968
TO DEAR MAJOR SATHRUM:
BY LETTER DATED DECEMBER 18, 1967, THE CHIEF OF FINANCE AND ACCOUNTING FORWARDED YOUR LETTER OF DECEMBER 7, 1967, WITH ENCLOSURES, REQUESTING AN ADVANCE DECISION AS TO THE PROPRIETY OF PAYING A VOUCHER STATED IN FAVOR OF NGUYEN QUANG MINH IN THE AMOUNT OF $VN618,925 ($5,245.13) COVERING THE CLAIM FOR THE DIFFERENCE BETWEEN 80 $VN TO $1 AND 118 $VN TO $1 FOR ICE DELIVERED TO THE GOVERNMENT UNDER CONTRACT NO. DAJB-1168-D-0016.
THE CITED CONTRACT CONTAINS UNIT PRICES STATED IN UNITED STATES DOLLARS AND PROVIDES THAT:
"EXCEPT AS OTHERWISE PROVIDED IN THE CONTRACT, PAYMENT WILL BE MADE IN PIASTERS AT THE RATE OF EXCHANGE RECOGNIZED BY THE U.S. GOVERNMENT ON THE DATE PAYMENT IS MADE.' IN YOUR LETTER OF DECEMBER 7, YOU STATE THAT A CLAIM FOR ICE DELIVERED DURING THE PERIOD OCTOBER 1 THROUGH 10, 1967, WAS RECEIVED AND PAID IN PIASTERS AT THE EXCHANGE RATE OF 80 $VN TO $1 IN OCTOBER 1967. THE ADDITIONAL AMOUNT NOW CLAIMED IS BASED ON A 38-PIASTER SUBSIDY ESTABLISHED BY DECREE--LAW NO. 002/SLU OF JUNE 17, 1966, AS AMENDED BY DECREE--LAW NO. 035/SLU OF AUGUST 29, 1967.
IT IS CLEAR THAT UNDER THE EXPRESS TERMS OF THE CONTRACT THE CONTRACTOR IS ENTITLED TO RECEIVE PAYMENT FOR THE SUPPLIES DELIVERED BY CONVERTING THE UNITED STATES DOLLARS CALLED FOR BY THE CONTRACT INTO PIASTERS AT THE EXCHANGE RATE RECOGNIZED BY THE UNITED STATES AT THE TIME OF PAYMENT. WE, OF COURSE, ARE NOT IN A POSITION TO STATE WHAT RATE IS RECOGNIZED BY THE UNITED STATES. CONSEQUENTLY, WE HAVE OBTAINED THE VIEWS OF RESPONSIBLE OFFICIALS OF THE DEPARTMENTS OF STATE AND TREASURY. WE HAVE BEEN ADVISED BY THOSE DEPARTMENTS THAT:
"THE OFFICIAL RATE OF EXCHANGE, ESTABLISHED BY DECREE-LAW NO. 001 SLU OF JUNE 19, 1966, IS 80 VIETNAMESE PIASTERS TO U.S. $1.00. A 38 PIASTER SUBSIDY, ESTABLISHED BY DECREE-LAW NO. 002-SLU OF JUNE 17, 1966, ALSO APPLIED TO MANY TRANSACTIONS, WITH THE RESULT THAT THERE WERE TWO BUYING RATES. DECREE-LAW NO. 035-SLU OF AUGUST 29, 1967, AMENDED DECREE-LAW NO. 002-SLU BY EXTENDING THE APPLICATION OF THE 38 PIASTER SUBSIDY TO ALL FINANCIAL AND COMMERCIAL TRANSFERS FROM ABROAD TO VIET-NAM, EFFECTIVE OCTOBER 1, 1967. THUS THE OFFICIAL RATE REMAINS AT 80 PIASTERS TO U.S. $1.00, AND THIS RATE IS USED BY THE VIETNAMESE GOVERNMENT FOR PURPOSES OF CUSTOMS VALUATION. THE RATE AT WHICH THE U.S. GOVERNMENT PRESENTLY BUYS PIASTERS FROM THE VIETNAMESE GOVERNMENT IS EFFECTIVELY 118 PIASTERS TO U.S. $1.00.'
IN VIEW OF THE FOREGOING, IT APPEARS THAT THE OFFICIAL RATE OF EXCHANGE AT THE TIME PAYMENT WAS MADE FOR THE ICE WAS 80 PIASTERS TO UNITED STATES $1. THE SUBSIDY OF 38 PIASTERS PER UNITED STATES DOLLAR GRANTED TO THE UNITED STATES BY THE GOVERNMENT OF VIETNAM WOULD APPEAR TO BE SOLELY FOR THE BENEFIT OF THE UNITED STATES AND SHOULD NOT BE PASSED ON TO THE CONTRACTORS HAVING CONTRACTS WITH THE UNITED STATES.
ACCORDINGLY, PAYMENT OF THE VOUCHER IS NOT AUTHROIZED AND IT WILL BE RETAINED IN THE FILES OF THIS OFFICE.