Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

LAO PEOPLES DEMOCRATIC REPUBLIC

PEACE INDEPENDENCE DEMOCRACY UNITY PROSPERITY
________________

National Assembly No. 34/PO

DECREE
of the
PRESIDENT
of the
LAO PEOPLES DEMOCRATIC REPUBLIC

On the Promulgation of the Law on Electricity

Pursuant to Chapter 5, Article 53, point 1 of the Constitution of the Lao

Peoples Democratic Republic which provides for the promulgation of the
Constitution and of laws which are adopted by the National Assembly;

Pursuant to Resolution No. 02-97/NA, dated 12 May 1997, of the National

Assembly [of the Lao Peoples Democratic Republic] regarding the adoption of the
Law on Electricity; and

Pursuant to Proposal No. 15/NASC, dated 7 May 1997, of the National

Assembly Standing Committee.

The President of the Lao Peoples Democratic Republic

Decrees That:

Article 1. The Law on Electricity is hereby promulgated.

Article 2. This decree shall enter into force on the date it is signed.

Vientiane, 31 May 1997

The President of Lao Peoples
Democratic Republic

[Seal and Signature]

Nouhak PHOUMSAVANH
 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

LAO PEOPLE'S DEMOCRATIC REPUBLIC

PEACE INDEPENDENCE DEMOCRACY UNITY PROSPERITY
________________

National Assembly No. 02/97/NA

12 April 1997

THE LAW ON ELECTRICITY

Chapter 1
General Provisions

Article 1. Function of the Law on Electricity

The Law on Electricity has the function of determining a regime for

the administration, production, transmission and distribution of electricity,
including export and import[,] through the use of a highly productive natural
resources potential[,] to contribute to the implementation of the national socio-
economic development plan and to upgrade the living standards of the people.

Article 2. Electricity 1

Electricity [refers to] a type of energy comprising electricity, electrical

currents, electrical intensity and electrical energy 2 produced by physical
sources of electrical energy: water power, wind power, solar power, petroleum
and coal. Electrical power from other sources is not covered by this law.

Article 3. Ownership of Physical Sources of Electrical Energy

Physical sources of electrical energy throughout the Lao Peoples

Democratic Republic are the property of the national community that the State
administers, preserves, and conservatively uses on a long term and productive
basis.

1
The word electricity is defined in this article in a manner consistent with its common usage
(i.e., to refer to electrical energy or an electrical current). However, the reader may wish to note that
electricity is often used elsewhere in this law (as a standalone word without any qualifying nouns or
adjectives) to mean electrical facilities, electricity plants, electrical network or, indeed, the entire
electricity system. Where it is clear from the context which of these alternative meanings is
intended, the translators have used words to convey the intended meaning, enclosed in square brackets.
2
Electrical current is measured in ampere; electrical intensity in voltage; and electrical energy
in wattage.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 4. Promotion of Electrical Power Production and Development

The State promotes all sectors of the economy to invest in the

production of electricity to meet the demands of the people in urban and rural
areas, including the development of electricity as an export commodity.

Article 5. Protection of the Rights and Interests of Investors and Users of

Electricity

The State protects the rights and interests of those investing in

electricity enterprises and those using electricity according to the laws and
regulations of the Lao Peoples Democratic Republic.

Article 6. Environmental Protection

Commencing from the survey, the agreement upon the scale [of the
project], as well as the construction and expansion of the electricity [facility],
the undertaking of electricity business shall ensure economic efficiency, shall
take into account an assessment of its impact on the natural environment,
[and] the ecological system, and shall limit impact to society and wildlife
habitats. 3

Article 7. Foreign Cooperation

The State broadens foreign cooperation in the production, distribution

and export and import, and in the development of operations relating to
electricity according to the Law on the Promotion and Management of Foreign
Investment in the Lao Peoples Democratic Republic 4 .

Chapter 2
Operations Relating to Electricity

Article 8. Operations Relating to Electricity

Operations relating to electricity [refers to] the conduct of surveys,

data collection, design, construction and installation, production, transmission
and distribution, export and import, development[,] and other services related
to electricity.

3
For readability, the structure of this sentence has been modified.
4
This law has since been amended and is now titled The Law on the Promotion of Foreign
Investment in the Lao Peoples Democratic Republic.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 9. Sizes 5 of Electricity Enterprises 6

Electricity enterprises in the Lao Peoples Democratic Republic are

divided into four sizes as follows:

1. Electrical [plants] 7 with an installed capacity of more than fifty

thousand (50,000) kilowatts [that must be] proposed by the
government to the National Assembly for approval;
2. Electrical [plants] with an installed capacity of more than two
thousand (2,000) to fifty thousand (50,000) kilowatts [that must
be] approved by the government;
3. Electrical [plants] with installed capacity of more than one
hundred (100) to two thousand (2,000) kilowatts [that must be]
approved by the provincial, municipal 8 or special zone
administrative authorities subject to the consent of the Ministry of
Industry and Handicrafts;
4. Electrical [plants] with installed capacity of less than one hundred
(100) kilowatts [that must be] approved by the district
administrative authorities subject to the consent of the concerned
province, municipality or special zone.

Chapter 3
Concessions for Operations relating to Electricity 9

Article 10. Investment in Operations Relating to Electricity

The State promotes investment in operations relating to electricity,

with an emphasis upon hydropower in order to utilize the [electricity-
generating] potential of water sources that are natural resources.

Investment in operations relating to electricity may be undertaken by

different types of enterprises as follows: 10

5
The Lao word for scale and size is the same word. The translators have used the English
alternative that works best in the context.
6
The Lao word is electricity enterprise even though the context suggests that this is a
reference to the assets or project (i.e., electrical facility, electrical plant or electricity project)
rather than the entity. It is possible that the distinction was not important when this law was first
promulgated because most electricity enterprises were single-purpose entities at the time. In this
Article and in the rest of this law, the translators have kept to the literal translation.
7
The literal translation is electricity with an installed capacity of .
8
This Law on Electricity predates the enactment of the Law on Local Administration (which
has changed the designation of different levels of administration). The reader should not assume that a
reference to a municipality in this law is a reference to the same level of local administration referred to
as a municipality in the Law on Local Administration.
9
In the title, operations relating to electricity is used as an adjective to describe concessions.
10
This list refers to modes of investment in an electricity project and is not intended to refer to
the shareholding or ownership of the enterprises.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

1. The State invests by itself;

2. The State invests with other domestic or foreign parties;
3. Domestic cooperative or private investment.

Enterprises engaged in operations relating to electricity may undertake

their operations in the following forms:

1. Build, operate and transfer (BOT);

2. Build, operate, own and transfer (BOOT);
3. Build, transfer and finance (BTF);
4. The State engages in the undertaking by assigning the State
electricity company to be its representative;
5. Investment in some other form.

Article 11. Concessions for Electricity Enterprises

All persons or organisations who seek to operate an electricity

enterprise engaged in the production, transmission and distribution, export and
import or development of electricity shall request a concession from the
government of the Lao Peoples Democratic Republic and shall request
approval to establish and register the enterprise as provided for in the Business
Law.

Article 12. Concession Procedures

An electricity enterprise shall request a concession [in the following

steps 11 :] studies, evaluation of the project, initial survey, application for
investment, consideration of the investment application, signing of a
memorandum of understanding, survey 12 , drafting of a feasibility study, an
environmental impact assessment statement, consideration and approval of the
concession and other [steps] 13 , the procedures of which the Ministry of
Industry and Handicrafts shall determine in detail.

The government of the Lao Peoples Democratic Republic will 14

participate in the shareholding when there is a concession for an electricity
enterprise.

Article 13. Feasibility Studies

Feasibility studies comprise the following contents:

11
The literal translation of the Lao word is comprise. The translators are aware that this list
does not express itself consistently in terms of either nouns or verbs.
12
In this article, the first mention of survey is to an initial survey. The second mention of
survey refers to a more detailed survey, but the Lao original does not allow a more specific
translation.
13
The literal translation of the Lao word is other works.
14
The Lao word connotes a high degree of likelihood but is not absolute.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

1. Socio-economic results;
2. Estimated maximum electrical capacity;
3. Estimated project value;
4. Estimated project term and life of the dam or estimated term and
life of some other electrical system;
5. Estimated electricity price;
6. Plans and operation phases: construction, installation, and
commencement date of electricity supply.

Article 14. Environmental Impact Assessment

Along with the feasibility study, the investor shall undertake an

environmental impact assessment which shall comprise the following
contents:

1. Assessment of environmental impact in each case, together with

proposals of methods and measures for solving or mitigating any
adverse impact on the environment, ecology, society and wildlife
habitats;
2. An estimate of the damage and resettlement [costs] of peoples
who will have to conduct their production activities somewhere
else because of the electricity project;
3. Means to limit the downstream impacts of a hydropower dam,
which is a major direct contributor to increased flooding during
rainy season, by excavating a drainage ditch to divert the water if
necessary or by some other means;
4. Calculation of expenses for restoration of the impacts provided for
in paragraphs 1, 2 and 3 of this Article shall be incorporated into
the project cost.

Article 15. Conditions for those who [are eligible to] receive Concessions

Those who [are eligible to] receive concessions shall meet the
following conditions:

1. They shall have financial and technical capacity;

2. They shall have a good and trustworthy business background;
3. [Their] project shall be productive economically and socially;
4. [Their] concession shall comply with the national socio-economic
development plan and shall not create severe adverse impacts to
the environment.

When a concession applicant meets all of the conditions, the

government shall consider granting a concession.

Article 16. Concession Term

A concession term shall not exceed thirty (30) years, including the
construction period, and shall commence from the date of the concession
approval. After the expiry of the concession period, the concessionaire shall

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

transfer the entire enterprise to the government in good and operational

condition without any compensation whatsoever.

A concession term may be extended, but [such extension] shall not

exceed ten (10) years, as agreed to by the government. Requests to extend a
concession term shall be submitted five (5) years before the expiry of the
concession.

Article 17. Rights of Concessionaires

Electricity enterprises holding concessions have the following rights:

1. To lease land necessary for the operations of the electricity

enterprise, provided that they shall first obtain an approval from
the government if they wish to use any other resources on the
leased land;
2. To receive benefits from the concession;
3. To receive protection under the laws;
4. To receive technical and technological instructions from the
government related to electricity;
5. To request an extension to the concession term;
6. To transfer [their rights to] or to succeed to [the rights of] another
electricity enterprise with the consent of the government.

Article 18. Obligations of Concessionaires

Electricity enterprises holding concessions have the following major

obligations:

1. To operate the enterprises properly and in accordance with the

conditions of the concession;
2. To deposit a guarantee with the Bank of the Lao Peoples
Democratic Republic;
3. To import registered capital as foreign currency into the Lao
Peoples Democratic Republic according to the laws and
regulations and according to the foreign investment contract 15 ;
4. To protect the environment;
5. To keep accounts as provided for in the Enterprise Accounting
Law;
6. To timely and completely pay tax or duty obligations according to
laws and regulations;
7. To pay compensation in the event that there is damage to the
environment, [or to the] lives and property of people, or in the
event that there is a resettlement of peoples;
8. To train and build up the expertise [of] and [to] guarantee social
welfare for Lao workers;
9. To record and report results of the concession according to a time
period 16 , including detailed expenses of the project;
15
This is relevant to enterprises that operate via business cooperation by contract as referred to
in Article 6 of the Law on the Promotion of Foreign Investment.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

10. To maintain and repair machinery and electrical equipment in

order to maintain them in good condition according to technical
principles related to electricity;
11. To strictly adhere to the Labour Law and other laws of the Lao
Peoples Democratic Republic;
12. To hand over the project along with the feasibility study and other
project documents to the Lao government without any
compensation in the event that the concessionaire does not
continue to operate the electricity enterprise;
13. Before such hand over of the electricity enterprise to the
government, the electricity enterprise shall first pay all of its
debts.

Article 19. Expiry of Concessions

Concessions shall expire in the following cases:

1. End of the concession term;

2. Voluntary cessation of the concession before its term with the
approval of the government;
3. Concession rights are withdrawn due to a serious violation of the
laws and regulations;
4. Transfer of the enterprise to someone else with the approval of the
government.

Article 20. Exceptions to Concession Applications

The following [types of project] do not require concessions:

1. Building of a small scale dam with an installed capacity of less

than two thousand (2,000) kilowatts and causing minor impact to
the environment;
2. Building and installation of equipment to produce electricity by
means of a heating system of less than five hundred (500)
kilowatts.

Operation of an electricity enterprise as referred to above shall

conform to the national master plan and the needs of the multi-ethnic Lao
people.

16
It is unclear from the Lao text whether the meaning is timely or for specific accounting
time periods.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Chapter 4
Installation and Determination of Electricity
Equipment Standards

Article 21. Installation of Electricity

Installation of electricity [refers to] the building, installation, expansion

and repair of an electrical system 17 that aims to support the production, the
services and the livelihood of the people by means of a complete electrical
system.

Article 22. Approval to Operate an Electricity Installation Enterprise

Individuals and organisations that seek to operate an enterprise

engaged in the installation of electricity shall obtain an approval from the
industry and handicrafts sector 18 and shall register their business with the
[governmental] sector responsible for commerce, and shall file a tax
registration with the [governmental] sector responsible for finance.

Article 23. Determination of Standards for Electrical Equipment

To ensure that electrical tools, electrical equipment, electricity

transmission lines and electrical appliances meet the relevant standards, are
safe, are energy saving and form a uniform system throughout the country[,]
the Ministry of Industry and Handicrafts shall determine, approve, inspect and
conduct inspections 19 of the quality of all types of electrical equipment
produced domestically and imported from abroad.

Chapter 5
Electricity Production

Article 24. Electricity Production

Electricity production [refers to] the process of producing electricity

from unit generating electricity by water power, wind power, heat energy,
[bio-mass] power or other energy.

Article 25. Conditions of Electricity Production

Electricity production shall comply with the following conditions:

Use modern equipment;

Have equipment which limits the environmental impact;
17
The activities referred to here include setting up electrical wiring and power lines, connecting
electrical equipment to the grid, etc.
18
The word sector is often used to refer to the cluster of government ministries or agencies
engaged in a particular activity.
19
The translators are not aware of the intended difference between the meaning of inspect and
conduct inspections.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Meet the standards and quality provided for in specific

regulations;
Adhere to other necessary conditions in the production of
electricity.

Chapter 6
Electricity Transmission

Article 26. Electricity Transmission

Electricity transmission [refers to] the system of sending and

transporting electricity from the electricity production source to the electricity
distribution station, to remote districts or to foreign countries.

Article 27. Installation and Construction of Electricity Transmission Lines

The installation and construction of electricity transmission lines shall

ensure safety and shall limit damage to nature and to the property of the
people.

All citizens have the obligation to contribute to ensuring the safety and
the protection of electricity poles, electricity transmission lines and other
equipment in the area where they reside.

Article 28. Transmission of Electricity via a System

The transmission of electricity via a system [refers to] the transmission

of electricity over an electrical transmission system to another party. The
owner of an electricity transmission system who [receives a] request for
electricity over its electricity transmission system does not have the right to
refuse the transmission, unless its safety cannot be technically guaranteed.
Those who use the electricity transmission system of another shall pay a
service fee.

Article 29. National Electricity Transmission Grid

The national electricity transmission grid [refers to] the high power
electricity transmission line system of the government of the Lao Peoples
Democratic Republic which connects one party to another party throughout
the country and which is connected to foreign transmission lines [, with the
aim of] ensuring the administration of production, transmission and
distribution of electricity including the protection of the environment and of
the property of the people.

All electricity production sources shall transmit electricity through the

national electricity transmission grid, unless such distribution of electricity
occurs within an area where there is an electricity generating plant, where
there is small scale production of electricity, or where there is yet no national
electricity transmission grid.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Chapter 7
Electricity Distribution

Article 30. Electricity Distribution

Electricity distribution refers to the distribution, by means of a high,

medium or low power system, of electricity from the transmission system or
from the electricity generating equipment to various types of substations,
which are referred to as the electricity distribution network.

Article 31. Principles of Electricity Distribution

Electricity distribution shall be carried out based on the following

principles:

1. Continuous and regular electricity distribution;

2. Broad-based, regular and economical distribution of electricity;
3. Safe distribution of electricity;
4. Distribution of electricity to ensure socio-economic development.

Article 32. Determination of Electricity Prices

The determination of electricity prices is subject to socio-economic

conditions and the standard of living of the people from time to time.
Electricity prices are divided into the following types:

1. The export [as commodity] price and the import price;

2. The domestic price for industrial and agricultural production;
3. The price for electricity used in remote rural areas;
4. The price for electricity used in other services.

The government shall approve the electricity price for each type
periodically.

Article 33. Rights and Obligations of Electricity Distributors

Electricity distributors have the following major rights:

1. To collect fees for electricity distribution and [other] services;

2. To warn electricity users who violate regulations;
3. To suspend electricity distribution to users who seriously violate
regulations on the use of electricity;
4. To determine measures to ensure the safety of the public and the
environment relating to electricity distribution;
5. To inspect the installation of electricity of electricity users.

Electricity distributors have the following obligations:

1. To broadly and regularly supply electricity to those who request it;

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

2. To notify electricity users in advance of each instance [when the

electricity supply will be] cut off;
3. To provide instruction on regulations and principles regarding the
use of electricity;
4. To responsibly and timely provide service to electricity users;
5. To ensure the safety and social welfare of workers in the
electricity [industry], [and] safety for society and the environment;
6. To pay taxes and duties and other fees to the State in accordance
with the laws and regulations;
7. To pay compensation in the event that electricity destroys the
environment, the lives or property of the people, or public
property.

Article 34. Rights and Obligations of Electricity Users

Electricity users have the following rights:

1. To use electricity;
2. To receive instructions relating to the use of electricity;
3. To have the right to the safe use of electricity;
4. To receive electricity installation and repair services in their
homes;
5. To request inspection of [any] electricity fee calculation that one
views is incorrect.

Electricity users have the following obligations:

1. To pay electricity and service fees for the electricity that one
uses;
2. To comply with regulations and instructions regarding electricity
usage;
3. To facilitate the installation, repair, inspection and recording of
electricity usage figures;
4. To ensure the safety and to protect the environment relating to
electricity usage;
5. To urgently notify electricity officials when an electricity-related
irregularity is discovered.

Chapter 8
Electricity Export and Import

Article 35. Electricity Export

The government of the Lao Peoples Democratic Republic promotes

the development of electricity for export, while ensuring sufficient electricity
for industrial expansion and national socio-economic development.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 36. Electricity Import

Electricity can be imported into the Lao Peoples Democratic Republic

provided that it is necessary for the country's socio-economic development
and with the approval of the government.

Article 37. Transmission of Electricity through the Lao Peoples Democratic

Republic

The transmission of electricity through the Lao Peoples Democratic

Republic [refers to] the transmission of electricity from one country across the
territory of the Lao Peoples Democratic Republic to some other country with
the approval of the government of the Lao Peoples Democratic Republic. The
transmission of electricity through the Lao Peoples Democratic Republic
shall be conducted via the national electricity transmission grid with payment
of a service fee, unless the Lao Peoples Democratic Republic national
electricity transmission grid is unable to supply that service. In such case, the
government shall temporarily approve that a party may transmit power over
their own transmission line system, but under the administration and
inspection of the relevant agency of the Lao Peoples Democratic Republic.

The transmission of electricity through the Lao Peoples Democratic

Republic shall fulfil the following conditions 20 :

1. Limit adverse environmental impact and limit damage to the

people;
2. Pay fees to cross the Lao territory and other service fees while
also compensating for all damages which may arise from the
construction of such transmission line system;
3. Allow the Lao Peoples Democratic Republic the use of that
transmission line system when required.

Chapter 9
Electricity Development in the Localities and in Rural Areas

Article 38. Electricity in the Localities and in Rural Areas

Electricity in the localities and in rural areas [refers to] an electricity

network which is not connected to the general electricity network or is a
separate electricity network for a specific area, which produces electricity by
virtue of small scale hydropower, with petroleum-operated machinery, by
solar energy, by wind power or by some other energy.

The State promotes the development of electricity in the localities and

in rural areas for use in commodities production and in people's daily lives in
remote areas.

20
Presumably, these conditions must be fulfilled by the person transmitting the electricity.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 39. Approval for Establishment of an Electricity Enterprise in a

Locality or in Rural Areas

The provincial, municipal 21 or special zone industry and handicrafts

division 22 will conduct surveys and collect information relating to small scale
physical sources of electrical energy with power generating capacity of one
hundred (100) to two thousand (2,000) kilowatts in order to develop a plan for
the construction and development of electricity [facilities] within the areas
under its administration.

The provincial governor, municipal chief or the chief of the special

zone shall have the authority to approve applications to establish electricity in
the locality 23 within their area of responsibility, with the technical approval 24
of the Ministry of Industry and Handicrafts.

The district industry and handicrafts office shall conduct surveys and
collect data relating to physical sources of electrical energy with power
generating capacity of less than one hundred (100) kilowatts in order to
develop a plan for the construction and development of electricity [facilities]
within the areas under its administration. The district chief shall have the
authority to approve applications to establish electricity in the rural area 25
with the consent of the provincial, municipal or special zone industry and
handicrafts division.

Article 40. Construction of Electricity in the Localities and in Rural Areas

Construction and installation of electricity in the localities and in rural

areas may be conducted in the following forms:

1. Provinces, municipalities, special zones and districts may conduct

the construction and installation themselves;
2. The Ministry of Industry and Handicrafts may construct and
install [the relevant facilities], and thereafter hand them over to the
province, the municipality, the special zone or the district to
administer;

21
This Law on Electricity was enacted before the Law on Local Administration. The reader
should therefore not assume that the hierarchical relationships and designations described in some
detail in the Law on Local Administration applied when this law was enacted. Specifically, the
translators are aware that the local administrative territories referred to in this law as municipalities
may not be the same as those referred to as municipalities in the Law on Local Administration, even
though the Lao word used in both laws is the same.
22
Readers may wish to refer to the Law on Local Administration for more information on the
different levels of local administrative agencies.
23
Quotation marks are not included in the original. This appears to be a reference to the defined
term in Article 38.
24
The term technical approval refers to approval of technical aspects of the project.
25
Quotation marks are not included in the original. This appears to be a reference to the defined
term in Article 38.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

3. Private parties or other parties may construct and install [the

relevant facilities] and thereafter hand them over to the province,
the municipality, the special zone or the district to administer.

The Ministry of Industry and Handicrafts and other relevant ministries

have the right to make technical recommendations and [gives] instructions
regarding the construction and installation of electricity, the protection of the
environment and electricity operations in localities and rural areas.

Provinces, municipalities, special zones and districts have the duty to

report, according to reporting procedures, all construction and installation of
electricity in the localities and in rural areas to the Ministry of Industry and
Handicrafts.

Article 41. The Fund for Development of Electricity in the Localities and in
Rural Areas

The State establishes a fund to provide grants and loans for the
construction, installation and development of electricity in the localities and in
rural areas.

The fund for development of electricity in the localities and in rural

areas comes from the following funding sources:

1. The State budget;

2. The State and the people 26 ;
3. Other enterprises;
4. The people;
5. Domestic and foreign assistance.

In addition, the State may have a policy of exempting or reducing taxes

and duties, [or] providing import credits for vehicles and equipment, for
construction and for electricity operations in the localities and rural areas.

Chapter 10
Electricity Administration and Inspection Agencies

Article 42. Electricity Administration and Inspection Agencies

Electrical administration and inspection agencies comprise the

following:

1. The Ministry of Industry and Handicrafts;

2. The provincial, municipal, or special zones industry and
handicrafts division;
3. The district industry and handicrafts office;
4. The village administrative authority.

26
The term people here refers to people in the locality who may be prepared to pay for
construction even when the State budget does not allow for it.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 43. Rights and Duties of the Ministry of Industry and Handicrafts

In the administration and inspection of electricity enterprises 27 , the

Ministry of Industry and Handicrafts has the following rights and duties:

1. To elaborate on the strategic plan relating to the development of

electricity enterprises;
2. To survey and collect information, and collect statistics regarding
physical electrical energy sources throughout the country;
3. To draft a master plan regarding the development of electricity
enterprises, including short-term, medium term and long term
plans for the development of electricity enterprises and
environmental protection;
4. To issue regulations regarding the production and development of
electricity enterprises;
5. To protect physical sources of electricity;
6. To study [proposals for] and provide technical opinions relating to
investment in electricity enterprises;
7. To study electricity prices and to submit [recommendations] to the
government for approval;
8. To coordinate with other parties and concerned local
administration authorities in the administration and inspection of
electricity enterprises;
9. To cooperate with foreign parties and seek out funding sources for
developing electricity enterprises;
10. To exercise such other rights and perform such other duties
relating to the administration of electricity enterprises and [to
comply with] the laws and regulations.

Article 44. Rights and Duties of the Provincial, Municipal, or Special Zone
Industry and Handicrafts Divisions

In the administration and inspection of electricity enterprises, the

provincial, municipal or special zone industry and handicrafts divisions have
the following rights and duties:

1. To elaborate on the Ministry of Industry and Handicrafts master

plan regarding the development of electricity enterprises and the
protection of the environment;
2. To survey, collect data, record statistics and protect physical
sources of electrical energy;
3. To study [proposals for] and provide opinions regarding
applications to establish small scale electrical production plants
from two thousand (2,000) kilowatts down to one hundred (100)
kilowatts, and to submit [recommendations] to the provincial

27
Here, electricity enterprises appears to refer to the actual facilities and operations of the
enterprises rather than the enterprises themselves. This conflation of the enterprise and its operations
may be due to the historical identification of electricity enterprises with a restricted set of permitted
operations or facilities.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

governor, the mayor of the municipality or the chief of the special

zone for approval;
4. To coordinate with other relevant parties in the administration and
inspection of electricity enterprises relating to the production,
transmission, and distribution of electricity and the standards for
electrical equipment produced domestically and imported from
abroad;
5. To exercise such other rights and perform such other duties
relating to the administration of electricity enterprises as assigned
by the Ministry of Industry and Handicrafts.

Article 45. Rights and Duties of the District Industry and Handicrafts Office

In the administration and inspection of electricity enterprises, the

district industry and handicrafts office has the following rights and duties:

1. To implement the plan, project and regulations and instructions of

the provincial, municipal or special zone industry and handicrafts
division relating to electricity enterprises and the protection of the
environment;
2. To study [proposals for] and provide opinions regarding
applications to establish small scale electrical production plants or
electricity generating equipment of one hundred (100) kilowatts or
less, and to submit [recommendations] to the district chief for
approval;
3. To coordinate with other relevant parties regarding the
administration and inspection of electricity enterprises within the
area of its responsibility;
4. To exercise such other rights and perform such other duties
relating to the administration of electricity enterprises as assigned
by the industry and handicrafts division.

Article 46. Rights and Duties of the Village Administrative Authority

In the monitoring and inspection of electricity enterprises, the village

administrative authority has the following rights and duties:

1. To monitor and inspect the operations of small scale electricity

enterprises within the area of the village;
2. To make proposals and report to [the relevant] organisation
regarding the operations of electricity enterprises that affect the
rights and benefits of the people, fine traditions 28 and the laws and
regulations;
3. To facilitate parties who operate electricity enterprises within the
area of the village;
4. To coordinate with parties who are operating electricity
enterprises to ensure public order and security within the area of
the village.

28
The Lao term connotes both customs and traditions.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 47. Inspection

Inspection of electricity enterprises refers to the inspection of the

operations of an electricity enterprise in order to make the electricity
enterprise productive and technically safe, to protect the environment and to
ensure that the electricity enterprise's operations are in compliance with the
laws and regulations.

Article 48. [Points for Inspection] 29

Inspections of electricity enterprises shall cover the following major

[points]:

1. Compliance with all steps of electricity enterprise operations;

2. Compliance with time schedule;
3. Compliance with feasibility study;
4. Compliance with plans that have been issued;
5. Compliance with technical safety measures;
6. [Compliance with] standards for electrical equipment;
7. Construction, installation, and management of electrical
equipment;
8. Application of measures to limit environmental impact;
9. Payment of [compensation] for damage to the environment and
peoples lives and property;
10. Inspection of the financial system and social welfare policies;
11. Implementation of other regulations relating to operations of an
electricity enterprise.

Article 49. The Technical Inspection Committee

In order to ensure that the construction, installation, and operations of

an electricity enterprise are technically sound, ensure safety, and protect the
environment, the government may create a technical inspection committee
which shall comprise the Ministry of Industry and Handicrafts and other
relevant ministries or agencies. The technical inspection committee shall be
automatically terminated after having completed its duties as assigned.

Chapter 11
Policies 30 towards Persons with High Achievement
and Measures Against Violators

Article 50. Policies towards Persons with High Achievement

Individuals or organisations achieving excellent results in the operation

of electricity enterprises and the protection of the environment shall receive
commendations and shall enjoy various policies: [financial] credit, extension
of the concession or other policies.
29
The literal translation is contents of inspection.
30
The term policies in this context takes the meaning of privileges.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

Article 51. Measures Against Violators

The following major measures shall be applied to those who violate

this law:

1. Re-educational measures 31 ;
2. Fines;
3. Penal measures.

In addition, violators may receive additional punishment: suspension

of business operations, withdrawal of licenses, confiscation of vehicles or
other equipment used in the offence, or termination of electricity supply.

Article 52. Re-educational Measures

Individuals or organisations that have violated this law by committing

minor wrong-doing such as failure to report on the operations of the electricity
enterprise, failure to timely make reports, and failure to adhere to technical
standards which are not dangerous, shall be re-educated.

Article 53. Fines

Individuals or organisations that have violated this law shall be fined

an amount equivalent to the amount of actual damage caused by any one of the
following acts:

1. Operating an electricity enterprise without approval;

2. Installing electricity without approval;
3. Installing electricity into one's home without a meter;
4. Allowing others to draw electricity from one's home without
approval;
5. Modifying electricity meters;
6. Failing to adhere to safety standards;
7. Failing to adhere to standards to limit adverse environmental
impact;
8. Failing to pay taxes and duties;
9. Failing to pay compensation for damage caused to the
environment, and to peoples lives and property;
10. Failing to cooperate with electricity administration and inspection
officials.

Article 54. Penal Measures

Any individual committing a violation of this law which constitutes an

offence, such as[:] cutting off electrical lines, destroying electrical equipment,
abuse of power and position to derive personal benefit from operations
relating to electricity, or failure to apply safety measures which causes a loss
of life or damage to health, or causes a person to become handicapped, or
31
Here, re-educational measures does not mean the same as re-education without deprivation
of liberty referred to in the Penal Law.

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 Translation Endorsed by the Law Committee of the National Assembly of the Lao PDR

causes damage to assets of the State, cooperatives and the public, shall be
punished according to the Penal Law.

Chapter 12
Final Provisions

Article 55. Implementation

The government of the Lao Peoples Democratic Republic shall

implement this law.

Article 56. Effectiveness

This law shall enter into force ninety (90) days from the date of the
promulgating decree issued by the President of the Lao Peoples Democratic
Republic.

Persons or organisations, who have received concessions before the

date [when] this law becomes effective, shall have the right to continue their
enterprise operations. Should the provisions of this law affect their interests,
they have the right to request the competent agency to consider how to deal
with the issues within a period of one hundred eighty (180) days from the
effective date of this law. Regulations and provisions which conflict with this
law are hereby repealed.

Vientiane, 12 April 1997

President of the National Assembly

[Seal and Signature]

Samane VIGNAKET

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