MONTHLY LEGAL UPDATE – 12/2018: LEGAL UPDATE RELATING TO FINANCE AND CREDIT
1. LEGAL DOCUMENTS ARE EFFECTIVE FROM 01/12/2018
1.1. Circular No. 25/2018/TT-NHNN amending and supplementing a number of articles of the Decree No. 10/2015/TT-NHNN of July 22nd, 2015 of Government guiding the implementation of a number of contents of the Decree No. 55/ND-CP of June 9th, 2015 of Government on credit policies in service of agricultural and rural development
v Name of legal document: Circular No. 25/2018/TT-NHNN issued on 24/10/2018 by the State Bank of Vietnam amending and supplementing a number of articles of the Decree No. 10/2015/TT-NHNN of July 22nd, 2015 of Government guiding the implementation of a number of contents of the Decree No. 55/NĐ-CP of June 9th, 2015 of Government on credit policies in service of agricultural and rural development (hereinafter referred to as the “Circular No. 24/2018/TT-NHNN”).
v Effective date: 10/12/2018.
Some contents should be noted:
· Firstly, amending the regulation on
subjects of application of Circular No. 10/2015/TT-NHNN.
Specifically,
Clause 2 Article 2 of Circular No. 25/2018/TT-NHNN stipulates: “Clause 2 of Article 2 is amended and
supplemented as follows:
"2. Customers are entitled to borrow
capital in accordance with Clause 2 and Clause 3 of Article 2 of Decree
55/2015/NĐ-CP (as amended and supplemented by Clause 1 Article 1 of Decree No.
116/2018/NĐ-CP). ""
· Secondly, adding the provision on
debt grace.
Specifically,
Clause 4, Article 1 of Circular No. 24/2018/TT-NHNN stipulates: “Adding Article 4a as follows:
“Article 4a. Debt grace
For borrowers to plant, care for and
re-plant perennial trees, the credit institution and the customer shall agree
on the grace period for debt repayment in accordance with the construction
period of the perennial crop. The grace period is the period from the time when
the credit institution begins to disburse the loan until the customer commences
repayment of principal and interest as agreed in the credit agreement.””
· Thirdly, abolishing Form 01, 02, 03,
04, 05, 06 issued together with Circular No. 10/2015/TT-NHNN.
Specifically,
Article 2 of Circular No. 25/2018/TT-NHNN stipulates: “Abolishing Point d of
Clause 4 of Article 8 and Form 01, 02, 03, 04, 05, 06 issued together with
Circular No. 10/2015/TT-NHNN.”
v Name of legal document: Circular No. 26/2018/TT-NHNN issued on 16/11/2018 by the State Bank of Vietnam guiding on statistical surveys of monetary, banking and foreign exchange outside the National Statistical Survey Program (hereinafter referred to as the “Circular No. 26/2018/TT-NHNN”).
v Effective date: 31/12/2018.
Some contents should be noted:
· Firstly, regulating on the
confidentiality and use of information and results of statistical surveys.
Specifically, Article 11 of Circular No.
26/2018 / TT-NHNN stipulates: “Confidentiality
and use of information and statistical survey results.
1.
Information and statistical survey results must be kept confidential,
including:
a)
Information and data associated with specific names and addresses of each
organization or individual, unless otherwise agreed upon by such organizations
or individuals or provided for by law;
b)
Statistical survey information not yet publicized by competent persons;
c)
Information on the list of State secrets.
2.
Information and results of statistical surveys shall be used for the purposes
specified in the approved statistical survey plans and according to the
provisions of the legislation on statistics.
3.
The quotation and use of information and results of statistical surveys
published by the State Bank must be truthful and clearly state the sources of information.
4.
Agencies, organizations and individuals may use information and statistical
survey results publicized in service of their activities but must not
negatively affect monetary stability and operational safety to interfere with
the national interests and interests of organizations and individuals providing
investigation information.“
· Secondly, stipulating the rights and
obligations of the subject of statistical surveys[1].
Specifically, Specifically, Article 16 of
the Circular No. 26/2018/TT-NHNN stipulates: “The rights and obligations of the subject matter of statistical
surveys
1.
Subjects of statistical surveys have the following rights:
a)
Being informed of the main decisions, purposes, requirements, scope, contents
and duration of the investigation;
b)
Being provided with confidential information provided to the State Bank
according to the provisions of Article 11 of this Circular;
c)
Complaining and denouncing about law-breaking acts of statistical surveys.
2.
Subjects of statistical surveys have the following obligations:
a)
Supplying truthful, accurate, complete and timely information at the request of
the State Bank;
b)
Not being refused or obstructed the supply of statistical survey information to
the State Bank;
c)
Submitting to the inspection by the State Bank and specialized statistical
inspectors of the information provided.”
· Thirdly, regulating on monetary and
banking statistics in addition to state statistics
Specifically, Article 17 of Circular No.
26/2018/TT-NHNN stipulates: “Investigation
of monetary statistics and banks in addition to state statistics
1.
Organizations and individuals conducting monetary and banking statistics
surveys in addition to state statistics in service of scientific research and
production and business activities according to the provisions of law.
2.
Organizations and individuals conducting statistical and monetary surveys in
addition to state statistics must comply with the requirements specified in
Article 68 of the Statistics Law[2].
3.
Organizations and individuals may not conduct statistical surveys or disclose
information on statistical surveys which harm national interests, monetary
stability, banking operation safety and national monetary policy.
4.
Organizations and individuals, when disclosing the results of the statistical
and monetary statistics surveys, must quote the method of survey, the sample
survey, the scope of investigation, the timing and the time carrying out,
finish the investigation.”
2. LEGAL DOCUMENTS ISSUED IN 11/2018
2.1. Circular No. 27/2018/TT-NHNN regulating cases of blockade, termination of blockade of capital and assets of foreign bank branches
v Name of legal document: Circular No. 27/2018/TT-NHNN issued on 22/11/2018 by the State Bank of Vietnam regulating cases of blockade, termination of blockade of capital and assets of foreign bank branches (hereinafter referred to as the “Circular No. 27/2018/TT-NHNN”).
v Effective date: 10/01/2019.
Some contents should be noted:
·
Firstly, providing for the blockade
of capital and assets.
Specifically, Article 5 of Circular
27/2018/TT-NHNN provides: “Cases of
blockade of capital and property
The
State Bank shall consider and decide on the blockade of capital and assets of
the foreign bank branch in the following cases:
1.
The net value of the granted capital of the foreign bank branch shall be lower
than the legal capital level for a continuous period of 06 months.
2.
Violations of prudential ratios in banking activities stipulated in Article 130
of the Law on Credit Institutions and the State Bank have made a written
request for remedy but have not taken remedial measures or failed to remedy
them within the time limit as requested by the State Bank.
3.
The accumulated loss amount of a foreign bank branch is more than 50% of the
value of the issued capital and reserves stated in the latest audited financial
statement.
4.
The State Bank has requested that the parent bank fail to properly perform its
obligations to its branch operating in Viet Nam.
5.
When there is information that the parent bank shows signs of insolvency or
insolvency or is required by the competent authorities of the country of origin
to be in a state of special control liquidation, bankruptcy, or withdrawal of
licenses for establishment and operation.”
·
Secondly, regulating on the cases of
termination of blockade of capital and assets.
Specifically, Article 6 of Circular
27/2018 / TT-NHNN states: “Cases of cases
of termination of blockade of capital and assets
The
State Bank shall consider and decide to terminate the blockade of capital and
assets of the foreign bank branch in the following cases:
1.
Foreign banks' branches have overcome the violations as provided for in Clauses
1, 2 and 3, Article 5 of this Circular.
2.
The parent bank has fulfilled the obligations already committed to the foreign
bank branch at the request of the State Bank stipulated in Clause 4, Article 5
of this Circular.
3.
The State Bank shall receive information from competent authorities of the
country of origin that the parent bank has overcome the shortcomings specified
in Clause 5, Article 5 of this Circular.”
· Thirdly, deregulating on blockage of
capital and assets stipulated in Circular No. 03/2007/TT-NHNN guiding the
implementation of a number of articles of Decree No. 22/2006/NĐ-CP on
organization and operation of Branches of foreign banks, joint venture banks,
banks with 100% foreign capital, representative offices of foreign credit
institutions in Viet Nam.
Specifically, Clause 2, Article 10 of
Circular No. 27/2018/TT-NHNN stipulates: “2.
Annulling Section VI, Part II of Circular No. 03/2007/TT-NHNN issued on June
5th, 2007 by State bank governor guiding the implementation of a number of
articles of Decree No. 22/2006 of the Government on organization and operation
of foreign bank branches, joint venture banks, banks with 100% foreign capital
and representative offices of foreign credit institutions in Viet Nam.”
[1] “Subject of statistical surveys of monetary
and banking are organizations and individuals subjected to statistical surveys”
(Clause 6, Article 3 of Circular No. 26/2018/TT-NHNN)
[2] “Article 68.
Requirements for statistical activities outside state statistics
1. Comply with laws and take
responsibility to the law for professional activities, statistical information,
using statistical information outside state statistics;
2. Comply with fundamental principles
of statistical activities outside state statistical activities as prescribed in
Clause 2, Article 5 hereof;
3. Carry out collection of
information on a voluntary basis and agree to supply information to
organizations and individuals chosen for statistical investigations.”
