Circular No. 05/2016/TT-NHNN dated April 15, 2016 of the State Bank of Vietnam on amending and supplement a number Articles of the Circular No. 03/2016/TT-NHNN by the Governor of the State Bank on guidelines for certain details of the management of foreign exchange with regard to enterprises’ foreign borrowings and repayment

THE STATE BANK OF VIETNAM

Circular No.05/2016/TT-NHNN dated April 15, 2016 of the State Bank of Vietnam on amending and supplement a number Articles of the Circular No. 03/2016/TT-NHNN by the Governor of the State Bank on guidelines for certain details of the management of foreign exchange with regard to enterprises’ foreign borrowings and repayment

Pursuant to the Law of Vietnam State Bank No. 46/2010/QH12 dated 16 June 2010;

Pursuant to the Law of Credit Institutions No. 47/2010/QH12 dated 16 June 2010;

Pursuant to the Foreign Exchange Ordinance No. 28/2005/PL-UBTVQH11 dated 13 December 2015 bythe Standing Committee of the National Assemblyand the Ordinance No. 06/2013/PL-UBTVQH13 dated 18 March 2013 on amendments and supplements to the Foreign Exchange Ordinance;

Pursuant to the Government’s Decree 156/2013/ND-CP dated 11 November 2013 on functions, missions, authority and organizational structure of Vietnam State Bank;

Pursuant to the Government’s Decree No. 219/2013/ND-CP dated 26 December 2013 on the management of enterprises’ borrowing and repayment of foreign loans not backed by the Government;

At the request of the Head of the Foreign Exchange Management Department;

Government of Vietnam State Bank issues the Circular on amendments and supplements to certain articles of the Circular No. 03/2016/TT-NHNN dated 26 February 2016 by the Government of the State Bank on guidelines for certain details of the management of foreign exchange with regard to enterprises foreign borrowings and repayment.

Article 1. To amend and supplement the Circular No. 03/2016/TT-NHNN as follows:

1.To supplement to Section 3, Section 4, Section 5 and Section 6 of Article 4:

“3. Foreign loan granted by deferral of payment for imported goods shall include imports on which the first date of disbursement precedes the last date of payment.

4.The date of disbursement of foreign loan granted by deferral of payment for imported goods shall be:

a) The ninetieth day from the date that transport documents are issued if the bank providing account services requires transport documents included in the payment documents;

b) The forty-fifth day from the date that the examination of information in the cleared customs declaration if the bank providing account services does not require transport documents included in the payment documents.

5.The last date of payment shall be:

a) The final date of the payment time limit as shown in the contract;

b) The last date of payment in reality if the contract is not followed or does not specify any payment time limit.

6.The time limit of a foreign loan granted by deferral of payment for imported goods shall commence on the first date of disbursement and ends on the last date of payment.”.

2.To amend and supplement to Section 2 of Article 24:

“2. For borrowers that are foreign direct investment enterprises:

a) Medium-term and long-term foreign borrowings: The account for foreign borrowings and repayment shall be the account for direct investment. Apart from receipts and spending related to foreign borrowings and repayment as stated in Article 26 and Article 27 of this Circular, borrowers being foreign direct investment enterprises shall utilize the account for direct investment (also defined as the account for foreign borrowings and repayment) for other receipts and spending related to foreign direct investments in Vietnam as per current laws on management of foreign exchange with regard to foreign direct investments in Vietnam.

b) Short-term foreign borrowings: Borrowers can utilize the account for direct investment as stated in Point a of this Section or an account for foreign borrowings and repayment (as distinct from the account for direct investment) to process receipts and spending related to foreign borrowings. Each short-term foreign borrowing shall only be processed through 01 (one) bank that provides account services. Borrowers can utilize 01 (one) account for 01 (one) or various short-term foreign borrowings. Receipts and spending through such account are defined in Article 26 and Article 27 of this Circular.”.

3.To amend the Article 28:

“Article 28. Change of the account for foreign borrowings

1.If the account for foreign borrowings changes as the bank providing account services is replaced, borrowers that are not a commercial bank or foreign bank s branch shall request the current bank providing account services to attest information regarding the disbursement and repayment of foreign borrowings for the new bank providing account services to follow up the progress of such borrowings as per current regulations on management of foreign borrowings and repayment.

2.If the account for foreign borrowings changes as the currency alters but the bank providing account services remains unchanged, such bank shall be responsible for supervising the disbursement and repayment of foreign borrowings as per current regulations on management of foreign borrowings and repayment.”.

4.To amend the Article 32:

"Article 32. Transfer of repayments on foreign loans granted by deferral of payment for imported goods

When transferring repayments on the principal and interest of a foreign loan granted by deferral of payment for imported goods, a borrower shall be responsible for presenting documents and papers as requested by the bank providing account services.”.

5.To supplement the Point dd, Section 2 of Article 34:

“dd) Repayment of short-term foreign loans granted by deferral of payment for imported goods.”.

Article 2. Effect

1.This Circular takes effect on April 15, 2016.

2.Office Manager and Head of the Foreign Exchange Management Department, Heads of units under Vietnam State Bank, Directors of the State Bank’s provincial branches, Chairs of Boards of Directors, Chairs of Member Councils, General Directors (Directors) of credit institutions, foreign banks’ branches and enterprises are responsible for enforcing this Circular.

For the Governor

The Deputy Governor

Nguyen Thi Hong