Circular No. 64/2001/TT-BTC dated August 10, 2001 of the Ministry of Finance guiding the implementation of the regulation on management of the state capital at other enterprises

DECREE

ON PAYMENT ACTIVITIES VIA PAYMENT SERVICE-PROVIDING ORGANIZATIONS

THE GOVERNMENT

Pursuant to the Law on Organization of the Government of September 30, 1992;

Pursuant to the Law on the State Bank of Vietnam of December 12, 1997;

Pursuant to the Law on Credit Institutions of December 12, 1997;

At the proposal of the Governor of the State Bank of Vietnam,

DECREES:

Chapter I

GENERAL PROVISIONS

Article 1.-Objects and scope of application

1. This Decree prescribes payment activities via payment service-providing organizations, including:

a/ Opening accounts, providing payment services, organizing and joining payment systems of payment service-providing organizations;

b/ Opening accounts, using payment services by payment service users.

2. This Decree applies to domestic and international payment activities carried out via payment service-providing organizations on the Vietnamese territory. All payment activities via payment service-providing organizations must comply with the provisions of this Decree and other relevant legislations.

Article 2.-The State management over payment activities

The State Bank of Vietnam exercises the function of State management over payment activities via payment service-providing organizations by:

1. Studying and proposing policies to promote the expansion and development of non-cash payment.

2. Promulgating legal documents on payment according to its competence.

3. Granting permits for, and suspending payment operations of credit institutions and other organizations.

4. Examining, inspecting and handling law-breaking acts committed by payment service providing organizations and payment service users.

Article 3.-Interpretation of terms

In this Decree, the following terms and expressions are construed as follows:

1. Payment activities mean the opening of accounts, provision of payment services, organization of and joining in payment systems of payment service-providing organizations as well as the opening of accounts and use of payment services by payment service users.

2. Payment service-providing organizations are the State Bank of Vietnam (hereinafter called the State Bank for short), banks and other organizations permitted to provide payment services.

3. Payment service users are organizations and individuals conducting payment transactions via payment service-providing organizations.

4. Payment transactions are the performance of the obligation to pay or transfer money among organizations and/or individuals.

5. Payment services mean the supply of payment instruments, the conduct of domestic and international payment transactions, and the performance of authorized collection and/or expenditure and other types of services as specified by the State Bank, which are carried out by payment service-providing organizations at requests of payment service users.

6. Other organizations permitted to provide payment services are organizations permitted by the competent State agencies to perform one or several payment services.

7. Payment instruments are cash and non-cash payment instruments, which are used to effect payment transactions.

8. Payment accounts are those opened by payment service users at payment service-providing organizations to effect payment transactions according to the State Bank’s regulations.

9. Account holders are persons who open accounts under their own names. For accounts of individuals, account holders are individuals who open such accounts under their own names. For accounts of organizations, account holders are representatives at law or authorized representatives of account-opening organizations.

10. Account joint-holders are two or more persons who jointly open an account under their names.

11. Payment orders are orders made by account holders to payment service-providing organizations in form of paper vouchers, electronic vouchers or other forms under the regulations of competent State agencies, requesting such organizations to conduct payment transactions.

12. Overdraft means the expenditure by payment service users in excess of money amounts they have on their payment accounts when using payment services.

Article 4.-Application of international agreements and international practices in payment activities with foreign countries

1. In international payment activities, in cases where an international agreement, which the Socialist Republic of Vietnam has signed or acceded to, contains provisions different from those of this Decree, the provisions of such international agreement shall apply.

2. Parties participating in international payment activities may agree upon the application of international practices, provided that those practices are not contrary to the law of the Socialist Republic of Vietnam.

Chapter II

OPENING AND USE OF PAYMENT ACCOUNTS

Article 5.-Opening of payment accounts

1. The State Bank shall open payment accounts for domestic credit institutions and other organizations permitted to provide payment services and foreign banks, international monetary organizations, and banks.

The State Bank is entitled to open payment accounts at foreign banks, international monetary organizations and banks.

2. Credit institutions being banks shall open payment accounts for other credit institutions, other organizations and individuals. The State-run commercial banks shall open payment accounts for the State Treasury offices in districts and provincial towns other than provincial capitals.

Credit institutions shall open payment accounts at the State Bank and banks. Credit institutions being banks shall be entitled to open payment accounts at foreign banks as soon as they are permitted by the State Bank to provide international payment services.

3. The State Treasury shall open payment accounts at the State Bank. In districts and provincial towns other than provincial capitals, the State Treasury shall open payment accounts at State-run commercial banks.

4. Other organizations which are permitted to provide payment services shall open payment accounts for payment service users under the regulations of competent State agencies.

5. Payment service users have the right to choose banks and other organizations permitted to provide payment services to open their payment accounts, except otherwise provided for by law.

Article 6.-Use of accounts and authorized use of accounts

1. Account holders have the right to use money amounts on their payment accounts by means of payment orders placed in compliance with the State Bank’s regulations and other relevant legislations.

2. Account holders are obliged to abide by the provisions of this Decree and other relevant legislations on the use of payment accounts.

3. Account holders may authorize others in writing to use their accounts according to the provisions of law. The authorized persons shall have the rights and obligations like the account holders within the authorized scope and must not re-authorize them to the third party.

Article 7.-The use and authorized use of accounts by joint-holders

Besides the provisions of above-said Article 6, the use of accounts and authorized use of accounts by joint-holders must also comply with the following regulations:

1. All payment transactions on the accounts shall be conducted only when so consented by all account joint-holders.

2. Account joint-holders may authorize others to use the accounts within the ambit of their rights and obligations. The authorization must be made in writing according to the provisions of law.

3. In cases where an account joint-holder dies, is declared missing or losing his/her civil act capacity, the right to use the account and the obligation(s) arising from the use of such person’s account shall comply with the provisions of law.

Article 8.-Payment accounts, the conditions and procedures for opening and using payment accounts

Types and characteristics of payment accounts, conditions and procedures for opening and use of payment accounts shall be prescribed by the payment service providing organizations in compliance with the regulations of the State Bank and other relevant provisions of law.

Article 9.-Blockade of accounts

1. Part or the whole money amount on a payment account shall be blockaded in the following cases where:

a/ There is an agreement between the account holder and the payment service-providing organization;

b/ There is a decision or written request of a competent person according to the provisions of law;

c/ Other cases prescribed by law.

2. The payment account blockade shall terminate when:

a/ The account blockade duration agreed upon between the account holder and the payment service-providing organization expires;

b/ The competent person defined by law issues a decision on or requests the blockade termination;

c/ According to the provisions of law.

Article 10.-Closure of accounts

1. A payment service-providing organization shall close a payment account in the following cases where:

a/ The account holder so requests;

b/ The individual holding such account dies, is missing or loses his/her civil act capacity;

c/ The organization holding such account terminates its operation according to the provisions of law.

2. Payment service-providing organizations can decide the closure of accounts when holders of such accounts commit law violations in payment activities or breach agreements with payment service-providing organizations; or when such accounts have low balance and remained dormant for a certain period of time as prescribed by the payment service-providing organizations.

3. After an account is closed, the balance remaining thereon shall be handled as follows:

a/ To be disbursed at request of the account holder or his/her heir or inheritance representative in cases where the account holder being an individual dies or his/her guardian in cases where the account holder being an individual loses his/her civil act capacity;

b/ To be disbursed under the court’s decision;

c/ To be managed according to regulations of the payment service-providing organization for cases where the account is closed according to Clause 2 of this Article, but the account holder, his/her heir, inheritance representative or guardian does not receive the money amount remaining on the account after the payment service-providing organization notifies in writing the account holder, his/her heir, inheritance representative or guardian of the account closure.

Chapter III

USE AND PERFORMANCE OF PAYMENT SERVICES

Article 11.-Payment services

1. Payment services include:

a/ Supply of payment instruments;

b/ Domestic payment services;

c/ International payment services;

d/ Authorized collection and expenditure services;

e/ Other payment services prescribed by the State Bank.

2. Payment services shall be performed in compliance with the following regulations:

a/ The State Bank is entitled to provide all the payment services prescribed in Clause 1 of this Article for domestic credit institutions, other organizations permitted to provide payment services and foreign banks, international monetary institutions and banks.

b/ Banks are permitted to provide the following payment services:

- Providing payment services prescribed at Points a, b and d, Clause 1 of this Article for other credit institutions, organizations and individuals;

- Providing payment services prescribed at Point c, Clause 1 of this Article for other credit institutions, organizations and individuals if so permitted by the State Bank;

- Providing other payment services prescribed at Point e, Clause 1, Article 1 of this Article according to the provisions of the State Bank.

c/ Other organizations shall be permitted by the State Bank to provide one or several payment services prescribed in Clause 1 of this Article for organizations and individuals if they fully meet the following conditions:

- The provision of payment services is necessary and closely related to the main activity;

- They have material conditions suited to requirements of the provision of payment services;

- They have contingents of personnel knowledgeable about payment activities.

Article 12.-Payment instruments

Payment instruments include:

a/ Cash;

b/ Check;

c/ Payment order or accreditative expenditure;

d/ Accreditative collection;

e/ Bank card;

f/ Other payment instruments provided for by law.

Article 13.-Cash supply

Payment service-providing organizations are obliged to fully and promptly meet the cash-depositing and -withdrawing requests of payment service users in compliance with the provisions of law.

Article 14.-Use of payment services

Payment service users are entitled to choose and use payment services provided by payment service-providing organizations in compliance with provisions of law.

Article 15.-Assurance of solvency

Payment service users must assure enough money on payment accounts to execute payment orders they have placed, except for cases where there are overdraft agreements with payment service-providing organizations.

Article 16.-Execution of payment orders

Payment service-providing organizations are obliged to execute fully and promptly payment orders of payment service users in compliance with regulations or agreements between payment service-providing organizations and payment service users not in contravention of law.

Article 17.-Payment service charges

Payment service-providing organizations are entitled to collect charges from payment service users. The payment service charge levels shall be set by payment service-providing organizations and publicly posted up.

Article 18.-Damage compensations

If payment service-providing organizations and/or payment service users cause damage to relevant parties due to their breaches of regulations or their mutual agreements, they shall have to pay compensations therefor.

Article 19.-Settlement of disputes

Any dispute arising between a payment service user and a payment service-providing organization shall be, first of all, settled through conciliation between the involved parties. In cases where the dispute cannot be settled through conciliation, the dispute settlement shall be made under the provisions of law.

Article 20.-Assurance of payment safety

Payment service-providing organizations are entitled to prescribe measures to ensure safety in payment activities. Payment service users are obliged to abide by measures to ensure safety in payment activities, which are prescribed by payment service-providing organizations.

Chapter IV

ORGANIZATION OF AND PARTICIPATION IN PAYMENT SYSTEMS

Article 21.-Organization of internal payment systems

1. Banks are entitled to organize their own internal payment systems to perform payment services among their attached units.

Conditions, order and procedures for participating in internal payment systems as well as measures to ensure safety for the operation of internal payment systems shall be prescribed by banks organizing such internal payment systems.

2. The organization of internal payment systems by other organizations permitted to provide payment services shall comply with the regulations of competent State agencies.

Article 22.-Organization of and participation in inter-bank payment systems

1. The State Bank organizes the inter-bank payment system to perform payment services among such system’s members being the State Bank, credit institutions and other organizations permitted to provide payment services.

Conditions, order and procedures for participating in the inter-bank payment system as well as measures to ensure safety for the operation of the inter-bank payment system shall be prescribed by the State Bank.

2. Banks are entitled to organize the inter-bank payment according to agreements reached between the involved parties and in compliance with the State Bank’s regulations.

3. Other organizations which are permitted to provide payment services may organize and participate in inter-bank payment when so allowed by competent State agencies.

Article 23.-Participation in international payment activities

1. The State Bank is entitled to participate in international payment activities to perform agreements on payment with foreign banks and international monetary institutions and banks according to the provisions of law.

2. Banks and other organizations, which are permitted to provide payment services, shall participate in the international payment system when being permitted by the State Bank.

Chapter V

NOTIFICATION AND REPORTING REGIME AND INFORMATION CONFIDENTIALITY

Article 24.-Rights and obligations of payment service-providing organizations regarding notification and reporting

1. Payment service-providing organizations are entitled to request payment service users to supply relevant information when using payment services.

2. Payment service-providing organizations are obliged to periodically notify account holders of payment transactions and balance on their accounts.

3. When account holders request, the payment service-providing organizations may supply extraordinary information on payment transactions and balance on their accounts.

4. Payment service-providing organizations being banks and other organizations permitted to provide payment services are obliged to supply to the State Bank information related to payment activities at such organizations when the State Bank so requests.

Article 25.-Information confidentiality

The secrecy, archival and supply of information related to deposits of payment service users at payment service-providing organizations shall comply with the provisions of law.

Chapter VI

VIOLATIONS AND HANDLING THEREOF

Article 26.-Strictly-prohibited acts

1. Counterfeiting payment instruments;

2. Keeping, circulating, transferring and using counterfeit payment instruments;

3. Modifying, erasing payment instruments and vouchers for deceitful purposes;

4. Intruding or seeking to intrude into, spoiling or illegally changing programs or databases in computer networks used in payment activities.

5. Supplying untruthful information, forging vouchers when requesting to use payment services or in the course of using payment services.

6. Supplying information related to deposits of account holders at payment service-providing organizations not in compliance with the provisions of law.

7. Covering up or performing payment services on, money amounts already proved having illegal origin.

Article 27.-Handling of violations

Organizations and individuals that violate the provisions of this Decree shall, depending on the nature and seriousness of their violations, be disciplined, administratively sanctioned or examined for penal liability. If damage is caused, they shall have to pay the compensations therefor according to the provisions of law.

Chapter VII

IMPLEMENTATION PROVISIONS

Article 28.-Implementation effect

1. This Decree takes effect as from January 1, 2002.

2. To annul the Government’s Decree No.91/CP of November 25, 1993 on organization of non-cash payment.

3. All the previous stipulations on payment, which are contrary to the provisions of this Decree, are hereby annulled.

Article 29.-Implementation responsibilities

The State Bank Governor shall have to guide the implementation of this Decree.

The ministers, the heads of the ministerial-level agencies, the heads of the agencies attached to the Government, the presidents of the provinces and centrally-run cities shall have to implement this Decree.