Decree No. 87/2019/ND-CP amending the Decree No. 116/2013/ND-CP

DECREE

Amending and supplementing a number of articles of the Government’s Decree No. 116/2013/ND-CP of October 4, 2013, detailing a number of articles of the Anti-Money Laundering Law^[1]

Pursuant to the June 19, 2015 Law on Organization of the Government;

Pursuant to the June 16, 2010 Law on the State Bank of Vietnam;

Pursuant to the June 18, 2012 Anti-Money Laundering Law;

Pursuant to the June 12, 2013 Counter-Terrorism Law;

Pursuant to the November 27, 2015 Criminal Procedure Code;

Pursuant to the November 15, 2010 Law on Inspection;

Pursuant to the June 17, 2010 Law on Execution of Criminal Judgments;

Pursuant to the November 14, 2008 Law on Execution of Civil Judgments and the November 25, 2014 Law Amending and Supplementing a Number of Articles of the Law on Execution of Civil Judgments;

Pursuant to the November 26, 2015 Law on Organization of Criminal Investigation Bodies;

Pursuant to November 26, 2014 Law on Enterprises;

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

The Government promulgates the Decree amending and supplementing a number of articles of the Government’s Decree No. 116/2013/ND-CP of October 4, 2013, detailing a number of articles of the Anti-Money Laundering Law.

Article 1. To amend and supplement a number of articles of the Government’s Decree No. 116/2013/ND-CP of October 4, 2013, detailing a number of articles of the Anti-Money Laundering Law

1. To amend and supplement Clause 2, Article 2 as follows:

“2. Other organizations and individuals involved in anti-money laundering activities, including:

a/ Intermediary payment service providers;

b/ Foreign organizations and individuals or stateless persons that do neither carry out activities nor reside in Vietnam’s territory but conduct financial transactions or other asset-related transactions with the organizations and individuals specified in Clause 1 of this Article.”

2. To add the following Clause 3 to Article 2:

“3. Intermediary payment service providers shall apply anti-money laundering measures in accordance with the law on anti-money laundering like reporting subjects being financial institutions prescribed in Clause 3, Article 4 of the Law on Anti-Money Laundering.”

3. To amend and supplement Article 5 as follows:

“Article 5. Beneficial owners

1. A reporting subject shall identify the ultimate beneficial owner of a client and apply measures to identify and update information on the beneficial owner according to the following criteria:

a/ The individual who actually owns an account or a transaction: The account holder, co-holder or any person who controls activities of such account or benefits from such transaction;

b/ The individual who has the right to control a legal person: The individual who directly or indirectly holds 25% or more of the charter capital of such legal person; the owner of a private enterprise; or another individual who actually dominates or controls such legal person;

c/ The individual who has the right to control an investment entrustment or authorization agreement: The entrustor or authorizer; the individual who has the right to control the entrusting or authorizing individual, legal person or organization.

2. The identification and verification of identification information of beneficial owners must comply with Article 4 of this Decree, except cases in which beneficial owners are persons representing the State’s capital portions in organizations.”

4. To add the following Clause 5 to Article 6:

“5. Based on results of the assessment of money laundering and terrorism financing risks at reporting subjects, reporting subjects may apply one or all of the following simplified know-your-customer (KYC) measures to clients identified as posing a low degree of money laundering or terrorism financing risks:

a/ Not to collect information on the purpose and nature of the business relationship when having grounds for identifying the purpose and nature from transactions or business relationships that have been conducted or established;

b/ To verify identification of clients and beneficial owners after the business relationship has been established;

c/ To reduce the frequency of updating client identification information;

d/ To reduce the level of transaction monitoring and control;

Reporting subjects may not apply simplified KYC measures to those suspected to being involved in money laundering or terrorism financing.

The State Bank of Vietnam shall assume the prime responsibility for, and coordinate with related ministries and agencies in, guiding criteria to assess money laundering and terrorism financing risks for implementation by reporting subject.”

5. To amend and supplement Point a, Clause 2, Article 8 as follows:

“a/ Request the client to provide information under Article 4 of this Decree and decide whether to meet the client face-to-face when establishing for the first time the relationship. If not meeting the client face-to-face, the report subject shall take measures and apply technologies to identify and verify the client.”

6. To amend and supplement Points b and c, Clause 2, Article 11 as follows:

“b/ Charter capital; 

c/ List of founding shareholders and list of authorized representative(s) of foreign organizational shareholder(s), if any;”

7. To amend and supplement Point a, Clause 1, Article 14 as follows:

“a/ Reasonable grounds to suspect that the property in the transaction has been acquired from criminal activities include: The transaction is requested to be conducted by a person against whom an offense denunciation or a criminal case initiation proposal is made, the accused, defendant or convict as prescribed in the criminal procedure law and property in the transaction originates from property owned or controlled by such individual or individuals or organizations related to him/her, during or after the commission of the crime;”

8. To amend and supplement Point d, Clause 3, Article 17 as follows:

“d/ Tax offices or bodies assigned to carry out a number of investigation activities, for transactions related to individuals and organizations suspected of having violated tax laws, custom law or other relevant laws. Heads or deputy heads of these offices or bodies shall sign requests for information provision;”

9. To add the following Clause 5 to Article 17:

“Reporting subjects shall provide information, including also information classified as state secret, at the request of investigation agencies at all levels from the stage of settling denunciations and reports on crime and proposing the initiation of criminal cases. Investigation agencies shall store, preserve and use received information classified as state secrets in accordance with the law on protection of state secrets.”

10. To amend and supplement Clause 2 of Article 18 as follows:

“2. An organization or individual will be suspected of being involved in money laundering or terrorism financing if committing acts to:

a/ Conduct or intend to conduct a transaction related to an organization or individual listed in relevant resolutions of the United Nations Security Council;

b/ Conduct or intend to conduct a transaction related to an organization or individual on a list of terrorist and terrorism-financing organizations and individuals, made by another international organization or country and warned by the State Bank of Vietnam;

c/ Conduct or intend to conduct a transaction related to an organization or individual that has been convicted for the crime of terrorism or terrorism financing in Vietnam;

d/ Conduct or intend to conduct a transaction related to a terrorist or terrorism-financing organization or individual known to the reporting subject through other information sources.” 

11. To amend and supplement Point e, Clause 2, Article 20 as follows:

“e/ Other transactions which are deemed by the Anti-Money Laundering Agency of the State Bank of Vietnam, based on its authentic documents and work experience, to be possibly related to criminal activities.”

12. To amend and supplement Point b, Clause 3, Article 20 as follows:

“b/ Other transactions which are deemed by the Anti-Money Laundering Agency of the State Bank of Vietnam, based on its authentic documents and work experience, to be possibly related to activities of money laundering for terrorism financing.”

13. To amend and supplement Point d, Clause 4, Article 20 as follows:

 “d/ Bodies assigned to carry out a number of investigation activities.”

14. To add the following Point d to Clause 1 of Article 21:

“d/ At the request of inspection agencies, judgment enforcement agencies, tax offices and customs offices.”

15. To amend and supplement Clause 5 of Article 20 as follows:

“5. Competent agencies shall receive information about suspicious transactions transferred from the State Bank. In case there are criminal signs and sufficient grounds, competent agencies shall classify and process them in accordance with the provisions of the criminal procedure law on receipt and settlement of denunciations and reports on crime. In case the information shows unclear criminal signs, competent agencies shall classify and verify contents of suspicious transactions transferred from the State Bank.”

16. To amend and supplement Clause 4 of Article 22 as follows:

“4. When applying the measure of transaction delay, reporting subjects shall promptly report in writing and notify it via telephone to competent state agencies and concurrently report it to the State Bank of Vietnam.”

17. To amend and supplement Article 23 as follows:

“Article 23. Freezing of accounts, sealing or seizure of property

1. Reporting subjects shall freeze accounts or apply measures of sealing or seizure property after obtaining decisions of competent state agencies.

2. Competent state agencies defined in the law on criminal procedure, the law on execution of judgments and the law on inspection may issue decisions to request reporting subjects to apply the measure of freezing of accounts, sealing or seizure of property and shall take responsibility for such decisions.

3. The freezing of an account or sealing or seizure of property must be recorded in a record with at least the following details: name of the reporting subject required to apply the measure of freezing of accounts or sealing, seizure of property; full name of the account owner or the individuals or organizations related to the sealed or seized property; number of the frozen account or list of sealed or seized property; the amount of frozen money; the time for beginning and finishing the freezing of the account, sealing or seizure of property; reason for requesting the freezing of the account, sealing or seizure of property; or made according to the form provided in the law on criminal procedure.

4. Reporting subjects shall send a report thereon to the State Bank of Vietnam right after applying the measure of freezing of accounts or sealing, seizure of property under Clause 1 of this Article.

5. The State Bank of Vietnam shall, according to its functions and tasks, coordinate with competent state agencies in the process of freezing of accounts or sealing, seizure of property under Clause 1 of this Article.”

Article 2. Responsibility for organization of implementation

Ministers, heads of ministerial-level agencies, heads of government-attached agencies, chairpersons of provincial-level People’s Committees, and related organizations and individuals shall implement this Decree.

Article 3. Implementation provision

This Decree takes effect on the date of its signing.-

On behalf of the Government
Prime Minister
NGUYEN XUAN PHUC