Law on the State Bank of Vietnam, No. 01/1997/QH10

LAW

ON THE STATE BANK OF VIETNAM

In order to formulate and efficiently implement the national monetary policy; to enhance the State management over currency and banking activities; to contribute to the development of the multi-sector commodity economy under the State-regulated market mechanism along the socialist orientation; to protect the State's interests and the legitimate rights and interests of organizations and individuals;

Pursuant to the 1992 Constitution of the Socialist Republic of Vietnam;

This Law provides for the State Bank of Vietnam,

Chapter I

GENERAL PROVISIONS

Article 1.- Position and functions of the State Bank of Vietnam

1. The State Bank of Vietnam (hereafter referred to as the State Bank) is a Government agency and the central bank of the Socialist Republic of Vietnam.

2. The State Bank performs the function of State management over currency and banking activities; is the money-issuing bank, a bank of credit institutions and a bank providing monetary services for the Government.

3. The State Bank's operation aims to stabilize the currency value, contribute to ensuring the safety of the banking activities and the system of credit institutions, and to promote the socio-economic development along the socialist orientation.

4. The State Bank is a legal entity having its legal capital being under the State's ownership and its head office located in Hanoi.

Article 2.- The national monetary policy

The national monetary policy constitutes a part of the State's financial-economic policies aimed to stabilize the currency value, control inflation, contribute to boosting socio-economic development, ensure the national defense and security and to raise the people's living standards.

The State shall exercise uniform management over all banking activities; work out policies to mobilize mainly domestic resources, make the fullest use of overseas resources and bring into play the combined strength of all economic sectors; ensure the leading and major role of the State credit institutions in the field of currency and banking activities; to maintain the socialist orientation and national sovereignty; to expand the international cooperation and integration; to meet the socio-economic development requirements and contribute to the national industrialization and modernization.

Article 3.- Deciding and organizing the implementation of the national monetary policy

1. The National Assembly shall decide and supervise the implementation of the national monetary policy and the projected annual inflation rate in correlation with the State budget balance and economic growth rate.

2. The President of the State shall perform tasks and exercise powers provided for by the Constitution and laws in negotiating, signing, acceding to and ratifying in the name of the Socialist Republic of Vietnam, international treaties and/or international agreements concerning the fields of finance, currency and banking activities.

3. The Government shall elaborate the national monetary policy and projected annual inflation rate to be submitted to the National Assembly for decision; organize the implementation of the national monetary policy; decide the amount of money to be additionally supplied for annual circulation, the purposes of the use of this money and periodically report to the National Assembly Standing Committee; and determine other concrete policies and implementation solutions.

Article 4.- The National Monetary Policy Advisory Council

1. The Government shall set up the National Monetary Policy Advisory Council to advise it on deciding, within its tasks and powers, issues related to the monetary policy.

2. The National Monetary Policy Advisory Council is composed of: the Chairman being a Deputy Prime Minister; a standing member being the Governor of the State Bank, other members being representatives of the Ministry of Finance, the Ministry of Planning and Investment, the concerned ministries and branches, and banking experts.

3. The tasks and powers of the National Monetary Policy Advisory Council shall be determined by the Government.

Article 5.- Tasks and powers of the State Bank

The State Bank shall have the following tasks and powers:

1. In performing the State management function:

a/ To take part in elaborating the State's socio-economic development strategy and plans;

b/ To formulate the national monetary policy to be submitted to the National Assembly for decision and organize the implementation of this policy; to map out a strategy for the development of the system of Vietnamese banks and credit institutions;

c/ To elaborate draft laws, ordinances and other projects on currency and banking activities; to issue legal documents and regulations on currency and banking activities according to its competence;

d/ To grant and withdraw establishment and operation licenses of credit institutions, except for cases to be decided by the Prime Minister; to grant and withdraw banking operation licenses of other organizations; to decide the dissolution, approve the division, splitting, consolidation or merger of credit institutions in accordance with the provisions of law;

e/ To examine and inspect banking activities; to control credits; to handle violations of law in the fields of currency and banking operations according to its competence;

f/ To manage the foreign loans and payment of foreign debts by enterprises in accordance with the stipulations of the Government;

g/ To assume the prime responsibility in making and supervising the balance of international payment;

h/ To manage foreign exchange transactions and gold trading activities;

i/ To sign and accede to international treaties concerning currency and banking activities in accordance with the provisions of law;

j/ To represent the Socialist Republic of Vietnam at international monetary and banking institutions when so authorized by the President of the State and the Government;

k/ To organize training and development of banking expertise, to conduct research and application of banking science and technology.

2. In performing the function of the central bank:

a/ To organize the printing, minting, preservation and transportation of money; to engage in the issuance, withdrawal, replacement and destruction of money;

b/ To reallocate capital in order to provide short-term credits and means of payment for the economy;

c/ To manage the monetary market; and to conduct open-market professional transactions;

d/ To control international reserves; and manage the State's foreign exchange reserves;

e/ To organize a system of payment through banks, provide payment services and manage the provision of payment instruments;

f/ To act as agent and provide banking services for the State Treasury;

g/ To organize an information system and provide banking information services.

3. To perform other tasks and exercise other powers in accordance with the provisions of law.

Article 6.- Responsibilities of the ministries, the ministerial-level agencies, the agencies attached to the Government and other State agencies at the central level for banking activities

1. The ministries, the ministerial-level agencies, the agencies attached to the Government and other State agencies at the central level shall, within their respective tasks and powers, coordinate with the State Bank in exercising the State management over currency and banking activities.

2. The Ministry of Finance shall coordinate with the State Bank in elaborating the national financial and monetary policies, estimating the total advance for the State budget in the subsequent year and implementing other provisions of this Law concerning the relationship between the Ministry of Finance and the State Bank.

Article 7.- Responsibilities of the People's Councils and People's Committees of different levels in the implementation of legislation on currency and banking activities

The People's Councils and People's Committees at different levels shall, within their respective tasks and powers, supervise and inspect the enforcement of the legislation on currency and banking activities in their localities.

Article 8.- The role of the Vietnam Fatherland Front and its member organizations in banking activities

The Vietnam Fatherland Front and its member organizations shall join the State agencies in supervising the enforcement of the legislation on currency and banking activities; propagating and mobilizing organizations and individuals to comply with the provisions of legislation on currency and banking activities.

Article 9.- Interpretation of terms

In this Law the following terms shall be construed as follows:

1. Money is a payment instrument, which includes bank-notes, metal coins and papers of monetary value.

2. Monetary market is a short-term capital market where people buy and sell papers of short-term value, including treasury bills, the State Bank's bills, certificates of deposit and other papers of short-term value.

3. Banking activities include money trading activities and banking services with the regular contents being to receive deposits and use such money for the supply of credits and the provision of payment services.

4. Open-market professional transaction means the purchase and sale of papers of short-term value conducted by the State Bank on the monetary market so as to implement the national monetary policy;

5. Compulsory reserve is a sum of money that a credit institution must deposit at the State Bank for the implementation of the national monetary policy;

6. Foreign exchange include foreign currencies, gold of international standard, valuable papers and other instruments of payment in foreign currencies.

7. Foreign exchange transactions mean the operations of investment, borrowing, lending, guarantee, purchase and sale and other transactions regarding foreign exchange.

8. Foreign exchange rate is the rate between the value of Vietnam dong and that of a foreign currency.

9. International reserves mean the State's foreign exchange reserves managed by the State Bank and the foreign exchange reserves of credit institutions allowed to engage in foreign exchange transactions;

10. Re-financing is a form of allocating secured credits of the State Bank with a view to supplying short-term capital and payment instruments to banks.

11. Re-lending according to credit facilities is a form of re-allocating capital of the State Bank to other banks which have provided loans for customers;

12. Base interest rate is the interest rate announced by the State Bank to serve as basis for credit institutions to determine their business interest rates;

13. Re-financing interest rate is the interest rate applied by the State Bank when re-allocating capital.

14. Re-discount interest rate is a form of re-financing interest rate to be applied when the State Bank rediscounts negotiable instruments and other papers of short-term value for credit institutions;

15. Papers of short-term value are valuable papers with term of less than one year.

Chapter II

ORGANIZATION OF THE STATE BANK

Article 10.- Organizational structure

1. The State Bank shall be organized into a centralized and unified system, comprising executive and professional operation sections at its head office, branches in provinces and cities directly under the Central Government, its representative offices inside and outside the country and its attached units.

2. The organization, tasks and powers of the managerial apparatus of the State Bank shall be stipulated by the Government.

Article 11.- Leading and managing the State Bank

1. The Governor of the State Bank (hereafter referred to as the Governor) is a member of the Government and responsible for leading and managing the State Bank.

2. The Governor shall have the following tasks and powers:

a/ To direct and organize the performance of tasks and the exercise of powers of the State Bank as provided for in Article 5 of this Law and the Law on Organization of the Government;

b/ To be answerable before the Prime Minister and the National Assembly for the field he/she is in charge of.

c/ To act as the legal representative of the State Bank.

Article 12.- Branches and representative offices

1. A branch is a dependent unit of the State Bank, subject to the centralized and uniform leadership and management of the Governor.

The branch shall perform the following tasks and exercise the following powers as authorized by the Governor:

a/ To examine and inspect banking activities in its assigned geographical area;

b/ To grant and withdraw establishment and operation licenses of credit institutions as well as banking operation licenses of other organizations; to decide the dissolution, approve the division, splitting, consolidation or merger of credit institutions in the geographical area;

c/ To carry out re-financing operations and provide loans for payment;

d/ To provide payment, cash, and other banking services for credit institutions and the State Treasury;

e/ To perform other authorized tasks under the provisions of law.

2. A representative office is a dependent unit of the State Bank, that has the task of representing the Bank under authorization of the Governor. The representative office shall not be allowed to conduct banking professional activities.

3. The Governor shall stipulate the organization, concrete tasks and powers of the State Bank's branches and representative offices.

Article 13.- Attached units

1. The State Bank has its non-business units to perform the tasks of training, scientific research, and the provision of specialized banking cyberspace, information and press services.

2. The Prime Minister shall decide the establishment of the enterprises attached to the State Bank for the supply of specialized products in service of banking activities.

Article 14.- Responsibilities of officials and employees of the State Bank:

The State Bank's officials and employees shall have to abide by the following regulations:

1. To keep secret the professional activities of the State Bank, credit institutions and the customers' deposits as prescribed by law;

2. To refrain from acting as consultants, representatives or collaborators for monetary, credit, commercial, financial or other business organizations, except for cases otherwise provided for by law;

3. To refrain from abusing their posts and powers to take bribes or hassle others for personal benefits;

4. To fulfill other obligations prescribed for the State officials and employees by law.

Chapter III

OPERATIONS OF THE STATE BANK

Section 1. IMPLEMENTING THE NATIONAL MONETARY POLICY

Article 15.- Responsibilities of the State Bank in implementing the national monetary policy

In implementing the national monetary policy, the State Bank shall have the responsibility:

1. To assume the prime responsibility in formulating the national monetary policy and annual plans on the additional supply of money for circulation to be submitted to the Government;

2. To operate instruments for the implementation of the national monetary policy; to put money into circulation or withdraw money from circulation according to the market's signals within the amount of money supply already ratified by the Government;

3. To report to the Government and the National Assembly on the results of the implementation of the national monetary policy.

Article 16.- Instruments for the implementation of the national monetary policy

To implement the national monetary policy, the State bank shall use such instruments as re-financing, interest rates, exchange rates, compulsory reserves, open-market professional transactions and other instruments to be decided by the Governor.

Article 17.- Forms of re-financing

The State Bank shall provide the re-financing for the banks in the following forms:

1. Re-lending capital under credit facilities;

2. Discounting and re-discounting commercial bills and other papers of short-term value;

3. Granting loans secured by the pledge of commercial bills and other papers of short-term value.

Article 18.- Interest rates

The State Bank shall determine and announce the base interest rate and the re-financing interest rate.

Article 19.- Foreign exchange rates

1. The foreign exchange rates of Vietnam dong shall be determined on the basis of the market foreign currency supply and demand which are regulated by the State.

2. The State Bank shall determine and announce the foreign exchange rates of Vietnam dong.

Article 20.- Compulsory reserves

1. The State Bank shall determine the compulsory reserve rate for each type of credit institution and each kind of deposit, ranging from 0% to 20% of the total deposit balance of each credit institution in each period.

2. The payment of interests on compulsory reserve deposits for each type of credit institution and each kind of deposit in each period shall be determined by the Government.

Article 21.- Open-market professional transactions

The State Bank shall undertake open-market professional transactions through the purchase and sale of treasury bills, certificates of deposit, State Bank's bills and other papers of short-term value on the monetary market for the implementation of the national monetary policy.

Section 2. ISSUING BANK NOTES AND COINS

Article 22.- Monetary unit

The monetary unit of the Socialist Republic of Vietnam is "dong", with its national symbol being "d" and the international symbol being "VND"; one "dong" is equal to ten "hao" and one "hao" is equal to ten "xu".

Article 23.- Issuing money

1. The State Bank shall be the only agency entitled to issue money of the Socialist Republic of Vietnam, including bank-notes and metal coins.

2. The bank-notes and metal coins issued by the State Bank shall be used as a means of payment without limitation on the territory of the Socialist Republic of Vietnam.

3. The State Bank shall manage the reserve money for issuance under the stipulations of the Government.

4. The State Bank shall ensure the sufficient supply of money and the ratio between the bank-notes and metal coins for the national economy.

5. The money issued for circulation shall be recorded as "debit" of the national economy and shall be balanced by the "credit" of the State Bank.

Article 24.- Printing, minting, preserving, transporting, issuing and destroying money

1. The State Bank shall design the denominations, sizes, weights, drawings, adornment and other characteristics of bank-notes and metal coins and submit them to the Prime Minister for ratification.

2. The State Bank shall organize the printing, minting, preservation, transport, issue and destruction of money.

Article 25.- Dealing with torn or damaged money

The State Bank shall determine criteria for the classification of torn or damaged money; exchange and withdraw assorted money torn or damaged during the circulation process; and not exchange the money which are torn or damaged due to acts of sabotage.

Article 26.- Withdrawing, replacing money

The State Bank shall withdraw from circulation types of money which are no longer appropriate and shall issue other types of money for replacement. The withdrawn money of different types shall be changed for others of equivalent value within the time-limit prescribed by the State Bank. Beyond this time-limit, the withdrawn money shall be invalid for circulation.

Article 27.- Sample and souvenir money

The State Bank shall organize the printing, minting and domestic and overseas sale of sample and souvenir money of different types, which are designed for collection purpose or for other purposes as prescribed by the Government.

Article 28.- Promulgating, inspecting and supervising the implementation of regulations on the professional money-issuing activities

1. The Government shall promulgate the regulations on the professional money-issuing activities, including the printing, minting, preservation, transport, distribution, withdrawal, replacement and destruction of money as well as on the expenses for the professional money-issuing activities.

2. The Ministry of Finance shall inspect the implementation of the regulations on the professional money-issuing activities; the Ministry of Finance and the Ministry of the Interior shall supervise the process of printing, minting and destruction of currency.

Article 29.- Forbidden acts

The following acts are strictly forbidden:

1. Issuing counterfeit money; transporting, storing and circulating counterfeit money;

2. Destroying money;

3. Refusing to receive and circulate the money issued by the State Bank.

Section 3. CREDIT ACTIVITIES

Article 30.- Lending

1. The State Bank shall provide short-term loans to credit institutions which are banks in the form of re-financing as prescribed in Article 17 of this Law.

2. In exceptional cases where the Prime Minister has approved, the State Bank shall grant loans to credit institutions which temporarily lose their payment capability, thus threatening the safety of the system of credit institutions.

3. The State Bank shall not grant loans to individuals and organizations that are not credit institutions as prescribed in Items 1 and 2 of this Article.

Article 31.- Guaranty

The State Bank shall not provide guaranty for organizations and/or individuals to borrow capital, except for cases where such guaranty is designated by the Prime Minister for a credit institution to borrow capital from foreign country(ies).

Article 32.- Advances for the State budget

The State Bank shall provide advance for the central budget to deal with a temporary deficit in the State budget fund by decision of the Prime Minister. Such advance must be refunded in the budgetary year, except for special cases which shall be decided by the Prime Minister.

Article 33.- Capital contribution and share purchase

The State Bank shall not be allowed to contribute capital to and purchase shares from credit institutions and other enterprises.

Section 4. ACCOUNT OPENING, PAYMENT AND TREASURY OPERATIONS

Article 34.- Opening accounts

1. The State Bank shall be entitled to open accounts in foreign banks, international monetary and banking institutions.

2. The State Bank shall open accounts and undertake transactions for domestic credit institutions, foreign banks and international monetary and banking institutions.

3. The State Bank shall open accounts and undertake transactions for the State Treasury. In a district or provincial capital other than city, the State Treasury shall open an account at a State-owned commercial bank.

Article 35.- Payment and treasury operations

1. The State Bank shall organize an inter-bank payment system and provide payment services.

2. The State Bank shall provide treasury services through the collection and payment of cash to customers.

3. The State Bank shall have to fully and promptly provide cash payment services and shall not use cash at the request of account owner(s).

4. The State Bank shall sign and abide by agreements on payment with foreign banks and international monetary and banking institutions in accordance with the provisions of law.

Article 36.- Agency for the State Treasury

The State Bank shall act as an agent for the State Treasury in organizing bids, issuing and paying bonds and treasury bills.

Section 5. MANAGEMENT OF FOREIGN EXCHANGE AND FOREIGN EXCHANGE TRANSACTIONS

Article 37.- Tasks and powers of the State Bank in the management of foreign exchange

In the management of foreign exchange, the State Bank shall have the following tasks and powers:

1. To elaborate draft laws, ordinances and other projects on the management of foreign exchange; to issue legal documents and regulations on the management of foreign exchange according to its competence;

2. To grant and withdraw permits for foreign exchange transactions;

3. To organize and manage the inter-bank foreign currency market and the domestic foreign exchange market;

4. To examine and/or inspect the implementation of the legislation on the management of foreign exchange; to control the foreign exchange input and output;

5. To control foreign exchange transactions by credit institutions;

6. To perform other tasks and exercise other powers regarding the management of foreign exchange in accordance with the provisions of law.

Article 38.- Management of the State's foreign exchange reserves

1. The State's foreign exchange reserves include:

a/ Foreign currencies in cash, foreign currency balances on offshore deposit accounts;

b/ Foreign bank drafts and debt instruments denominated in foreign currency(ies);

c/ Public securities issued or guaranteed by foreign governments, foreign banks, international monetary and banking institutions;

d/ Gold;

e/ Other types of State's foreign exchange.

2. The State Bank shall manage the foreign exchange reserves of the State of the Socialist Republic of Vietnam in accordance with the Government stipulations with a view to implementing the national monetary policy, ensuring international payment capability and preserving the State's foreign exchange reserves.

3. The use of the State's foreign exchange reserves to meet unexpected and urgent demands of the State shall be decided by the Prime Minister.

4. The State Bank shall report to the Government and the National Assembly Standing Committee the state of affairs of the State's foreign exchange reserves.

5. The Ministry of Finance shall inspect the management of the State's foreign exchange reserves by the State Bank in accordance with the Government stipulations.

Article 39.- Foreign exchange transactions of the State Bank

The State Bank shall buy and sell foreign exchange on the domestic market for the attainment of objectives of the national monetary policy; buy and sell foreign exchange on the international market and undertake other foreign exchange transactions in accordance with the Government stipulations.

Section 6. INFORMATION ACTIVITIES

Article 40.- Collection and provision of information

1. The State Bank shall organize the collection, analysis and forecast of domestic and foreign information on economic, financial and monetary issues and on banking activities in service of the elaboration and management of the national monetary policy. The concerned organizations shall have to provide necessary information for the State Bank in accordance with the Government stipulations.

2. The State Bank shall exchange information and provide information services relating to currency and banking activities for credit institutions, other organizations and individuals.

Article 41.- Promulgation of information

The State Bank shall promulgate information on currency and banking activities. The Governor shall determine the scope, form and time for promulgating such information.

Article 42.- Protection of information secrets

The State Bank shall have to work out and submit to the Government for ratification a list of confidential documents on currency and banking activities; to protect the secrets of the State, the State Bank and customers in accordance with the provisions of law.

Chapter IV

FINANCE, COST-ACCOUNTING OF ACCOUNTS AND REPORTS OF THE STATE BANK

Article 43.- Legal capital

The State Bank's legal capital shall be allocated from the State budget. The level of the State Bank's legal capital shall be decided by the Prime Minister.

Article 44.- Financial revenues and expenditures

The State Bank's revenues and expenditures shall, in principle, be carried out in accordance with the provisions of the Law on the State Budget. The Government shall stipulate contents of specific financial revenues and expenditures in conformity with professional operation of the State Bank.

Article 45.- Difference between revenue and expenditure of the State Bank

The difference between the annual revenue and expenditure of the State Bank shall be determined on the basis of revenues from banking professional activities and other revenue sources, after deducting the operational costs and contingency reserves.

Article 46.- Establishing fund

The State Bank shall deduct part of the difference between its revenue and expenditure to set up a fund for the implementation of the national monetary policy in accordance with the Government stipulations; the remainder must be remitted to the State budget.

Article 47.- Cost-accounting of accounts of the State Bank

The State Bank shall conduct cost-accounting of accounts according to the account system and the regime of vouchers and invoices provided for by the legislation on accounting and statistics.

Article 48.- Auditing

The annual financial statements of the State Bank must be audited and certified by the State Audit.

Article 49.- Fiscal year and financial statement

1. A fiscal year of the State Bank shall commence on January 1st and end on December 31 of the solar year.

2. The State Bank shall follow the regime of financial statement in accordance with the provisions of law.

Chapter V

BANK INSPECTORATE AND GENERAL CONTROL COMMISSION OF THE STATE BANK

Section 1. BANK INSPECTORATE

Article 50.- Bank Inspectorate

1. The Bank Inspectorate is the specialized banking inspectorate in the State Bank's apparatus.

2. The relationship between the Bank Inspectorate and the State Inspectorate is provided for by the legislation on inspectorate.

3. The organization, concrete tasks and powers of the Bank Inspectorate shall be stipulated by the Government.

Article 51.- Subjects and objectives of the Bank Inspectorate

1. Subject to inspection by the Bank Inspectorate are the organization and operation of credit institutions and the banking activities of other organizations.

2. Objectives of the Bank Inspectorate are to contribute to ensuring the safety of the system of credit institutions, to protect the legitimate rights and interests of depositors and serve the implementation of the national monetary policy.

Article 52.- Contents of operation of the Bank Inspectorate

Contents of operation of the Bank Inspectorate include:

1. Inspecting the observance of the legislation on currency and banking activities; as well as the compliance with banking operation licenses;

2. Detecting, preventing and handling according to its competence or proposing the competent agencies to handle violations of the legislation on currency and banking activities;

3. Proposing measures to ensure the implementation of the legislation on currency and banking activities.

Article 53.- Powers of the Bank Inspectorate

When conducting inspection, the Bank Inspectorate shall have the following powers:

1. To request the inspected subjects and the concerned parties to provide documents and evidences and answer questions on issues related to the inspection contents;

2. To make records of inspection and propose handling measures;

3. To apply preventive measures and handle violations in accordance with the provisions of law.

Article 54.- Responsibilities of the Bank Inspectorate

When conducting inspection, the Bank Inspectorate shall have the following responsibilities:

1. To produce the inspection decision and the inspectors' cards;

2. To comply with the inspection order and procedures, not to trouble, hassle or obstruct regular banking activities or harm the legitimate interests of credit institutions and other organizations involved in banking activities;

3. To report to the Governor on the inspection results and propose handling measures;

4. To observe law and be answerable before the Governor and before law for inspection conclusions and for all of its activities and decisions.

Article 55.- Rights of credit institutions and other organizations involved in banking activities when the Bank Inspectorate conducts inspection

When the Bank Inspectorate is conducting an inspection, the concerned credit institutions and other organizations involved in banking activities shall have the following rights:

1. To request the inspectors to produce the inspection decision, the inspectors' cards and abide by the legislation on inspectorate;

2. To complain, denounce to the competent State agency or take legal actions against the inspectors' acts as well as the conclusions and decisions of the Bank Inspectorate which they deem improper;

3. To request compensation for damage caused by the Bank Inspectorate's acts or decisions which are contrary to law.

Article 56.- Obligations of credit institutions and other organizations involved in banking activities when the Bank Inspectorate conducts inspection

When the Bank Inspectorate is conducting an inspection, the concerned credit institutions and other organizations involved in banking activities shall have the following obligations:

1. To meet the Bank Inspectorate's requests on the inspection contents;

2. To abide by the handling decisions of the Bank Inspectorate.

Article 57.- General Control Commission

1. The General Control Commission is a unit belonging to the State Bank's apparatus and has the following tasks:

a/ To control the operations of units under the system of the State Bank.

b/ To conduct internal audit in units undertaking the central bank's professional transactions.

2. The organization, concrete tasks and powers of the General Control Commission shall be stipulated by the Governor.

Chapter VI

COMMENDATION AND HANDLING OF VIOLATIONS

Article 58.- Commendation

Organizations and/or individuals with meritorious deeds in banking activities, contributing to the promotion of socio-economic development, ensuring safety of operations of the system of credit institutions shall be rewarded in accordance with the provisions of law.

Article 59.- Subjects and acts of violation

1. Organizations and/or individuals that violate the provisions of Article 29 of this Law; conduct banking activities without licenses or operate outside the scope of operation defined in the licenses; obstruct the examination and inspection by the State Bank; violate other provisions of this Law and provisions of the legislation on currency and banking activities shall, depending on the nature and seriousness of their violations, be disciplined, administratively handled or examined for penal liability as prescribed by law.

2. Officials and employees of the State Bank, who violate the provisions of Article 14 of this Law; lack responsibility while performing their duties, cover up organizations and/or individuals that violate the provisions of this Law and other provisions of the legislation on currency and banking activities shall, depending on the nature and seriousness of their violations, be disciplined or examined for penal liability as prescribed by law.

3. Organizations and/or individuals that violate the provisions of Items 1 and 2 of this Article, thus damaging interests of the State, organizations and/or individuals shall have to pay compensation therefor in accordance with the provisions of law.

Article 60.- Competence of the State Bank in handling administrative violations

The State Bank shall have the competence to handle administrative violations committed by organizations and individuals in the field of currency and banking activities in accordance with the provisions of law.

Article 61.- Complaints and/or litigation against decisions on handling of administrative violations

1. Organizations and/or individuals administratively sanctioned for their violations in the field of currency and banking activities shall have the right to lodge complaints about decisions on the handling of administrative violations to the competent State agency or litigate at court. The complaint or litigation shall comply with the provisions of law.

2. During the complaining or litigating period, the organizations and/or individuals subject to administrative sanctions shall still have to execute the decisions thereon. When a decision on the settlement of a complaint has been issued by the competent State agency or a court judgment or decision has taken its effect, such decision or judgment shall apply.

Chapter VII

IMPLEMENTATION PROVISIONS

Article 62.- Effect of implementation

1. This Law takes effect from October 1st, 1998.

2. The May 23, 1990 Ordinance on the State Bank of Vietnam shall cease to be effective from the date this Law takes effect.

3. The Government, the Supreme People's Court, the Supreme People's Procuracy shall, within their respective tasks and powers, organize the revision of the provisions of the legislation on currency and banking activities so as to annul, amend, supplement, issue or propose the National Assembly Standing Committee and the National Assembly to annul, amend, supplement or issue documents to conform to the provisions of this Law.

Article 63.- Guidance for implementation

The Government shall provide guidance for the implementation of this Law.

This Law was passed by the Xth National Assembly of the Socialist Republic of Vietnam at its second session on December 12, 1997.